Noam Chomskyʻs article “ʻLosingʻ the World: American Decline in Perspective” in Truthout inspired me to write this post on the world system as a continuation of the ongoing sovereignty conversation on the umiverse (more to come on that). Chomsky, as others have done, emphasizes that the decline is relative – that is, the US no longer controls the gargantuan share of world wealth it once did, but will hardly be relegated to a second-rate power in the near future. It will, according to world system scholar Immanuel Wallerstein, be one of several “poles,” or hegemons in the future – perhaps as many as eight or nine. One surprising new power could include Brazil, along with others more expected: China, Russia, the US. Wallerstein warns that this is too many poles, and will contribute to instability through strange bedfellow alliances as each of the “super”powers (none of which can really be super in such a diffused system) seeks to maximize its own advantage in trade and military supremacy. Wallerstein seems to imply that this system will give way through competition, military and/or economic, to a more sustainable number, three or so. This could take the better part of a century. These concerns are behind such documents as the Plan for a New American Century, to which some ascribe conspiratorial motives linked to 9/11.
It is important to remember that American dominance, at its very pinnacle, was a fairly short-lived phenomenon. Just as the short decade of the 1950s is such a longed-for time by conservatives and liberals alike, American supremacy was in decline almost as soon as it was achieved. And it was achieved, as any high schooler knows, immediately after World War II. Arnie Saiki points out that this supremacy was not just economic and not even financial, but monetary, that is, it was largely predicated on the political manuvering that established the dollar as the worldʻs reserve currency. Documents show that this was no natural occurence, but was the result of threats, veiled and otherwise, carrots and sticks.
The US, as Chomsky points out, controlled half of all global wealth after WWII. This was still 40% when Eisenhowerʻs administration established a policy to supress development in foreign, especially third world countries, recognizing that such disparity would generate the envy of the developing world. As Chomsky notes:
The basic viewpoint was outlined with admirable frankness in a major state paper of 1948 (PPS 23). The author was one of the architects of the New World Order of the day, the chair of the State Department Policy Planning Staff, the respected statesman and scholar George Kennan, a moderate dove within the planning spectrum. He observed that the central policy goal was to maintain the “position of disparity” that separated our enormous wealth from the poverty of others.
Chomsky points to the Machivellian approach taken by the foreign policy establishment led by Kennan, who advised that the US:
“should cease to talk about vague and… unreal objectives such as human rights, the raising of the living standards, and democratization,” and must “deal in straight power concepts,” not “hampered by idealistic slogans” about “altruism and world-benefaction.”
By 1970, Chomsky notes, this proportion of global wealth controlled by the US had dropped to 25% – it remains there. This is still very disproportionate, as the US constitutes 5% of the global population. Enter China: Chomsky shows that China’s “stellar” growth is based on shaky demographic, environmental and economic bases:
“China’s recent economic growth has relied substantially on a “demographic bonus,” a very large working-age population. “But the window for harvesting this bonus may close soon,” with a “profound impact on development”: “Excess cheap labor supply, which is one of the major factors driving China’s economic miracle, will no longer be available.”
And Indiaʻs problems are worse, apparently.
All of this relates to sovereignty in that it provides the underlying motives for why states behave the way they do, and, less often, for the formation and even dissolution of states. As Niall Ferguson holds, the history of economics, finance and markets is the history behind the history. Or, as one of our econ teachers more succinctly (if oversimply) puts it: economics is history and history, economics. The business world is the world.
If we can understand and begin to come to terms with these “facts” (I donʻt hold that this is only way to look at the world system, but simply that one most understand those in power), we can make meaningful distinctions that shed light on the vagueries of “international law” – whose efficacy is questioned from all quarters.