Elephants fight. Flickr/Chris Eason. Some rights reserved.New political-economic forces have upended ‘normal’
international and domestic politics in a good number of nations. This past 12
months has seen the confluence of the Trump takeover of the US Government, pressures
to dismantle the EU through Brexit, Greek debt negotiations, the Le Pen
campaign in France and the proliferation of constitutional coups in Brazil, Philippines, US and elsewhere. These
macro-economic events invite a search for a new framework to explain the new
and unexpected dynamics. I want to argue that we are witnessing a new three way
economic-ideological battle among global ruling elites.
The explanation posits that the three factions are ‘the
old fashioned globalization’ group, the ‘multistakeholderism’ advocates, and
the ‘state destruction‘ faction.
State
destruction
The starting point is the recognition that the ‘state
destruction’ faction in the EU, in the US, and in Brazil is now a separate
political force and that it is making a play for real global power.
In the US, this assessment is based on taking
seriously Trump Administration statements to ‘get rid of the EPA’, ‘repeal
affordable care’, ‘weaken the SEC’ ‘shutdown the Consumer Financial Protection
Bureau’, ‘eliminate support for public schools’, and ‘abandon Federal support
for affordable housing’.
This view was synthesized by Presidential Counselor Steve
Bannon, when he said that
a major goal of Trump’s presidency, along with renegotiating trade deals and
securing the border, was the total “deconstruction of the administrative
state.” [i]
They want to lay the foundation for market expansion
by ‘re-taking’ areas currently excluded from market control by environmental,
social, gender, health, and labor regulations.
Instead of dismissing such claims as just crazy, one
could well see them as indicative of a new economic force, one that focuses not
on international markets and technology change for future growth but on markets
created by the elimination of the nation-state. The deconstruction of the
administrative state would, for example, speed up the privatization of state
resources, replace the delivery of state services with private firms, and remove
the labor, environmental, and other regulations that constrain domestic
production and restrict the marketing of high risk products and services.
In short, the ‘state destruction’ faction sees limited
opportunities for stable growth in the global market. The scale of global
instability is too great across a wide range of social, environmental,
monetary, and cultural spheres to comfortably predict what future returns might
be. They want to lay the foundation for market expansion by ‘re-taking’ areas
currently excluded from market control by environmental, social, gender,
health, and labor regulations. And by disabling the related state institutions,
they see a growth opportunity for the domestic private sector to step in and sell
that ‘state’ service to the community. In order to ‘give away’ so much of the public’s health
and safety, so much of the public’s assets, and so much Government legitimacy,
it is necessary to tighten control over the population.
This inward-turning for new markets is consistent with
the Trump Administration call for greater ethno-centric nationalism, expanded domestic
authoritarianism and reduced commitment to multilateralism. In order to ‘give
away’ so much of the public’s health and safety, so much of the public’s
assets, and so much Government legitimacy, it is necessary to tighten control
over the population and to shift hostility and violence onto those who are
relatively weaker and less able to defend themselves.
In Brazil the basis for this assessment is the abrupt
rightward shift toward domestic business-interest by the post-impeachment
Government; in the UK this ‘state destruction’ faction is represented by those
who are actively supporting the Prime Minister’s decision for a hard Brexit
from the EU, leaving the EU as a significantly weakened institution. The potential
fragmentation of the EU as a regional governmental institution is also being advocated
by Marine Le Pen forces in France, by the practice of walling off sections of
Europe from regional migrants, and by the continued threats to the functioning
of the Greece state. In all of these areas, the call for less state role (e.g.
less rules from Brussels ) goes hand in hand with a more nationalistic economic
political message and fears directed at various types of ‘foreigners’.
The following are some additional characteristics of
these three factions and some of the ways that they may be engaging in a very
powerful intra-corporate battle over the role of state and the control of
globalization. While much of the specifics are drawn from current US political-economic
conflicts, there do appear to be parallel developments in other parts of the
globe.
Faction A :
“Old fashioned globalization” group
Historical
context is based on the global economic reality before the start of 2008/2009
financial crisis.
Key characteristics include:-
– Continued domination of the global market by MNCs;
– Supports the EU and other
regional economic areas in order to gain the benefits of expanded consumer and
worker markets and to have stable rules;
– Cooperates
with the rise of China and the other BRICs as important international market actors;
– Rise
in the dominance of the financial sector over the productive and service
sectors; massive national debt crises continually occurring between the international
finance and the nation-states; and the creation of Financial Stability Board as
a partial stabilizing force over the international financial sector;
– Advocates
for ‘free trade’ and WTO-based rules and dispute settlement procedures;
– By
in large, MNCs and their associations exercise whatever governance there is
over globalization; there is no analog to a national government for
globalization which could balance competing class and social realities.
– At the nation-state level, corporate capture
of state agencies and open to privatization of state assets; corporate-related
payments can be made to elected state officials; investor-state dispute systems
help MNCs manage nation-states;
–
Under US and NATO leadership, military open new markets and attempts to quell
global and regional dissent;
– Believes that governments should take the
lead for managing climate change in a way that leaves the private sector a high
degree of market flexibility;
– Seeks to minimize corporate risks from
climate change and to maximize investments in potentially remunerative
alternate energy sources;
–
At the ideological level, the message is ‘globalization is a good thing’
and corporate personhood should be respected;
–
At the institutional level, UN system bodies, IMF, World Bank and the WTO
are either stepping back from addressing the governance of globalization or
internally divided on how to govern globalization;
– Major US media aligned with Faction A include
the Wall Street Journal , CNN, Washington Post, and the New York Times
Faction B :
“Multistakeholderism” advocates
Historical
context is that the 2008/2009 crisis demonstrated that the international financial
system was far too fragile and that the globalization project itself could be
delegitimized by the system’s fragility [ii]
Key
characteristics include:
– Recognizes that some form of
quasi-state function is needed on the international level;
– Acknowledges that too much
poverty, too much illiteracy, too much inequality, too much sexual violence and
too much institutional racism is bad for the long term stability of
globalization;
– Has an open, but restricted, door
for multi-culturalism and ethnic diversity;
– Establishes multistakeholder governance
task forces with hand-selected participants to address complex global issues;
– Seeks
to institutionalize TNCs as part of the recognized global governance system;
– Incorporates
selected international civil society organizations (and celebrities, religious
leaders, and academics) into the functioning of global governance system;
– Protects
against a too strong quasi-state function by establishing a volunteer
opt-in-opt-out approach and a non-institutional foundation for multistakeholder
arrangements;
– Moves
slowly toward a multipolar political-economic system involving greater
distribution of power to regional institutions, the BRICs, and China; China,
Russia, and other authoritarian states do not share an interest in
participating in the multistakeholder governance;
– Accepts
the de-legitimization of government (and by extension the UN system} as
effective tools for managing international social and economic conflicts;
– Seeks
to move from corporate personhood to multistakeholder governance and to have
multistakeholder governance group displace multilateral decision-making on
major issues;
– Encourages
UN system bodies to be open to active MNC participation (e.g. Global Compact,
Gates Foundation leadership in health matters); Governments at UN system
bodies, BWI, and the WTO seek out private sector bodies and multistakeholder
groups to take over ‘solving’ difficult public interest problems .[iii]
Faction C :
“State Destruction” (except the security services) faction.
Historical
context: The management of the Brexit
vote, the treatment of the Greek state, the appeals of Le Pen in France result
in a direct challenge to the existence of the EU itself ; Trump’s election and constitutional
coups.
Key
characteristics:
– Believes
that the State with the exception of the security services is an obstacle to market
growth;
– Expects to
obtain new wealth from the destruction of the administrative structure of state
by the:
(1)
Expansion of the delivery of former
state services (e.g. Trump’s infrastructure projects for bridges, roads, and ports;
support for-profit educational businesses; privatization of prisons) Removing the
state from these functions also transfers long term control of these ‘state’
functions to the private sector;
(2)
Growth of domestic production from
the removal of government environmental, social, worker, and gender
restrictions (e.g. increased and lower-cost domestic production from
elimination of restricting regulations, reduction in need to disclose and
report activities, and cut costs from fewer civil and criminal court cases);
(3)
The projected jump in contracts for
the domestic military industrial complex as a result of the sharp budget shift
toward the military budget (e.g. the planned 20% increase in military budget
without a change in war plans; the call to other NATO Governments to move to 2%
of GDP for their military expenditures);
(4)
The planned increase in the rate of privatization
of state assets (e.g. more aggressive exploitation of formerly government
protected natural resources, which are both nearer to final domestic markets
and resources that can be easily exported);
(5)
Regards mixing state functions and
private business activities as not ‘corruption’ but the correct way that the private
sector should be using government institutions to find new sources of income;
(6)
Greater retained earnings by firms
which file US taxes and a faster circulation of private savings thru the state into
corporate hands [iv].
– Considers that a strong
corporate-controlled and militarized state can avoid global compromises, like
the recognition of the ascension of China as a superpower, any limitations imposed
by ‘fairness’ in trade agreements, and expectations of other OECD Governments
for mutual military cooperation ;
– Verbally attacks ‘globalization’ while aggressively supporting
national-based MNCs at home and in the global market; seeks to replicate the
lack of rules in globalization in the domestic market;
– Seeks to exclude selected nationalities and races as legitimate
participants in the national or international political processes; –
– ‘Solves’ a wide range of global environmental and social issues by
simply denying that the issue is real (consistent with their effort to destroy
national governmental agencies dealing with these and related issues. No real
issue means no real reason to have a government agency);
– Believes
that ‘climate change’ is dangerous to corporate investment returns and that
pushing it off the political agenda has enormous short-term advantages;
– Without
a socially-focused state, increasingly dependent on the expanded use military,
para military, and police forces to control domestic populations (e.g. trying
to use the US national guard as immigration/ deportation officers);
– Seeks to minimize NATO or other
long-standing military alliances, which would result in the implosion of US
military global dominance;-
– Believes that UN system bodies,
IMF, and WTO are unnecessary institutions, as MNCs can solve for themselves any
inter-country, inter-sectorial or market crises;
– Seeks major budget cuts to UN system bodies
and development-oriented programs, as these activities are either not needed or
should be open to privatization;
– Major
media aligned with Faction C include Brietbart News and InfoWars
The
characteristics of the three political economic forces represent distinct and
competing approaches for maintaining and expanding control by different sectors
of the global elite. At any one time a specific firm, corporate executive, or
trade association may behave more in line with one force than another. This is
expected as the intra-corporate factions explore which avenue or avenues are
best from their own perspective.
Force A, the
current status-quo globalization force, is in a way the old guard; Force B, the
multistakeholder group, is the group that is attempting to recuperate the
globalization project and formalizing MNCs as global governors; Force C, the
state-destruction force, in this explanation is clearly the insurgent force.
Collisions Involving Forces A, B, and C
These
divergent directions result in some quite significant collisions of
interests.
For
Force A and B, Force C represents a fundamental threat to the legitimization of
the globalization project, however it is defined.
For Force C, Force A and B have
failed to manage climate change and it is now important to divert the quite
appropriate fears of the impacts of climate change onto fear of others before
it is too late (a quite different approach to ‘climate change
adaptation’).
For Force B, Force A is on a
self-destructive course as inter-competitive pressures are undermining the
economic foundation of the international economy (an internationalized version
of the old rationale for domestic anti-monopoly rules)
For Force B and Force A, Force C
misunderstands the necessity for a quasi-state world government to
counter-balance what are now economically and socially useless territorial
boundaries. The world is now a global inter-connected economy and no
nation-state can rule alone as the overlord of the planet.
For Force C, Force A is the old
order and is premised on cross-boundary economic interests that cannot manage
the maintenance of white ethno-centric role in the world economy.
For Force A and B, Force C is
needlessly provoking a military and economic conflict with China, as these two
Forces are quite comfortable dealing with the opportunities and challenge of
China’s role in the world economy;
For
Force C, Force B is a misguided naïve attempt – and a bad compromise – to coopt
social forces of international civil society as a partner in corporate control.
For
Force C in the US, the attacks on the intelligence services, which are an
integral component of Force A and B, may explain part of Force C’s campaign to
break the internationally oriented market leaders in Forces A and B.
Force
A and Force B, which employ – and sell to – a wide range of ethnicities and
multi-country markets, will contest the extreme ethno-centric programs of Force
C.
If this
analysis is correct, the battle between the three elite Forces is likely to impact
a wide range of institutions and communities, particularly those grassroots
institutions and communities around the world where the consequences of the
three way battle will be most difficult to contain. However, while the
Elephants fight it out, one can take parallel efforts to develop a sound
counter-strategy – one that takes the grassroots as the ecological and social
foundation for a new order and seeks to minimize societal-wide collateral
damage. In different countries and regions, one should expect that specific political-economic
impacts will be quite different. One
can take parallel efforts to develop a sound counter-strategy – one that takes
the grassroots as the ecological and social foundation for a new order and
seeks to minimize societal-wide collateral damage.
Teasing out the political-economic consequences from the three-way
elites battle
– Force
C’s abandonment of US leadership in global military and economic institutions
means that the Pax Americana period of global leadership since World War II may
have come to an unexpected end.
– The
leadership of international civil society and domestic NGOs, which now lack a
potential government ally in their campaigns, may also migrate toward Force B
with its possibility of direct engagements with TNCs to address a range of
issues, many of which are caused by actions of TNCs.
– Force
B has not gained sufficient acceptance to present itself as the new global
norm. However, Force C is fighting to claim ‘normalization’ of
political-economic reality away from the ‘normalized’ global realities of Force
A.
– Mainline
media and other commentators are restrained in acknowledging the extent of
Force C’s authoritarianism, as they assume that Force A will prevail in the
contest with Force C.
– Mainline
political parties will struggle internally to re-align their party messages and
party alliances in order to position themselves with the more multi-cultural
Force B, with Force C as the party in power, or with the old guard Force A.
– The
UN system will continue to highlight SDGs and Human Rights, as counter-weight
to Force C, as they will in general assume that Force A or Force B will prevail
over Force C
Concluding observations
There are
other possible political-economic explanations for these abrupt global and
national changes. First there is the no-rationale political economic hypothesis
for the current direction. The situation may be so confusing, so unstable, or
so different in different parts of the globe that no one scenario can provide a
plausible hypothesis.
Second is
that the real power drivers today are sharply enhanced national
authoritarianism, ethnic domination, and gender control and that whatever
happens in the political economy will flow from the dynamic assertion of these
multiple forms of elite domination. In this alternative, the argument is that
social and cultural control is central and that they will be atypically drivers
for the underlying political economy.
Third that the
Trump Administration sharp swing to far higher state-expenditures for military
matters in the US and in other NATO countries is an effort to restore the
military-industrial complex as the key domestic political-economic force. In
this circumstance the militarism combined with nationalism would create a drive
to seize oil and other natural resources abroad while enhancing domestic public
fears of the Other in order to use military forces inside the country.
Many are
still struggling with shell shock from the scope and violence of the political
changes in their country and around the globe, most of which have occurred in just
the past year. Consequently it may well be too early to formulate a
political-economic assessment of these changes or even to assess arguments for and
against this particular three competing forces framework. The examples used to
explain the Three Forces framework has been drawn heavily from the US
experience. The author would welcome alternative interpretations of these
events and any evidence – or counter-evidence – to this three way assessment,
particularly by those in other countries or regions. In the end, the goal is to
move from shell-shock realities to a sound analysis and then to a
counter-strategy as soon as possible.
The title of this article is based on
an old African saying.
Flickr/YoTUT.Some rights reserved.
[i] http://www.huffingtonpost.com/entry/steve-bannon-media-cpac_us_58af38f3e4b0780bac2761e3?ncid=engmodushpmg00000006
[ii] For additional information on multistakeholder governance, see the
Readers Guide to WEF’s Global Redesign Initiative on the website of the
University of Mass-Boston, www.umb.edu/gri
[iii] For additional background on the relationship of
multistakeholderism and the UN system, see Gleckman, H, ‘WEF proposes a public
–private United ‘Nations’, at http://www.policyinnovations.org/ideas/commentary/data/000263
[iv] Business enthusiasm for
lower corporate taxes could well be behind the 27,000 point surge in Dow Jones
average since Trump’s election http://money.cnn.com/2017/03/01/investing/dow-21000-trump-speech/index.html
