Year 501 (11 page)

“Western European and third world diplomats here were sharply critical of some of the language in the document,” Patrick Tyler reported from Washington. “Senior White House and State Department officials have harshly criticized” it as well, claiming that it “in no way or shape represents U.S. policy.” The Pentagon spokesman “pointedly disavowed some of the central policy statements” of the document, noting, however, that “its basic thrust mirrors the public statements and testimony of Defense Secretary Dick Cheney.” This constitutes a “tactical withdrawal” by the Pentagon, Tyler suggests, prompted by the “reaction in Congress and from senior Administration officials.” Quite possibly Administration criticisms also reflect concerns over the alarms that the document set off in many capitals, and their harsh criticism too is a tactical withdrawal. Cheney and Undersecretary for Policy Paul Wolfowitz “endorsed [the] principal views” of the document, senior officials acknowledged. There was also criticism in the press, notably from
Times
foreign policy specialist Leslie Gelb, who objected to the “daydreaming about being the world's policeman” and one “disturbing omission”: “the document seems to be silent about any American role in insuring Israeli security.”
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To what extent the other members of the club will accept the suzerainty of the enforcer who pledges to “account sufficiently for their interests” is an unsettled question. In the present case, protests and concerns over cost led the Administration to revise the plan a few months later, replacing traditional themes by tepid clichés—at least for public consumption. Meanwhile France and Germany moved to implement a Franco-German military corps independent of NATO, over intense US opposition. France also blocked US efforts to extend the NATO alliance (including the related North Atlantic Cooperation Council) to include Hungary, Poland, and Czechoslovakia. US officials allege that “the French don't want an American-led NATO to take on further responsibilities in Eastern Europe” and perpetuate the alliance, the
Wall Street Journal
reported.
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The debates reflect a real foreign policy dilemma. With its economy in relative decline and its social base in serious disrepair, particularly after a decade of Reaganite borrow-and-spend abandon, is the US in a position to maintain the hegemonic role it has played for half a century? And will others accept a subordinate role? Will they be willing to pay the costs, as the US exploits its comparative advantage in military force to maintain the particular version of global order demanded by the domestic power interests, costs that the US is no longer in a position to sustain itself? It is not clear that the other rich men will agree to employ the US as their “Hessians,” as widely advocated in the business press during the build-up to the Gulf war, perhaps along with its British lieutenant. The latter is also in social and economic decline but “well qualified, motivated, and likely to have a high military profile as the mercenary of the international community,” the military correspondent of the London
Independent
comments—again, a regular theme during the Gulf war, accompanied by much triumphant breast-beating among British jingoists, dreaming of the good old days when they had “the right to bomb niggers” with no whining from the left-fascists.
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To understand the discussion, it is necessary to decode the conventional euphemisms in which it is framed (“responsibility,” “security,” “defense,” etc.). The code words disguise a basic question: Who is going to run the show?

4. The End of the Affluent Alliance

The basic framework of policy formation tends to remain in place as long as the institutions of power and domination are stable, with the capacity to deflect challenges and accommodate or displace competing forces. That has been true of the United States in the postwar period, indeed long before. Nevertheless, policies have to be adapted to changing contingencies.

A change in world order of lasting importance was recognized officially in August 1971, when Richard Nixon announced his “New Economic Policy,” dismantling the international economic order established after World War II (the Bretton Woods system), in which the US served, in effect, as international banker, with the dollar as the world's sole international currency, convertible to gold at $35 an ounce. By that time, “the affluent alliance had come to the end of the road” and “the disorder was getting too serious for aspirins,” international economist Susan Strange observed. German-led Europe and Japan had recovered from wartime destruction, and the US was facing the unanticipated costs of the Vietnam war. The world economy was entering an era of “tripolarity”—and also, crucially, of stagnation and declining profitability of capital.
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The predictable reaction was a rapid intensification of the class war that is waged with unceasing dedication by the corporate sector, its political agents, and ideological servants. The years that followed saw an attack on real wages, social services, and unions—indeed any kind of functioning democratic structure—so as to overcome the troublesome “crisis of democracy” brought about by the illegitimate efforts of the public to bring their interests into the political arena. The ideological component of the offensive sought to strengthen authority and habits of obedience, to diminish social consciousness and such human frailties as concern for others, and to instruct young people that they are confirmed narcissists. Another objective has been to establish a de facto world government insulated from popular awareness or interference, devoted to the task of ensuring that the world's human and material resources are freely available to the transnational corporations (TNCs) and international banks that are to control the global system.

The US remains the largest single economy, though declining relative to its major rivals, which are not without their own problems. Those faced by the US are also too serious for aspirins, though little more is available thanks to doctrinal and policy triumphs that have diminished the capacity for constructive social action directed to the needs of the irrelevant majority, one happy consequence of Reaganite debt-creation.

Nixon's response to the decline of US economic hegemony was forthright: “when you're losing, change the rules of the game,” economist Richard Du Boff observes. Nixon suspended the convertibility of the dollar to gold, overturning the international monetary system, imposed temporary wage-price controls and a general import surcharge, and initiated fiscal measures that directed state power, beyond the previous norm, to welfare for the rich: reduction of federal taxes and domestic expenditures, apart from the required subsidies to the corporate sector. These have been the guiding policies since. They were accelerated during the Reagan years, largely following Carter Administration prescriptions that were reshaped by the more doctrinaire Reaganites to bring about a huge growth in debt at every level (federal, state, local, household, corporate), with little to show in the way of productive investment. One crucial element is the incalculable debt of unmet social needs, a mounting burden imposed upon the large majority of the population and future generations.

Nixon's initiatives constituted “a sort of mercantilist revolution in domestic and foreign policy,” political economist David Calleo observed a few years later. The international system grew more disorderly, “with rules eroded and power more significant.” There was less “rational control over national economic life,” hence great advantages to internationalist business and banking, freed from capital controls and official restraint and secure in the expectation of a state-organized public bail-out if something goes wrong. International capital markets rapidly expanded as a consequence of the decline of regulation and control, the huge flow of petrodollars after the 1973-1974 oil price rise, and the information-telecommunications revolution, which greatly facilitated capital transfers. Vigorous bank initiatives to stimulate new borrowing contributed to the Third World debt crisis and the current instability of the banks themselves.
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The rise in oil prices (preceded by a comparable increase in price of US coal, uranium, and agricultural exports) yielded temporary advantages for the US and British economies, providing windfall profits for the energy corporations, primarily US and British, and inducing them to bring into production high-cost oil (Alaska, North Sea) that had been withheld from the market. For the US, rising energy costs were substantially offset by military and other exports to the Middle East oil producers and huge construction projects for them. Their profits also flowed to Treasury securities and investment; support for the economies of the US and UK has long been the primary responsibility of the Arab Facade of local managers.
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The same years saw the stagnation and collapse of the Soviet empire, which had interfered with the planned global order in crucial ways (chapter 3). The power of the state capitalist industrial societies was enhanced further by the economic catastrophe that swept through most of their domains in the 1980s. The sense of foreboding throughout the Third World is readily understandable.

Japan and continental Europe recovered from the recession of the early 1980s, though without resuming earlier growth rates. US recovery involved massive borrowing and state stimulation of the economy, mainly through the Pentagon-based public subsidy to high technology industry, along with a sharp increase in protectionist measures and a rise in interest rates. This contributed to the crisis of the South as interest payments on the debt rose while investment and aid declined, and the wealthy classes invested their riches in the West. There was a huge capital flow from South to North, with effects that were generally disastrous, apart from the NICs (newly industrialized countries) of East Asia, where the state is powerful enough to control capital flight and direct the economy efficiently. The catastrophe of capitalism in the 1980s also had an impact on Eastern Europe, contributing to the disintegration of the Soviet empire and the virtual disappearance of Russia from the world scene.
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In earlier years, the nonaligned countries had sought to gain some control over their fate. Initiatives were taken through UNCTAD (the UN Conference on Trade and Development) to create a “new international economic order” with support and stabilization programs for primary commodities, in the hope of stemming the deterioration in terms of trade and controlling the sharp price fluctuations that have a devastating impact on economies that rely on few primary exports. UNESCO undertook parallel efforts to provide Third World countries with access to international communications, a virtual monopoly of the advanced industrial societies.

These initiatives naturally elicited enormous hostility on the part of the world rulers, and were turned back decisively in the 1980s. The US led a fierce attack on the United Nations that effectively eliminated it as an independent force in world affairs. UNESCO inspired particular hatred, because of its Third World orientation and threat to ideological domination. The demolition operation and the return of the UN to US control have been lauded here as a restoration of the ideals of the founders, not without justice. Extraordinary deceit has been required to conceal the fact that it has been primarily the US, secondarily Britain, that have vetoed Security Council resolutions and generally undermined the UN for over 20 years, and to sustain the standard pretense that “Soviet obstructionism” and “shrill Third World anti-Americanism” are what rendered the UN ineffective. The no less extraordinary levels of deceit that accompanied the government-media campaign to eliminate UNESCO heresies are documented in an important study, which, needless to say, had no effect whatsoever on the flow of necessary lies.
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The hysteria about “political correctness” is an interesting domestic analogue. Its extent is truly something to behold, including a stream of best-sellers with anecdotes, many concocted, about alleged horrors in the universities, angry speeches, and a flood of articles from the news columns to the sports pages and journals of opinion that gushed forth suddenly, as if on command; a study of one six-month period found over a mention per day in the
Los Angeles Times
. The outrage has a basis in reality. There really are a great many people who oppose racist and sexist oppression, have respect for other cultures, and do not look kindly upon atrocities in a “good cause,” and the abuses that so horrify the faithful are not entirely fanciful; even the clumsiest propaganda usually takes off from something real. But as in the case of official enemies abroad, the real abuses, whatever they may be, have little relation to the drama constructed around them.

The phenomenon did not emerge from nowhere. One crucial component of the post-affluence class war has been a far-reaching takeover of the ideological system by the right, with a proliferation of right-wing think tanks, a campaign to extend conservative control still further over ideologically significant sectors of the colleges and universities, now replete with professorships of free enterprise, lavishly funded far-right student journals, and so on; and an array of other devices to restrict the framework of discussion and thought, as much as possible, to the reactionary end of the already narrow spectrum. Things actually reached such a point that a respected liberal foreign policy analyst could describe the statist-conservative
New York Times
, without irony, as the “establishment left” (Charles Maynes). In the political system, “liberal” joined “socialist” as a scare word; by 1992, the Democratic Party scarcely needed to make a gesture to popular constituencies it had once professed to represent. Gore Vidal hardly exaggerates when he describes US politics as a one-party system with two right wings. One aspect of this ideological triumph has been the deeper implantation of Orwellian rhetoric and standards of Political Correctness to which one must adhere to join respectable discussion, a number of examples already illustrated. Departure from these conventions of belief and rhetoric is virtually unthinkable, in the mainstream.
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