Sunday, August 13, 2006

Navarro Worldwide Class Struggle

Monthly Review
by Vincent Navarro (Professor and Director, Public Policy Program, The Johns Hopkins University, USA – Pompeu Fabra University, Spain0

In memory of my good friends Paul Sweezy and Harry Magdoff, who taughtus an uncompromising critical evaluation of all that exists,uncompromising in the sense that our criticism fears neither its own results nor conflict with the powers that be.

Neoliberalism as a Class Practice
A trademark of our times is the dominance of neoliberalism in the majoreconomic, political, and social forums of the developed capitalistcountries and in the international agencies they influence – including the International Monetary Fund (IMF), the World Bank, the World Trade Organization (WTO), and the technical agencies of the United Nationssuch as the World Health Organization (WHO), Food and Agricultural Organization (FAO), and UNICEF. Starting in the United States during theCarter administration, neoliberalism expanded its influence through the Reagan administration and, in the United Kingdom, the Thatcher administration, to become an international ideology. Neoliberalism holds to a theory (though not necessarily a practice) that posits the following:

1. The state (or what is wrongly referred to in popular parlance as “thegovernment”) needs to reduce its interventionism in economic and socialactivities.
2. Labor and financial markets need to be deregulated in order toliberate the enormous creative energy of the markets.
3. Commerce and investments need to be stimulated by eliminating bordersand barriers to allow for full mobility of labor, capital, goods, andservices.

Following these three tenets, according to neoliberal authors, we have seen that the worldwide implementation of these practices has led to thedevelopment of a “new” process: a globalization of economic activitythat has generated a period of enormous economic growth worldwide, associated with a new era of social progress. For the first time inhistory, we are told, we are witnessing a worldwide economy, in which states are losing power and are being replaced by a worldwide market centered in multinational corporations, which are the main units ofeconomic activity in the world today.

This celebration of the process of globalization is also evident amongsome sectors of the left. Michael Hardt and Antonio Negri, in their widely cited Empire (Harvard University Press, 2000) celebrate the great creativity of what they consider to be a new era of capitalism. This new era, they claim, breaks with obsolete state structures and establishes anew international order, which they define as an imperialist order.

They further postulate that this new imperialist order is maintained withoutany state dominating or being hegemonic in that order. Thus, they write: We want to emphasize that the establishment of empire is a positive steptowards the elimination of nostalgic activities based on previous power structures; we reject all political strategies that want to take us backto past situations such as the resurrection of the nation-state in orderto protect the population from global capital. We believe that the new imperialist order is better than the previous system in the same way that Marx believed that capitalism was a mode of production and a type of society superior to the mode that it replaced. This point of view held by Marx was based on a healthy despisement of the parochiallocalism and rigid hierarchies that preceded the capitalist society, as well as on the recognition of the enormous potential for liberation that capitalism had.

Globalization (i.e., the internationalization of economic activity according to neoliberal tenets) becomes, in Hardt and Negri’s position, an international system that is stimulating a worldwide activity that operates without any state or states leading or organizing it. Such an admiring and flattering view of globalization and neoliberalism explains the positive reviews that Empire has received from Emily Eakin, a book reviewer of the New York Times, and other mainstream critics, not knownfor sympathetic reviews of books that claim to derive their theoreticalposition from Marxism. Actually, Eakin describes Empire as the theoretical framework that the world needs to understand its reality. Hardt and Negri celebrate and applaud, along with neoliberal authors,the expansion of globalization. Other left-wing authors, however, lament rather than celebrate this expansion, regarding globalization as the cause of the world’s growing inequalities and poverty. It is important to stress that even though the authors in this latter group – which includes, for example, Susan George and Eric Hobsbawm – lament globalization and criticize neoliberal thinking, they still share withneoliberal authors the basic assumptions of neoliberalism: that states are losing power in an international order in which the power of multinational corporations has replaced the power of states, operatingwithin a global market that is responsible for the international order(which neoliberals applaud) or disorder (which some left-wing criticslament).

The Contradiction Between Theory and Practice in Neoliberalism
Let’s be clear right away that neoliberal theory is one thing and neoliberal practice another thing entirely. Most members of the OECD (including the U.S. federal government) have seen state interventionism and state public expenditures increase during the last 30 years. My area of scholarship is public policy, and, as such, I study the nature of state interventions in many parts of the world. I can testify to the expansion of state intervention in most countries in the developedcapitalist world. Even in the U.S., Reagan’s neoliberalism did nottranslate into a decline of the federal public sector. As a matter offact, federal public expenditures increased under his mandate, from21.6% to 23% of GNP, as a consequence of a spectacular growth inmilitary expenditures from 4.9% to 6.1% of GNP during the Reagan years(Congressional Budget Office National Accounts 2003). This growth in public expenditures was financed by an increase in the federal deficit(creating a burgeoning of the federal debt) and increase in taxes. As the supposedly anti-tax president, Reagan in fact increased taxes for agreater number of people (in peace time) than any other president inU.S. history. And he increased taxes not once, but twice (in 1982 and in1983). In a demonstration of class power, he reduced the taxes of the top 20% (by income) of the population enormously, at a cost of increasing taxes for the majority of the population. It is not accurate, therefore, to say that President Reagan reduced the role of the state in the U.S. by reducing the size of the public sector and lowering taxes. What Reagan (and Carter before him) did was dramatically change the nature of state intervention, such that it benefited even more the upper classes and the economic groups (such as military-related corporations) that financed his electoral campaigns.Reagan’s policies were indeed class policies that hurt the majority ofthe nation’s working class. Reagan was profoundly anti-labor, making cuts in social expenditures at an unprecedented level. It bears repeating that Reagan’s policies were not liberal: they were Keynesian, based on large public expenditures and large federal deficits. Also, the federal government intervened very actively in the nation’s industrial development (mainly, but not exclusively, through the DefenseDepartment). As Caspar Weinberger, Secretary of Defense in the Reagan administration, once indicated (in response to criticisms by the Democratic Party that the U.S. government had abandoned the manufacturing sector), “Our Administration is the Administration that has a more advanced and extended industrial policy in the western world”(Washington Post, 13 July 1983). He was right. No other western government had such an extensive industrial policy. Indeed, the U.S. federal state is one of the most interventionist states in the western world.There exists very robust scientific evidence that the U.S. is not a liberal state (as it is constantly defined) and that the U.S. state is not reducing its key role in developing the national economy, including in the production and distribution of goods and services by large U.S.corporations which, incidentally, are wrongly referred to as“multinationals” but are actually “transnational’s.” This empirical evidence shows, the U.S. federal government’s interventionism (in theeconomic, political, cultural, and security spheres) has increased overthe last 30 years. In the economic sphere, for example, protectionism has not declined. It has increased, with higher subsidies to the agricultural, military, aerospace, and biomedical sectors. In the social area, public interventions to weaken social rights (and most particularly labor rights) have increased enormously (not only under Reagan, but also under Bush Senior, Clinton, and Bush Junior), and surveillance of the citizenry has increased exponentially. Again, there has been no diminution of federal interventionism in the U.S., but rather an even more skewed class character to this intervention during the last 30 years. Neoliberal narrative about the declining role of thestate in people’s lives is easily falsified by the facts. Indeed, as John Williamson, one of the intellectual architects of neoliberalism,once indicated, “We have to recognize that what the U.S. government promotes abroad, the U.S. government does not follow at home,” adding that “the U.S. government promotes policies that are not followed in theU.S.” (J. Williamson, “What Washington Means by the Policy Reform,” inJ. Williamson (ed.), Latin America Adjustment: How Much Has Happened?Institute for International Economics, 1990). It could have not been said better. In other words, if you want to understand U.S. public politics, look at what the U.S. government does, not what it says. This same situation occurs in the majority of developed capitalist countries.Their states have become more, not less, interventionist. The size ofthe state (measured by public expenditures per capita) has increased in most of these countries. Again, the empirical information on this point is strong. What has been happening is not a reduction of the state but rather a change in the nature of state intervention – further strengthening its class character.

Deterioration of the World Economic and Social Situation
Another correction that needs to be made as a rebuttal to neoliberal dogma is that neoliberal public policies have been remarkablyunsuccessful at achieving what they claim to be their aims: economic efficiency and social well-being. If we compare the period 1980-2000 (when neoliberalism reached its maximum expression) with the immediately preceding period, 1960-1980, we can easily see that1980-2000 was much less successful than 1960-1980 in most developed and developing capitalist countries. As Table 1 shows, the rate of growth and rate of growth per capita in all developing (non-OECD) countries (excluding China) were much higher in 1960-1980 (5.5% and 3.2%) than in1980-2000 (2.6% and 0.7%). Mark Weisbrot, Dean Baker and David Rosnick have documented that the improvement in quality-of-life and well-beingindicators (infant mortality, rate of school enrollment, life expectancy, and others) increased faster in 1960-1980 than in 1980-2000 (when comparing countries at the same level of development at thestarting year of each period) (M. Weisbrot, D. Baker, and R. Rosnick,The Scorecard on Development: 25 Years of Diminishing Progress, Centerfor Economic and Policy Research, September 2005). And as Table 2 shows, the annual rate of economic growth per capita in the developed capitalist countries was lower in 1980-2000 than in 1960-1980. But, what is also important to stress is that due to the larger annual economic growth per capita in the OECD countries than in the developing countries (except China), the difference in their rates of growth per capita has been increasing dramatically (Table 2). This means, in practical terms, that income inequalities between these two types of countries have grown spectacularly, and particularly between the extremes (see Table 2). But, most importantly, inequalities have increased dramatically not only among but within countries, developed and developing alike. Adding both types of inequalities (among and within countries), we find that, as Milanovic has documented, the top 1% of the world population receives 57% of the world income, and the income difference between those at the top and those at the bottom has increased from 78 to 114 times (Branco Milanovic, Worlds Apart: Measuring International and Global Inequality, Princeton University Press, 2005). It bears emphasizing that even though poverty has increased worldwide and within countries that are following neoliberal public policies, this does not mean the rich within each country (including developing countries) have been adversely affected. As a matter of fact, the rich saw their incomes and their distance from the nonrich, increase substantially. Class inequalities have increased greatly in mostcapitalist countries.

Neoliberalism as a Class Practice: The Roots of Inequalities.
In each of these countries, then, the income of those at the top has increased spectacularly as a result of state interventions. As a result, we need to turn to some of the categories and concepts discarded by large sectors of the left: class structure, class power, class struggle,and their impact on the state. These scientific categories continue tobe of key importance to understanding what is going on in each country. Let me clarify that a scientific concept can be very old but not antiquated. “Ancient” and “antiquated” are two different concepts. The law of gravity is very old but is not antiquated. Anyone who doubts this can test it by jumping from the tenth floor. There is a risk that some sectors of the left may pay an equally suicidal cost by ignoring scientific concepts such as class and class struggle simply because these are old concepts. We cannot understand the world (from Iraq to the rejection of the European Constitution) without acknowledging the existence of classes and class alliances, established worldwide between the dominant classes of the developed capitalist world and those of the developing capitalist world. Neoliberalism is the ideology and practiceof the dominant classes of the developed and developing worlds alike. But before we jump ahead, let’s start with the situation in each country. Neoliberal ideology was the dominant classes’ response to the considerable gains achieved by the working and peasant classes between the end of World War II and the mid-1970s. The huge increase in inequalities that has occurred since then is the direct result of the growth in income and well-being of the dominant classes, which is a consequence of class-determined public policies such as:
(a) deregulation of labor markets, an anti-working class move;
(b) deregulation of financial markets, which has greatly benefited financial capital, the hegemonic branch of capital in the period 1980-2005;
(c) deregulation of commerce in goods and services, which has benefited thehigh-consumption population at the cost of laborers;
(d) reduction ofsocial public expenditures, which has hurt the working class;
(e) privatization of services, which has benefited the top 20% of thepopulation (by income) at the cost of the well-being of the workingclasses that use public services;
(f) promotion of individualism andconsumerism, hurting the culture of solidarity;
(g) development of atheoretical narrative and discourse that pays rhetorical homage to themarkets, but masks a clear alliance between transnationals and the state in which they are based;
and (h) promotion of an anti-interventionistdiscourse in clear conflict with the actual increased stateinterventionism to promote the interests of the dominant classes and theeconomic units – the transnationals – that foster their interests.
Eachof these class-determined public policies requires a state action orintervention that conflicts with the interests of the working and other popular classes.

The Primary Conflict in Today’s World: Not Between North and South But Between an Alliance of Dominant Classes of North and South Against Dominated Classes of North and South
It has become part of the conventional wisdom that the primary conflictin the world is between the rich North and the poor South. The North and the South, however, have classes with opposing interests that have established alliances at the international level. This situation became clear to me when I was advising President Allende in Chile. The fascist coup led by General Pinochet was not, as was widely reported, a coup imposed by the rich North (the U.S.) on Chile (the poor South). Those who brutally imposed the Pinochet regime were the dominant classes ofChile (bourgeoisie, petit bourgeoisie, and upper-middle professionalclasses), with the support not of the U.S. (U.S. society is not an aggregate of 240 million imperialists!) but of the Nixon administration(Nixon as spokesperson for the dominant classes of the U.S.) – which at that time was very unpopular in the U.S., and it had sent the Army to put down the coalminers’ strike in Appalachia. A lack of awareness of the existence of classes often leads to condemnation of an entire country, frequently the U.S. But, in fact, theU.S. working class is one of the first victims of U.S. imperialism. Some will say that the U.S. working class benefits from imperialism. Gasoline, for example, is very cheap (although increasingly less so) in the U.S. It costs me $35 to fill my car in the U.S. and 52 euros to fill the same-model car in Europe. But, by contrast, public transport in the U.S. is practically nonexistent in many regions. The working class ofBaltimore (where the Johns Hopkins University is located), for example, would benefit much more from first-class public transport (which it does not have) than dependency on a car, whatever the price of gasoline. And let’s not forget that the energy and automobile industry interests have been major agents in opposing and destroying public transport in the U.S. The U.S. working class is a victim of its nation’s capitalist and imperialist system. It is not by chance that no other country in the developed capitalist world has such an underdeveloped welfare state as the U.S. More than 100,000 people die in the U.S. every year due to lack of public health care.The tendency to look at the distribution of world power while ignoring class power within each country is also evident in the frequent denunciations that the international organizations are controlled by the rich countries. It is frequently pointed out, for example, that the 10% of the world population living in the richest countries has 43% of thevotes in the IMF, but it is not that 10% of the population living in the so-called rich countries controls the IMF. It is the dominant classes of those rich countries that dominate the IMF, putting forward public policies that hurt the dominated classes of their own countries as well as other countries. The director of the IMF, for example, is Mr. Rato, who while Spain’s Minister of Economy in the ultra-right government ofMr. Aznar (who partnered with Bush and Blair to support the Iraq War) carried out most brutal austerity policies that severely reduced thes tandard of living of the Spanish popular classes (V. Navarro, "Who IsMr Rato?" CounterPunch, June 2004). Let me also clarify another point. Much has been written about the conflict within the WTO between rich and poor countries. The governments of the rich countries, it is said, heavily subsidize their agriculture while raising protective barriers for industries such as textiles and foods that are vulnerable to products coming from the poor countries. While these obstacles to world trade do indeed adversely affect poor countries, it is wrong to assume that the solution is freer worldwide trade. Even without the barriers, the higher productivity of the rich countries would guarantee their success in world trade. What poor countries need to do is to change from export-oriented economies (the root of their problems) to domestic-oriented growth – a strategy thatwould require a major income redistribution and is thus resisted by thed ominant classes of those (and of the rich) countries. It is extremely important to realize that most countries already have the resources (including capital) to break with their underdevelopment. Let me quote from an unlikely source. The New York Times, in the middle of the Malthusian highs (when population explosion was held to be the cause of world poverty) published a surprisingly candid assessment of thesituation in Bangladesh, the poorest country in the world. In this extensive article, Ann Crittenden touched directly on the root of the problem: the patterns of ownership of the production asset – the land: The root of the persistent malnutrition in the midst of relative plentyis the unequal distribution of land in Bangladesh. Few people are rich here by Western standards, but severe inequalities do exist and they arereflected in highly skewed land ownership. The wealthiest 16% of therural population controls two thirds of the land and almost 60% of thepopulation holds less than one acre of property.

Crittenden is not hopeful that the solution is technological. Quite to the contrary, technology can make things even worse:The new agricultural technologies being introduced have tended to favor large farmers, putting them in a better position to buy out their less fortunate neighbors.

Why does this situation persist? The answer is clear. Nevertheless, with the government dominated by landowners – about 75% ofthe members of the Parliament hold land – no one foresees any official support for fundamental changes in the system.

Let me add that in the U.S. State Department’s classification of political regimes, Bangladesh is placed in the democratic column. Meanwhile, hunger and underweight are the primary cause of child mortality in Bangladesh. The hungry face of a child in Bangladesh has become the most common poster used by many charitable organizations to shame people in developing countries into sending money and food aid toBangladesh. With what results? Food aid officials in Bangladesh privately concede that only a fractionof the millions of tons of food aid sent to Bangladesh has reached the poor and hungry in the villages. The food is given to the Government, which in turn sells it at subsidized prices to the military, the police,and the middle class inhabitants of the cities.The class structure of Bangladesh and the property relations that determine it are the causes of the enormous poverty. As Ann Crittenden concludes:Bangladesh has enough land to provide an adequate diet for every man,woman and child in the country. The agricultural potential of this lushgreen land is such that even the inevitable population growth of thenext 20 years could be fed easily by the resources of Bangladesh alone.

Most recently, Bangladesh has been much in the news as having undergone high economic growth due primarily to its exports in the world market.But that growth has been limited to a small, export-oriented sector ofthe economy and has left untouched the majority of the population. Malnutrition and hunger, meanwhile, has increased.

The States and Class Alliances
In the establishment of class alliances, states play a key role. U.S. foreign policy, for example, is oriented towards supporting the dominant classes of the South (where, incidentally, 20% of the world’s richest persons live). These alliances include, on many occasions, personal ties among members of the dominant classes. Examples are many – among them, the traditional support of the Bush family for the Middle East feudal regimes; Clinton’s support for the United Arab Emirates (UAE), one of the major supporters of President Clinton’s library in Arkansas and major donor to Clinton in speaking fees (up to a million dollars) or to causes favoring Clinton (as reported in the Financial Times, March 4, 2006). The UAE is one of the world’s most oppressively brutal regimes. The dominant classes deny citizenship to 85% of the working popluation (called "guest workers”). Needless to say, international agencies (heavily influenced by the U.S. and European governments) promote such alliances based on the neoliberal rhetoric of free markets. Cutting social public expenditures, advocated by the IMF and the World Bank, is part of the neoliberal public policies pushed by the dominant classes of North and South at the cost of the well-being and quality of life of the dominated classes of North and South. In all these examples, the states of the North and the South play a critical role. Another example of alliances among dominant classes is the current promotion of for-profit health insurance by the Bush administration, both to the U.S. population and, increasingly, to the developing world.This is done with the advice and collaboration of conservativegovernments in Latin America on behalf of their dominant classes, which benefit from private insurance schemes that select clientele and exclude the popular classes. Those popular classes, in the U.S. and Latin America, profoundly dislike this push toward for-profit health care. (The movie John Q relates the hostility against health insurance companies among the U.S. working class.) The fact that the dominant classes in the developed and developing countries share class interests does not mean they see eye-to-eye on everything. Of course not. They have major disagreements and conflicts (just as there are disagreements and conflicts among the different components of the dominant classes in each country). But these disagreements cannot conceal the commonality of their interests as clearly exposed in the neoliberal focus (such as at Davos) and neoliberal instruments that have a hegemonic position (suchas the Economist and the Financial Times).

Is There a Dominant State in the World To Date?
More than globalization, what we are witnessing in the world today is the regionalization of economic activities around a dominant state: North America around the U.S., Europe around Germany, and Asia around Japan – and soon China. Thus there is a hierarchy of states within each region. In Europe, for example, the Spanish government is becoming dependent on public policies of the European Union in which the German state predominates. This dependency creates an ambivalent situation. On the one hand, the states of the E.U. chose to delegate major policies(such as monetary policies) to a higher institution (the European Central Bank, which is dominated by the German Central Bank). But this does not necessarily mean that the Spanish state loses power. “Losing power” means you had more power before, which is not necessarily the case. Spain, for example, is more powerful with the euro as currency than it was with the peseta. Indeed, Spanish President Zapatero would have paid a very high cost in his confrontation with Bush (in withdrawing Spanish troops from Iraq) if Spain still had the peseta as its national currency. Sharing sovereignty can increase power. On the other hand, the European government is frequently used by Europe’s dominant classes as excuse and justification to carry out unpopular policies that they want to implement (such as reducing public expenditures as a consequence of the European Stability Pact, which forces countries to maintain a central government deficit below 3% ofGNP); these policies are presented as coming from European legislation rather than any of the member states, thus diluting the responsibilityof each government.

Class alliances at the European level are manifested through the operation of E.U. institutions heavily imbedded of neoliberal ideology and public policies. The “no vote” on the proposed European Constitution was the response of the working classes of some member states to the European institutions that operate as alliances forEurope’s dominant classes. Within the hierarchy of states, some are dominant. The U.S. state has a dominant place that is maintained through a set of alliances with the dominant classes of other states. Neoliberal ideology provides the linkage among these classes. Needless to say, there are conflicts and tensions among them. But these tensions cannot outweigh the commonalityof their class interests. Among the practices that unite them are aggressive policies against the working class and left-wing instruments. The 1980-2005 periods were characterized by an anti-left-wing aggressive campaigns against left-wing parties that had been successful in the earlier, 1960-1980 period. During the “neoliberal” period, the alliance of the dominant classes has promoted multi-class religious movements that have used religion as a motivating force to stop socialism or communism. It was the administration of President Carter that began to support the religious fundamentalists in Afghanistan to overthrow the communist-led government. From Afghanistan to Iraq, including Iran, thePalestinian Territories, and many other Arab countries, the dominant classes of the U.S. and Europe, through their governments, funded and supported the religious fundamentalists – often not only out of their own class interests, but out of their own religiosity. The “moral majority” in the U.S. was supposed to become the moral majority worldwide. These profoundly anti-left fundamentalist movements developed their own dynamics, channeling the enormous frustrations of the Arab masses with their oppressive, feudal regimes, but replacing those regimes with equally oppressive religious theocracies, as has happened in many Arab countries. But it is wrong to see the support by the dominant classes for the feudal regimes as simply a product of the Cold War. It was much more than that. It was a class response. The best evidence for this is that the support has continued even after the collapse of the Soviet Union. The Cold War was an excuse and justification for carrying on the class struggle at the world level – asi ts continuation proves. Class war has indeed become an extremely active component of U.S. interventionism. It was the “shock therapy” pushed by Summers and Sachs in Russia during the Clinton administration that led to the shortening of life expectancy in Russia, a consequence of the dramatic decline in standard of living of the Russian popular classes. The increased privatization of major public assets was part of that class war. As it was in Iraq. The chief of the U.S occupation, Paul Bremer, fired half a million government workers, slashed business taxes, gave investors extraordinary new rights, and eliminated all import restrictions for all business except the oil industry. The only laws from the brutal Iraqi dictatorship that the occupation did not supplant were those that were anti-labor union and restrictive collective-bargaining agreement that took away all workers’ bonuses andfood and housing subsidies, as Jeff Faux relates in Global Class Struggle. As the Economist editorialized, “The occupation of Iraq is acapitalist’s dream.”
Recently, another version of the North-South divide appears in the writings of one of the most influential thinkers in the U.S., thephilosopher John Rawls, who divides the countries of the world into decent and non-decent countries. The decent countries (mostly located in the developed capitalist world) are those that have democratic rights, while the non-decent countries (mostly located in the developingcapitalist world) are those that do not have democratic rights and institutions. After dividing the world into these two categories, he concludes that the non-decent countries had better be ignored, although he admits “a moral responsibility to help poor countries that areprevented by poverty from organizing themselves as liberal or decentsociety.” I must admit that I find such positions and statements remarkable for their overwhelming ignorance of past and present international relations, as well as of the class relations in each of those countries. Rawls further confuses governments with countries (a confusion that occurs frequently in the assumption that the primary conflict is between North and South). What he calls non-decent countries (characterized by brutal and corrupt dictatorships) have classes; their dominant classes have not been ignored in activities cultivated and supported by the dominant classes of the decent countries, which have also hurt the quality of life and well-being of their own dominated classes. Also, in Rawls’s so-called non-decent countries, there are class-based movements that endure enormous sacrifices, carrying out a heroic struggle for change, struggling constantly while handicapped and opposed by the dominant classes of the so-called decent countries. I find it remarkable (but predictable) that such a figure designs the moral compass of these indecent classes. The latest example of this indecency is the reported support of the U.S. and U.K. governments forthe King of Nepal in their concern to stop a mass revolt led byleft-wing parties.

Inequalities among Countries and Their Social Consequences
That inequalities contribute to a lack of social solidarity and increasesocial pathology is well documented. Many people, including myself, haved ocumented this reality (see V. Navarro, The Political Economy of Social Inequalities: Consequences for Health and Quality of Life, Baywood, 2005). The scientific evidence supporting this position is overwhelming.In any given society, the greatest number of deaths would be prevented by reducing social inequalities. Professor Marmot studied the gradientof heart disease mortality among professionals at different authority levels, and he found that the higher the level of authority, the lower the heart disease mortality (M. Marmot, The Status Syndrome, 2005). And he further showed that this mortality gradient could not be explained by diet, physical exercise, or cholesterol alone; these risk factors explained only a small part of the gradient. The most important factor was the position that people held within the social structure (in which class, gender, and race play key roles) and the social distance and differential control that people have over their own lives. This enormously important scientific finding has many implications; one of them is that the major problem we face is not simply in eliminating poverty but rather in reducing inequality. The first is impossible to resolve without resolving the second. Another implication is that poverty is not just a matter of resources, as is wrongly assumed inWorld Bank reports that measure worldwide poverty by quantifying thenumber of people who live on a standardized U.S. dollar a day. The real problem, again, is not absolute resources but the social distance and the different degrees of control over one’s own resources. And this holds true in every society. Let me elaborate. An unskilled, unemployed, young black person living inthe ghetto area of Baltimore has more resources (he or she is likely to have a car, a mobile phone, a TV set, more square feet per household, more kitchen equipment) than a middle-class professional in Ghana, Africa. If the whole world were just a single society, the Baltimore youth would be middle class and the Ghana professional would be poor. And yet, the first has a much shorter life expectancy (45 years) than the second (62 years). How can that be, when the first has moreresources than the second? The answer is clear. It is far more difficult to be poor in the U.S. (the sense of distance, frustration ,powerlessness, and failure is much greater) than to be middle class in Ghana. The first is far below the median; the second is above the median. Does the same mechanism operate in inequalities among countries? The answer is “increasingly, yes.” And the reason for adding “increasingly” is communication – with increasingly globalized information systems and networks, more information is reaching the most remote areas of theworld. And the social distance created by inequalities is becoming increasingly apparent, not only within but also among countries. Because this distance is more and more perceived as an outcome of exploitation, we are facing an enormous tension, comparable with that of the 19th and early 20th centuries, when class exploitation became the driving force for social mobilization. The key element for defining the future is through what channels that mobilization takes place. What we have seen is an enormous mobilization, instigated and guided by an alliance of the dominant classes of the North and the South, aimed at – as mentioned earlier – stimulating multi-class religious or nationalistic mobilizations that leave key class relations unchanged. We saw this phenomenon at the end of the 19th and beginning of the 20th centuries. Christian Democracy in Europe, for example, appears as the dominant classes’ response to the threat of socialism and Communism. The birth ofIslamic fundamentalism was also stimulated for the same purposes. The left-wing alternative must be centered in alliances among the dominated classes and other dominated groups, with a political movement that must be built upon the process of class struggle that takes placein each country. As President Chavez of Venezuela said, “It cannot be a mere movement of protest and celebration like Woodstock.” It is an enormous struggle, an endeavor in which organization and coordination are key, calling for a Fifth International. This is the challenge to the international left today.

TABLE 1Economic Growth, 1960–2000
1960–1980 1980–2000
Rate of economic growth in developing countries (except China):
Annual economic growth 5.5% 2.6%
Annual economic growth per capita 3.2% 0.7%
Annual economic growth 4.5% 9.8%
Annual economic growth per capita 2.5% 8.4%
Source: World Bank 2001; R. Pollin, Contours of Descent, Verso, 2003, p.131.

I. Annual Rate of Economic Growth per Capita in the OECD and Developing Countries
Period 1960 – 1980 Period 1980 – 2000
(A) OECD countries 3.5% 2.0%
(B) Developing countries (except China) 3.2% 0.7%
Growth differential (A/B) 0.3% 1.3%

Peter Waterman criticisms
Thanks for the Vincent Navarro/Monthly Review type piece, Patrick. It is a classical, or at least traditional, view of the world, or worldview, of the national-industrial-(anti)-colonial left, from the period of a passing national-industrial-colonial capitalism.

I am in a bit of a rush, since I am off to Peru tomorrow. So I will cut to the end. And, indeed, I would advise readers of Navarro to start withthis.

He concludes:
'The left-wing alternative must be centered in alliances among the dominated classes and other dominated groups, with a political movement that must be built upon the process of class struggle that takes place in each country. As President Chavez of Venezuela said, “It cannot be a mere movement of protest and celebration like Woodstock.” It is an enormous struggle, an endeavor in which organization and coordination are key, calling for a Fifth International. This is the challenge to the international left today.'

We have been here before, namely in the period of the First, Second, Two-and-a-half (really!), Third and Fourth Internationals. Not to speak of such Third worldist internationals as the Tricontinental (sponsored by Cuba following its revolution). Just how his Fifth is going to differ from and succeed where the others failed is not spelled out. Perhaps it will be funded by Radical-Nationalist/Populist Presidents (who happen to be sitting on barrels of oil), like Chavez?

To say that Navarro's view is reductionist and simplistic is to severely understate the matter. It is precisely because of these qualities that the previously-named internationals failed.

For Navarro there is only class (tho he is a little woozy about naming it in this passage - or them, since he is here surprisingly pluralistic). Neither does he distinguish between classes and groups, nor specify the groups.But he is clear that the 'political movement' will be a class movement and be national. Perhaps he is thinking today of Venezuela? As yesterday we thought of Russia, China, Vietnam, Cuba, and various other 'weak links in the capitalist chain' (the leftist equivalent of the Christian search for the Holy Grail). Navarro sets up various strawmen (no 'men/women' is necessary here since over 50% of the world population has been excluded from consideration by Navarro) to dispose of what I would call 'theoretically-critical and socially-committed globalisation theory'. But let's see what or who hefails to consider in his analysis of our current situation: informatisation, gender relations, ecological despoliation, consumerism, indigenous genocide, ethnic/religious fundamentalisms. I could go on.

Like his only personalised symbol of emancipation, Hugo Chavez, he disparages the World Social Forum - and has no word for the wider Global Justice and Solidarity Movement.

Indeed, his final paragraph, the only one on the worldwide complex of struggles provoked by capitalist globalisation, and dramaticallyfaciliated> by (capitalist) information technology, is a rhetorical gesture.

I prefer the thought of Boaventura de Sousa Santos (search for his growing body of work in English on Amazon), who has said: every significant new movement needs a new theory - and who then attempts to work this out in relation to 'the real movement that changes the present order of things' (Karl Marx). This real movement, today, is global, multi-faceted, complex, networked. The NYTimes editorial said after the great anti-Iraq-war demonstration, that this represented 'the second world power'. Those of us>within this movement, and trying to give it shape and impact, wouldconsider this more of a potential than a reality.

But Navarro's movement is an abstraction, an aspiration, and an archaic one - forward to the past?. Worst of all, it actually has no message forthe working class(es) or labour movement he sees as the sole agent of social transformation. These classes and that movement - even the national-industrial-international trade union organisations - are being increasingly addressed by and drawn into the 'real movement'. It is onlyby a self-transformation in the light of globalisation and its new movements (and theories) that labour can again become an emancipatory force against capitalism rather than a defensive one within this.

If Navarro's analysis leads to his pathetic conclusion, then the theoryhas to be considered profoundly mistaken.

Peter W.

Vincent Navarro responds on the SA Debate list
Dear Patrick,
Regarding the comments by Peter Waterman (P.W.): I was surprised to read them. Not knowing who he is, I can only judge him by his remarks, which convey, besides an enormous hostility, an overwhelming ignorance. He insults rather than argues. How does one respond to such insults ("antiquated," "traditionalist," "pathetic," etc.)? It is difficult to establish a debate on this basis. But let me try.

P.W. reproduces what the right-wing media are saying, without any sense of historical reality. Where is the evidence, for example, for his statement that the II and III Internationals failed? If their objectives included – as they did – improving the quality of life of those who were
exploited, the evidence indeed shows that the health and quality of life of the majority of exploited populations in the 20th century did improve because of the existence of political movements (communist and social democratic) rooted in those Internationals. The evidence supporting this is overwhelming (see my article in the International Journal of Health
Services (IJHS), "Has Socialism Failed?" Vol. 22(4):
583-601, 1992). The 20th century was better off because both Internationals existed. In the underdeveloped world, countries governed by communist parties improved the lives of their populations much better than did countries governed by other political traditions. And in the developed capitalist countries, those governed by social democratic parties have done much better in improving the life and quality of life of their populations (see my edited collection The Political and Social Contexts of Health, 2005) than those governed by other political traditions. Where is the failure? P.W. should not add his voice to the right-wing chorus that socialism has failed. Needless to say, many problems remained and others were reproduced in these movements. But it is right-wing ideological
garbage to dismiss these socialist movements as failures.

I also find ignorance and prejudice in his dismissal of the Cuban revolution. If Latin American children had had the infant mortality rate achieved by that revolution, 1.3 million would have survived in 2005. And the same type of nonsense appears when P.W. ridicules one of the
most important developments in today’s Latin America: the control of Venezuela’s oil by progressive forces. Quite remarkable!!! Of course, these and other progressive movements have weak points that need to be criticized, such as the excessive protagonism of their leaders. But to
dismiss these progressive movements because of these weaknesses is just plain wrong. The history of Latin America has been enriched by the existence of the Cuban revolution and by the political changes occurring in Venezuela and Bolivia.

Finally, P.W. stereotypes my views to an unrecognizable point. He builds a straw-man then tries to destroy it. Let’s look at reality. For some time now, P.W.’s postmodernist chic has been the dominant ideology in some influential segments of the anti-globalization movement (see
Attac’s crises in France). He emphasizes social movements as the major instruments for social transformation. I believe they are indeed important, but dramatically insufficient. Social movements, in the absence of political forces, instruments, and projects, are very limited
indeed. The U.S. is the best example of this observation. The U.S. has a very strong feminist movement, but women have fewer rights in the U.S. than in most European countries. The environmental movement is very strong in the U.S., but environmental standards are weaker in the U.S. than in many European countries, such as Sweden. The "issue-oriented"
movements are limited and limiting. You need to have a political movement that relates the different forms of exploitation. Political maturity means the ability to relate things. In Europe, the Swedish labor movement, a class movement, has been able to relate historically the different forms of exploitation far better than has any rainbow coalition of social movements in the U.S. (as you know, I used to be in the leadership of the Rainbow Coalition and I know what I am talking about). As a consequence, not only workers, but also women and the environment are better off in Sweden than in the U.S. The U.S. is the country of social movements and nowhere is the left as weak as in the U.S. Is that what is called for? The Americanization of Politics? > > > > Of course, there is the enormous risk of transforming social movements into mere transmission belts for political parties. Indeed, this is a major risk. But we have enough experience in the world to know that social movements can develop their own autonomy while working
together with other forces in the struggle for a joint socialist project. And even though each country has to develop its own strategy, we have to learn from other countries as well as from our own. > > > >
In that respect, the left has to build upon its impressive history in the 20th century. It is opportunistic and wrong to build an international left movement that ignore or moves away from that history. Of course, socialist forces have made many mistakes and errors. But
socialism is in its infancy. And, most importantly, in spite of their errors, these movements have done much more good than harm. This is why the popular masses in their daily struggles recover the symbols and cultures inherited from those past movements. We see, from Bolivia to
Venezuela, that socialism is the ideology of those who are exploited, be they indigenous people or homeless people or whatever.

And while class exploitation is not the only type of exploitation, it remains central in the struggle for liberation. To say this does not make me a reductionist. Rather, it recognizes that capitalism is first and foremost a form of class exploitation upon which other forms of exploitation are reproduced. None other than Martin Luther King (one week before he was killed) said that the key struggle in the U.S. was the class struggle. To say this does not make Martin Luther King or me a reductionist. It means that to solve other forms of exploitation, it is necessary (although not sufficient) to end with capitalism. Here again, I am not saying – as P.W. would immediately conclude I am saying – that other forms of liberation struggles – race, gender, national, etc. –
must be postponed until capitalism has disappeared or that those liberation struggles must be subsumed under class liberation. I mean that they have to be part of that last struggle. Class is always inside any form of exploitation (whether race, gender, or environment). In the Rainbow Coalition, we always had to choose which women the Rainbow had to be sensitive and responsive to: working-class women (the majority of the U.S. working class are women) or upper-middle-class women – who tend to dominate the feminist movement. The same issue arises for race. The U.S. has developed a very strong middle-class black population, while the black working class continues to see its quality of life deteriorate. And its the same situation in the Indian nations of the U.S. Class, under capitalism, is everywhere. It would be interesting to see who benefits in today’s South Africa from its economic policies. That is for you to study.

I don’t mind you sharing these notes among your colleagues. But it is not my intention to start a debate with your comrades. I just cannot do it. I am heavily involved in other struggles. I hope it is not taken as a note of arrogance just to refer those who may be interested in pursuing these notes to my writings in my Spanish and English books. > > > >

Finally, I want to clarify that I don’t usually write using the tone I’ve used in this reply, but anyone who writes such insulting comments as P.W. did doesn’t deserve any comradely tone in response.
Take care,
Fraternally yours,
Aug 21st Peter Waterman replies
Vincente Navarro reacts with shock and anger at my critique of an originalpiece by himself.

And I - arriving in Lima without my email archive - was struck by a sense of guilt. What on earth could I have said that was so offensive and ill-informed?

Having recovered the exchange (...) I was somewhat relieved to find that my admitedly hasty and limited note wasno more extreme in form or content than what is fairly common on and, Ithink, accept to Debate. Perhaps Vincente is more accustomed to beingcriticised from the right than the left?

Interested readers can go [...] judge for themselves whether or not my argument or tone was beyond any particular pale.

I appreciate Vincente's reference to the historical left, since much of mywork has been concerned with a recuperation of its emancipatory moments. I am also currently engaged in tracing my own itinerary from the historical international left to the contemporary 'global justice and solidaritymovement'.

I do not however feel that Vincente's references to shortcomings or problemsof that tradition are in any way adequate to the case. Especially since he seems enclosed within this major 150-year-old emancipatory discourse, concerned primarily to update it, fill in the gaps, and simply try harder next time.

Moreover, his preference for the labour and socialist tradition, which he considers 'young' (though at least 150 years old) over the newest wave of emancipatory global movements (1994?) comes over as a prejudice rather thanan argument. For me it is a matter of re-inventing the socialist tradition,internationalism and the labour movement in the light of both the capitalist revolutions (globalisation/informatisation), and of a powerful and increasingly attractive movement active on both these terrains (as well as the gender, ecological and other ones buried, ignored or marginalised by the traditional left).

The 'failure' of the new 'single issue' social movements in the USA is a matter I leave to North Americans to discuss. I would have thought they were in a rather lively condition compared to the socialist tradition and the trade union movement.

And I cannot but note here that the single biggest Mayday in US history was organised this year by *immigrant* workers - i.e. by a segment of the US working class self-identified by its exclusion from citizenship, marginalised within the union movement, energised by its own national/sub-continental traditions of struggle. And possibly organised largely by their own national/sub-continental middle classes? I note, moreover, that the AFL-CIO has felt obliged just now to give recognition to centres of day labourers - i.e. again to marginalised workers who either do not want to or cannot join the traditional trade unions, or perhaps simply want to preserve their collective autonomy so as not to be reduced to a 'special interest' or 'minority section' within a union movement that long ago made peace with US capitalism (and imperialism), and that is anyway - and because of its profound self-subordination - now in deep do-do. (

Workers and worker struggles can no longer be reduced to a homogenouscategory, nor to single organisational forms, and certainly not be led by a self-appointed revolutionary working-class party. The way it looks is as if real-life and differentially-placed workers and movements are learning from the new social movements! Becoming class-conscious does not mean prioritising some empty essence over something considered inferior, peripheral or even 'anti-working class'. Recognition of one's class statusis no less or more significant in anti-capitalist struggle than recognition of racial, gender, sexual, national, communal or 'natural' (ecological) alienation. It is precisely the combination of these different'single-identities' that can create the force to impact on capitalism.

I happened to refer in my note to the Portuguese thinker Boaventura de Sousa Santos. This is someone who has been trying for a decade or more to develop emancipatory theory and strategy in the light of the 'real movement that transforms the present nature of things'. He has been in Lima this lastweek, as the guest of an academic/activist programme of an international(ist) nature, of which I am also part. Boa was here for the launching of two books of his in Spanish. Details can be found on thelargely Spanish language site of DemocraciaGlobal,
However, Boa also has *seven* present or forthcoming books in English, listed on, one of which is 'The Rise of the Global Left: The World Social Forum and Beyond'. This has a final chapter on the future of the left which I would like to draw to the attention of both Vincente and a wider readership. I have just mailed it to a few lists and am consulting on whether this 17-20 page item should beposted on Debate and/or on the Centre for Civil Society pages.

I look forward to the possibility of Vicente and others responding to this draft chapter or the eventual book. Also, for that matter, of it being published by Monthly Review, or some other left magazine/journal in the US.In so far as Boa himself is trying to both preserve and reinvent the left under and against a contemporary capitalist order, I find myself in broad agreement with him. Or maybe I have not yet had enough time to find ordevelop my disagreements with him. But I am confident that the chapter andthe book are going to have a major impact on anti-capitalist thought andstruggle worldwide.

Finally, let me note that Vincente did not take up my concern with his Fifth International (an idea floated also by other old left notables such as SamirAmin and Michael Löwy). Anyone considering this should first take a look atthe history of the internationals, as well as at the divisions between andwithin such today. Or do a google search on it!

My own position was set out around 1990 in a paper, 'Labour Internationalism by Computer: A Fifth International?'. This concluded that precisely becauseof what we today call the Web or the Internet, a Fifth International, on the model of any of the previous or existing ones, was unnecessary. Today Iwould feed into this argument the relatively high level of education of evenrural leaderships even in the South, and the growing social movementpractices of coordination, alliance, dialogue and exchange. They make anynotion of national or global vanguards (or of the more modest internationalunion confederations) rigid, narrow and archaic, where notcounter-productive. (Any claim to truth, or simply primacy, is an open invitation, if not a provocation, to competition, factionalism, splits and intellectual dogmatism).
Peter Waterman
PS. The notion that I am some kind of Post-Modernist I ignore, given myenergetic struggle with and against this within the Politics Programme ofthe Institute of Social Studies, in The Hague, in the 1990s. I thought that foisting this Grand Methodology on Third World students was irresponsible to the point of criminality. The accusation is a common label stuck on the new emancipatory thought and action by an old left which remains fiercely modernist, sharing this ground with pro-capitalists worldwide. Here again I can refer to Boa Santos, who distinguishes between what he calls 'celebratory post-modernism' and 'critical post-modernism'. I like the distinction tho I would prefer another name for the second posture. I would not want to be dependent on post-modernism even by opposition to it. On the other hand, I think the PoMo-istas did serious damage to modernist (i.e. capitalist, statist, industrialist, rationalistic, universalistic,Westocentric, racist and sexist) certainty, and that there is no way back to a simple or simplified past. If, as one writer on modernism said, quoting Marx, 'all things solid melt into air', then this has to apply to our deepest past assumptions also.


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