Free-Trade Treaties are Anti-Free Trade

Commentary No. 407, August 15, 2014

Free trade is one of the principal mantras of capitalism as an historical system. Free trade is preached as the optimal arrangement for expanding production, lowering costs of production and therefore prices for consumption, and increasing income equality over the long run. This all may be true. We shall never know since we have never ever known a world of free trade. Protectionism has always been the dominant mode of economic relations between states.

But, you may think, are not states constantly ratifying treaties that are termed free-trade treaties? Yes, they are. But such treaties are not really based on free trade but rather on protectionism. Let us start with the first basic fact. There is no such thing as free trade that does not include every state in the world-system.

If a treaty includes any number of states running from two states to n-1 states (n being the totality of states at any given time), this means by definition that some other states are excluded from the provisions of that treaty. The collectivity of states within this so-called free-trade treaty are in fact creating a protectionist zone against the excluded state or states.

One of the reasons why it always seems so difficult for states to agree upon a so-called free-trade treaty is that the states involved have to negotiate a trade-off. Each of these states is deciding which protectionist measures it is ready to sacrifice vis-à-vis the limited group of states to be included in the treaty in order to obtain the advantages it would obtain from the readiness of some other state or states to sacrifice some particular protectionist measure.

We can see this how this works by looking at a major negotiation that has been going on for some time under the heading of the Trans-Pacific Partnership (TPP). There are currently twelve states involved in the prospective treaty: Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, United States, and Vietnam. This group of 12 began negotiations in 2008 and they set a date of 2012 for completion. The year 2012 is behind us. They now are claiming in 2015 that the current negotiations will be a final phase and presumably completed this year.

If one looks at the list of states involved, it is a curious hodgepodge geographically. In addition, the countries are quite different in size, in GDP, and in importance in the world-economy. There is said to be a long list of potential other countries that may seek to enter once the TPP is functioning. There are however two very large countries that are not being talked about as potential members – China and India. Why is that?

The current and potential list is obviously based first of all on political, not economic, considerations. However, rather than discussing the politics of choosing the outer boundaries of the TPP zone, let us rather look at why it has taken so long to arrive at a treaty that all twelve states will be ready to ratify.

Take the question of dairy products. Canada protects them. New Zealand exports them. Canada is about to have elections. The party that governs Canada currently is afraid of losing these elections. Hence, there is no way Canada will sign on to a reduction of protection for its dairy farmers. New Zealand’s prosperity depends on being able to expand sales of dairy products.

Take another issue that involves New Zealand. It keeps its extensive medical benefits by using generic drugs extensively. So does Australia. Pharmaceutical companies in the United States are anxious to impose severe restrictions on use of generics, which hurt income from protected drugs. They call this “safeguarding intellectual property,” safeguarding being a euphemism for protecting.

Or take another issue: so-called human rights concerns. Trade-unions in the United States assert that there is an exodus of jobs from the United States because other countries permit conditions for their workers that seriously abridge their rights, thereby lowering the cost of production. The trade-union opposition is joined by opposition from human rights groups.

To achieve this objective however various other countries in the TPP would not only have to promise multiple unpalatable measures but actually enforce them. The political problem for the United States is how to arrive at wording that will keep these other states in the TPP but not alienate a sufficient number of members of the U.S. Congress to endanger ratification of the TPP. So far, it has proved difficult.

One could go on about protecting sugar or defining what is a truck produced within the TPP zone. The essential point is that the TPP states have now missed the most recent “final” date for an accord. The headline reporting it by The New York Times was “What Was to Be the Last Of the Trade Pact Sessions Ends With Heels Dug In.”

Given various requirements of U.S. Congressional schedules, even if an accord were now to be reached, no vote could be taken in the U.S. Congress before 2016, an election year. It seems at the very least unlikely that the treaty would be ratified. If this is true of TPP, it is even more true of the negotiations for a trans-Atlantic treaty, which are at an earlier stage of discussion.

I return to my fundamental point. So-called free-trade treaties are about managing the protectionist interests of the various parties to these treaties. Whatever they do, the results are anti-free trade. To understand what is going on, we have to start with that, and evaluate any proposal with that in mind.

Greece: Who’s to Blame, and For What?

Commentary No. 406, August 1, 2015

Anyone who has been following world events recently could not have failed to read endless analyses in the media concerning economic realities in Greece. The most remarkable thing about these analyses is how radically different they are, the ones from the others. They nonetheless can be divided into two main camps.

There is one group who say that Greece’s difficulties are self-created because successive Greek governments and Greek citizens have spent recklessly money they didn’t have in order to sustain a collective life style beyond their level of collective income. This group has a simple solution for Greece’s ills. It is to cut sharply Greece’s collective expenditures in order for it to repay its extensive loans. The advocates of this position call this proposed program “reform” and say that over time Greece will emerge stronger. This view is held to varying degrees by most members of the Eurozone of the European Union. Its most vocal and uncompromising spokesperson has been Germany’s Finance Minister Wolfgang Schäuble. He has been making two main arguments: Greece should leave the Eurozone “temporarily” and Greece should be held to the strict payment of all outstanding debts.

The critics of this program call it “austerity” and argue that it is cruel and heartless, forcing an ever-growing part of the Greek population into abject poverty. Furthermore, they say, a regime of austerity will not, cannot lead to an end to the present acute depression in Greece. They say that each successive loan has increased, not decreased, the rate of unemployment and has made it less possible to achieve its ostensible goal of restoring Greece’s “competitivity” in the world market. They call instead for substantial debt forgiveness and a reversal of the demands of creditors that Greece make cuts in pensions and other parts of the social security net. The demand of debt forgiveness has gained increasing support from prominent economists like Joseph Stiglitz and from Christine Lagarde, the president of the International Monetary Fund (IMF).

How did Greece arrive at this point of economic distress? The first debate is about when to date the starting-point of Greece’s misfortunes, itself a major point of contention. The partisans for the neoliberal reforms start the story quite recently, essentially when the military dictatorship was overthrown in 1974 and a left party, PASOK, led by Andreas Papandreou, emerged as a major force on the scene. This date puts the blame solidly on Greece itself for adopting the social-democratic policies of successive governments. The critics start the story much earlier, somewhere in the 1930s, when the West European governments, and particularly Germany, imposed a subordinate quasi-colonial system in Greece. This puts the blame squarely on capitalist and imperial forces.

Greek politics after 1974 were in many senses the usual division between a center/right party, New Democracy, and an initially left but increasingly center/left party, PASOK. As the successive governments accepted the conditions for loans and therefore more and more austerity, the vacant left space came to be occupied by Syriza, a new party founded in 2004, whose name is a Greek acronym for the Coalition of the Radical Left.

In the beginning, Syriza was indeed a coalition bringing together a variety of small parties ranging from the far left to the center/left. This party distinguished itself by its strong opposition to austerity. Its leader came to be Alexis Tsipras. In successive elections, Syriza gained more and more strength, finally obtaining first place in 2015 with 36% of the vote. Since Greek electoral rules award a bonus to the leading party, this was enough to give it 149 seats out of 300 and enabled Syriza to form a government with the support of one small party.

It was at this point that Syriza had to face up to the dilemmas of being the government, which does not allow the easy positions of being a radical opposition movement. The new government chose Yanis Varoufakis as its Finance Minister and chief negotiator with Greece’s creditors.

One of Syriza’s electoral promises had been not to deal with the so-called troika about what should be done. The troika was composed of the IMF, The European Central Bank, and the European Union. Varoufakis found that no one would talk with him if he didn’t talk with the troika. Nonetheless, Varoufakis was quite persistent and voluble about the need for debt forgiveness and for a transition loan to permit Greece’s banks to remain solvent. He wanted to buy time to enable Syriza to reduce the damages that years of austerity had wrought. And he wished to do this without Greece leaving the Eurozone, the so-called Grexit.

When the negotiations got nowhere, Syriza suddenly called for a referendum in Greece about whether or not to accept the terms offered by the troika. Everyone, including Syriza itself, expected that the results of the referendum would be close. Instead, when it was held on July 5, the no vote against yielding to the troika (called OXI in Greek) received a remarkably high percentage of 61.3 percent.

What to do now was the issue before Syriza. Its decision lay with a restricted committee of six persons including Tsipras and Varoufakis. Varoufakis proposed a so-called Plan B that he had been preparing for five months. It involved setting up a parallel payments system that would have permitted monetary transactions if there were a bank holiday and capital controls. It was a sort of Grexit on Greece’s terms. It would have faced maximum retribution by the neoliberal forces. The small committee of six voted 4-2 against implementing Plan B and Varoufakis resigned as Finance Minister. Syriza was then forced to agree to a still harsher set of “reforms” than it had faced at the beginning of the negotiations.

The locus of the political storm has now passed to Syriza itself. There are those who give priority to the survival of Syriza as a party. There are those in the so-called Left Platform inside Syriza who are denouncing Tsipras as a “traitor” and are perhaps intent on creating a new party. And there are those like Yaroufakis who think Tsipras has erred seriously in his tactics but remains committed to ending austerity.

What conclusions can Syriza (and the rest of us) draw from what has happened? The first thing to note is what is not being debated. From the very beginning in 2004 Syriza has been engaged in seeking state power to implement its objectives. It seems that alternative political routes were not envisaged. But of course, seeking state power brings with it certain very serious costs. One of these costs is that governments, all governments everywhere, are forced to make compromises in their dealing with the rest of the world. Eventually this leads to the kind of split that Syriza is undergoing now.

What is being debated is whether it is a plus or minus to remain in the Eurozone. And obviously this is a matter of short-term tactics. The Eurozone as presently constructed is a pressure to further neoliberal policies. But withdrawing from it involves serious short-term negative impact on the lives of Greeks. The enormous support for OXI was a vote for Greece’s dignity, against austerity, and for remaining in the Eurozone all at the same time.

We may expect now early parliamentary elections, in which Syriza under Tsipras will have a difficult time to get a renewed mandate. But there is no alternative for Tsipras. He is trapped by his previous decisions and the priorities of a party that wishes to remain in power.

Flags and Other Symbols: Do They Matter?

Commentary No. 405, July 15, 2015

The short answer is: very much. The United States as a whole, and in particular the states in the south that were part of the attempted secession in 1861 called the Confederacy, have been embroiled in a passionate debate for several weeks now. On June 17, a young man named Dylaan Roof, a self-avowed White supremacist, killed eight persons and wounded many others at the Emanuel AME church, a historic Black church in Charleston, South Carolina. Among the dead was the pastor, the Rev. Clementa C. Pinckney, who was a member of the South Carolina State Senate.

Violence against Black persons is not unusual throughout these states. It has indeed been frequent and rarely punished seriously. What has also been true in the states of the former Confederacy is the persistent use in legal symbols of the flag of the Confederacy. It was used as part of state flags and as part of state automobile license plates. There were many statues on state grounds of persons prominent in the secession.

Many people, especially in the Black population, have long argued that these symbols were racist and actually encouraged the frequent violence. They called for removing these symbols. However, for over a century, such calls were not only not heeded but actively denounced. The leading voice to retain these symbols was an organization called the Sons of Confederate Veterans (SCV).

The SCV asserted that these symbols merely honored the sacrifices of the individuals who fought in the war. This group held such great sway in these states that the whole issue had long been considered the third rail of politics in these states. Any White legislator who called for removing the symbols was sure to be defeated at the subsequent election.

Something astonishing happened now. The slaughter was so egregious and so obviously motivated by racism that major political leaders in South Carolina and throughout the neighboring states ignored the “third rail” and called for the removal of the symbols. And, rather swiftly, this occurred throughout these states.

The scene then passed to the national legislature, where many called for removing all the symbols honoring figures of the Confederacy from all structures controlled by the federal government. This is now being deliberated.

Lest one think that such a debate about symbols is solely a USA phenomenon, let us remember the large number of quite recent such debates elsewhere. In Ukraine, the Lyiv government has had a major debate about the inclusion of symbols that referred to the fascist government of Stepan Bandera. The same defense of such symbols was offered here, that the symbols predated Bandera and actually referred to a traditional Ukrainian flag of very long ago.

In Russia, there is a debate about reopening to public view Lenin’s tomb. In Venezuela, the opposition complains of the many uses by the government of symbols referring to Hugo Chavez. In France, the kind of headwear women may use in public has been a constant debate for at least the last twenty years. This French debate has now spread to many other countries of northern Europe. In Spain, there has been a debate about the remaining symbols referring to the Franco era. In India, Prime Minister Narendra Modi has called for practice of yoga, which many consider a way of promoting Hindu values and pre-eminence. And one could go on.

It is very clear that flags and other symbols are never neutral terrain. They matter, and people know that they matter. But why do they matter? It is because symbols create attitudes as much as, or quite possibly more than, attitudes create (or are reflected in) the symbols.

Flags and other symbols are major socializing instruments of children. Children learn what they are supposed to believe from these symbols. Adults are reminded by these symbols of what they are supposed to believe. Groups feel justified in excluding (even killing) members who do not conform to the recognition of these symbols.

So yes, symbols matter. The next question is whether changing the symbols matter. Now that the flag of the Confederacy no longer flies in South Carolina, is there less racism? Will there be less violence against the Black population? Quite possibly not, in the short run. The racism may be more covert, but no less real. So why then bother about changing the symbols? Because it may matter in the longer run. It is a part of a continuing struggle about the world in which we live and hope to build. It is only a part of the struggle. But it needs to be pursued because it is an indispensable part of the struggle.

That brings us to the last danger. It is all too easy in the struggle against one noxious set of symbols to install in our collective value system another noxious set of symbols. There is no magic formula in the real world where many groups are struggling for their place in the sun, and we are all members of multiple, overlapping groups. We have to find the space for reasonable compromises about symbols.

The Latin American Left Moves Rightward

Commentary No. 404, July 1, 2015

The last fifteen years or so has seen a major shift in Latin America’s political orientation. In a large number of countries, left parties have come to power. Their programs have emphasized redistribution of resources to aid the poorer segments of the population. They have also sought to create and strengthen those regional structures that included all the countries of Latin America and the Caribbean but excluded the United States and Canada.

Initially, these parties succeeded in bringing together multiple groups and movements that sought a change from the traditional parties that were oriented to right politics and close ties with the United States. They sought to prove, in the slogan of the World Social Forum, that “another world is possible.”

The initial collective enthusiasms began to fade on multiple fronts. Middle-class elements became increasingly disturbed not only by the rampant corruption in the left governments but by the increasingly harsh ways which these governments used to treat opposition forces. This shift rightward of some initial supporters of a leftward “change” was normal in the sense that it usually happens everywhere.

There was however a much more important problem facing these countries. There are, and have always been, essentially two Latin American lefts, not one. One is composed of those persons and movements that wish to overcome the lower standards of living in the countries of the South by using state power to “modernize” the economy and thereby “catch up” with the countries of the North.

The second, quite different, is composed of those underclasses who fear that such “modernization” will make things not better but worse for them, increasing the internal gaps between the better-off and the poorest strata of the country.

In Latin America, this latter group includes the indigenista populations, that is, those whose presence dates from before the time that various European powers sent their troops and settlers into the Western Hemisphere. It also includes the afrodescendentes, that is, those who were brought in from Africa by the Europeans as slaves.

These groups began to speak of promoting a civilizational change based on buen vivir – a translation from Incan languages meaning “living well.” They argued for a maintenance of traditional modes of living under the control of local populations.

The two visions – that of the modernizing left and that of the proponents of buen vivir – soon began to clash, and clash seriously. Whereas, in the first elections that the left won, the left forces had the support of the movements of the underclasses, that was no longer as true in the subsequent elections. Quite to the contrary! As time went on, the two groups spoke more and more angrily and uncompromisingly about each other.

The net result of this split is that both groups – the left parties and the underclasses – moved rightward. The representatives of the underclasses found themselves allied de facto with rightist forces. Their main demand began to be the overthrow of the left parties, and particularly its leader. This was something that would clearly result in rightist governments coming to power, parties that were no more interested in buen vivir than the left parties.

Meanwhile the left parties promoted developmentalist policies that ignored to a significant degree the negative ecological effects of their programs. In practice, their agricultural programs began to eliminate the small agricultural producers who had been the basis of internal consumption in favor of mega-corporate structures. Their programs began to resemble in many ways the programs of previous right governments.

In short, the progress of the Latin American left, so remarkable in recent years, is being undone by the bitter struggle between the two Latin American lefts. Those persons and groups that have tried to encourage a meaningful dialogue between the two lefts have been seen as very unwelcome by both sides. It is as though the two sides are saying that you are with us or against us, that there is no median path. It is very late, but it may not be too late for both sides to engage in intelligent reassessment of the situation and to rescue the Latin American left from self-destruction.

Turkey: Instability Ahead

Commentary No. 403, June 15, 2015

Turkey held parliamentary elections on June 7, 2015. Against the expectations of virtually everyone, the governing Justice and Development Party (AKP in its Turkish initials) lost its absolute majority. This was seen as a major defeat both for the party and Turkey’s president, Recep Tayyip Erdogan. The correspondent of the Financial Times called the results “seismic” and cited a commentator/critic of Erdogan who said: “There’s no risk-free path for him at the moment; anything he chooses will be a gamble.” The headline of this article says Erdogan has a “post-poll choice: step back or forge ahead.”

Virtually all observers, within and outside Turkey, have been analyzing the elections with similar dramatic verbiage. To understand why, we have to go back to the beginning of Turkey’s history as an independent state in 1923. The Turkish War of Independence (1919-1923) ended with the Treaty of Lausanne. At that point, the interim parliament called for elections. This second parliament proclaimed the republic, accepted the Treaty of Lausanne, and abolished the caliphate. The new majority party, The Republican People’s Party (CHP in its Turkish initials), soon became the only party. It was led by its founder, Mustafa Kemal Ataturk, until his death in 1938.

Ataturk’s policies were modeled in many ways on what he considered those of France. He was an anticlerical Jacobin who sought to “modernize” his country. Central to his Jacobinism was the French view of the relations between the state and religions, called laicité. The Turkish translation of this word is an invented cognate, laiklik.

The Jacobinism was expressed in Ataturk’s ferocious opposition to any kind of intermediary allegiances between the state and the individual, whether such intermediaries were religious, ethnic, or regional. There were four large possible intermediaries, and Ataturk took action against all four. The first was Islam – hence the abolition of the caliphate and the banning of Islamic vestments. The second was the Kurds – hence the denial of the use of their language and indeed of their very existence, calling them “mountain Turks.” The third was the Armenians – hence their slaughter and expulsion. The fourth was the Greek Orthodox population and church – hence the forced transfers to Greece in exchange for Turks resident in Greece.

Furthermore, for Ataturk and the CHP, the creation of a modern state implied a careful limitation of the boundaries of the Turkish state. This meant rejecting the ideology of pan-Turkism, which sought to unite all Turkic-speaking peoples. It rejected a fortiori so-called Turanism, which sought to unite all peoples that were linguistically descended from common roots, like Finns, Hungarians, Mongols, Koreans, and Japanese, among others.

Quite to the contrary. Ataturk sought to “purify” Turkish by rejecting all linguistic imports from Arabic, Persian, Greek, and Latin in Turkish, as used within the boundaries of Anatolia, which provided the basic boundaries of modern Turkey. He also ended the use of the Arabic alphabet, replacing it with the Latin alphabet.

Successive versions of the constitution all included the term “secular” in the description of the republic. In 1930, Ataturk wrote of the “erroneous appellations” by “co-nationals who has been incited to think of themselves as Kurds, Circassians, Laz or Bosnians.” They were rather, he said, “individual members of the nation.”

The second issue of continuing importance for Turkey was its geopolitical orientation. In the early days of the republic, Turkey entertained links with the Soviet Union. They shared a sense of being “revolutionary” and consequently not being accepted by the Western world. But for Ataturk, this alliance receded as he pursued his aspiration to create a modern state following the French model. Then, with the coming to power of Hitler, Turkey was courted by Germany. Hence, when the Second World War began, the Turkish state was torn between possible allegiances, and opted for neutrality, which was seen by the Allied powers as too pro-German.

In part to repair the relations with western Europe (and North America), Ataturk’s successor Ismet Inönü ended one-party rule in 1944 and called for elections. The CHP easily won the first election, but after that, it became a minority party. It proclaimed itself social-democratic and joined the Socialist international. It continued to be strongly nationalist but found its electoral strength in urban areas from middle-class professional and managerial elites. Its supporters pushed both for pro-Western policies (like joining NATO) and for greater civil liberties.

The CHP found itself beset by opponents. There were now the successive versions of a conservative party, which placed less emphasis on pro-Western policies. It had strong roots in rural areas and a somewhat more tolerant view of Islam. There was the army and the judiciary, who wanted to maintain a very strong state and were extremely vigilant in the defense of laicité, leading to several military takeovers. And there were the Kurds who began to organize politically and eventually started a military insurrection under a party/army known as the Kurdish Workers’ Party (PKK in its Turkish initials). This group, led by Abdullah Ocalan, originally proclaimed itself Marxist-Leninist but later evolved into a revised socialist orientation willing to integrate politically as an autonomous region within Turkey. Ocalan was captured with CIA assistance and condemned to death, which was commuted into lifetime imprisonment on a remote island.

The Muslim-based parties that emerged in this period were successively outlawed and their leaders either imprisoned or barred from politics. So, when Erdogan’s “moderate Islamic” party, the AKP, first came to power in 2002, it was seen as a veritable progressive revolution. It was still faced with strong opposition from many left “secularist” intellectuals and also faced the possibility of an army takeover. Erdogan carefully and successfully navigated all the shoals, and grew steadily stronger. At this point, Erdogan sought a parliament that would vote for a new constitution creating a very strong presidential system. The AKP that seemed to represent a progressive force in 2002 now seemed to be the potentially dictatorial party of the future.

Erdogan did however do one remarkable and surprising thing in his late term of office. He started negotiations with Ocalan to see if there could be some formula of devolution of power that would resolve the issue. He got great credit for this among the Kurds. However, he also pursued a new foreign policy that reinserted Turkey into the Middle Eastern arena. His ferocious opposition to Syria’s Bashir al-Assad led him to engage in negative behavior vis-a-vis Syrian Kurds who gave priority to opposing the Islamic State and were allied with the PKK.

Ergo, in these last elections, the latest legal Kurdish party, the People’s Democratic Party (HDP in its Turkish initials), pursued a new policy entirely. It created a progressive rainbow coalition. On its slate of candidates were persons from all major ethnic groups, the first openly gay candidate, and perhaps most important a large number of women. This party received over 13% of the vote nationally, enabling a Kurdish party for the very first time to exceed the high threshold of 10% needed to have seats in parliament.

Erdogan has no chance now of enacting his constitution. His immediate problem is whether to try to govern as a minority party (very difficult) or to ally with one of the three parties with the votes to give him a majority: the left HDP, the secularist CHP, or the far rightwing party. It is a very difficult choice for him, for his party, and for Turkey. The outcome will have a fundamental impact not only on the future of Turkey but on the geopolitics of the Middle East.

 

Protesting Mainstream Parties

Commentary No. 402, June 1, 2015

In countries with contested elections, there are usually two mainstream parties considered as being somewhere in or near the center of the views of the voters in that country. In the last few years, there have been a relatively large number of elections in which a protest movement has either won the election or at least won enough seats such that their support must be obtained in order that a mainstream party govern.

The latest example of this is Alberta in Canada, where the National Democratic Party (NDP), running on a platform reasonably far to the left, surprisingly and unexpectedly ousted from power the Progressive Conservatives, a rightwing party that had governed the province without difficulty for a very long time. What made this all the more surprising was that Alberta has the reputation of being the most conservative province in Canada, and is the base of Prime Minister Stephen Harper of Canada, in office since 2006. The NPD even won 14 of 25 seats in Calgary, Harper’s own residence and stronghold.

Alberta is not the only case. The Scottish National Party (SNP) swept elections in Scotland, after a history of being a marginal party. The ultra-rightwing Polish party, the Law and Justice Party, defeated the candidate of what had been considered a conservative pro-business party, the Civic Platform. Syriza in Greece, campaigning on an anti-austerity platform, is now in power and Prime Minister Alexei Tsipras is struggling to achieve its objectives. In Spain, Podemos, another anti-austerity party, is steadily rising in the polls and seems poised to make it difficult or impossible for the governing conservative party, the People’s Party, to remain in power. India is just celebrating the year in power of Narendra Modi, who ran on a platform of ousting Establishment parties and dynasties from power.

These protest elections all have something in common. They all utilized rhetoric in their campaigning that we call populist. This means that they asserted that they were fighting against the country’s elites, who have too much power and ignore the needs of the vast majority of the population. They emphasized the gaps in wealth and well-being between these elites and everyone else. They deplored the decline in the real income of the “middle” strata. They emphasized the need to provide jobs, usually in instances in which there had been a significant increase in unemployment.

In addition, these protest movements always pointed to corruption in the parties in power and they promised to check it, or at least seriously reduce it. And all of this together they packaged as a call for change, real change.

However, we should look more closely at these protests. They are in no way all alike. Indeed, there is a fundamental split among them, which we can notice as soon as we look at the rest of their rhetoric. Some of these protest movements are on the left – the NDP in Alberta, Syriza in Greece, Podemos in Spain, the SNP in Scotland. And some are clearly on the right – Modi in India, the Law and Justice Party in Poland.

Those on the left focus their criticisms centrally around economic issues. They are class-based in their recruitment and their rhetoric. Those on the right primarily make nationalist assertions, usually with a xenophobic emphasis. Those on the left want to combat unemployment by government policies that would create the jobs, including of course greater taxation of the more wealthy. Those on the right want to combat unemployment by preventing immigration, even expelling immigrants.

Once in power, these protest movements, whether of the left or of the right, find it very difficult to fulfill the populist promises they have made to become elected. Large corporations have major tools with which to limit measures taken against them. They act through this mythical entity called the “market,” aided and abetted by other governments and international institutions. The protest movements find that, if they push too hard, government income is reduced, at least in the short run. But for those who have voted for them, the short run is their measure of continuing approval. The protest movements’ day of glory and power risks being very limited. So they “compromise,” which angers the most militant of their supporters.

One must always remember that the supporters of a change in government are a motley lot. Some are militants seeking extensive change in the world-system and their country’s role in it. Some are merely weary of the traditional mainstream parties, seen as having become tired and non-responsive. Some say that a new group in power couldn’t do anything worse than those previously in power. In short, these protest movements are not an organized army but an unstable floating alliance of many different groups.

There are three conclusions we can draw from this situation. The first is that national governments do not have unlimited power to do what they want. They are extremely constrained by the operation of the world-system as a whole.

The second conclusion is that, nonetheless, they can do something to alleviate the distress of ordinary persons. They can do this precisely by pursuing reallocations of income via taxation and other mechanisms. Such measures will “minimize the pain” of those who are the beneficiaries. The results may only be temporary. But once again I remind you that we all live in the short run and any help we can get in the short run is a plus, not a minus.

The third conclusion is that, if a protest movement is going to be a serious participant in changing the world-system, it must not limit itself to short-run populism but engage in middle-run organization to affect the worldwide struggle in this period of systemic crisis and transition to an alternative world-system, one that has already begun and is ongoing.

It is only when left protest movements learn how to combine short-run measures to “minimize the pain” with middle-run efforts to tilt the bifurcated struggle for a new system that we can have some hope of arriving at the outcome we desire – a relatively democratic, relatively egalitarian world-system.

Post-Britain: Does It Matter?

Commentary No. 401, May 15, 2015

In the middle of the seventeenth century, the United Provinces (more or less today’s Netherlands) was the hegemonic power of the capitalist world-system, which was then geographically smaller. Within this world-system, it was the wealthiest country with the most efficient industrial enterprises. It dominated the trade and finances of this world-system. It had the strongest military.

Then it started on its decline as a hegemonic power. And one by one it lost each of these advantages. To salvage as much as it could, it became the junior partner of Great Britain, an aspiring hegemon. The advantage that it held onto longest was its financial dominance. It held onto that until the 1780s. At that point one could have written a commentary entitled “Post-Netherlands: Does It Matter?”

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The Greek Melodrama, or Who Really Wants What?

By any definition, what is going on in Greece today, or rather what is going on between Greece and outside countries and institutions, is a melodrama, a melodrama of epic proportions. What we mean by a melodrama is a dramatic encounter that is deliberately overacted by the many participants. They make threats, implicitly or sometimes explicitly. They draw public lines that cannot be crossed in the negotiations. They make dire predictions of the consequences of not following their recommendations. A melodrama heightens events and insists on moral dichotomies.

In a melodrama, the participants do just about everything they can to make others take the blame for past, present, and future negative consequences. The one thing they do not do is to confess their real priorities, and how their priorities are being served by participating in the melodrama instead of entering into sober discussions aimed at some resolution of the differences.

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