The Making of Global Capitalism: The Political Economy Of American Empire
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The all-encompassing embrace of world capitalism at the beginning of the twenty-first century was generally attributed to the superiority of competitive markets. Globalization had appeared to be the natural outcome of this unstoppable process. But today, with global markets roiling and increasingly reliant on state intervention to stay afloat, it has become clear that markets and states aren’t straightforwardly opposing forces.
In this groundbreaking work, Leo Panitch and Sam Gindin demonstrate the intimate relationship between modern capitalism and the American state, including its role as an “informal empire” promoting free trade and capital movements. Through a powerful historical survey, they show how the US has superintended the restructuring of other states in favor of competitive markets and coordinated the management of increasingly frequent financial crises.
The Making of Global Capitalism, through its highly original analysis of the first great economic crisis of the twenty-first century, identifies the centrality of the social conflicts that occur within states rather than between them. These emerging fault lines hold out the possibility of new political movements transforming nation states and transcending global markets.
chairmanship of the Basel Committee on Banking Supervision was occupied by the president of the Federal Reserve Bank of New York, with the 120 economists employed there doing much of the research for the BIS and sharing data with the other central banks. This took place just as the BIS was turning its attention from the G10 to the rest of the world’s banking systems, beginning with an international conference attended by representatives of 140 countries to address the risks international banks
the role the US played as “consumer of last resort.” In true imperial fashion, the US fully shared its problems with the rest of the world. Given the role of US financial assets and consumer spending in global capitalism, illusions that other regions might be able avoid the crisis were quickly dispelled. But the centrality of the American state was at the same time made clearer than ever. Its key role in global crisis management was confirmed as the crisis unfolded, from the US Federal Reserve
far too much weight in his The Politics of War (New York: Vintage Books, 1968) to Secretary of State Hull’s free-trade pronouncements during World War II. It would once again have amounted to “transcendental false consciousness” to base policy on the notion that exports rather than domestic accumulation would save the US from another depression after the war. And Kolko was joined in this by many others who took it as a simple matter of fact that postwar policy was driven by the belief that “the
18 The most detailed account is still Wilson, American Business and Foreign Policy. 19 Maddison, Phases of Capitalist Development, Tables A8 and F4, pp. 175, 251. 20 “Considerable economic aid had been extended to Europe from the US after World War I, first by the Herbert Hoover–led relief and reconstruction effort and then by private capital speculating on a restoration of monetary stability and pre–World War I exchange rates . . . Post–World War I reconstruction loans had been sold as sound
but almost certainly collapse the global economic system.65 The truth of this observation could already be seen in the relationship the US established with Europe after the war. Since oil was “the largest single item in the dollar budget of most of the Marshall Plan countries,” its US administrators “kept up constant pressure on the companies to lower their prices and thus lower the dollar costs of ‘oiling’ European recovery”; the critical issue became how to “balance the US interest in