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Date: 2/9/00
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Immanuel Wallerstein, Historical Capitalism with Capitalist Civilization. London: Verso, 1995.
I. The Commodification of Everything: Production of Capital
. . . We must rid ourselves of the simplistic image that the "market" is a place where initial producer and ultimate consumer meet. No doubt there are and always have been such marketplaces. But in historical capitalism, such marketplace transactions have constituted a small percentage of the whole. Most transactions have involved exchange between two intermediate producers located on a long commodity chain. The purchaser was purchasing an "input" for his production process. The seller was selling a "semi-finished product," semi-finished that is in terms of its ultimate use in direct individual consumption.
The struggle over price in these "intermediate markets" represented an effort by the buyer to wrest from the seller a proportion of the profit realized from all prior labor processes throughout the commodity chain. This struggle to be sure was determined at particular space-time nexuses by supply and demand, but never uniquely. In the first place, of course, supply and demand can be manipulated through monopolistic constraints, which have been commonplace rather than exceptional. Secondly, the seller can affect the price at the nexus through vertical integration. Whenever the "seller" and the "buyer" were in fact ultimately the same firm, the price never represented the interplay of supply and demand. Vertical integration, just like the "horizontal" monopoly, has not been rare. We are of course familiar with its most spectacular instances: the chartered companies of the sixteenth to eighteenth centuries, the great merchant houses of the nineteenth, the transnational corporations of the twentieth. These were global structures seeking to encompass as man links in a particular commodity chain as possible. But smaller instances of vertical integration, covering only a few (even two) links in a chain, have been even more widespread. It seems reasonable to argue that vertical integration has been the statistical norm of historical capitalism rather than those "market" nexuses in commodity chains in which seller and buyer were truly distinct and antagonistic.
Now commodity chains have not been random in their geographical directions. Were they all plotted on maps, we would notice that they have been centripetal in form. Their points of origin have been manifold, but their points of destination have tended to converge in a few areas. That is to say, they have tended to move from the peripheries of the capitalist world-economy to the centers or cores. It is hard to contest this as an empirical observation. The real question is why this has been so. To talk of commodity chains means to talk of an extended social division of labor which, in the course of capitalism's historical development, has become more and more functionally and geographically extensive, and simultaneously more and more hierarchical. This hierarchization of space in the structure of productive processes has led to an ever greater polarization between the core and peripheral zones of the world-economy, not only in terms of distributive criteria (real income levels, quality of life) but even more importantly in the loci of the accumulation of capital.
Initially, as this process began, the spatial differentials were rather small, and the degree of spatial specialization limited. Within the capitalist system, however, whatever differentials existed (whether for ecological or historical reasons) were exaggerated, reinforced and encrusted. What was crucial in this process was the intrusion of force into the determination of price. To be sure, the use of force by one party in a market transaction in order to improve his price was no invention of capitalism. Unequal exchange is an ancient practice. What was remarkable about capitalism as an historical system was the way in which this unequal exchange could be hidden; indeed, hidden so well that it is only after five hundred years of the operation of this mechanism that even the avowed opponents of the system have begun to unveil it systematically.
The key to hiding this central mechanism lay in the very structure of the capitalist world-economy, the seeming separation in the capitalist world-system of the economic arena (a world-wide social division of labor with integrated production processes all operating for the endless accumulation of capital) and the political arena (consisting ostensibly of separate sovereign states, each with autonomous responsibility for political decisions within its jurisdiction, and each disposing of armed forces to sustain its authority). In the real world of historical capitalism, almost all commodity chains of any importance have traversed these state frontiers. This is not a recent innovation. It has been true from the very beginning of historical capitalism. Moreover, the transnationality of commodity chains is as descriptively true of the sixteenth-century capitalist world as of the twentieth-century.
How did this unequal exchange work? Starting with any real differential in the market, occurring because of either the (temporary) scarcity of a complex production process, or artificial scarcities created manu militari, commodities moved between zones in such a way that the area with the less "scarce" item "sold" its items to the other area at a price that incarnated more real input (cost) than an equally-priced item moving in the opposite direction. What really happened is that there was a transfer of part of the total profit (or surplus) being produced from one zone to another. Such a relationship is that of coreness-peripherality. By extension, we can call the losing zone a "periphery" and the gaining zone a "core." These names in fact reflect the geographical structure of the economic flows. (29-32) . . . The economic arena of feudal Europe was going through a very fundamental, internally generated, crisis in this period [the fourteenth and fifteenth centuries] that was shaking its social foundations. Its ruling classes were destroying each other at a great rate, while its land-system (the basis of its economic structure) was coming loose, with considerable reorganization moving in the direction of a far more egalitarian distribution than had been the norm. Furthermore, small peasant farmers were demonstrating great efficiency as producers. The political structures were in general getting weaker and their preoccupation with the internecine struggles of the politically powerful meant that little time was left for repressing the growing strength of the masses of the population. The ideological cement of Catholicism was under great strain and egalitarian movements were being born in the very bosom of the Church. Things were indeed falling apart. Had Europe continued on the path along which it was going, it is difficult to believe that the patterns of medieval feudal Europe with its highly structured system of "orders" could have been reconsolidated. Far more probable is that the European feudal structure would have evolved towards a system of relatively equal small-scale producers, further flattening out the aristocracies and decentralizing the political structures.
Whether this would have been good or bad, and for whom, is a matter of speculation and of little interest. But it is clear that the prospect must have appalled Europe's upper strata--appalled and frightened them, especially as they felt their ideological armor was disintegrating too. Without suggesting that anyone consciously verbalized any such attempt, we can see by comparing the Europe of 1650 with 1450 that the following things had occurred. By 1650, the basic structures of historical capitalism as a viable system had been established and consolidated. The trend towards egalitarianization of reward had been drastically reversed. The upper strata were once again in firm control politically and ideologically. There was a reasonably high level of continuity between the families that had been high strata in 1450 and those that were high strata in 1650. Furthermore, if one substituted 1900 for 1650, one would find that most of the comparisons with 1450 still hold true. It is only in the twentieth century that there are some significant trends in a different direction, a sign as we shall see that the historical system of capitalism has, after four to five hundred years of flourishing, finally come into structural crisis.
No one may have verbalized the intent, but it certainly seems to have been the case that the creation of an historical capitalism as a social system dramatically reversed a trend that the upper strata feared, and established in its place one that served their interests even better. Is that so absurd? Only to those who were its victims. (42-3) * * * 2. The Politics of Accumulation: Struggle for Benefits
. . . [T]he structural base of the economic system and the clearly-perceived interests of the major accumulators of capital were fundamentally opposed to a transformation of the world-economy into a world-empire.
First of all, the accumulation of capital was a game in which there was constant incentive for competitive entry, and thus there was always some dispersion of the most profitable productive activities. Hence at any time numerous states tended to have an economic base that made them relatively strong. Secondly, accumulators of capital in any given state utilized their own state structures. For if their state-machinery became too strong, it might, for reasons of internal political equilibrium, feel free to respond to internal egalitarian pressures. Against this threat, accumulators of capital needed the threat of circumventing their own state-machinery by making alliances with other state-machineries. This threat was only possible as long as no one state dominated the whole.
These considerations formed the objective basis of the so-called balance of power, by which we mean that the numerous strong and medium-strong states in the interstate system at any given time have tended to maintain alliances (or if need be, shift them) so that no single state could conquer all the others.
That the balance of power was maintained by more than political ideology can be seen if we look at the three instances in which one of the strong states achieved temporarily a period of relative dominance over the others--a relative dominance that we may call hegemony. The three instances are the hegemony of the United Provinces (Netherlands) in the mid-seventeenth century, that of Great Britain in the mid-nineteenth, and that of the United States in the mid-twentieth.
In each case, hegemony came after the defeat of a military pretender to conquest (the Hapsburgs, France, Germany). Each hegemony was sealed by a "world war"--a massive, land-centered, highly destructive, thirty-year-long intermittent struggle involving all the major military powers of the time. These were the Thirty Years' War of 1618-48, the Napoleonic Wars (1792-1815), and the twentieth-century conflicts between 1914 and 1945 which should properly be conceived as a single lone "world war." It is to be noted that, in each case, the victor had been primarily a maritime power prior to "world war," but had transformed itself into a land power in order to win this war against an historically strong land power which seemed to be trying to transform the world-economy into a world-empire.
The basis of the victory was not however military. The primary reality was economic: the ability of the accumulators of capital located in the particular states to out compete all others in all three major economic spheres--agro-industrial production, commerce and finance. Specifically, for brief periods, the accumulators of capital in the hegemonic state were more efficient than their competitors located in other strong states, and thus won markets even within the latter's "home" areas. Each of these hegemonies was brief. Each came to an end largely for economic reasons more than for politico-military reasons. In each case, the temporary triple economic advantage came up against two hard rocks of capitalist reality. First, the factors that made for greater economic efficiency could always be copied by others--not the truly weak but by those who had medium strength--and latecomers to any given economic process tend to have the advantage of not having to amortize older stock. Secondly, the hegemonic power had every interest in maintaining uninterrupted economic activity and therefore tended to buy labor peace with internal redistribution. Over time, this led to reduced competitiveness thereby ending hegemony. In addition, the conversion of the hegemonic power to one with far-flung land and maritime military "responsibilities" involved a growing economic burden on the hegemonic state, thus undoing its pre-"world war" low level expenditure on the military.
Hence, the balance of power--constraining both the weak states and the strong--was not a political epiphenomenon which could be easily undone. It was rooted in the very ways in which capital was accumulated in historical capitalism. Nor was the balance of power merely a relationship between state-machineries, because the internal actors within any given state regularly acted beyond their own boundaries either directly or via alliances with actors elsewhere. Therefore, in assessing the politics of any given state, the internal/external distinction is quite formal and is not too helpful to our understanding of how the political struggles actually occurred. (58-60) . . . . . . [I]f we pay attention only to the class struggle, because it is both obvious and fundamental, we shall lose from view another political struggle that has absorbed at least as much time and energy in historical capitalism. For the capitalist system is a system that has pitted all accumulators of capital against one another. Since the mode by which one pursued the endless accumulation of capital was that of realizing the profits coming from economic activity against the competitive efforts of others, no individual entrepreneur could ever be more than the fickle ally of any other entrepreneur, on pain of being eliminated from the competitive scene altogether.
Entrepreneur against entrepreneur, economic sector against economic sector, the entrepreneurs located in one state, or ethnic group, against those in another--the struggle has been by definition ceaseless. And this ceaseless struggle has constantly taken a political form, precisely because of the central role of the states in the accumulation of capital. Sometimes these struggle within states have merely been over personnel in the state-machineries and short-run state policies. Sometimes, however, they have been over larger "constitutional" issues which determine the rules of governing the conduct of shorter-run struggles, and thus the likelihood of one faction or another prevailing. Whenever these struggles were "constitutional" in nature, they required greater ideological mobilization. In these cases, we heard talk of "revolutions" and "great reforms" and the losing sides were often given opprobrious (but analytically inappropriate) labels. To the extent that the political struggles for, say, "democracy" or "liberty" against "feudalism" or "tradition" have not been struggles of the working classes against capitalism, they have been essentially struggles among the accumulators of capital for the accumulation of capital. Such struggles were not the triumph of a "progressive" bourgeoisie against reactionary strata but intra-bourgeois struggles.
Of course, using "universalizing" ideological slogans about progress has been politically useful. It has been a way of associating class struggle mobilization to one side of intra-accumulator struggles. But each ideological advantage has often been a double-edged sword, unleashing passions and weakening repressive restraints in the class struggle. This was of course one of the ongoing dilemmas of the accumulators of capital in historical capitalism. They were forced by the operations of the system to act in class solidarity with one another against the efforts of the work force to pursue its contrary interests, but simultaneously to fight each other ceaselessly in both the economic and political arenas. This is exactly what we mean by a contradiction within the system.
Many analysts, noticing that there are struggles other than class struggles which absorb much of the total political energy expended, have concluded that class analysis is of dubious relevance to the understanding of political struggle. This is a curious inference. It would seem more sensible to conclude that these non-class-based political struggles, that is, struggles among accumulators for political advantage, are evidence of a severe structural weakness in the accumulator class in its ongoing world wide class struggle. (63-4) * * * 3. Truth as Opiate: Rationality and Rationalization
. . . [T]here is almost no correlation between present-day ethnic labor-force allocation and the patterns of the purported ancestors of present-day ethnic groups in periods prior to historical capitalism.
The ethnicization of the world work force has had three main consequences that have been important for the functioning of the world-economy. First of all, it has made possible the reproduction of the work force, not in the sense of providing sufficient income for the survival of groups but in the sense of providing sufficient workers in each category at appropriate levels of income expectations in terms both of total amounts and the forms the household income would take. Furthermore, precisely because the work force was ethnicized, is allocation was flexible. Large-scale geographical and occupational mobility had been made easier, not more difficult, by ethnicity. Under the pressure of changing economic conditions, all that was required to change work force allocation was for some enterprising individuals to take the lead in geographical or occupational resettlement, and to be rewarded for it; this promptly exerted a natural "pull" on other members of the ethnic group to transfer their locations in the world-economy.
Secondly, ethnicization has provided an in-built training mechanism of the work force, ensuring that a large part of the socialization in occupational tasks would be done within the framework of ethnically-defined households and not at the cost of either employers or wage-workers, or the states.
Thirdly, and probably more important, ethnicization has encrusted ranking of occupational/economic roles, providing an easy code for overall income distribution--clothed with the legitimization of "tradition."
It is this third consequence that has been elaborated in greatest detail and has formed one of the most significant pillars of historical capitalism, institutional racism. What we mean by racism has little to do with the xenophobia that existed in various prior historical systems. Xenophobia was literally fear of the "stranger." Racism within historical capitalism had nothing to do with "strangers." Quite the contrary. Racism was the mode by which various segments of the work force within the same economic structure were constrained to relate to each other. Racism was the ideological justification for the hierarchization of the work force and its highly unequal distributions of reward. What we mean by racism is that set of ideological statements combined with that set of continuing practices which have had the consequence of maintaining a high correlation of ethnicity and work force allocation over time. The ideological statements have been in the form of allegations that genetic and/or long-lasting "cultural" traits of various groups are the major cause of differential allocation to positions in the economic structures. However, the beliefs that certain groups were "superior" to others in certain characteristics relevant to performance in the economic arena always came into being after, rather than before, the location of these groups in the work force. Racism has always been post hoc. It has been asserted that those who have been economically and politically oppressed are culturally "inferior." If, for any reason, the locus in the economic hierarchy changed, the locus in the social hierarchy tended to follow (with some lag, to be sure, since it always took a generation or two to eradicate the effect of previous socialization).
Racism has served as an overall ideology justifying inequality. But it has been much more. It has served to socialize groups into their own role in the economy. The attitudes inculcated (the prejudices, the overtly discriminatory behavior in everyday life) served to establish the framework of appropriate and legitimate behavior for oneself and for others in one's own household and ethnic group. Racism, just like sexism, functioned as a self-suppressive ideology, fashioning expectations and limiting them.
Racism was certainly not only self-suppressive, it was oppressive. It served to keep low-ranking groups in line, and utilize middle-ranking groups as the unpaid soldiers of the world police system. In this way, not only were the financial costs of the political structures reduced significantly, but the ability of anti-systemic groups to mobilize wide populations was rendered more difficult, since racism structurally set victims against victims.
Racism was not a simple phenomenon. There was in a sense a basic world-wide fault line, marking off relative status in the world system as a whole. This was the "color" line. What was "white" or upper stratum has of course been a social and not a physiological phenomenon, as should be evident by the historically-shifting position, in world wide (and national) socially-defined "color lines," of such groups as southern Europeans, Arabs, Latin American mestizos and East Asians.
Color (or physiology) was an easy tag to utilize, since it is inherently hard to disguise, and, insofar as it has been historically convenient, given the origins of historical capitalism in Europe, it has been utilized. But whenever it was not convenient, it has been discarded or modified in favor of other identifying characteristics. In many particular places, the sets of identities have thus become quite complex. When one considers the additional fact that the social division of labor was constantly evolving, ethnic/racial identification turned out to be a highly unstable basis for delineating the boundaries of the existing social groups. Groups came and went and changed their self-definitions with considerable ease (and were perceived by others as having different boundaries with equal ease). But the volatility of any given group's boundaries was not inconsistent with, indeed was probably a function of, the persistence of an overall hierarchy of groups, that is, the ethnicization of the world work force.
Racism has thus been a cultural pillar of historical capitalism. Its intellectual vacuity has not prevented it from unleashing terrible cruelties. Nonetheless, given the rise of the world's anti-systemic movements in the past fifty to one hundred years, it has recently been under sharp attack. Indeed, today racism in its crude variants is undergoing some deligitimization at the world level. Racism, however, has not been the only ideological pillar of historical capitalism. Racism has been of greatest importance in construction and reproduction of appropriate work forces. Their reproduction nonetheless was insufficient to permit the endless accumulation of capital. Work forces could not be expected to perform efficiently and continuously unless they were managed by cadres. Cadres too have had to be created, socialized, reproduced. The primary ideology that operated to create, socialize and reproduce them was not the ideology of racism. It was that of universalism. (77-80) . . . There was a catch to universalism. It did not make its way as a free-floating ideology but as one propagated by those who held economic and political power in the world-system of historical capitalism. Universalism was offered to the world as a gift of the powerful to the weak. Timeo Danaos et dona ferentes! The gift itself harbored racism, for it gave the recipient two choices: accept the gift, thereby acknowledging that one was low on the hierarchy of achieved wisdom; refuse the gift, thereby denying oneself weapons that could reverse the unequal real power situation.
It is not strange that even the cadres who were being coopted into privilege were deeply ambivalent about the message of universalism, vacillating between enthusiastic discipleship and a cultural rejection brought on by repugnance for racist assumptions. This ambivalence was expressed in the multiple movements of cultural "renaissance." The very word renaissance, which was widely used in many zones of the world, itself incarnated the ambivalence. By speaking of rebirth, one affirmed an era of prior cultural glory but one also acknowledged a cultural inferiority as of that moment. The word rebirth was itself copied from the specific cultural history of Europe.
One might have thought that the world work forces were more immune from this ambivalence, never having been invited to sup at the lord's table. In fact, however, the political expressions of the world's work forces, the anti-systemic movements, have themselves been deeply imbued with the same ambivalence. The anti-systemic movements, as we have already remarked, clothed themselves in the ideology of the Enlightenment, itself a prime product of universalist ideology. They thereby lay for themselves the cultural trap in which they have remained ever since: seeking to undermine historical capitalism, using strategies and setting medium-term objectives that derived from the very "ideas of the ruling classes" they sought to destroy.
The socialist variant of anti-systemic movements was, from the outset, committed to scientific progress. Marx, wishing to distinguish himself from others he denounced as "utopians," asserted that he was advocating "scientific socialism." His writings laid emphasis on the ways in which capitalism was "progressive." The concept that socialism would come first in the most "advanced" countries suggested a process whereby socialism would grow out of (as well as in reaction to) the further advancement of capitalism. The socialist revolution would thus emulate and come after the bourgeois revolution in those countries in which it had not yet occurred.
The later differences between the Second and Third Internationals did not involve a disagreement over this epistemology, which both shared. Indeed, both Social-Democrats and Communists in power have tended to give great priority to the further development of the means of production. Lenin's slogan that "Communism equals socialism plus electricity" still hangs today in enormous banners on the streets of Moscow. Insofar as these movements, once in power--Social-Democrats and Communists alike--implemented Stalin's slogans of "socialism in one country," they thereby necessarily furthered the process of the commodification of everything that has been so essential to the global accumulation of capital. Insofar as they remained within the interstate system--indeed struggled to remain within it against all attempts to oust them--they accepted and furthered the world-wide reality of the dominance of the law of value. "Socialist man" looked suspiciously like Taylorism run wild.
There have been of course "socialist" ideologies which have purported to reject the universalism of the Enlightenment, and have advocated various "indigenous" varieties of socialism for peripheral zones of the world-economy. To the extent that these formulations were more than mere rhetoric, they seemed to be de facto attempts to use as a base unit of the process of commodificatin not the new households that share income but larger communal entities that were, it was argued, more "traditional." By and large, these attempts, when serious, turned out to be fruitless. In any case, the mainstream of world socialist movements tended to denounce these attempts as non-socialist, as forms of retrograde cultural nationalism. *85-7) * * * 4. Conclusion: On Progress and Transitions
. . . [T]here has been a growing "gap" in the consumption of the surplus between the upper ten to fifteen percent of the population in the capitalist world-economy and the rest. Our impression that this was not so has been based on three facts. First, the ideology of meritocracy has truly functioned to make possible considerable individual mobility, even the mobility of specific ethnic and/or occupational groups in the work force. This occurred however without transforming fundamentally the overall statistics of the world-economy, since individual (or subgroup) mobility was countered by incorporating new populations into the world-economy or by differential demographic rates of growth.
The second reason we haven't observed the growing gap is that our historical and social science analyses have concentrated on what has been happening within the "middle classes"--that is, to that ten to fifteen percent of the population of the world-economy who consumed more surplus than they themselves produced. Within this sector there really has been a relatively dramatic flattening of the curve between the very top (less than one percent of the total population) and the truly "middle" segments, or cadres (the rest of the ten to fifteen percent). A good deal of the "progressive" politics of the past several hundred years of historical capitalism has resulted in the steady diminution of the unequal distribution of world surplus-value among that small group who have shared in it. The shouts of the triumph of this "middle" sector over the reduction of their gap with the upper one percent have masked the realities of the growing gap between them and the other eighty-five percent.
Finally, there is a third reason the phenomenon of the growing gap has not been central to our collective discussions. It is possible that, within the past ten to twenty years, under the pressure of the collective strength of the world's anti-systemic movements, and the approach to the economic asymptotes, there may have been a slowing down of absolute, though not of relative, polarization. Even this should be asserted with caution, and placed within the context of a five hundred year historical development of increased absolute polarization. (104-5) . . . The choice for the world's bourgeoisie is not between maintaining historical capitalism and suicide. It is between on the one hand a "conservative" stance, which would result in the continued disintegration of the system and its resultant transformation into an uncertain but probably more egalitarian world order; and, on the other hand, a bold attempt to seize control of the process of transition, in which the bourgeoisie itself would assume "socialist" clothing, and seek to create thereby and alternative historical system which would leave intact the process of exploitation of the world's work force, to the benefit of a minority.
It is in the light of these real political alternatives open to the world bourgeoisie that we should assess the history of both the world socialist movement and those states where socialist parties have come to power in one form or another.
The first and most important thing to remember in any such assessment is that the world socialist movement, indeed all forms of anti-systemic movements, as well as all revolutionary and/or socialist states, have themselves been integral products of historical capitalism. They were not structures external to the historical system but the excretion of processes internal to it. Hence they have reflected all the contradictions and constraints of the system. They could not and cannot do otherwise.
Their faults, their limitations, their negative effects are part of the balance-sheet of historical capitalism, not of a hypothetical historical system, of a socialist-world-order, that does not yet exist. The intensity of the exploitation of labor in revolutionary and/or socialist states, the denial of political freedoms, the persistence of sexism and racism all have to do far more with the fact that these states continue to be located in peripheral and semi-peripheral zones of the capitalist world-economy than with the properties peculiar to a new social system. The few crumbs that have existed in historical capitalism for the working classes have always been concentrated in core areas. This is still disproportionately true.
The assessment of both the anti-systemic movements and the regimes which they have had a hand in creating cannot therefore be evaluated in terms of the "good societies" they have or have not created. They can only be sensibly evaluated by asking how much they have contributed to the world-wide struggle to ensure that the transition from capitalism is towards and egalitarian socialist world-order. Here the accounting is necessarily more ambiguous, because of the workings of the contradictory processes themselves. All positive thrusts involve negative as well as positive consequences. Each weakening of the system in one way strengthens it in others. But not necessarily to equal degrees! The whole question is there.
There is no doubt that the greatest contribution of the anti-systemic movements has occurred in their mobilizing phases. Organizing rebellion, transforming consciousness, they have been liberating forces; and the contributions of individual movements here have become greater over time, through a feedback mechanism of historical learning.
Once such movements have assumed power in state structures, they have done less well, because the pressures on and within the movements, have increased geometrically. Nevertheless, this has not meant a totally negative balance-sheet for such "reformism" and "revisionism." The movements in power have been to some extent the political prisoners of their ideology and hence subject to organized pressure from the direct producers within the revolutionary state and from the anti-systemic movements outside it.
The real danger occurs precisely now, as historical capitalism approaches its most complete unfolding--the further extension of the commodification of everything, the growing strength of the world family of anti-systemic movements, the continued rationalizing of human thought. It is this complete unfolding that will hasten the collapse of the historical system, which has thrived because its logic has hitherto been only partially realized. And precisely while and because it is collapsing, the bandwagon of the forces of transition will seem ever more attractive, and therefore the outcome will be ever less certain. The struggle for liberty, equality and fraternity is protracted, comrades, and the locus of the struggle will be ever more inside the world wide family of anti-systemic forces themselves.
Communism is Utopia, that is nowhere. It is the avatar of all our religious eschatologies: the coming of the Messiah, the second coming of Christ, nirvana. It is not an historical prospect, but a current mythology. Socialism, by contrast, is a realizable historical system which may one day be instituted in the world. There is no interest in a "socialism" that claims to be a "temporary" moment of transition towards Utopia. There is interest only in a concretely historical socialism, one that meets the minimum defining characteristics of an historical system that maximizes equality and equity, one that increases humanity's control over its own life (democracy), and liberates the imagination. (107-10) * * * Capitalist Civilization: Future Prospects
The specific acts of states vary constantly, because world market conditions constantly change, the balance of power in the interstate system constantly changes, and the internal political situation within states constantly changes. The attitude of sets of producers towards their own state therefore constantly changes as well, as the likelihood that state action will help or hurt them in particular changes. But what is constant is the search by some powerful producers for state enhancement of their market position, and the largely positive response of the states to such demands. Had this not been a constant of the capitalist world-economy, capitalist civilization would never have flourished.
Producers have not however relied only on the state. They have relied also on "custom." As I noted, this is amorphous but not thereby insignificant. Custom includes the creation of markets via the creation of tastes. Advertising and marketing are obvious constructions of custom but they are only a small part of this story. A far larger part is the shaping of the entire value system as fostered and reproduced by all the institutions of socialization created and refined over 500 years of modern history. It is to this vast framework we point when we speak of the existence of the "consumer society." The need to acquire certain kinds (and not other kinds) of material objects is a social creation of capitalist civilization. its broad underpinnings are assured by a range of other institutions. On this foundation, given sets of producers can develop arguments to persuade large groups of purchasers to buy specific kinds of products. This is no doubt a key element in the ability to establish relative monopolies.
Custom also works in still other, subtler ways. There have been established wide linguistic and cultural channels that ensure the greater likelihood that given economic groups will tend to deal with given other ones rather than with those with whom market rationality alone would dictate. Real economic transactions in the capitalist world-economy have depended to a greater extent than we admit on links of community and family, familiarity and trust. And while, up to a point, this reduces transaction costs and therefore is rational in market terms, that point has been readily and regularly exceeded, pushing towards a "customary" monopolizing of production not determined by market considerations.
Competition, we have said, always comes along to undermine the monopolies. But in order to do so, competitors also cannot rely simply on the market, for the market has been rigged against competition by states and by custom. Potential competitors must usually act first to change the states and to change custom. They have done this by using one set of states against another, or by creating political coalitions within states to change state policy, or by acting in the social arena to change the social definitions of customary and expected behavior, in part by changing immediate taste preferences, in part by attacking more fundamental value premises.
Thus, the politics of accumulation has been a constant battle, which has led to the sapping of the monopolies that have ensured overall expansion of the world-economy; this regular sapping of monopolies, however slow it is, this repeatedly increased degree of competition, has led to the profit squeezes and long stagnations we call Kondratieff B-phases. Each time there is such a stagnation, the system is out of equilibrium. To permit the system to resume its expansion and therefore its ability to ensure the endless accumulation of capital, some adjustments must be made.
Three standard kinds of adjustments are possible, all of which serve to augment overall levels of profit, and therefore to provide the basis of renewed expansion of the world-economy. One can seek to lower the cost of producing competitive products. One can seek to find new buyers for competitive products. One can find new products to produce which will be relatively monopolized yet have a significant market. All three of these adjustments have been made each time there has been a global profit squeeze.
One way to lower the costs of production is to reduce the cost of inputs. But while this may increase profits for one producer, it may lower them for another. Globally, it may change little. The more effective way to lower costs of production is to lower the costs of labor--by further mechanization, by changing law or custom causing lower real wages, or by geographical displacement of production to zones of lower labor costs. These tactics work; they do reduce the cost of labor.
However, these tactics contradict the other mode of increasing profits, if not profit rates, which is that of increasing effective demand. in order to increase effective demand, the global absolute level of reward for labor input must go up, not down. How can these two needs be reconciled? Historically, there has been only one way--by geographical disjuncture. Whenever, in more favored regions of the world-system, political steps are taken to raise in some way effective demand (increases in wage levels, and in the social wage or state-controlled redistribution), steps have been taken in other parts of the world-system to increase the number of producers at low wage levels. The latter has taken two main forms: transforming rural, land-based workers into more urban, part lifetime wage workers; and expanding the boundaries of the world-economy to include in the world's work force peoples who have previously been rural producers, often largely subsistence producers.
The third and most publicized way to restore profit levels has been of course through technological change, that is, the creation of new so-called leading products which can serve as the locus of monopolized, high-profit operations. This too requires considerable state intervention and reconstruction of "custom" to ensure monopolization. Without this, the efforts of imaginative entrepreneurs are likely to be stillborn. (143-6) . . . The First World War weakened the political hold of the core states on the South. The political integration of their populations now became critical for the stable functioning of the world-system. The dilemma of political legitimization, played out in the nineteenth century within the core states, was replicated for the whole world in the the twentieth century. The question was still how to offer the cadres ever-increased reward but also to offer the masses (now the whole world) a small part of the pie and reformist hope. This solution was what we call Wilsonianism, which offered an analogy to the suffrage in national self-determination (the political parity of all states within interstate structures parallel to the political parity of all citizens within a state). And Wilsonianism also offered an analogy to social legislation and the welfare state in the concept of the economic development of underdeveloped nations assisted by development aid (or the welfare state on a world level).
This adjustment seemed at first to work as well, culminating in the political decolonizations and the coming to power in the 1945-65 period of national liberation movements throughout the Third World. Unlike the adjustments of the nineteenth century, however, the adjustments of the twentieth century were not, and could not be, underwritten by a further geographical expansion of the capitalist world-economy. Therefore, the limits of what could be offered in world redistribution without having a serious negative impact on the share of surplus value accorded to the cadres of the system were reached circa 1970. Since that time, Wilsonianism has been in retreat. The very normal downturn of the world-economy, the world economic stagnation we have been in since then, has seen all the useful processes of adjustment discussed previously in terms of the dilemma of accumulation. But the capacities of the world-system to make the adjustments necessary to maintain the legitimization of the nation-states has shown acute signs of strain.
We have therefore seen, as a growing process in the 1970s and 1980s, the political collapse of the erstwhile national liberation movements in the South, of the Communist parties in what used to be the socialist bloc, and even of Keynesianism/social-democracy in the core states. These collapses have been the result of the withdrawal of mass support for these movements which had previously, after a century of struggle, actually come to political power. But the withdrawal of popular support marked also the abandonment of reformist hope. It thereby removed one of the binding forces of the system of states, and removed in effect their popular legitimization. If, however, the states are no longer legitimized, they cannot contain the political struggles. From the point of view of the capitalist world-system, this collapse of left strategy has been a disaster, since far from being revolutionary the classical left strategy has served as part of the integrating glue of capitalist civilization. (150-151) . . . . . . The counter cultural clothes of the 1968 revolutionaries were not so much an affirmation of individualism in general (as is often said) as they were a specific affirmation of one of the thrusts (that towards individual fulfillment) and a specific rejection of the contradictory thrust (that towards egoistic consumerism).
The events of 1968 around the world followed the typical form of initial bifurcations. The swings in social sentiment were extremely strong. The events were a rupture, breaking for the first time in a significant way the widespread legitimation of state structures as such, which had been such a stabilizing force in capitalist civilization. Of course, the immediate demands of the 1968 revolutionaries were in part met by adjustments of state social policy, in part suppressed by the authorities. The adjustments were more frequent in the core zones of the capitalist world-economy than in the periphery. They were least made in the socialist countries. On the contrary, Brezhnevian stagnation was specifically suppressive of 1968 demands. The reason fewer adjustments were made in the peripheral zones was that the world accumulation process left them with less flexibility. Their state structures all suffered severe financial squeezes in the Kondratieff B-phase, and were in no position to buy off protest. Furthermore, these governments in power were by and large precisely those of the anti-systemic movements, which meant the pressure on government policy such movements would normally make were absent.
One by one, these governments came undone, and were forced into IMF tutelage (and national illegitimacy) by the careening oil prices, the debt imbroglio and falling terms of trade. The last of these governments to fall were the Communist regimes of eastern Europe, which have now gone the way of other Third World countries. The second in the cascade of bifurcations is thus symbolized by 1989. Seemingly quite different from 1968, it actually pursued parallel themes: disillusionment with the possibility of a state-led reformism path to equality in the world-system.
The collapse of the Communisms was an even bigger blow to the stability of capitalist civilization than the 1968 events. Previously some would excuse the failures of some anti-systemic movements by suggesting that they had been insufficiently based on the Soviet model, and therefore inherently weak. But when even the Soviet model collapsed, and from disillusionment within, the possibility of progressive steady social change seemed to become very remote. The loss of hope in Leninism has really been the loss of hope in centrist liberalism. The ex-Communist countries have simply become reintegrated in terms of perception into the category of non-core zones of the world-system. The particularity of this second bifurcation was that it brought in its train the disintegration of state structures without the optimistic (and stabilizing) effect of the post-1918 and post-1945 nationalist decolonizations. The Wilsonian call for self-determination has not yet lost all its power perhaps, but it has definitely lost its bloom. (157-8) . . . In the twenty-five to fifty years to come, we are likely to see different forms of disorder in the South and in the North. In the South, there will probably be no more of the national liberation movements that have dominated the landscape throughout the twentieth century. They have played their historical role, for good or ill. Few believe they have a further role to play. Instead we will see the three options that have come to prominence in the last two decades. I shall call them the Khomeini option, the Saddam Hussein option, and the "boat people" option. In terms of the equilibrium of capitalist civilization, each is equally unsettling.
The Khomeini option is the option of radical alterity, of total collective refusal to play by the rules of the world-system. When engaged in by a large enough group with enough collective resources, it can provide a formidable challenge to systemic equilibrium. A single instance of it may perhaps be tamed, if only with great difficulty. But multiple simultaneous explosions would wreak havoc.
The Saddam Hussein option is quite different but equally difficult to handle. It is the path of investment in the creation of larger states that are heavily militarized with the intent of engaging in actual warfare with the North. It is not an easy option to pursue and it may seem possible, after the Gulf War, for the North to stand up to it comfortably. Let us not be deceived by appearances. As this option becomes the policy of more and more states, it will be increasingly difficult to counter it easily. As it is, let us not fail to notice that total military defeat was insufficient to end permanently a Saddam Hussein option even in Iraq.
Finally there is the "boat people" option, the massive, relentless drive of households to migrate illegally to wealthier climes, to escape from the South to the North. Boat people can be sent back, but with difficulty; and more will keep coming. Over the coming twenty-five to fifty years, we may expect enormous numbers to succeed in this South-North migration. The double reality of the material conditions gap and the demographic gap make it highly improbable that any state policy in the North can be seriously effective in stemming the flow.
What then will happen in the economically still buoyant North? Recall that we are predicting a decline in the efficiency of state structures, even in the North. The phenomenon of the "Third World within" in the core zones of the capitalist world-economy will become massive as the demographic balance shifts. North America has the largest south contingent today. Western Europe is catching up. The phenomenon is beginning even in Japan, which has erected the strongest legal and cultural barriers of any state in the North.
The demographic transformation, caused by weakening state structures, will in turn weaken them further. Social disorder will once again become normal in the core zones. In the last twenty years there has been much discussion on this under the false label of increased crime. What we shall be seeing is increased civil warfare. This is the face of the time of troubles. The scramble for protection has already begun. The states cannot provide it. For one thing they do not have the money; for another they do not have the legitimation. We shall see instead the expansion of private protection armies and police structures--by the multiple cultural groups, by the corporate production structure, by local communities, by religious bodies, and of course by crime syndicates. This should not be termed anarchism; it is rather deterministic chaos.
Where shall we come out? For out of chaos comes new order. We cannot know for certain, except for one thing. Capitalist civilization will be over; its particular historical system will be no more. The most we can say beyond that is to outline a few alternative possible historical trajectories--outline them, that is, in broad brush strokes without the institutional detail that is entirely unforseeable.
Three types of social formulae seem plausible in the light of history of the history of the world-system. One is a sort of neo-feudalism that would reproduce in a far more equilibrated form the developments of the time of troubles--a world of parcellized sovereignties, of considerably more autarkic regions, of local hierarchies. This might be made compatible with maintaining (but probably not furthering) the current relatively high level of technology. Endless accumulation of capital could no longer function as the mainspring of such a system, but it would certainly be an inegalitarian system. What would legitimate it? Perhaps a return to a belief in natural hierarchies.
A second formula might be a sort of democratic fascism. Such a formula would involve a caste-like division of the world into two strata, the top one incorporating perhaps a fifth of the world's population. Within this stratum, there could be a high degree of egalitarian distribution. On the basis of such a community of interests within a large group, they might have the strength to keep the other 80 percent in the position of a totally disarmed working proletariat. Hitler's new world order had such a vision in mind. It failed, but then it defined itself in terms of too narrow a top stratum.
A third formula might be a still more radical world wide highly decentralized, highly egalitarian world order. This seems the most utopian of the three but it is scarcely to be ruled out. This kind of world order has been foreshadowed in much intellectual musings of the past centuries. The increased political sophistication and technological expertise we now have makes it doable, but not at all certain. It would require accepting certain real limitations in consumption expenditures. But it does not mean merely a socialization of poverty, for then it would be politically impossible to realize.
Are there still other possibilities? Of course there are. What is important to recognize is that all three historical options are really there, and the choice will depend on your collective world behavior over the next fifty years. Whichever option is chosen, it will not be the end of history, but in a real sense its beginning. The human social world is still very young in cosmological time.
In 2050 or 2100, when we look back on capitalist civilization, what shall we think? We will possibly be quite unfair. Whichever option we choose for a new system, we may feel it necessary to denigrate the one just past, that of capitalist civilization. We will emphasize its evils and ignore whatever it did achieve. By the year 3000, we may remember it as a fascinating exercise in human history--either an exceptional and aberrant period, but just possibly an historically important moment of a very long transition to a more egalitarian world; or an inherently unstable form of human exploitation after which the world returned to more stable forms. Sic transit gloria! (160-3)
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Last changed: October 28, 2001