Permanent War is American Capitalism’s Response to the Crisis

The American economy is in a much worse state than the statistics would appear to indicate. What we are witnessing is a crisis which is not only a crisis of neo-liberalism, but also a crisis of those Keynesian ideas, which were, in their day, seen as the solution to the inadequacies of the economic policy of free exchange which held sway in the Great Depression of the '30's. The failure of both policies demonstrates that capitalism cannot overcome its contradictions, no matter what type of economic policy it is forced to adopt. Every time it crashes into depression which bring huge social consequences.

The consequences of the current crisis are enormous. In the second quarter of 2002 the American economy had accumulated a debt of $3000bn in the productive sector alone. The public accounts ate also in the red, and individual family debt is huge. The foreign trade deficit alone is touching $500bn. All the major sectors of production are in crisis. This goes all the way from the most important airlines, through the energy companies to steel firms and land transport. In the financial area the Stock Exchange collapsed for the nth time, especially as the Nasdaq, the technology listing, lost 70% of its capitalisation. The bursting of the stock exchange bubble was preceded by the crisis of all the sectors linked to the production of technical goods, sectors in which the American economy had high hopes. The eleven consecutive reductions in interest rates in a single year have done nothing to prop up an economy which is suffocating and is prey to the convulsions of depression.

On a social level unemployment has officially gone from 4.1% to 4.9%, or, in real terms, from 12% to 14%. The difference between the rich, who are ever fewer in number though richer, and the poor, who are always growing in number and always poorer, has widened further. As well as the absolute poverty of those who either have no income or an income below $10,000 per annum (36 million Americans live in these conditions, and the estimates don't reflect the real situation), there is the phenomenon of relative poverty, of those who, although having a job and an income (the first being temporary and part-time and the second being of low pay), live, somehow or other, below the poverty threshold.

The causes are always the same, only made worse in terms of their intensity and the speed of operation. The cyclical crises which periodically devastate capitalist relations of production are accompanied by rates of profit which are dramatically smaller. This aggravates capital's valorisation mechanisms, making accumulation more difficult, intensifying competition and creating crises on a global scale. Despite this, the American economic machine remains on its feet and is still in a condition to dominate the great international markets. It is still the vanguard of the world capitalist system and can present itself both economically and financially as the colossus with which the rest of the world must reckon. However, for this reason American imperialism has had to put into effect a series of strategies in order to continue this dominance. The most significant of these strategies which allows the USA to survive its own contradictions more than any other is that of force. This allows the USA to partly export its problems to the periphery of its empire and to exclude international competitors from key markets, both conditions for its economic survival. In the last ten years there have been a series of wars in which the permanent use of force has been as ferocious as the planning has been carefully timed.

The use of force seems to have been a constant amongst the political baggage of American imperialism.

The use of force can be seen everywhere in every international market from the commercial to the financial, from the control of oil to the management of the markets of strategic raw materials. The repertoire varies from wars of plunder to preventative ones, from direct to indirect control. They always find justifications, if they are not to hand they are invented, and the devastation duly arrives.

In eleven years there have been five wars, including the latest with Saddam Hussein's Iraq. From the Gulf War through Afghanistan to the current occupation of Iraq runs a black thread of the perverse use of war as the primary condition for the maintenance of American world primacy. Such a primacy has to eliminate all forms of competition from the management of strategic markets, whether they deal with oil or financial flows, if it is to be maintained. Wars against the current “enemy” create the conditions for control and control is the premise for the elimination of competition. Whether this is

European, Russian or Chinese doesn't really matter, except for Washington's chosen solution in terms of regional tactics or global strategy. To put it in a nutshell, one could say that the degree of arrogance and violence with which the USA pursues its objectives is directly proportional to the crisis which produced them. (1)

Where economic blackmail and political pressures do not get results, the military is violently unleashed. The former demands the opening up of overseas markets to the needs of American business through conditions placed on foreign loans contracted with to: IMF or World Bank. This means American goods enjoy the freedom to circulate but tariffs for goods produced in the peripheral countries trying to enter the USA. Once political control of the financing is conceded further loans are only offered as a condition of the USA having free access to the exploitation of cut price raw materials. If the governments of these countries accept the diktat, everything proceeds as normal, if there is resistance and popular uprisings, then that brings us to the second case. The government is overthrown and the eventual revolts are bloodily repressed with the aid or advice of the CIA. Central and South American experience confirms this, and not just in episodes way back in the past but also more recently in Argentina, Columbia and Venezuela.

On the oil scene, American imperialism's mode of operation is a great deal more coherent and determined. The game is not just about its desire to extend its control over the area of greatest interest for energy, such as the Persian Gulf or the Caspian, but also to continue to manage parasitic oil revenue through the maintenance of the dollar as the monetary unit of exchange with the world's primary energy source, and the possibility of intervening in decisions about the quantity production and the prices paid for it, and thus the financial flows between the oil-producing and consuming areas. In the final analysis the USA is the sole hub around which the interests of the other international powers must all revolve.

These four aspects of the question are intimately linked. The control of oil is of vital importance for the American economy, its energy demand means that it imports 60% of its requirements. The Texan wells are exhausted and the cost of extraction is very high. Those in Alaska barely cover 35% of the total demand. The need for easy and secure supplies has become pressing and cannot be put off, on pain of the rapid decline of its already precarious productive structure which has suffered from the greater competivity of Europe and Japan over the last thirty years. The quantity and sale price of oil are becoming a corollary of the control over energy, and are, from time to time, suggested, if not dictated, by relations of force between the internal economic situation and the necessity for penalising international competitors who do not possess a drop of oil. Continuing to impose the dollar as the universal coefficient of exchange in oil transactions enables the USA to overvalue its own currency to parasitically appropriate for itself quotas of surplus value produced in the four corners of the globe, but mostly from highly industrialised countries, favouring a financial flow towards the Americane economy, which needs fresh capital, an even more strategic need when put in its relation to the ever greater difficulties of productively achieving profit rates which are significant in respect to the mass of capital invested. Then control of oil-bearing areas also allows the use of the primary energy source, which no country in the world can forego, especially if it is industrially developed, as a political deterrent, forcing countries to line up behind, or entirely submit to American strategic needs. The use of force, therefore, of permanent war, as the means of realising all these objectives is the indispensable condition for American imperialism in its desperate attempt to survive the contradictions of its own so capitalist economy, to manage them better, to make everyone else to pay for them to the same extent, if with different consequences, from the other competing capitalist powers to the countries of the so-called periphery. This project can clearly be seen through a study of declared US policy intentions and from the facts. The growth in war spending, in the face of the dismantling of the welfare state, which had already started under the Reagan administration has exponentially increased under every successive government, touching the historic peak of $400 bn under the present administration of Bush junior.

They sing the praises of American neo-liberalism, as if, after the a collapse of the USSR, for the whole a of humanity there had opened up horizons of peace and prosperity, as if Western capitalism, following the collapse of Eastern state capitalism, was in a position to solve its own contradictions. Steeped in this fiction, they have produced new monsters to fight, they have invented new enemies to eliminate, they have further equipped themselves with war-making destructive capacity with the sole aim of surviving by killing,of perpetuating a regime of exploitation without frontiers, limits or shame. First, it was the spectre of Saddam, then that of bin Laden, in the middle the Serbs and Milosevic, tomorrow it could be the turn of whoever has the misfortune to find themselves in the way of American interests, the satisfaction of which can no longer be delayed and have to be pursued a immediately, by force in the explosion of devastating wars one after the other in a tragic succession which appears to be unending. In eleven years, there have been five wars. Behind nearly all of them, the shadow of oil, in front of all of them American arrogance, in the middle the direct and indirect victims who have had to pay the highest price for what is necessary for American imperialism's survival.

In every episode of war, US imperialism’s arrogance makes a farce of the international organisations; it has used them as far as possible, it has changed them according to tactical necessity and disagreements with the other powers and has abandoned them when their use has been rendered difficult or purposeless. The first Gulf War was fought by American imperialism under the flag of convenience of the UN in order to get its hands on the oil of the Persian Gulf. Then, when many countries smelt a rat and made their opposition felt within the UN over the question of war in Bosnia and Kosovo, the USA turned to NATO. In the Afghan War, when the game was about the control of Caspian oil and it was difficult to obtain a second backer, it decided to act almost alone. It played the card of its vote of approvals by world opinion on the basis of a dubious interpretation of article five of NATO'S rules, which was to sanctify the right of revenge for a USA struck by the equally dubious massacre of 11th September, even if the USA had to carry it out alone, supported only by Great Britain. Currently, when faced with opposition to its occupation of Iraq, they are using the iron fist in the UN, or rather in their dealings with some European countries, and with Russia and China. American arrogance replied (once they had forced through the final, much disputed resolution) that if some attitude or other of Saddam Hussein did not fully satisfy American expectations, then this would be sufficient grounds for unleashing an invasion. President Bush, and the oil and the military lobbies, had already decided on this invasion. They would certainly not have been stopped by any resolution which the UN might have passed.

The way the Washington government has made use of international organisations whilst they did its bidding and then abandoned them as soon as they ceased to be useful or credible covers for US action, can also be seen from the debts they have run up in their subscriptions to the UN. After the US got no favours after the first Gulf War, American subscriptions have practically dried up. Even in '94 during the civil war in Bosnia, and just before the war in Kosovo was unleashed, an outcome strongly desired by the American administration but without the unconditional support of the permanent members of the Security Council, the amount of the missing American contributions reached $285.5m, a figure which today has more than doubled. The fact that the American share was 25% of the UN's total budget means that the US has virtually paralysed the UN.

Having made full military use of the UN once the Cold War was over the USA now condemned it at the very moment when it no longer corresponded to American strategic interests. Finally, in defiance of all international protocols, US power had made sure that the standards of the International Criminal Court relating to the prosecution of those governments, armies or soldiers who stain themselves with crimes against humanity, would have no jurisdiction over the USA. The Bush Government not only refused to put its own signature to the international agreement of intent, but had stressed that no American Citizen could be investigated, and certainly not judged, by international tribunals either in terms of offences or of war crimes.

This is a kind. of safe-conduct for previous offences and for those not yet committed, in perfect harmony with the needs of American imperialism, which must be free to use force at all times and in every way, whenever it needs to do so. (2)

The conditions which make war an instrument for the defence of American imperialism's interests are clear. The international scene which emerged after the collapse of the Soviet Union was the major reason why it is much easier for American imperialism to pursue its aims of economic and financial supremacy, and to control commercial markets and raw materials, by using military methods. In the Cold War period, whether inside the UN or in the various theatres of the wars across the planet, the presence of a second imperialist pole forced the USA to be less daring, to limit its expansionist policies, and to successfully use economic blackmail with its Western allies, in the name of a convenient unity faced with the common enemy, Soviet communism. Never mind the fact that communism didn't exist there, or that the carrying out of the communist programme there was impossible by the late twenties, and that it was plain to even the most inattentive observer of international politics that Stalinism was the political form which the counter-revolution assumed in Russia, the “ideological” confrontation was opportunistically used to hide the true meaning of the conflict, which was an imperialist one, or rather both pursued capitalist interests, whether in the private or the state capitalist version of the system.

With the fall of the Soviet union (3) a previously unimagined field of play opened up for American imperialism. Successive American administrations fully profited from this situation. Even whilst the USSR was still formally alive the first Gulf War was unleashed. It come a good two years after Gorbachov's historic declaration of perestroika and the end of the Cold War, and when the President of the moribund Soviet Union had already begun to dismantle Comecon and the Warsaw Pact. When he withdrew his own troops from every corner of the globe he left his real, if ambiguous allies, including Milosevic's Yugoslavia and Saddam Hussein's Iraq, at the mercy of the old deadly enemy. All the wars that followed, from Bosnia to Afghanistan, took place in the absence of the Soviet counterweight, that is, in a particularly favourable inter- imperialist situation for the USA which was absolutely unique in the period after the Second World War.

The fall of the USSR meant that the surviving Russian Federation could do very little against the old American enemy. On the level of their respective imperialist strengths, in every type of confrontation, from the economic to the political, Russia was simply incapable of opposition. This does not mean that the Russia of Yeltsin or that Putin has not, or is not, trying to pick up the crumbs: of the left-overs put on the table by imperialist plunder, but these are the left-overs that American imperialism leaves in exchange for having free hands on other tables with other fellow diners. Putin's Russia has had some crumbs in Chechenya, Daghestan and those Asian provinces which were at one time part of its empire. With Caspian oil, on the other hand, things have been very different.

The Russians have been excluded from all the American projects for Kazakh oil concessions, and control and transport of the oil towards the Indian Ocean via Afghanistan. The second war against Saddam Hussein's Iraq for the complete control over the Gulf’s oil followed the same pattern. The Putin administration opposed this objective, not because the imperialist strength of Russia had increased, but simply because the devastating economic crisis which post-Soviet Russia is still heading towards forced him into this opposition. Putin was compelled to play his game diplomatically within the discredited UN, trying to soften the aggressive American policy which, as President Bush himself had declared several times, did not admit of modification if Saddam did not submit to all the US demands, however unpalatable. In concrete terms, in the daily unfolding of imperialist dynamics over the question of the control of oil, over that of the parasitic revenue derived from the oil trade, over the trade in goods and raw materials, the weight of the Russian Federation is almost irrelevant. as it is subject to pressures and blackmail over the concession of credits from the IMF, or rather, from America. Conversely, the possibilities for the Bush government to act freely are growing exponentially. The US ability to use force, to adopt the permanent war option finds plenty of space and favourable conditions, despite the feeble alternatives put forward by its competing allies.

Even though it is completely different in terms of economic and historic trajectories, the relation of force between “Europe” and the USA can be seen in the same way. Above all, Europe does not exist as a united political entity and even less as a military one. Over the previous thirty years Europe has, in almost all the sectors of the real economy, contributed to the creation of the hole in the American balance of payments, by setting itself up as an economic colossus, but it still retains all the genetic characteristics of a political and military dwarf. Its imperialist weight is very close to being zero and this situation means that the individual countries find themselves alone in their competition with the American superpower, triggering the practice of “everyone for themselves and God for all”. All this despite various attempts, which have recently been invoked more often, to create a common military force to stand alongside the Euro, the monetary instrument that the European countries have adopted in order to stand up to the dollar on the international money market. But the European monetary effort, if not supported by a military force enabling it to play in the imperialist game, remains an incomplete weapon, and this is entirely to the advantage of its American counterpart. It was no accident that one of the reasons that pushed the Bush administration to military intervention in Iraq and eliminate the Saddam regime in order to replace it with a pro-American one, lay in its aim to take possession of the second largest oil deposits in the world, to eliminate the possibility that Russia and Europe could have access to Iraqi oil, thus by-passing the American monopoly on managing the area, and to eliminate the possibility that the rouble and the euro could gradually replace the dollar in oil transactions, thus paving the way for countries like Iran and Libya who are just waiting for the opportune moment to do the same. Everything, once again, was played out on the level of force. Europe, that is, France, Germany and Russia, made great efforts on the level of diplomatic skirmishes, and played the game of UN resolutions, while the USA instead showed its muscle, by sustaining the thesis of the strongest takes all and “either with us and on our terms, or against us with all the consequences”.

The compromise of Resolution 1441 which France and Germany strongly supported, and which was only accepted by Saddam

Hussein, only partly moved the USA. There were so many traps hidden inside in this resolution that there was always scope for launching an attack. The military attack against the Taliban government was ready long before September 11. For well-known reasons, the planning foresaw that the attack on the Kabul government would carried out militarily in October 2001, but the first decision was made in 1990 and the second in August 2001 when it became clear first to the Clinton administration and then to the Bush clique, that the reliability of the Taliban government that they had themselves promoted, was almost non-existent. A similar timing was repeated in the case of Iraq. The planning of the second attack on Saddam Hussein took shape a year before the actual event when certain things changed in the Middle Eastern oil scenario. The Afghan option had not had, for the moment, the desired results. In fact, the Karzai government showed itself to be too unreliable and weak and Saudi Arabia was no longer that firm base that the Americans had been used to, and thus it was necessary for the US to reposition itself in the area. If, maintaining the Saddam regime in place had initially justified the permanent American presence in the area, now all that was no longer sufficient. It was necessary to eliminate the Baghdad chief and replace him with a friendly government, both to put the deposits of Mosul and Kirkuk under US control and to secure the energy supplies of the American economy. In all these cases, American imperialism regards war as being the best instrument to obtain the satisfaction of its interests in the region and, simultaneously, to eliminate possible European or Russian competition.

Overall then, the opportunity for the use of force by the ruling class in Washington is directly proportional to the political and military weakness of the other imperialists. Russian imperialism, as the heir to the Soviet crises, has been destroyed and is no longer functional. European imperialism is beginning to exert itself; but this is also directly proportional to the low level of class struggle in all the major powers. Class movements everywhere find it difficult to struggle against the devastation and barbarism of the new imperialist framework. In the periphery, revolts explode, even violent ones, but without a strategy or a revolutionary leadership, whilst in the metropolitan countries, the movements are latent, or, if they do break out they are completely within the framework of neo-reformism.

Fabio Damen

(1) The latest revelation of US plans in 1973 to invade the oil producing states, including Saudi Arabia, during the first oil shock indicates just how determined the US ruling class are to have their hands on the levers control of this most basic of commodities for modern capitalism. We should not forget that it was the US devaluation of the dollar n 1971 and 1973 (which signaled the end of the cycle of accumulation) that forced the oil-producing states to form OPEC in the face of a falling real price of their major commodity. Oil and dollar levels have been inextricably linked ever since. Today as US oil demands have increased

And domestic production has declined’ the situation is much more critical.

(2) And since war against Saddam the US has openly declared the abandonment of any notion of collective security, instead preferring the idea of “selective engagement” with those powers it deems friendly or useful.

(3) This was not a result of any attempt to create an unrealisable communist society, nor because of the USSR's presumed inferiority in terms of economic and social competition with Western capitalism, but rather because of an economic implosion whose causes are to a sought in the same capitalist contradictions that can be found in the West. The single difference was only that of the ownership and management of production in the USSR, including that of labour power, was by the state.