Final Year Project Report - University of Limerick [PDF]

Aug 23, 2011 - Final Year Project Report. Project Title: The Sources of, and Prospects for U.S. Hegemony: An Internation

20 downloads 23 Views 501KB Size

Recommend Stories


COMP4921 Final Year Project
Do not seek to follow in the footsteps of the wise. Seek what they sought. Matsuo Basho

Year Two Final Report
You miss 100% of the shots you don’t take. Wayne Gretzky

Project Final Report Final Publishable Summary Report
What we think, what we become. Buddha

Project Final Report
Don't count the days, make the days count. Muhammad Ali

Project Final Report public
Raise your words, not voice. It is rain that grows flowers, not thunder. Rumi

Project Final Report
Why complain about yesterday, when you can make a better tomorrow by making the most of today? Anon

Project Final Report
It always seems impossible until it is done. Nelson Mandela

FIspace Project Final Report
No amount of guilt can solve the past, and no amount of anxiety can change the future. Anonymous

Project Final Report
Make yourself a priority once in a while. It's not selfish. It's necessary. Anonymous

EDRC Project Final Report
Respond to every call that excites your spirit. Rumi

Idea Transcript


Final Year Project Report Project Title: ,,

The Sources of, and Prospects for U.S. Hegemony: An International Political Economy Approach.

Student Name:

David O’Mahony

Student ID:

0245453

Supervisor:

Dr. Owen Worth

Course:

BA. Politics and International Relations

Academic Year:

2011/’12

Acknowledgements  I’d like to thank my supervisor, Dr. Owen Worth, for his helpful guidance and patience throughout the project.

 I’d like to thank Dr. Peadar Kirby for advice given about an emerging alternative to neoliberalism in Latin America.

 I would also like to thank my family and friends for their encouragement and support throughout.

Abstract The global financial crisis and subsequent effects on sovereign debt, the “rise of China”, prolonged war in the Middle East, as well as the recent as yet uncertain wave of political unrest and civil war known popularly as the “Arab Spring” have shaken the world, and called into question the future of U.S. hegemony. In this regard, the prospects for continued U.S. hegemony in the international political economy will be analysed. First, however, it will be necessary to determine exactly what factors are constitutive of U.S. hegemony. In this regard, the structural analysis devised by Susan Strange in the 1980s is apt to illustrate the main sources of U.S. power in the international system. Additionally, the insights of Robert Cox’s analysis of the internationalization of production, world order, and his application of Gramsci’s theory of hegemony to the international political economy allow for a more thorough understanding of the nature of the U.S. hegemony. Additionally, East Asia and Latin America will briefly be analysed due to their potential as sites for collective counterhegemony, if not on a global, then at least on a regional level. It will be concluded that U.S. hegemony through dominance in the structures of production, finance, security and ideology appears to be relatively safe from effective contestation for the foreseeable future. Once again, the decline of the U.S. has been much exaggerated due to a lack of focus on structural power, and an in depth analysis of the myriad sources of power which the U.S. draws from.

Contents 1 Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 2 The Production Structure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 3 The Finance Structure. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11 4 The Security Structure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 5 The Knowledge Structure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 6 Latin America . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36 7 East Asia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37 8 The Nature of U.S. Power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 9 Conclusions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40 10 Bibliography . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43

Introduction The global financial crisis and subsequent effects on sovereign debt, the “Rise of China”, prolonged war in the Middle East, as well as the recent as yet uncertain wave of political unrest and civil war known popularly as the “Arab Spring” have shaken the world, and called into question the future of U.S. hegemony. In this essay the prospects for continued U.S. hegemony in the international political economy will be analysed. First, however, it will be necessary to determine exactly what factors are constitutive of U.S. hegemony. In this regard, the structural analysis devised by Susan Strange in the 1980s is apt to illustrate the main sources of U.S. power in the international system. Additionally, the insights of Robert Cox’s analysis of the internationalization of production, world order, and his application of Gramsci’s theory of hegemony to the international political economy allow for a more thorough understanding of the nature of the U.S. hegemony. Firstly, it is necessary in an evaluation of power in the international system, to outline what exactly is meant when we speak of power. According to Strange (ibid: p. 24), there are two types of power exercised in a political economy – structural power and relational power. Relational power is “the power of A to get B to do something they would otherwise not do” (ibid: p. 25). An example of relational power would be the huge amounts of U.S. government bonds held by China, which increase China’s power in relation to the U.S. Structural power on the other hand, “is the power to shape and determine the structures of the global political economy within which other states, their political institutions, their economic enterprises and (not least) their scientists and other professional people have to operate” (ibid: p. 25). Expressions of such power would include the control that the U.S. exerts over the institutions of global economic governance, which set the agenda and impose policies which are in the interests of the U.S. Additionally, this structural power could be in the form of “customs, usages, and modes of operation” which are projected into and adopted by wider society generally (Strange, 2002: p. 145). This additional qualification by Strange of what she meant by structural power happens to be very similar to the definition of hegemony as used by Robert Cox. By hegemony, Cox means “a structure of values and understandings about the nature of order that permeates a whole system of state and non-state entities (Cox, 1992: p. 151). “Hegemony derives from the ways of doing and thinking of the dominant social strata of the dominant state or states insofar as these ways of doing and thinking have inspired emulation or acquired the acquiescence of the dominant social strata of other states. These social practices and the ideologies that explain and legitimize them constitute the foundation of the hegemonic order. Hegemony frames thought and thereby circumscribes action” (Cox, 1992: p. 518). Strange believed there to be four main structures of power within the global political economy, each 1

structure both supported by and conversely supporting the other three structures of power. “These four sources, corresponding to the four sides of a transparent pyramid, are: control over security; control over production; control over credit; and control over knowledge, beliefs and ideas” (Strange, 1994: p. 26). These structures of power, as theoretical models are artificial constructs with which to understand the complex and highly interrelated nature of power within the global political economy. Suffice it to say that this fact alone should demonstrate how interconnected these “structures” of power are, and how it is difficult to say with any certainty how important one is over the other without being guilty of abstraction from reality. Each construct of power is vital for the others to have any real explanatory significance. Of course, any one theory can only provide one perspective of the complex global political economy. With this in mind, additional insight can be gained by the use of the Coxian neo-gramscian notions of hegemony, world order and the internationalization of production. While not fully embracing the historical materialism of cox, nevertheless, his insights have profoundly altered the depth and scope of the study of International Political Economy since the late 1970s and so have the potential to add to an understanding of the global processes at work within capitalism to which virtually all states have become substantially subordinated. Additionally, the insights of Antonio Gramsci concerning hegemony, and Cox’s application of this to the international system illustrate processes and means with which the international system is shaped by consent and coercion by the dominant state, incorporating subordinate allies, and liquidating counter-hegemonic forces in the formation of what Gramsci termed, a “historic bloc”. These insights have given profound applicability to the study of international political economy, especially in this current period of U.S.-led globalization of production and finance, as well as near-worldwide reach of the U.S. military, engaged in alliance-building and asymmetric warfare.

The Production Structure According to Strange, a production structure is defined as “the sum of all the arrangements determining what is produced, by whom and for whom, by what method and on what terms” (Strange, 1994: p. 64). Strange points to there being two main changes in the production structure in the last two centuries; the transformation in Western Europe to a capitalist, market economy and secondly, a “gradual, uneven but apparently inexorable supplanting of a production structure geared primarily to serve national markets to one geared to serve a world market” (ibid: p. 65). This latter change not only involves multi-national corporations (MNCs), but also small and medium sized enterprises geared 2

toward the world market (ibid: p. 65). In the course of the last century there have been many examples of countries attempting to shield themselves from external economic forces, such as the communist powers of the Soviet Union and China, as well as the import substitution strategies of India and Latin America. Today, however, virtually all countries have come to accept the logic of globalization as a means of development, albeit to a lesser or greater extent. The transformation of the global production system from one centred on national economies to one geared towards the international system was “in large measure an American achievement” (ibid: p. 73). In the aftermath of the Second World War, the U.S. was the only major power to possess an undamaged manufacturing infrastructure and “had half of the world’s wealth, and incomparable security and global reach” (Chomsky, 2012). Due to its need to utilize the massive manufacturing base which it had created by the end of the war, and also to counter the influence and possible expansion of the Soviet Union, the U.S. adopted the Marshall Plan, which gave European economies $13 billion dollars between 1948 and 1952. This money was largely recycled back to the U.S. due to the conditionality on the loans which insisted on the funds being used to buy U.S. goods. In addition to the Marshall Plan, there was the European Payments Union (EPU), which facilitated European trade. After the dissolution of the EPU, the Bretton Woods monetary system came into effect in 1958, the same year that the U.S. balance of payments began producing deficits. The architecture of the Bretton Woods institutions was central to how the U.S. dominated the global economy in the post-war period. After the U.S. congress’ rejection of the International Trade Organization (ITO) in 1947, the General Agreement on Tariffs and Trade (GATT) became the default institutional regime governing the regulation of international trade. From its setting up, to its transformation into the World Trade Organization (WTO) in 1994, there were eight multilateral rounds of negotiations regarding, for the most part, the reduction of tariffs and trade barriers in order to increase world trade and prosperity. For an economy as large and as dominant as the U.S., freer trade meant that it could benefit from the competitive advantages that it had inherited from the war. In fact, an illustration of who benefits from the WTO agreement is noted by David Harvey, who points out that “The U.S. Senate ratification of the WTO agreement carried with it the proviso that the U.S. could ignore and refuse any WTO ruling that it considered to be fundamentally unfair to U.S. interests”, thus laying bare where the power lies in this institution (2003: p. 73). Any investigation into the sources of funding, staffing and training, ideological conformity and veto powers, besides the relational power which the U.S. can exert in the Bretton Woods institutions will show that power within these organizations almost invariably lies with the United States and to a lesser extent with its subordinated allies (Woods, 2003; Al-Islam Alqadhafi, 2007). The post-war years saw U.S. multi-national corporations (MNCs) increasingly operate across the 3

globe. Part of the reason for their success was in the legacy of the Second World War. Due to the devastation of the other powers’ industrial infrastructure, the U.S. had by the end of the war over half of the world’s manufacturing base, which gave the Americans a significant competitive advantage. Additionally, managerial and disciplinary skills had been developed within the U.S. military which were applicable to large and geographically dispersed businesses (Strange, 1994: p. 75). Increasingly, this infiltration of foreign economies by U.S. firms continually decreased the U.S. manufacturing base, at least within its own territory. This internationalization of U.S. business lessened direct U.S. control over such production, yet increased U.S. power within the production structure of the global economy. Strange described this “spilling out”, as, “the consolidation of an entirely new kind of nonterritorial empire” (ibid: p. 6). Although these companies are in theory independent from the U.S. government, in reality, these firms generally do what they are told when asked by the U.S. As Strange notes, “the ability of Washington to tell U.S. companies what to do or what not to do is immeasurably greater than the ability of Tokyo to tell Japanese companies in the United States what to do” (Strange, 1988: p. 7). Strange sees U.S. corporate enterprises as being crucial to the military-industrial complex and, by extension, the U.S. Empire. She describes the U.S. as a “corporation empire”, where “America’s “legions”” “are not military but economic” (Strange, 1994: p.10). In response to the outward spread of U.S. companies, non-American firms also began to internationalize as a means to stay competitive (Strange, 1994: p. 76). As predominantly European and Japanese enterprises expanded their share of world trade substantially, “so the American-controlled share of international business, though still growing in absolute terms, fell from two-thirds before 1970 to less than half in the 1980s” (ibid: p. 76). With the adoption and projection of neo-liberalism from the early 1970s, this internationalization of production in the supposed search for greater efficiency intensified, with many MNCs outsourcing their lower end jobs abroad. This had the effect over time of creating a world order where peripheral countries were incorporated into a global division of labour at the bottom end of the scale of valueadded. According to Cox, the internationalization of the state was another major development in the move towards globalization of production. Whereas, throughout most of the century, the role of the state has been to act as a “buffer protecting the national economy from disruptive external forces so as to be able to encourage internal levels of economic activity sufficient to sustain adequate employment and welfare”, the priority “shifted to one of adapting domestic economies to the perceived exigencies of the world economy” (ibid: p. 193). Institutions designated to international economic and trade relations transmitted the free market ideology through national agencies or as Cox calls them, “transmission belts”, promoting policies they had no part in deciding (ibid: p. 193).

4

The internationalization of production has brought about a “global division of labour in which technological development is concentrated in a core area, while physical production of goods is moving increasingly into peripheral areas” (Cox, 1977: p. 359). Cox describes multinational corporations as “technology and control mechanisms” which link the core and peripheral areas (ibid: p. 359). “The internationalizing of production, as it penetrates into the peripheries of the world economy, benefits some social groups and disadvantages others” (ibid: 195), creating small sections of pliant elites in peripheral countries willing to use political power against the best interests of the majority of the population. Also central to the restructuring of these economies in the periphery were the neo-liberal policies of the World Bank and the International Monetary Fund (IMF) which especially from the 1980s debt-crisis began attaching conditionalities onto their loans. These specified that borrowing countries would impose structural adjustment policies, now known as the Washington Consensus. These consisted of a set of policies aimed at reducing the size of the state, privatization of significant sections of the economy, deregulation of finance and industry, reducing/abolishing capital controls, and reorganizing the economy towards export-led growth aimed at incorporation into the global economy. During the British Empire international investment largely took the form of portfolio investment where the control over the productive resources remained with the borrower. With direct investment however, control of productive resources remains with the creditor (Cox, 1981: p. 110). “The essential feature of direct investment is possession, not of money, but of knowledge – in the form of technology and especially in the capacity to continue to develop new technology. The financial arrangements for direct investment may vary greatly, but all are subordinated to this crucial factor of technological control. These enterprises become suppliers of elements to a globally organized production process planned and controlled by the source of the technology. Formal ownership is less important than the manner in which various elements are integrated into the production system”. (ibid: 110). In terms of U.S. hegemony in the international political economy, capital flight and loss of manufacturing to the periphery has not had the kind of debilitating effect on U.S. power that many had predicted in the 1980s. The “declinists”, as they were collectively known, argued that every great power, or hegemon had, as a prerequisite, a large manufacturing base. Implicit in this argument is the belief that a hegemon must have a manufacturing base within the territorial location of the state. Strange countered this, however, when she argued that having lost its manufacturing base to other countries, it nonetheless exerts significant control over the production structure of the world economy by means of control over the world’s largest MNCs, many of which make more than entire countries. The U.S. controls significant world share of production through equity in MNCs, and so as long as there is a liberal trade regime which can ensure that the core can obtain primary commodities and 5

manufactured goods from the periphery, then in fact, there is no reason why the U.S. cannot continue to dominate the production structure of the world economy, along with other advanced countries. According to Strange, “it is the information rich occupations, whether associated with manufacturing or not, that confer power, much more now than the physical capacity to roll goods off an assembly line” (Strange, 1988: p. 5). Strange also notes how the location of manufacturing is insignificant compared to “the location of the people who make the key decisions on what is to be produced, where and how, and who design, direct and manage to sell successfully on a world market” (ibid: p. 5). In the 1980s, there was much debate within IPE about whether the U.S. could continue as hegemon with a decreasing level of exports. Japan was seen by many as being the successor to U.S. hegemony since its manufacturing of electronics, automobiles, as well as other high end goods seemed to indicate a continued rise, and therefore a supplanting of U.S. dominance. This largely came to nothing, with Japan’s economy becoming mired in debt, and having only modest growth since then. With the Asian Financial Crisis of 1997 Japan’s growth took a further hit, but even without this setback, it had by then become clear that Japan lacked the full range of structural and relational power to be capable of achieving hegemony, at least on a world level. In recent years, China has emerged as the new successor apparent to U.S. hegemony. In 2009, China grew to be the world’s largest exporter of goods, overtaking Germany (Nolan and Zhang, 2010: 1). Many have heralded the continuous and substantial growth of the Chinese economy, as well as the size of China’s population as having enough potential to remove the US from its hegemonic position in the global political economy. However, if one looks a little closer at the basis of China’s rise, one will see that China has substantial hurdles to climb before it should be considered as a rival to the U.S. Since the wave of neo-liberal globalization took off in the 1970s, there has been a massive amount of consolidation of international firms, with mergers continually reducing the number and increasing the size of the world’s largest companies. This is the case in almost every sector. “In many sectors, two or three firms account for more than half of total sales revenue” (ibid: 1). Illustration of the consolidation of global business in certain sectors can be seen in Table 1, below. Alongside this change in the production structure of the world economy, there have been further changes in that these companies “have emerged as “systems integrators” at the apex of extended value chains” (ibid: 1). This has a “cascade effect” on their suppliers, further increasing consolidation (ibid: 1). Hence, not only do firms have to compete with the leading “systems integrators”, but they also have to compete with the supporting firms which consolidate the extended value chains which have been built (ibid: 1). An illustration of the consolidation with global value chains, from 2006-08 is given in Table 2, below. 6

(ibid: 2). Additionally, the consolidation of research and development (R&D) shows an equally high degree of concentration (ibid: 2). Three sectors (IT, Pharmaceuticals and autos) account for two thirds of total R&D. Of the world’s top 1,400 firms (G1400), “companies from the U.S., Japan, Germany, France and the UK account for 80%”, “while within this group, the top hundred firms account for 60 per cent 7

of total R&D investment” (ibid: 3). This consolidation of international business continues relatively unabated. In the years 2007-2008, there were 169 cross border mergers and acquisitions valued at over $3 billion. Of these, “just eight involved companies with headquarters in low and middle-income countries” (ibid: 3). In the globalization years (1980-2008), more generally, companies from the advanced capitalist core increased their outward stock of foreign direct investment (FDI) from $503 billion to $13,623 billion”, while by 2008, the combined total of developing-world FDI “amounted to less than a fifth of the core’s” (ibid: 3). Additionally, most of the FDI which occurred during this time was between core economies. “The inward stock of FDI in the advanced economies rose from $394 billion in 1980 to $10,213 billion in 2008, mostly from other advanced economies” (ibid: 3). An additionally bleak picture is painted for developing countries when Nolan and Zhang compare the largest 100 TNCs from the core economies to the 100 largest TNCs from developing economies. “On the eve of the crisis, the international assets and foreign revenues of the “top hundred TNCs from developing countries - including firms from South Korea, Kuwait and Qatar – amounted to barely 14 per cent of those of the world’s hundred largest TNCs”” (ibid: 3). For a more detailed illustration of the gulf between developed and developing world TNCs, see Table 3, below.

8

(ibid, 4). In looking at China in particular, the huge foreign exchange reserves that have been accumulated are significant. As of December 2010, this figure stood at over $2.84 trillion (People’s Bank of China, 2011). Yet, Nolan and Zhang put this figure into perspective by comparing it to the fact that the combined “market capitalization of the top ten U.S. firms alone amounted to $2.4 trillion, while the top 500 asset managers had a total of $63.7 trillion at their command – of which 96 per cent was managed by firms from Europe, North America and Japan” (ibid: 4). China’s outward stock of FDI is also far from impressive, with Russia, Singapore and Brazil all investing more than China abroad (ibid: 4). “Significantly, nearly two-thirds of China’s outward FDI goes to Hong Kong and Macao and less than a tenth goes to the high-income countries, in which Chinese companies have virtually no presence” (ibid: 4). Conversely, companies from the core countries have become “deeply embedded” in the Chinese economy (ibid; 4). Figure 1 gives an illustration of the outward stock of FDI from the period 1990 to 2008.

9

(ibid, 5). Overall, China’s rise within the production structure of the world economy has been primarily due to its huge growth, from a low initial base, in exports. However, these exports, while initially in low end goods during the 1980s and 1990s in goods such as toys, textiles and cheap electronics, are now primarily in more advanced goods which are owned, designed and incorporated into extended value chains dominated by large western TNCs, with the overriding benefits accruing to these firms and 10

their shareholders as opposed to China. It has become incorporated into the global economy which by its nature constrains the Chinese from developing its own path independent from U.S.-led global production networks. How much the Chinese economy benefited from American companies in particular is highlighted by Hughes when he points out that “Wal-Mart alone purchased $18 billion worth of Chinese goods in 2004, making it China’s eight-largest trading partner – ahead of Australia, Canada and Russia” (Hughes, 2005: 94). It has been pointed out by some that increased imports by China in order to fuel its resource-hungry economy has begun to alter Asia’s developmental landscape, with many economies benefitting hugely from exporting to China (Beeson, 2010). However, with the majority of China’s economic growth coming from exports which are primarily part of the global production networks as mentioned above, this indicates that China is rising to a level of development which, although higher than peripheral commodity and primary producers, nonetheless will for the foreseeable future be constrained by the core of the global economy. How much the elites of China will be willing to spread the wealth accruing to the country is yet to be seen. However, the indicators do not seem to be very favourable to such an outcome. Inequality in the country is vast, and although many have been taken out of poverty in recent years, this has largely been due to the TNCs, and not so much due to the Chinese government itself, which has been happy to develop according to the needs of transnational business interests before the interests of labour. Having demonstrated the structural power of the US in the production structure of the global political economy, and China’s relative weakness, attention will now turn to the finance structure of the global political economy.

The Finance Structure According to Strange (1994: 90), the finance structure is “the sum of all the arrangements governing the availability of credit plus all the factors determining the terms on which currencies are exchanged for one another”. According to this definition, there are a number of factors which determine where power lies in the international political economy. In looking at the sources of U.S. power in the finance structure, attention will have to turn to the Bretton Woods system in order to understand the forces which altered that system from being based on the dollar-gold standard, to one based solely on the dollar. Additionally, the internationalization of finance which was the main driver of such changes, as well as how the U.S. uses its privileged position within international finance is crucial to understanding how it gained its unprecedented hegemony up to the present day. With the Marshall Plan and the Bretton Woods monetary regime, the post-war capitalist world was dominated by the U.S. A war-ravaged Europe and a booming U.S. economy meant that U.S. finance 11

had the ability to develop a considerable head start, and so the dollar became the predominant currency in international transactions, replacing the faltering Pound Sterling. By the time European countries had recovered sufficiently, “the American financial system had already gone through almost two decades of domestic financial growth” (Panitch and Konings, 2007: p. 16). Having gained a head start against the rest of its competitors, the U.S., with the establishment of the dollar-gold standard, the strength of its economy, and the centrality of New York as the world’s financial hub, set the stage for continued U.S. financial dominance. During the period 1945 to 1965, the world economy grew substantially, aided by the continuous increase in the amount of dollars in circulation, due to investment by U.S. MNCs abroad and also by the dollar becoming the reserve currency of choice for countries’ foreign exchange reserves. This liquidity in the international system sustained continuous and sizeable economic growth in the capitalist west. Eventually however, this situation was increasingly considered to be unsustainable. Robert Triffin was the most vociferous in pointing out that the continued increase in dollars held by foreign central banks would eventually lead to “overhang” which would destroy confidence in the U.S. ability to honour its commitments to convert dollars into gold. The U.S. on the other hand was quite happy to keep the U.S. dollar overvalued, so as to be able to engage in what de Gaulle described as “expropriation”, with U.S. businesses buying up European companies cheaply (Rickards, 2011: p. 82). The creation of the European Economic Community (EEC) in 1958 meant that there was an incentive for U.S. MNCs to manufacture inside this zone rather than import into it (Strange, 1986: p. 106). The increased activity of U.S. MNCs in Europe was a major factor in the “phenomenal expansion” of the Eurocurrency markets (ibid: p. 106). The expansion of these Euromarkets also resulted from the U.S. financial system itself. Owing to the legacy of the Great Depression, there existed in the U.S. a range of regulations to which U.S. banks were subjected. During the 1950s, market interest rates began to rise due to the Federal Reserve “gradually abandoning support for the Treasury’s debt funding efforts” (Ahearn, 1963). This meant that while previously U.S. MNCs had routinely parked their short term surpluses with U.S. banks, “short-term securities became more attractive than holding it with banks” (Konings, 2007: p. 45). This meant that banks were unable to lend to borrowing corporations due to a lack of funds, while this had the additionally damaging consequence for the banks in that the corporations also began to use the money markets for their borrowing requirements (ibid: p. 45). “This meant that banks were being bypassed in two ways, on both the liability side and the asset side” (ibid: p. 45). This situation led to a sea-change in banking. “Instead of managing assets on the basis of a given liability structure, the burden of securing liquidity and profitability shifted towards the management of a bank’s liabilities” (Chernow, 1990: p. 54). A multitude of new financial techniques were subsequently developed, “the most important of which was the so-called negotiable certificate of deposit (CD)” (Konings, 2007: p. 46). After having created a secondary market in these CDs, banks could offer similar rates to what the 12

corporations had been getting in the money markets, and so this enabled the banks attract back the corporate funds they had lost. This increased marketization of credit relations which had previously escaped mediation by financial markets “was a qualitatively new and unique institutional basis for financial intermediation” (ibid: p. 47). Due to the continued increase by the Fed of interest rate ceilings on time deposits, the CD market continued to increase during the 1960s. By the time the Fed had fully realized the inflationary implications that this credit creation posed, it was already too late. Had it attempted to stop the market, it would have created a serious financial crisis (ibid: p. 47). What followed were a series of measures whereby the Fed attempted to close loopholes, while the banks reacted by finding new ones. Eventually, the banks found that the easiest way around the Fed interference in their activities was to follow the MNCs and “apply their new financial techniques in the Euromarkets” (ibid: p. 47). With the “credit squeeze” of 1966 caused by the Fed’s attempt to control inflation, the Euromarkets were given a massive boost. Whereas in 1967 the total liabilities of US banks stood at $2 billion, by 1969 this had increased to $13 billion (De Cecco, 1987: 190). “While the transformation and subsequent internationalization of American finance threw into jeopardy more traditional and direct modalities of state intervention, it gave a huge boost to the structural capacity of the American integral state” (Konings, 2007: 49). In short, the internationalization of American finance had the effect of Americanizing international finance. While many have focused on the switch to floating exchange rates and the dollar standard in international monetary relations, a more revealing picture of how the U.S. dominates international finance is seen when one takes into account the massive use of dollar denominated debt-instruments which took off in this period. The U.S. Treasury eventually realized the benefits which accrued to the U.S. through the emerging dynamics of the international financial system. “While the internationalization of American capital had a deleterious effect on the U.S. payments position and fed the dollar overhang, the ability of American intermediaries to sell dollar debt had the effect of rendering the U.S. payments position less salient and so loosened external constraints” (ibid: 49).”The international extension of securitized and dollar-denominated debt relations and the creation of a highly integrated and liquid financial structure (straddling the domestic and the international) enhanced America’s structural power in international finance” (ibid: 50). This increased power within the international financial system, coupled with the contradictory effect of reducing the fed ability to control the creation of money and credit would be resolved during the 1970s with the introduction of monetarism to resolve these inherent contradictions (ibid: 50). In terms of inter-state monetary relations throughout the 1960s, the dollar was the predominant currency of choice for foreign reserves. Backed by the promise of gold at the price of $35 an ounce, the world economy grew for an uninterrupted period of about two decades. “Partly in response to an 13

outbreak of panic buying of gold in 1960, which had temporarily driven the market price of gold up to $40 an ounce”, the London Gold Pool was created as a collaborative exercise between the U.S, the U.K., France, Germany, Italy, Belgium, the Netherlands and Switzerland (Rickards, 2011: 82). It both bought and sold gold so as to keep the price stable at the $35 parity. However, by 1965, it had become almost exclusively a seller. In the mid-sixties, there were calls for there to be an alternative to the dollar as the international reserve currency. In 1965, de Gaulle famously renounced the “exorbitant privilege” that accrued to the U.S. due to the widespread use of the dollar and the resulting benefits accruing to the U.S. as a result of its ability to externalize the costs of domestic adjustment to other countries. He called for a return to the classical gold standard as the only reasonable and fair standard for international monetary relations (ibid: 82). By 1967, France had left the Gold Pool after having redeemed its dollars for gold. By March 1968, the London gold pool had collapsed, and thereafter, there began what became known as the gold window. This was a period whereby there was a two-tier price system for gold, with central banks able to buy gold according to the old international payments price of $35 an ounce, while on the open market, gold was sold for $40 an ounce. Among U.S. allies, there was agreement not to abuse the ability of central banks to engage in gold arbitrage. Nixon then engaged in his policy of “benign neglect” which “allowed the balance of payments deficits to grow unchecked in the anticipation that its attempts to force dollars onto European countries would leave them with no choice other than to revalue their own currencies” (Gavin, 2004). This policy was successful in another way however, in that “it had become clear that dollars had already stopped being backed by gold in any meaningful way and that a run on the dollar would be self-defeating” (Konings, 2007: 50). In this way, the switch to a paper-dollar standard after the closing of the gold window was the logical extension of the policy of benign neglect, and once the dollar was devalued and capital controls were abolished, “what had in the 1960s appeared to be America’s problem had now become Europe’s problem” (ibid; 50). The reason why the dollar was seen as the only contender to become the world’s reserve currency, unbacked by gold, was that there was no other country which possessed financial markets with the depth and liquidity that characterized dollar markets (ibid: 50). Also, other countries’ reliance on foreign trade meant that they needed to impose capital controls in order to protect the external value of their currencies, and so did not have enough depth in their financial architecture to be able to absorb the huge demand that this position required (ibid: 50). The paper-dollar standard allowed the U.S. to invert the traditional basis of monetary power. Instead of being the predominant provider of credit, the U.S. determined to use external debt as a means of control, allowing it to finance the Vietnam War, and “to retain substantial flexibility in domestic economic policy” (Gowan, 1983: 63). The collapse of the Bretton Woods system in 1971 was therefore beneficial to the U.S. With floating 14

exchange rates, the volatility of the dollar became much more important to other economies than it was to the Americans (Strange, 1994: 109). Throughout the 1970s and early 1980s, “the American state waged a vigorous battle to revive the industrial economy” (Gowan, 2009: 24). Central to this was the Nixon Shock of 1971, where on August 15, Nixon announced on primetime television his New Economic Policy, “consisting of wage and price controls, a ten per cent surtax on imports and the closing of the gold window” (Rickards, 2011: 86). What had been so surprising for U.S. trading partners was not the devaluation of the dollar, but the ten per cent tax on imports which effectively amounted to protectionism, especially when combined with the dollar devaluation. However, within two years the U.S. economy was mired in the worst recession since the Second World War, with rising inflation, collapsing GDP, rising unemployment, an oil crisis and a crashing stock market (ibid: 92). However, according to Harvey, the arab oil-shock of 1973 was initiated with the collusion of the U.S., the Saudis and the Iranians, with the aim of hurting the more vulnerable economies of Europe and Japan much more than the U.S. economy, which was far less dependent on Middle Eastern supplies (ibid: 61). The oil wealth that the OPEC oil spike created was recycled through the Euromarkets where they could gain the most interest. This had the effect of further increasing U.S. financial power. “U.S. banks (rather than the IMF which was the preferred agent of other capitalist powers) gained the monopoly privilege of recycling the “petrodollars” into the world economy” (ibid: 62). Additionally, the increased volatility of financial markets during this time meant an increased demand for financialization in order to hedge risk, and this helped spark the derivatives revolution (Panitch and Konings, 2009: 2). In order “to regulate derivatives so as to aid their development”, the Commodity Futures Trading Commission was created in 1974 (ibid: 2). Its stated aim was to spread, and hence reduce risk, but in reality its main goal was to lead the development of financial innovatory products which kept U.S. capitalism at the forefront of financialization and credit creation, and hence to increase U.S. power in the realm of international finance (ibid: 2). “Finance capital, in short, moved centre-stage in this stage of U.S. hegemony, and it was able to exercise a certain disciplinary power over both working class movements and state actions, particularly whenever and wherever the state ran up significant debts” (Harvey, 2003: 64). As mentioned with regard to the production structure, the move towards financial power had a devastating effect on the U.S.’s industrial infrastructure. “Offshore production became possible, and the search for profit made it probable” (ibid: 65). The benefit of this to the U.S. was the availability of cheaper and cheaper consumer goods, and increasing profits for the richest segments of society in the form of shareholder dividends. During the 1980s, as increasingly higher value-added industries moved abroad, together with stagnating incomes for most of the population, finance became the 15

growth industry of the U.S. With the neoliberal turn, there was an increased emphasis on financializing U.S. society itself. Increasingly, lower income families were encouraged to take on more and more debt, and this continued unabated until the financial crisis of 2007. Aggregate US debt to gdp rose from 163 per cent in 1980 to 346 per cent in 2007 (Gowan, 2009: 10). The two sectors which most accounted for this rise were the household sector and the financial sector. “Household debt rose from 50 per cent of gdp in 1980 to 100 per cent of gdp in 2007”, while financial sector indebtedness rose “from 21 per cent of gdp in 1980 to 83 per cent in 2000 and 116 per cent in 2007” (ibid: 10). The consumer model of the U.S. economy must be understood not as merely profligate spending, but at a more fundamental level as a means and result of financial sector control over the U.S. state since the early 1980s. Furthermore, this elevation of finance served U.S. hegemony abroad by making the rest of the world dependant on the dollar. Of course, no analysis of U.S. hegemony in the finance structure of the world economy can ignore the global financial crisis which swept the world from 2007 to the present day. In assessing the causes of the global financial crisis, and the future of U.S. hegemony in the finance structure of the global political economy, the role of Wall Street and of Washington need to be analysed as to their changed relationship during this time. What is clear is that the relations between Washington and Wall Street converged to a significant degree since it was realized that the internationalization of finance, and the continuous financial innovation which helped to dissipate U.S. liabilities, resulted in advancing the goal of U.S. hegemony, albeit with reduced central bank control over the mechanisms of money and credit creation in the commercial banking system” (Konings 2007: 58). It was this contradiction of increased power and reduced control which finally led to the global financial crisis. Gowan (2009) describes the changed system since the early 1980s as a “New Wall Street System”, which “produced new actors, new practices and new dynamics” (ibid: 1). For Gowan, there were a number of preconditions which facilitated the rise of this new system; “the “fiat” dollar system, the privatization of exchange-rate risk, and the sweeping away of exchange controls” (ibid: 2). Furthermore, the system could not have arisen had it not been seen as an answer to problems within U.S. capitalism. Whereas before the 1980s Wall Street banks engaged in very little securities trading on their own account (preferring instead to trade on behalf of clients), proprietary trading became an increasingly common activity for both commercial and investment bank alike. Furthermore, these banks became increasingly involved with lending to other bodies (predominantly hedge funds, private equity groups, and special investment vehicles (SIVs), which were often created by the investment banks themselves) which used these funds to trade themselves (ibid: 2). Known in the industry as “prime brokerage”, this became a very profitable activity for the banks, and occasionally became their 16

predominant activity. With the constantly increasing levels of credit created through these activities, and the vast amounts of money at the disposal of the major banks, it became possible for Wall Street to create their own arbitrage profits by generating price differences with the sheer scale of the resources at their disposal. “Time and again, Wall Street could enter a particular market, generate a price bubble within it, make big speculative profits, then withdraw, bursting the bubble” (ibid: 2). This occurred frequently in emerging markets, due to the ease with which capital could enter and leave a market quickly. The IMF and the World Bank also facilitated this by opening up new and easy to manipulate markets in emerging economies. This type of activity was the cause of the Asian Financial crisis of 1997, the Russian stock market crash soon after (although this was partly caused by the Asian crisis), the dot.com bubble, the housing bubble, as well as the commodity bubble which was created after the housing bubble had crashed, among others (ibid; 2). Dominated by just five banks, which had at their disposal over $5 trillion, Wall Street used maximum leverage ratios to move vast amounts of capital (ibid; 3) all with the acquiescence of Washington, which had by this time operated a revolving door policy with Wall Street, whereby individuals regularly moved between governmental and banking institutions, effectively negating the separation of interests which should have existed. With this vast increase in banking speculation and arbitrage rose the so-called shadow banking system. It consisted of unregulated hedge funds and SIVs which bought and sold securities without any capital requirements or regulatory supervision. Banks and hedge funds began sharing collateral assets through a process known as hypothecation, thus further expanding their leverage ratios (ibid: 5). “The debate whether deregulation or reregulation in the financial sector has been occurring since the late 1980s seems to miss the point that there has been a combination of a regulated and an unregulated shadow system, working dynamically together” (ibid; 5). In addition to hedge funds, since the 1990s “over the counter” derivatives markets became an increasingly important component of the shadow banking system. Credit default obligations (cdos) and credit default swaps (cdss) became the most infamous of such instruments through which leverage was increased and risk was spread. Securitized loans were famously bundled together and given Triple A ratings in return for a fee to the ratings agencies. Since the 1980s, real wages in the US had begun to stagnate as a result of the de-industrialization of the U.S. In order to grow the economy the U.S. promoted consumer debt so as to increase demand. Alongside this development was the wealth effect generated through inflated asset prices, especially during the 1990s (ibid: 10). This convinced many Americans that they were richer than they actually were. House prices continually rose during this period, and with this new-found “wealth”, people were encouraged to take out second mortgages in the illusion that asset values would keep rising. “Citigroup ran a billion-dollar campaign advertising second mortgages” in the 1990s, while other 17

Wall Street banks followed suit (Gowan, 2009: 7). Once the middle classes had been fully incorporated into the financial system by means of car loans, mortgages, student loans, and pensions, securitization ensured that these debts would be multiplied by being sold on again and again. In time, banks sought out more capital, and began offering credit to the lowest income classes in the form of sub-prime mortgages, so much so that “by 2006, subprime mortgages represented 28 per cent of total U.S. mortgages” (Panitch et al, 2009: 5). With a faltering economy, war in Iraq and Afghanistan, and a raising of interest rates in order to halt a decline of the dollar (ibid, 5), delinquency rates began to mount and the industry found that much of what they believed to be triple-A rated debt was in fact junk. Such was the interconnected nature of the globalized financial system, that “a sub-prime mortgage market involving a mere $34 billion in troubled loans had by the summer of 2007 imperilled a $57 trillion American financial system and then spread to numerous countries around the globe” (Kolko, 2009 21). Furthermore, similar processes of housing market bubbles in Europe further added to the near meltdown in the globalized financial structure. The financial crisis and the resulting recession have had the effect of severely damaging the credibility of the western model of neoliberal finance. It was also a further illustration of the potential damage that the so-called Washington consensus could wreak, and so led to further hostility towards the IMF and the World Bank. In reacting to the crisis however, there has been no straying from neoliberal policies, as states have embraced austerity and guaranteed their own banks with massive bailouts at the expense of the citizens. This should not be surprising given the close historical relationship between liberal democratic states and banks. These institutions developed symbiotically together and it is hard to picture one without the other, they were mutually constitutive. Also, although the policies of the IMF and World Bank have been discredited, the financial crisis has actually been beneficial to them in that before the crisis these institutions had actually been running out of money, and were in need of a purpose after the disastrous policies which they imposed on countries the world over in recent decades. This is similar to the early 1980s when these institutions were in a similar situation with no definite purpose until the third-world debt crisis hit. In analysing what effect the financial crisis has had on U.S. hegemony, there is no doubt that it has been damaging. The increased levels of sovereign debt as a result of the bailouts and quantitative easing aimed at keeping the “too big to fail” banks from insolvency has led to serious doubts about the ability of the U.S. to repay the $14 trillion or so of US sovereign debt. The quantitative easing has further decreased the value of the dollar, in what some have called a “currency war” (Rickards, 2011), where the U.S. aims to devalue its debt, while increasing its exports by means of increasing its competitiveness. This action may precipitate widespread currency devaluation by other states; most notably China in order to keeps exports competitive. In January 2010, Obama announced his intention 18

to double U.S. exports within 5 years. According to Rickards, by a process of elimination, the only available option for doing so would be to continually devalue to dollar (ibid: 129). This could put strain on the confidence that other central banks place in the dollar as a reliable store of value for foreign exchange reserves. If confidence were to drop significantly, then a repatriation of this money could spell disaster. This is unlikely however, due to the interconnectedness of the U.S. economy with the rest of the world, and also the political nature of such a decision. The crisis has illustrated just how connected the U.S. economy is with the rest of the world, especially Europe. In fact, it makes little sense to speak of American finance per say, with the London square mile acting essentially as an extension of Wall Street, and like the 1960s, much less regulated. This can be seen by the percentage of derivatives contracts which were traded in New York and London before the crisis. In 2007, “the U.K. had a global share of 42.5 per cent of derivatives based on interest rates and currencies, with the U.S. handling 24 per cent. In terms of credit-derivatives trading, the U.S. handled 40 per cent in 2006, while London handled 37 per cent” (Gowan, 2009: 6). Even after the crisis, Wall Street continues to develop financial innovatory products, albeit more focused on emerging markets than before. In this way, finance aims to expand to new markets which offer higher returns than the more developed economies. With the financial crisis, there were many mergers of the largest banking institutions, thereby making the largest bigger, and more systemically vital for the continued “health” of the U.S. and world economy. This increased consolidation and concentration of capital mirrors what has been happening in the production structure, where economies of scale continually make it impossible for effective competition to take place. As already mentioned, often these economies of scale are used to create arbitrage opportunities, otherwise known as “market making”. With the continual advancement of high-frequency trading, the even more consolidated “too big to fail” banks, maximally leveraged balance sheets, and government support if anything goes wrong, these banks, which are the nexus of U.S. and hence world finance, will continue to dominate the globalized financial system. Many have heralded the financial crisis as being proof of the unsustainability of the Anglo-Saxon model of neoliberal finance, however they fail to show what political authority is going to change anything. The U.S. government showed quite clearly, not just in the last bailout, but in the many bailouts which have occurred since the 1980s, that they are willing to bail out these banks when busts occur. Finance has become the most powerful lobby group in the U.S., and as of 2006, the finance industry accounted for over 40 per cent of US corporate profits (Gowan, 2009: 1), which makes it systemically vital for the health of U.S. government finances. Losses will continue to be put on the backs of the taxpayer, and this has shown to be true in Europe also. As far as China is concerned, the huge export surpluses that its workers have earned for the state have 19

been recycled back into the U.S., thus increasing the liquidity of the global financial system (ibid: 10), and thereby helping to keep interest rates low for continued borrowing and speculation. Of course China has the potential to use these reserves to damage the U.S., but more likely they are for defensive purposes, as seen with the Keynesian-style stimulus of $586 billion in infrastructure, education, housing and health care, aimed at shielding China from the effects of the financial crisis. In terms of international banking, the Chinese have also shown very little interest in globalizing their operations to compete with western institutions. “China does not have a single bank among the world’s top fifty, ranked by geographical spread” (Nolan and Zhang, 2009: 7). Furthermore, during the financial crisis, there was a perfect opportunity for Chinese banks to acquire banking assets in the high-income countries, yet they were “conspicuously absent” (ibid: 7). Even though China has the three largest banks in the world in terms of market capitalization, they are still not developed to the same degree as western banks. They operate in a closed market, with little experience the type of competition as in London and Wall Street (ibid: 7). One of the central bases of U.S. hegemony is dollar hegemony. The dollar is the world’s predominant currency in international trade and foreign exchange reserves. In international institutions, transactions are carried out in dollars. Also, oil is priced in dollars, and this is a very sensitive area for the U.S., whereby any threat by an oil producing state to price their oil in another currency has often been a factor which has led to conflict. Saddam Hussein’s proposal to denominate his oil sales in euros rather than dollars may have been one reason for the decision to invade Iraq (Harvey, 2003: 82). Similarly, invasion and overthrow followed Gaddafi’s proposal to create the gold dinar which, had it been launched, may have become a major currency in North Africa and potentially in OPEC (www.global research.ca, 2010). The recent move by Iran to change from the dollar in its oil sales adds to the escalating tension regarding its uranium enrichment program. In 2009, the chairman of the Central Bank of China, Zhou Xiaochuan, called for a new global reserve currency in the form of a basket of currencies to replace the dollar. Similar statements have come from Brazil and Russia. However, the fact that they have called for one without any action indicates the dearth of alternatives to the dollar. The U.S. is unlikely to give up its monopoly privilege, and the two main contenders do not appear to offer a suitable replacement anytime soon. The eurozone is undergoing a major debt crisis, which, although it will last due to political will, for the time being will not be able to offer the kind of stability needed for a reserve currency. The Renminbi on the other hand does not float; it is pegged, which means that it is not traded on the international markets. By 2020 however, China intends to operate a fully functioning financial services sector, and by this time also, the euro may have overcome the structural weaknesses that have plagued the Eurozone economies in recent years. 20

Ironically, when crises hit the global economy, investors tend to buy dollars as a safe-haven investment, and so the financial crisis, which emerged from the US, had the effect of increasing U.S. power in international finance. The likeliest outcome of the prolonged recession is a reliance on the dollar, even as it sinks in value due to U.S. attempts to inflate away its debt and to increase exports. Eventually there will be a more multipolar currency landscape, however, this may take some time to materialize. Even if the proposals for drastically increasing the use of the IMF’s Special Drawing Rights (SDRs) materializes, the power which the U.S. has within this organization may mean that the means of U.S. power in international currency transactions could shift to a more subtle means. Overall, the power of the U.S. in international finance appears safe for now. China does not appear to be interested in challenging the U.S. “for leadership in shaping the institutions of the world economy”, due to the fact that it is concentrated on “maintaining domestic growth and carrying through the leap of dynamic capital accumulation from the coast to the interior” (Gowan, 2009: 11). In fact the development of China’s economy may vastly increase the opportunities for U.S.-China trade relations, and lead to a so-called special relationship given the already close business ties through MNCs, and the potential that trade deals could offer to help reduce the U.S. trade deficit and China’s relatively undeveloped interior. Of crucial significance for U.S. power in international monetary relations will be how the U.S. manages to reduce its trade deficit by exporting more, most likely by devaluing the dollar, while keeping the dollar strong enough to maintain its share of world reserves, which, if repatriated would mean the disaster for the U.S. economy. As mentioned however, for the foreseeable future, this would also mean disaster for the world economy, and so is unlikely for the time being. Also crucial will be the configuration of power between Wall Street and Washington. It seems likely that the “too big to fail” banks will continue to influence Washington. Besides Wall Street banks being the largest contributors to U.S. presidential campaigns, U.S. monetary policy will likely be aimed at keeping these banks from going insolvent, many of which may in fact already be with “off-balance sheet” accounting capable of hiding insolvency. Whether Washington can partially decouple from Wall Street before the rest of the world decouples from the U.S. remains to be seen, but seems unlikely for the foreseeable future. As far as China’s model of banking goes, as a model to be emulated it is still unclear whether China’s economy is not in a bubble of its own, with vast amounts of real estate built in recent years, with entire cities having been built which, upon completion, lie deserted. No doubt there has been significant corruption with property development, with the motto, “build it and they will come” having been the operative principle in many cases. Whether this will spell disaster for its economy 21

and its banking model is still doubtful however, with so much potential in, and investment making its way to China, as well as the potential for direct government action on a massive scale given its foreign exchange reserves. In time, China and the Renminbi’s rise will see increased penetration into international finance, but not so much as to dislodge the U.S. from its dominant position. Of course, this may occur should it happen in combination with other factors such as the decline of petro-dollars, a surprise return to the gold standard by disenfranchised rising powers (Rickards, 2011) which could spell disaster for the U.S., and hence, world economy, or doubts about U.S. fiscal policy (Ferguson, 2010), but for the time being, the US is in a different league in terms of the finance structure, China’s foreign exchange reserves aside.

The Security Structure Strange defines the security structure as being “the framework of power created by the provision of security to some human beings over others” (1994: 45). The powerful state which can provide security can use this to gain benefits from other areas such as in production, wealth, or social relations (ibid: 45). Often power within the security structure lies in a threat or potential use of force rather than in its use, per se. A good example of this would be the nuclear deterrent which presumably has been the ultimate factor which has prevented any overt war between two powers which possessed this capability. The U.S. position within the security structure of the global political economy has been predominant since the Second World War. The alliance system which the U.S. consolidated thereafter was mainly aimed at the containment of the Soviet Union, and the resulting Cold war lasting for around 40 years did much to improve the influence of both of these powers, even if the Soviet Union ultimately became unsustainable. Both powers used the Cold war to increase power over their own citizens in the name of security against the “evil” other. Also, within the international system of states, there was widespread polarization between socialist and capitalist economies, although many would argue that the “socialist” powers were totalitarian abstractions of the ideology which they professed, and were more interested in subjugation of their populations than in their empowerment. Similarly, the U.S. used similar yet subtler forms of suppression against its population with discriminatory laws against African-Americans, as well as so-called communist sympathizers. Upon the fall of the Berlin Wall and the resultant breakup of the Soviet Union, the U.S. became the world’s only superpower. Upon this apparent triumph of liberalism, “the end of history” was proclaimed and the world looked set to be defined by U.S.-led globalization, which to a significant extent it has. 22

In assessing the history of U.S. power in the security structure of the world’s political economy, the Cold War and the mutual build-up of conventional and non-conventional weapons between the U.S. and the Soviet Union ensured that there was a certain level of peace maintained by the bi-polar balance. Central to U.S. geo-strategic thinking was the importance of oil, and especially the Middle East as the region with the best quality and most abundant and accessible reserves. A 1944 U.S. State Department memo called oil “a stupendous source of strategic power, and one of the greatest material prizes in world history” (Chomsky, 2012). One of the reasons why the allies won the Second World War was through their greater access to oil supplies. For this reason, the U.S. was determined not to allow the USSR to control the Middle East, and so when the declining colonial powers of Britain and France left the Middle East, it was the U.S. which stepped in, albeit in indirect ways, to protect U.S. business and geo-political interests. The 1953 overthrow of the Mossadiq government of Iran instigated by British and U.S. support was in reaction to the attempted nationalization of Iranian oil. After the 1956 Suez crisis, the U.S. forced British and French forces to stand down against the Egyptian forces which had blockaded the canal, due to a customs dispute. This moment illustrated U.S. superiority over the declining European powers. After this apparently pro-Arab stance by the U.S., Saudi Arabia became more allied to the U.S., and remains so today. Saudi Arabia has the largest oil reserves in the world, and acted for most of the post-war years as a swing producer, increasing production in times of high demand and vice versa so as to stabilize the price of oil. Over time, the oil-producing states began to assert their control over the supply of oil at the expense of the so-called “seven sisters”, the seven largest oil companies which had controlled the up-market and down-market supply of oil, making significant profits at the expense of the Arab states. With the creation of OPEC in 1960, and more importantly with the price-spike and embargo against states which supported the Israeli actions in the 1973 Yom Kippur war, OPEC became a significant force in the international political economy. As mentioned earlier, this price-spike has been documented as being encouraged by the Nixon administration in order to increase U.S. productivity in relation to the other rising industrial powers of Japan and Europe, as well as to increase U.S. power in international finance with U.S. banks’ recycling of the resultant “petrodollars”. In this way also, the U.S. could exercise control over the oil market with the price of oil being determined in dollars. With the military role that the U.S. played in deterring communism from overcoming the other capitalist powers, the U.S. was given relatively free rein to build military bases all over the world. With this power, the U.S. engaged in numerous conflicts against often democratic movements which were deemed to be even slightly socialist in their policies. The Vietnam War, the numerous coups and occasional invasions in Latin America, as well as the military aid which was given to numerous 23

governments in order to keep them out of the orbit of the communist bloc, effectively created a U.S. empire. “National interest” and realist paranoia dominated U.S. foreign policy thinking during this period, and in return for providing security, the U.S. could gain concessions in various other areas. In terms of the arms industry, the U.S. military-industrial complex dominated weapons development and distribution and to this day a sizeable amount of U.S. productive capacity is given to military hardware, sold on to client states often without regard to other factors such as human rights. Also, throughout this period, U.S. control over the World Bank ensured that certain regimes were given loans even though these regimes didn’t satisfy basic criteria. Woods (2003: 13) gives numerous examples of regimes which were given disproportionate levels of loans in support of U.S. geostrategic interests. The Somoza regime in Nicaragua, the Shah of Iran, and General Suharto’s Indonesia were all given significant support without regard to human rights abuses, high levels of corruption and failure to meet other basic World Bank criteria. The close relationship between the US military and oil has been starkly shown with the two Gulf wars in 1990 and 2003. In 1990, Iraq invaded Kuwait; a tiny, but oil rich state. Due to the Kuwaitis financial assistance to Iraq during the Iran-Iraq war, Iraq was pressed to pay back the money owed without delay. Having told the U.S. ambassador to Iraq that they would invade Kuwait, the Iraqis were given no clear position by the U.S. on what their position would be, and so took this to mean that there would not be U.S. reprisals. Whether this was a communication error or a calculated move by the U.S. is unclear. With the backing of the UN Security Council, a U.S.-led coalition of forces retook Kuwait, but stopped short of going beyond their mandate with invasion of Iraq. The importance of this move to U.S. geo-strategic planners had been due to the potential for Iraq to become the swing producer once it had taken control of Kuwaiti oil reserves, and this would have upset the balance of power in the region. With the September 11th, 2001 attacks on U.S. soil, the world security landscape changed drastically. Governments all over the world used it as an excuse to increase their defence spending. Since 2002, military sales “have increased by 60 per cent in real terms according to the Stockholm Peace Research Institute’s top 100 military defence contractors list” (Forbes, 27/02/2012). The neo-conservative Bush administration used the attacks to move to a more unilateralist foreign policy, and launched an invasion of Iraq, against UN Security Council clearance. The reasons for the attack were to control Iraqi oil, prevent it being priced in euros and for geo-strategic reasons as opposed to the official line given. During the period 2001 to 2010, U.S. Department of Defence spending increased from $290.2 billion, to $666.7 billion in 2010, with the 2012 estimate being $707.5 billion, despite a modest decrease from the previous year (SIPRI, 2012: 158). 24

The so-called “war on terror” justified a change in U.S. policy from one of seemingly passive hegemony to one of overt dominance. The U.S. increased its numbers of bases worldwide, and today has approximately 1,077 foreign military bases (Terse, 2011). Having caused the deaths of hundreds of thousands of people in the aftermath of the Iraq invasion, the U.S. military has become reviled by many in “the street” across the Middle East region especially. Also, the invasion is believed to have actually increased the numbers of people recruited to Al-Qaeda, and decreased the security of the US. However, the invasions of Iraq and Afghanistan have increased the geo-strategic presence of the U.S. in the Middle East and Central Asian regions. Like U.S. power in international finance, increased military power and geographical penetration have increased U.S. power, while also increasing instability, in the name of stability. The recent wave of protests across the region, popularly known as the “Arab Spring” has demonstrated many different aspects of these changing times. Firstly, it has demonstrated how social movements have become increasingly fed up with their dictators, and have used technology to organize and bolster civil society and in some cases topple regimes. It also shows how the U.S.-led NATO has used this to increase its power in the region, by arming rebels in oil-rich Libya, and presumably doing the same in Syria, which is geo-strategically important in that it is situated in the middle of the region, beside Iran. Having been allied to dictators in the region, the West has turned against them once it became clear that they had lost control of their populations, and have engaged in support of the successor factions which are deemed most conducive to carrying out the interests of Western capitalism. It also partly shows the damage that can come from the economic realm to world order, whereby prices of commodities rose drastically in the aftermath of the housing crash, due to the “New Wall Street System” and its bubble blowing speculative techniques driving up prices. Increased food prices added to social unrest, and high levels of unemployment, also partly due to the worldwide recession, as well as to neo-liberal policies which ignore the importance of full employment, added further fuel to an already tenuous political climate across the region. However, with a number of highly repressive and staunch allies in the region, the U.S. can count on continued dominance in the region for years to come. Presumably the only major obstacle to continued U.S. military presence would come from the election of an isolationist US president, with an aim to rein in public spending. This is unlikely however, as seen with the continued exceptionalist and imperial stance held by the vast majority of the U.S. political elite, increasingly subservient to corporate interests. Of course, the only other obstacle to continued U.S. military dominance in the region would be a crisis in international confidence in U.S. fiscal policy, and a repatriation of the dollar. However, this seems unlikely to happen for reasons already given, but also, it is not automatically presumable that, given a fiscal crisis, the US would divert funds from what is seen by many within the U.S. elite as being the 25

number one priority; the U.S. empire. The military is the back-stop to the multi-dimensional, and near-global hegemony which the US has created and expanded since the end of the Cold War, and the post-9/11 shift. Central to the use with which the military adds to U.S. hegemony is the control over the oil reserves of the Middle East. “What better way for the U.S. to ward off that competition in the worlds of production and finance and secure its own hegemonic position than to control the price, conditions, and distribution of the key economic resource upon which those competitors rely? And what better way to do that than to use the one line of force where the US still remains all powerful – military might” (Harvey, 2003: 25). As well as the goal of controlling the Middle East, control of the Indian and Pacific oceans is also central to the US empire. The Middle Eastern oil which East Asia relies on all comes through the narrow Straits of Hormuz as well as the Malacca Straits. However, this should be seen as merely a leadership role that the U.S. takes on in order to ensure the health and functioning of the global economy. It is near inconceivable that the U.S. would ever be so desperate as to use its control over these routes to redirect energy supplies, although if the oil starts running out quickly enough, then all bets may be off. Overall, the wars in Afghanistan and Iraq have shown many things. It has demonstrated the predominance of the US military in conventional terms, and the impossibility of any country challenging this role. However, it has also shown the difficulty of occupation, with asymmetric warfare proving extremely damaging for U.S. and coalition troops. Also, the financial cost of these wars may have shown the limits of the U.S. military, in that it can no longer afford to become engaged in two military campaigns at once for an extended period of time. The U.S. has recently encouraged Germany and Japan to expand their military capabilities in order to take up some of the expensive burden of policing the world (Chase-Dunn and Kwon, 2010). Recently, Obama has announced a reduction of US military operations to focus more on Asia. Alongside this will remain the “hub and spoke” bilateral military ties with various states in the region. This has the benefit to the U.S. of keeping Asia divided, and hence restraining the potential of China to increase its influence in the region. The reasons why this does not seem likely to change in China’s favour is that there are a number of issues (Taiwanese independence, Japan/China rivalry, North and South Korea, as well as sovereignty disputes over the South China Sea) which keep Asia divided, and so amenable to be kept largely within the U.S. defensive orbit. In terms of military expenditures, the U.S. spends approximately the same amount as the next 14 26

largest militaries combined, and accounts for 80 per cent of military research and development (Podliska, 2010: 4). In terms of sales of military equipment the U.S. is the world leader, with the 44 U.S. companies in the top 100 accounting for 60 per cent of all arms sales worldwide (Forbes, 27/02/2012). With international arms sales totalling almost $1.56 trillion in 2010, the US has substantial short-term material interest in continuing to arm the world. These figures demonstrate the overwhelming predominance of the US in the security structure of the world’s political economy. It is doubtful whether political decisions will be taken which significantly reduce this level of military expenditure in favour of more spending at home. Even if it does reduce its costs significantly due to declining sources of revenue, with the military alliances that it has built, and the self-sustaining nature of its dominance in the arms market, as well as the potential for its allies in NATO, as well as its bilateral geostrategic relationships which it has built across the globe, to increase their levels of spending and contribution to coalition engagements mean that the hegemony which the U.S. has led will continue well into the future, even with slightly reduced U.S. unilateralism. An illustration of the self-sustaining business that the U.S. has created in the arms industry is seen with the size of the international arms industry ($1.56 trillion), and the percentage of this accruing to US firms; 60 per cent.

27

(www.globalissues.org, 2012) As far as the potential for counter-hegemony in the Security Structure to rival U.S. predominance goes, the Shanghai Cooperation Organisation (SCO) is the most likely counter alliance. Comprising of China, Russia, Tajikistan, Kyrgyzstan, Kazakhstan and Uzbekistan, its six full members account for 60 per cent of the landmass of Eurasia, and a quarter of the world’s population. With its observer states included it accounts for half of the human race. Russia and China have successfully seen common cause in removing the U.S. from Central Asia, as they see US presence as threatening to their respective spheres of influence. During the 1990s, the US established a number of bases in central Asia in the wake of Soviet decline. However, in recent years, this has begun to change. Uzbekistan has already made the U.S. withdraw its airbases in the country, and Russia and China have called on the US to give a timetable for its withdrawal from other central Asian republics (Kapila, 2006). As far as being a rival to the U.S. or NATO, the SCO is still very much a collective selfdefence organization as opposed to a more proactive military alliance aimed at enforcing certain United Nations resolutions. Furthermore, with the authoritarian nature of many of the regimes in this organization, and their high priority given to state sovereignty, this organization can also be seen as a 28

means of protecting the authoritarian regimes of Central Asia from internal opposition forces, although, presumable Russia and China would be too large to need SCO assistance in this regard. In conclusion, within the security structure of the global political economy, the United States is by far the most powerful player, and this looks set to remain so for the foreseeable future. Although Chinese military spending has increased at a higher rate than the U.S. in percentage terms, like the growth in its economy, it is growing from a small initial size relative to the US. Furthermore, military capability is increasingly defined more by the level of military technology than by troop numbers, and with the added strength of U.S .allies also having relatively advanced weapons systems, and their potential to increase their military commitments if needed, then U.S.-led hegemony in this structure appears, for lack of a better word, safe.

The Knowledge Structure According to Strange, a knowledge structure determines “what knowledge is discovered, how it is stored, and who communicates it by what means to whom and on what terms” (1994: 121). The ageold saying “knowledge is power” has obvious applicability to international political economy. As already mentioned with reference to the logic of core and peripheral economies, and the internationalization of production which has reordered the world system, knowledge as a source of power, and as a means of domination is an important factor in analysing where power lies and who benefits. When analysing power in terms of a “knowledge structure” there are a number of different aspects to knowledge which are especially salient. There is knowledge as an economic commodity, such as used by business and protected by the near-global multilateral regime that is the WTO. Additionally this knowledge is seen in the security structure as being the product of weapons development and military technology, as well as more traditional forms of knowledge as seen in military strategy. Within the finance structure, faster IT enables the global market to operate twenty four hours a day, while “insider trading” enables huge sums to be siphoned from these markets. Central also to the knowledge structure is the IT revolution as seen with the extensive penetration of everyday life by the internet, and the huge benefits that this has for education and organization. This development has the potential to revolutionize the way life is organized, the way crimes can be committed, the way citizens can be tracked by government and the way citizens can overthrow their government. With this new technology there is the potential for both hegemonic consolidation and counterhegemonic contestation. Also, there is the knowledge which is derived from beliefs and ideologies which shape actions and 29

legitimize the hegemonic order, as well as the spontaneous counter-hegemonic sets of ideas and beliefs aimed at contestation. This kind of ideological contestation was most visibly seen with the long-running battle of ideas between capitalist and socialist thinkers. Today, many have proclaimed there to be “no alternative” to capitalism or, more precisely, the imperial capitalism which exists in this era of U.S.-imposed globalization of production and finance. Neo-liberalism has emerged as an imperial, capitalist method of domination, as well as an efficiency model of greater capital accumulation to which adherents proclaim is paramount. It serves as both, while decreasing the power of labour over productive processes, increasing inequality both within and between countries (Sanchez-Ancochea, 2003: 2) and reducing the link between economy and polity with widespread privatization of previously public goods. As far as opposition goes, it is hampered by the continual socialization and fragmentation of opposition, as well as incorporation of parts of society which Gramsci would deem to be part of the integral state, the classes which produce the traditional intellectuals which hold “together the ideological view of the dominant class with the “common sense” of the subordinate class” (D’Attoma, 2011: 5). Additionally, the beliefs of religious movements should not be omitted. While in previous times this was the predominant form of ideological debate and contestation, today religion has moved more to the periphery in the international political economy. This is not to say that religion as a form of power through belief and hierarchy has declined so much as to allow omission from a comprehensive analysis of today’s knowledge structure. Religious belief is still a major force in intra and inter-state affairs. Examples of such power in intra-state levels would be the ability of politicians to win elections by appealing to transcendental philosophies, and the fears of local superstition. On the interstate level, religious animosities have fuelled Islamic fundamentalism, and been a key recruitment tool for transnational terrorism and a purported counter-hegemonic Islamic world order in the form of Sharia law. Similarly, Zionism as a political force and tool of Israeli realpolitik has been a justification used for continuing warfare and violence since Israeli terrorist organizations began bombings of the British colonial occupation of Palestine. And within the United States, evangelical Christianity has become a major force in domestic, and by extension, foreign politics. Support for Israeli actions in “The Holy Land” is paramount for any potential U.S. president to secure election. This adds another layer of understanding, or misunderstanding, about U.S. presence in the Middle East. While, to be sure, U.S. politics is influenced by political forces such as Zionism, and fervent Christianity, the overriding and negating reason for U.S. control over the Middle East is, as mentioned earlier, about the control of, and power over the resource which all other competitors want; oil. Conversely however, the use of Islam as a rallying cry to recruit jihadi insurgents against the U.S. presence in the region is built on the belief in these transcendental philosophies, even if the elites in 30

these countries which organize the resistance may be more nationalistic and power-hungry than religiously inspired. In short, transcendental philosophies do not account for state and anti-state action as much as power and as Lord Curzon termed it, “the great game” of “great power” rivalry and empire building (Pilger, 2002: 101). In terms of U.S. power and hegemony within the knowledge structure of the international political economy, the U.S. must once again be seen as the leader. This has largely been the case since the Second World War, with the U.S. benefiting greatly from the exodus of academics of all disciplines from Nazi Germany, as well as Europe in general. With this influx of expertise, and with the acceptance of the just cause for which the U.S. was fighting, the Manhattan Project gained hugely in acquiring the assistance of some of the greatest scientific minds in the world. The influx of academic expertise, along with established domestic academics served to make the U.S. system of university education the best in the world. Today, the U.S. boasts the world’s most prestigious universities which have the double effect of both enhancing the quality of research and development, (which has added to U.S. power within the production, finance and not least security structure), as well as serving as a tool of socializing foreign elites who attend these institutions. This enhances the US integral state by creating Westernized elites which often take power in subordinate allied states. Similarly, the U.S. system of military colleges is used to train various nationalities of higher ranking military personnel and this has a similarly socializing effect on foreign militaries. These methods of socialization are crucial to how the U.S. can obtain hegemony by consent, even when the policies needed are damaging to the local populations. In terms of knowledge and expertise, the U.S. has had a clear head start over other powers in all areas since the Second World War. With the internationalization of production as mentioned, U.S. MNCs had competitive advantages in technology and with this, the reduction of barriers to trade allowed for a competitive advantage to accrue to the U.S., and this has, by and large, continued to this day, with U.S. MNCs able to allocate greater capital to research and development than their rivals in less developed states, thereby gaining greater market share. This ability to stay ahead of rivals in technology has also been evident in finance, whereby greater IT has allowed U.S. finance to operate with greater efficiency since the late 1960s. Greater speed in transactions continue up to the present day with “high-frequency trading”. Of course, the U.S. military industrial complex has also been a major driver of technological development in the U.S., with micro-processors and the internet being products of military research and development funding. These developments have spurred the IT revolution, and have altered the geography of capital accumulation, as well as allowing for the “empire” to be run more efficiently. 31

In order to consolidate the post-Fordist stage of development and the internationalization of production, there was a need for the U.S. to secure its property rights, and crucial to this was the WTO agreement. Having been the culmination of eight rounds of negotiations regarding the removal of tariff barriers and protection of intellectual property rights, among other issue areas, the WTO agreement locked in other states to abide by patent laws, and consolidated the technological lead which the U.S. and other advanced countries had reached. In return for FDI, other states were bound by laws which prevented them from duplicating without consent the intellectual property of MNCs. These agreements are the legal glue which holds neo-liberal globalization together. Without this arrangement, the U.S. would be unable to act in a rentier fashion with respect to the rest of the world, whereby the U.S. obtains royalties and dividends from the manufacturing which takes place within other states. In terms of who decides what is to be produced, the world’s largest corporations account for the predominant amount of research and development. As mentioned earlier, of the world’s top 1,400 companies, the so-called G1400, “the top hundred firms account for 60 per cent of total R&D investment” (Nolan and Zhang, 2009: 3). This concentration of knowledge is unprecedented, and if this trend continues, then the prospects for the core and periphery becoming more alike seems unlikely, unless the core becomes more unequal internally, such as has happened since the 1980s with neo-liberalism generally. Additionally, it raises serious concerns about the direction of research and development, when the decisions of what to develop are taken by for-profit corporations with interests lying in their balance-sheets as opposed to the beneficial purpose that their research could have for the human race. Also important to the US power in the knowledge structure has been the cultural imperialism which, to a significant degree, has had the effect of Americanizing the rest of the world, through film, television, and, most recently, the internet. Increased communications accompanying this technological change has mainly been unidirectional, and this has impeded communications not involving the core of the globalizing process. Central to this has been the English language which enables near-worldwide penetration. “The international consequence of Americanization is a wide sense of cultural insecurity vis-à-vis an unfathomable force that nobody seems capable of containing” (Amin, 2004). As Conversi notes, inter-cultural dialogue is “an essential component for safeguarding peace and stability” (2010: 355). “The current “cultural world order” retains a vertical communicational structure where groups have few opportunities to inter-communicate or interact in meaningful ways and know each other’s traditions” (ibid: p. 355). The “pyramidal” structure underlying globalization has meant that it has become “impossible for global exchanges to turn into egalitarian relationships based on evenly balanced inter-cultural communication and dialogue” (ibid, 32

p. 359). Far from uniting the world’s cultures, the cultural vacuity of corporate-driven Americanization has eroded national cultures, and fomented predictable opposition throughout the world. Crucial to US hegemony in general is the ideological belief in neo-liberal globalization as a model of development since the late 1970s and early 1980s. Crucial also to the spreading of this economic orthodoxy were the International Financial institutions (IFIs) which act as transmission belts for neoliberalism to be imposed in peripheral economies in need of loans. Furthermore, the core economies of the West, especially the U.S. and the U.K., were the most vociferous champions of neoliberalism, even if they themselves did not dare employ the full range of prescriptions in their own economies for fear of electoral consequences resulting from widespread economic upheaval. On the contrary, it was in the periphery, which had undergone troubles with attempting to make their own model of development independent from the subordinating imperatives of engagement with the more advanced economies, that the neoliberal loan conditionalities were foisted. This can be seen as an attempt to do a number of things. Firstly, it allowed for the dismantling of the powerful labour unions in the core which had been blamed for the 1970s stagflation by demanding what were deemed to be excessive wages. Secondly, it allowed for the western MNCs to engage in widespread outsourcing, as well as increasing their market share once they were allowed to enter emerging markets, where the previously dominant and subsidized industries were either sold off in privatization programmes, or were suddenly uncompetitive with the new economic landscape post-market deregulation. The effects of this enforcement have been a widespread denouncement of neoliberalism; however, among governments there seem to be less critical reactions generally. The imperatives of attracting inward FDI has meant that, once reduced, capital controls are rarely put back up. The logic of neoliberalism, as a hegemonic ideology, is that it has a consensual component in that elites in different countries have much to gain with the various investment opportunities which are produced post-privatization. In the aftermath of the Global Financial Crisis, the neoliberal ideology has certainly taken a battering in the mind of the public. However, such is the nature of the solutions proposed and implemented, (everywhere except Iceland), that the governments and their elite base of “organic intellectuals” have shown very little critical evaluation of possible alternatives, or even critical analyses of what were the prime causes. As far as blame narratives go, the overriding concern has been to re-regulate the banks. This is, as mentioned earlier, to ignore the elephant in the room in the shape (or lack of shape) of the shadow banking system, and the ability of banks to use off-balance sheet accounting to hide insolvency. A “crisis is not a natural event, but a social event, and therefore is always socially constructed and highly political” (Gamble, 2009: 38). Throughout the crisis, different narratives of blame, and hence solutions competed for prominence, and the winning message has been one of 33

blaming the people and governments for getting into too much debt, and resulting in the neoliberalplus policies of austere attacks on the welfare state (Roos, 2011). As social events, crises are socially constructed, and hence the narratives of the elite and corporate-owned media tend to win the battle of ideas. For this reason, similarly, the power of the U.S. in the world economy is safe from the social and intellectual criticism which would under “normal” circumstances elicit debate and systemicallycritical narratives concerning the creation of more secure and less turbulent economic systems. As seen with the reality of the response, however, the fundamental reasons for the crisis have not been solved but merely prolonged. In contesting the hegemonic order, the internet has emerged as a significant space for organizing opposition, both to the ideas and beliefs which are taken to be the “common sense” of the dominating and subordinating classes, as well as a site for the organization of active resistance. The so-called “Facebook revolution” in Egypt, as well as similar uses of social networks and IT communications devices elsewhere in the Middle East in the last year or so have shown the potential that this technology can have in empowering civil society and contesting the legitimacy of the ruling world order. The flexible and decentralized character of internet communications has enabled various different groups to organize around some central issue. This strength is also a weakness however, in that it is difficult “to articulate a clear programme of action because of its very diversity; and also by leaving the movement open to disruption by “agents provocateurs”” (Cox, 2006: 310). Overall, the internet acts more as a force against empire, by educating and empowering people, as well as through its inherently decentralized nature and organizing structure. “Its diversity and popular basis is totally opposed to the centralizing and homogenising force of Empire” (ibid: 310). Much remains to be seen in the battle over the internet, with groups such as Anonymous, Wikileaks, and others fighting over keeping the internet as a free and open common resource, as well as uncovering the abuses of power and hypocrisy of U.S. hegemony, widespread fraud within the financial realm, as well as war crimes committed by U.S. and coalition forces. Whether the internet can stay free from control is likely given the decentralized organizing principles behind it, and the global popular support that such internet freedom has. As a means of change, the internet is a tool with the greatest potential to contest the hegemonic “common sense” projected continually into society, but the process will likely be gradual and continually resisted. This can be seen as a microcosm of hegemony and counter-hegemonic contestation generally, whereby hegemony is never static, but always acting as an emergent system, continually changing its bases of power. In this way, U.S. hegemony is a complex system, which continually changes and 34

adapts to shifting underlying processes, or emergent internal contradictions, which give the impetus for renewal or decline in any one particular arena of contestation. As such, there is very little potential for definite prediction of the future. There is very little use in predicting decline especially, since the bases of hegemony are continually in flux. Also, there are increasingly, (with a much more complex international political economy due to increased speed of communications and interconnectivity) socalled “black swan” events, which are events which are by their nature unpredictable. Extreme weather events, at least on a disaggregated level are examples of such events, which have the potential for setting off processes which have much larger consequences due to the increasingly interconnected nature of the global economy. As an increasingly complex system, the global economy has become much more vulnerable to such “black swan” events, not least with the increasingly prevalent occurrences of financial crises in recent years. As mentioned, however, these financial crises are not unpredictable, but are caused by the herd behaviour of the unrestrained globalized financial markets, and the manipulation of such behaviour by what Gowan (2009) described as the “New Wall Street System”. In short, while the power of the U.S. seems unrivalled, it is also risky, and so the potential for collapse based on a lack of confidence is real. The US can be seen as the world’s bank, where a run would have similarly disastrous effects on the US as a run on a bank would have. As mentioned however, this seems unlikely, firstly due to the interrelatedness between the U.S. and the world economy, and secondly due to the self-defeating prospect of the “New Wall Street System” instigating a run on the dollar. The prospects for continuing U.S. dominance in the “knowledge structure” is varied and not entirely clear due to the vast and variegated nature of the structure. In terms of research and development, the U.S. has been the driver of what has been developed, and continues to lead the field in almost every academic discipline, (even if political science and international relations departments in the U.S. do have a certain bias towards a favourable view of the U.S. empire, which legitimizes further U.S. conquest). Its universities are among the most prestigious in the world, and act as socializing institutions for foreign elites. Furthermore, with the technological specificity of its MNCs, in collaboration with these universities, means that the U.S. will continue to be at the forefront of invention and expertise for decades to come, even if the level of its public schooling has much to be desired. In terms of the beliefs about the legitimacy of the neoliberal ideology which it projects onto the world, and in terms of the legitimacy of U.S. client states, the US has been hampered by the technology which it created through the military-industrial complex. Widespread public opposition to both the U.S.’s dominance and client states’ anti-democratic regimes have hampered the hegemony. However, with elites, there has been relatively little change from the neoliberal prescriptions in the aftermath of 35

the financial crisis. The confidence of the financial markets has become the new enforcer of neoliberal discipline in the “age of austerity”. Whether civil society movements can continue to contest and more importantly change society seems likely given the nature of the internet as a decentralized and oppositional structure to the centralizing tendencies of empire. The bypassing and subverting of democracy in recent years is under threat from the organizational capacity of the internet as a means of creating the counter-hegemonic consciousness which is needed before any alternative can be realized. Of course this will take time, and is by no means a straightforward process. In terms of the ideological strand to the knowledge structure, the neoliberal ideology which has been exported by the U.S. and Europe as a means of increasing Western power over developing economies has obviously been damaged by the financial crisis, the most recent in a series of bubbles generated and burst by the “New Wall Street System”. As such, the world population has eventually woken up to the dangers which this adherence to the “Washington Consensus” brings. However, due to the fall of communism, there remains a false belief that there is no alternative to this globalized neoliberalism. Countless governments have been unable to do anything about it due to their reliance on markets to keep financing deficits, and so cannot decouple from the system in fear of greater calamity if they did. Furthermore, as mentioned, the direction of information tends to come from the globalizing core, and with elite opinion having been inculcated to the logic and socialized into the belief that more globalized integration is needed, with banks which leech off the real economy and create periodic crises as being systemically vital, then not much is likely to change in general. Until enough informed debate is generated about a serious alternative to the Anglo-Saxon model, and alternatives in the vein of utility banks which provide credit for the real economy as opposed to the speculative bets covered by the citizens which are the basis of Western banks, then the US will continue to dominate the increasingly unstable and crisis generating international financial system.

Latin America In terms of Latin America however, there does seem to be an emerging alternative to U.S.-led globalization which has its roots in the democratic elections in the last decade or so which have brought in left of centre governments which have been keen to become autonomous from the influence of the IFIs. Continuously high commodity prices for much of the last decade allowed these states to free themselves from reliance on IFI funding. What has been dubbed a “pink revolution” has generally been in reaction to neoliberalism in the region which has given widespread consensus on the need for an alternative. What has emerged in this region has been dubbed, the “Post Washington 36

Consensus” (PWC). It emphasizes more of a role for society in policy generation. Also, it aims to provide more stable conditions for growth with more regulation of finance in order to prevent the periodic crises which accompanied previous economic reforms. Furthermore, there is an emphasis on a more nationally suited policy generation process, with account taken of the unique “history, social structure, external settings, political dynamics, and institutions” (Panizza, 2009: 164) of each country as opposed to the previous undifferentiated policies imposed by these IFIs. The fundamentals of this “consensus” is a step in the right direction, but still relies on the same belief in the primacy of markets, as well as free trade, rolling back of the state and privatization as a means of economic growth, and so essentially must be seen as a partial compromise to engagement with U.S.-led globalization of production and finance, as opposed to a serious and emphatic shift from laissez faire economic imperialism. Although it can be seen as a significant shift from the policies of the 1980s and 1990s, the PWC is still very much “an issue of contestation as well as consensus” (Panizza, 2009: 166). As far as the increased independence of the Latin American region from U.S. control goes, the region is still very much dependent on the U.S. for trade, and the incorporation of this region into the WTO, as well as the predominant decline of the far left in the region, has meant that the U.S. has obtained enough of its priorities in the region to continue to dominate without the need for subversive coups or outright invasions as in past decades. In saying this, however, this region has made huge strides in equitable economic development, with millions having been taken out of poverty in recent years. The much more stable democratic institutions, in a region which has traditionally seen stark political division, and the post-Washington compromise (as opposed to consensus, which it is not), should be given much credit for this.

East Asia In the East Asian region, a similar reaction against the Washington Consensus was seen in the legacy of the 1997 Asian Financial Crisis. This crisis marked a shift in the relationship between Asia and the U.S.-controlled IFIs. East Asian economies discovered first-hand the destructive consequences that deregulated financial markets can wreak when capital is suddenly able to leave on mass. Having promoted the policies which facilitated the crisis, the IMF stepped in to manage its aftermath. The policies proposed were widely viewed as “inappropriate and counter-productive” (Beeson, 2009d). Also, the policies which were implemented post-crisis were seen as being beneficial to Wall Street banks rather than to the economies which were so severely damaged.

37

In reacting to this crisis, East Asia has begun a process of regionalization aimed at integrating East Asia against the damaging effects of globalization. The ideational authority of the U.S. was severely damaged by this crisis, and in this regard, regional organizations were constructed which aimed at excluding the U.S., and creating greater regional autonomy. The standing of China was increased within the region due to the Chinese government’s decision not to devalue its currency, which would have caused further damage to China’s neighbours (Beeson, 2011: 361). In reacting to the crisis, a number of proposals for regional monetary governance were proposed. In 2000, the Chang-Mai initiative proposed to establish a regional bond market, and other currency swap arrangements were also proposed in order to insulate the region from similar future crises (ibid: 361). However, in spite of these proposals, which presumably could have done what they were designed to do, China and Japan declined to take the initiative (ibid: 362). As increased exports were seen as the main solution to the crisis, this set the stage for the U.S. to increase its power in the region by using Asia to finance the “war on terror”, by means of increasing its trade deficit with East Asia. This further increased U.S. structural power within this region due to the reliance that East Asia has on the U.S. economy to buy exports, as well as the increased reliance in the region on the value of the U.S. dollar due to the foreign exchange reserves which were built up. In this way, the Asian Financial Crisis sowed the seeds for the global imbalances which facilitated the latest financial crisis, and although this has led to regional organizations aimed at increasing intra-regional trade, nonetheless, the power of the U.S. in the region has been increased by means of further incorporation in the globalized economy. It has been pointed out that this increased regionalism in East Asia has the potential for partial decoupling from the U.S. (Beeson, 2009c). As mentioned, however, the increased reliance on global production networks and intellectual property laws, the increased interconnectedness between the U.S. and Asia in the financial realm, the lack of a clear ideational alternative to neoliberalism, as well as the longstanding hub-and-spoke security relationships in the region mean that any illusions of Asian autonomy from the U.S. should be taken with a sizeable pinch of salt.

The Nature of U.S. Power Having evaluating the place of the US within the four main structures of power in the international political economy, it is perhaps necessary to evaluate whether the U.S. is in fact hegemonic with this unrivalled power, or whether it is dominant, and so not a hegemon according to Gramsci’s definition of hegemony. According to Gramsci, hegemony “must result from the consent of the masses to be directed in all aspects of social life. The crisis of the state takes root when the ruling class has lost its consensus and is no longer leading, but only dominating” (D’Attoma, 2011: 6). According to this 38

analysis, the US today cannot be seen as a hegemon since the ideological consensus within the masses has evaporated and the unilateralism of military actions in various countries at present indicates a dominating, but not hegemonic state. However, reading US hegemony according to a strict evaluation of how an ideal hegemon should be defined negates a more nuanced analysis based on present and entirely new circumstances. For if anything, the US uses both consent and coercion simultaneously, and whether it is dominating or hegemonic is reductionist and misses the essence of US strategy. By means of the various methods through which the US engages with other powers, through productive, financial, military, institutional, and not least, ideological means, the US combines at any one time various levels of (explicit and passive) consent, and coercion. Often both can be seen to be used, as against the masses and the elites which are subservient to U.S. interests. The variegated nature of US hegemony, and the unprecedented scale of power which it possesses implies that although these theories of hegemony are useful in guiding the researcher in determining the means and processes through which hegemony is secured, nonetheless, they also constrain the full understanding of the “total war” approach which the US has undertaken against the world, but also with the world, in so far as the values and interests of the subordinated, yet nationally dominating elites which are its principle allies are also convergent with elite interests globally. In this sense, the rise of China should be seen through the lens of the socialization of the Chinese elite into the world order of international production networks, where a trans-national capitalist class has emerged in recent years aimed at incorporating more and more markets and hence elites into this globalizing interest. In this regard, the rising powers of other BRIC states can also partially be seen in this light, as the awakening of the elite globally. As has often been said, the elites in one country often have more in common with elites from other states than with most of their own “compatriots”, and so when analysing U.S. hegemony in light of this, then one must also come to the conclusion that although the U.S. is a greater threat to world peace, and regularly defies international law, and the sovereignty of other states, as well as the personal rights of individuals from all over the world, it should nevertheless be seen primarily as being involved with a hegemonic project, which to a significant extent has grown beyond its national roots, and ensures and defends the logical imperative of capital accumulation against other counter-hegemonic forces, whatever shape they may take. It should be noted again how vital to the projection of U.S. hegemony onto the world are the Bretton Woods institutions of the World Bank, the International Monetary Fund and the WTO. After the 1982 Mexican debt crisis especially, “the IMF and the World Bank, together with the domestic technocrats who share their views, became the collective “organic intellectuals” of the reform process” (Panizza, 39

2009: 36). These are overwhelmingly dominated by the U.S., and to a lesser extent, other industrialized states. The U.S. has veto power within all of these organizations, and as the greatest funder, regularly uses the potential withdrawal of funding to ensure that its interests are secured. These institutions are predominantly staffed and led by U.S. trained and U.S. educated economists, and due to the perceived interest by these economists of US interests, proposals which are presumed to be against the interests of the US will pre-emptively not even be proposed. As seen from the late1970s onwards, these institutions have acted as “transmission belts” for neoliberal ideology to be transmitted to the rest of the world, and once countries got into debt, the Washington Consensus ensured that Western and U.S. business interests could engage in expropriation activity, buying up major sectors of developing economies. This activity was also seen in the case of EU enlargement, whereby the ten Eastern European states which recently joined were forced to undergo significantly higher levels of so-called convergence criteria in order to gain admission to the EU. As such, this showed once again the subservient and infiltrated nature of the EU since the 1970s. According to Hage and Schneider, (2007), there has been a substantial statistical correlation between privatization of state-owned communications and telecommunications industries (seen as an accurate indicator of neoliberalism), and the influence of the so-called Europeanization. Over the period 1970 to 2000, the mean ratio of state ownership of the state airline and the dominant enterprises in the telecommunications and electricity sector of EU states was 18 percentage points higher in EU member states than in non-EU member states (ibid: 11). Although the EU as a regional organization and possible proto-state is relatively unique, this does raise concern that other inter-state organizations which have been seen by some as being protective against neoliberal globalization may in fact be transmission belts for the projection of neoliberalism on a regional scale, and by extension, globally. When these organizations promote intra-regional trade as opposed to inter-regional trade, can they really be seen as being against neoliberalism, or merely as regional enforcers of neoliberal logic? The answer, as seen with the EU, and in Asia, seems to indicate the latter.

Conclusion In conclusion, it has been shown that today the U.S. is the predominant power for the foreseeable future in the international political economy. Based on a structural analysis of where power lies, and who benefits, the U.S. is unrivalled. Furthermore, with the various levers of power to which the U.S. has an advantage, and the ability for the U.S. to manipulate and break rules, and basically put down 40

any potential opposition by various means, the U.S. has at least the power to remain the global dominant hegemon that it is today, albeit perhaps not the legitimacy. As seen in the production structure of the globalized political economy, the US productive base has shifted to become an incorporating system of globalized production linking the core to the periphery by means of global production networks which have the effect of increasing inequality globally, and within states. The internationalization of production has created global elite which act within virtually all countries to enforce the logic of neoliberal globalization. As far as competition in international business is concerned, the Western MNCs are unrivalled in terms of scale, R&D, and hence technological advantages. As far as a rival emerging in the production structure of the global economy, China has major structural weaknesses, and is likely to remain, for the foreseeable future, a location for cheap manufacturing, attractive to western MNCs. In the finance structure, the U.S. has Americanized international finance, and in the process used the ability of direct financing to act in a rentier fashion with respect to the rest of the world. In the process, the reliance of other states on the U.S. economy has meant that the rest of the world has a structural incentive to keep the U.S. economy strong. Ironically, financial crises, when they regularly occur, have the effect of increasing U.S. power due to the dollar’s safe-haven status. As mentioned, the U.S. economy has caused massive volatility within the international economy. However, this is then used by the U.S. controlled international monetary institutions to enforce the neoliberal orthodoxy upon states when crises occur. One weakness which the US might encounter within the finance structure could be a return to the gold standard by other countries, perhaps in combination against the U.S. dollar. If this were to happen, then investors may automatically have more faith in the gold-backed currency than in the US dollar, and this may have the effect of causing a dumping of the dollar, and a widespread chain reaction in relatively quick succession, whereby states with enough gold reserves could announce a return to the gold standard. The effects of such an unprecedented move would massively shake the core neoliberal economies and cause unpredictable effects within the currency markets. Within the financial structure the US is predominant, yet also the most vulnerable since there are a number of contingent actions which could cause crisis for the US. One would be a return to the gold standard, and perhaps a chain reaction whereby other countries follow suit, dumping dollars along the way. Another issue could be a general crisis of confidence in the US ability to repay the debt which it owes. Another crisis could occur from additional financial crises emerging from the US, and more specifically from western banks becoming undeniably insolvent due to sovereign defaults or from a similar crash in the stock market. Given what has occurred within western finance in recent decades, it is possible that banks could continue to engage in the high risk activities which have caused the financial crisis. For now 41

however, presuming that these possibilities do not occur due to reasons given earlier concerning the highly interconnected nature of the global financial system, the U.S. will continue to lead the world’s financial system as the centre of global finance, and this will continue to enable the U.S. to offset the costs of adjustments onto other subordinated and dependent states in the international political economy. Within the security structure of the international political economy, the U.S. is by far the most militarized and technologically advanced country of all time. It has used this power to defend against communism, as well as to secure its control over the most geo-strategically important region in the world; the Middle East. It has approximately 1,077 foreign military bases around the world (Terse, 2012), and this power will not be given up easily, even with economic distress which may result from the financial structure. Furthermore, with the close alliances which it has built around the globe, the ability to wipe out adversaries with nuclear weapons if necessary, the self-sustaining nature of U.S. power within the security structure due to its dominant position in the global arms market, the power which it exerts in the UN Security Council, as well as the combined might of NATO, and the possibility of other NATO members increasing military commitments, rivalry in the security structure is not likely to happen anytime soon. Within the knowledge structure of the global political economy, the U.S. continues to dominate research and development through its multinational corporations, as well as through the highly advanced universities which are considered to be the best in the world. In terms of military technology, U.S. corporations account for 80 per cent of the world’s military R&D. In terms of beliefs, the U.S. hegemonic ideology of neoliberalism has suffered continuous and increasing discrediting, however, the imperatives of other structures of power have meant that there has been relatively little straying from these policies in the aftermath of the financial crisis. As far as alternatives go, the Latin American region has been the region with the most insulating social policies from U.S.-led hegemony, however, this has been accomplished by means of compromise, resulting from the need to prevent the divisiveness which prevailed in previous decades. Overall, the “project for a new American century” is still on track, although with shakier foundations. This increased risk has been transformed to the rest of the world also, and has increased the reliance on the U.S. economy. Ceteris parabus, the U.S. will continue to lead the global economy, albeit with increasing instability, and a relatively larger role for the emerging BRICS economies whose growth is currently substantial, but whose structural power is not. The likelihood of substantial change in this regard does not seem probable for the foreseeable future. Such is the nature of structural power. Plus ça change, plus c’est la même chose. 42

Bibliography Ahearn, D. S. (1963): Federal Reserve Policy Reappraises, 1951-1959 (Columbia University Press, London: New York), from Konings, M. (2007): The Institutional Foundations of US Structural Power in International Finance: From the re-emergence of global finance to the monetarist turn, Review of International Political Economy, 15:1, 35-61 Al-Islam Alqadhafi, S. (2007) Reforming the WTO: Toward More Democratic Governance and Decision-Making (Gaddafi Foundation for Development, Tripoli) @ http://www.wto.org/english/forums_e/ngo_e/posp67_gaddafi_found_e.pdfAccessed on (19/11/2011) Amin, S. (2004): The Liberal Virus: Permanent War and the Americanization of the World. (Pluto Press, London) Arraghi, F. (2008): Political economy of the financial crisis: A world-historical perspective, Economic and political weekly, 43: 45, 30-32 Beeson, M. (2009a): Hegemonic transition in East Asia? The dynamics of Chinese and American power, British International Studies Association, 35, 95-112 Beeson, M. (2009b): Trading places? China, the United States and the evolution of the international political economy, Review of International Political Economy, 16: 4, 729-741 Beeson, M. (2009c): East Asian regionalism and the end of the Asia-pacific: After American hegemony, japan-focus.org, retrieved @ http://japanfocus.org/-Mark-Beeson/3008, 02/02/2012. Beeson, M. (2009d): The United States and East Asia: The decline of long-distance leadership, The Asia-Pacific Journal, October 26, 2009 Beeson, M. (2010) Asymmetrical regionalism: China, Southeast Asia and uneven development, East Asia, 27: 329-343 Beeson, M. (2011): Crisis dynamics and regionalism: East Asia in comparative perspective, The Pacific Review, 24: 3, 357-374 Conversi, D. “Globalization, Ethnic Conflict and Nationalism”, in Brian Turner, ed., Handbooik of Globalization Studies (Routledge/ Taylor & Francis, London) 2010, pp. 346-366 Chase-Dunn, C. and Kwon, R. (2010): Last of the hegemons: U.S. decline and global governance, Institute for Research on World Systems, University of California-Riverside, accessed on 27/01/2012, retrieved @ http://irows.ucr.edu/papers/irows65/irows65.htm 43

Chernow, R. (1990) The House of Morgan: An American Banking Dynasty and the Rise of Modern Finance, (Atlantic Monthly Press, New York) Chomsky, N. (2012): “Losing” the World: American Decline in Perspective, Part 1, in The Guardian, accessed on 15/02/2012, retrieved @ http://www.guardian.co.uk/commentisfree/cifamerica/2012/feb/14/losing-the-world-americandecline-noam-chomsky Cox, R. W. with Sinclair, T. J. (1996): Approaches to World Order, (Cambridge University Press, Cambridge) Cox, R. W. (2006): Beyond empire and terror: critical reflections on the political economy of world order, New Political Economy, 9: 3, 307-323 D’Attoma, J. (2011): Hegemony or Dominance? A Gramscian Analysis of US Ascendancy, paper presented at the 19th Annual Illinois State University Conference for Students of Political Science April 8, 2011 De Cecco, M. (1987): “Inflation and Structural Change in the Euro-dollar Market”, in M. de Cecco (ed.) Monetary Theory and Economic Institutions, Houndmills, Basingstoke and London: Macmillan Gamble, A. (2009): Spectre at the Feast: Capitalist Crisis and the Politics of Recession, (Palgrave and Macmillam, Basingdtoke and New York) Gavin, F. L. (2004): Gold, Dollars, and power: The Politics of International Monetary Relations, 1958-1971, (University of North Carolina Press, Chapel Hill) Globalresearch.com, (2011): accessed @ http://tv.globalresearch.ca/2011/10/assassination-gaddafipart-global-regime-change retrieved on 25/02/2012 Gowan, P. (1983): Closing the Gold Window: Domestic politics and the End of the Bretton Woods, (Cornell University Press, New York) Gowan, P. (2009): Crisis in the heartland: Consequences of the New Wall Street System, New Left Review, 55: January-February Hage, F. and Schneider, V., (2007): Europeanization and the Retreat of the State, Center for European Studies Working Paper Series #143 Harvey, D. (2003): The New Imperialism (Oxford University Press, Oxford) 44

Hughes, N. C. (2005): “A trade war with China?” Foreign Affairs, 84 International Monetary Fund, (2011): accessed @ http://www.imf.org/external/np/sta/cofer/eng/cofer.pdf Retrieved on 17/02/2012 Kapila, S. “Russia’s Foreign Policy in a Resurgent Mode: An Analysis”, South Asia Analysis Group @ http://www.southasiaanalysis.org/%5Cpapers17%5Cpaper1682.html 6/1/2006, retrieved on 23/11/2011 Kolko, G. (2009): World in crisis: the end of the American century, (Pluto Press, London) Konings, M. (2007): The institutional foundations of US structural power in international finance: From the re-emergence of global finance to the monetarist turn, Review of International Political Economy, 15:1, 35-61 Lacey-Barnacle, M. (2011): Has the global financial crisis challenged US power in international finance?, e-ir.info, published on August 23, 2011, retrieved at http://www.e-ir.info/2011/08/23/hasthe-global-financial-crisis-challenged-us-power-in-international-finance/, on 01/02/2012 Panitch, L. and Konings, M. (2009): Myths of neoliberal deregulation, New Left Review, 57: MayJune Panizza, F. (2009): Contemporary Latin America: Development and Democracy Beyond the Washington Consensus (Zed Books, London: New York) People’s Bank of China, (2011): Gold and Foreign Exchange Reserves, accessed @ http://www.pbc.gov.cn/publish/html/2010s09.htm on 20/02/2012. Pilger, J. (2002): The New Rulers of the World, (Verso Books, London) Podliska, B. F. (2010): Acting Alone: A Scientific Study of American Hegemony and Unilateral Useof-Force Decisionmaking (Innovations in the Study of World Politics), (Lexington Books, Plymouth) Roos, J. (2011): The Myth and the Crisis: the Greek Debt Tragedy, Research proposal for a PhD in Social and Political Science at the European University Institute, retrieved @ http://roarmag.org/2011/04/myth-tragedy-greek-debt-crisis-marx-keynes/ on 15/09/2011

45

Sanchez-Ancochea, D. (2003): Globalization and inequality in the developing world: potential benefits with real costs, retrieved @ http://users.ox.ac.uk/~qehs0648/research/cepa.pdf on 01/03/2012 Shor, F. (2011): Declining US Hegemony + rising Chinese power: A formula for conflict? State of Nature, Summer, 2011, retrieved at http://www.stateofnature.org/decliningUsHegemony.html on 01/02/2012 Strange, G. (2011): China’s post-Listian rise: Beyond radical globalization theory and the political economy of neo-liberal hegemony, New Political Economy, 16: 5, 539-559 Strange, S. (1988): The Future of the American empire, Review of International Affairs, 42: 1, 1-17 Strange, S. (1994): States and Markets 2nd Ed. (Pinter Publishers, London) Strange, S. (1996): The Retreat of the State: The Diffusion of Power in the World Economy (Cambridge University Press, Cambridge) Strange, S. (2002): “Towards a Theory of Transnational Empire” in Tooze, R. and May, C., eds. Authority and Markets: Susan Strange’s Writings on International Political Economy, (Palgrave Macmillan, New York) Terse, N. (2011): “The Pentagon’s Planet of Bases”, accessed @ http://www.tomdispatch.com/archive/175338/ on 27/03/2012 Woods, N. (2003) The United States and the International Financial Institutions: Power and Influence Within the World Bank and the IMF. @ http://www.globaleconomicgovernance.org/wpcontent/uploads/US%20and%20IFIs.pdf accessed on 13/11/2011. (Final version published as chapter 5 in Rosemary Foot, Neil MacFarlene and Micheal Mastanduno, US Hegemony and International Organization (Oxford University Press, 2003)) Worth, O. (2003): Making Sense of Globalisation: A neo-Gramscian analysis of the practices of neoliberalism, Limerick Papers in Politics and Public Administration, No. 6, 2003

46

Smile Life

When life gives you a hundred reasons to cry, show life that you have a thousand reasons to smile

Get in touch

© Copyright 2015 - 2024 PDFFOX.COM - All rights reserved.