Monday, 16 April 2012


 There are very clear signs that structurally the world is moving increasingly toward further consolidation of the polarizing model that divides the world geographically - rich or developed, semi-developed, and poor or underdeveloped countries - and socioeconomically. This polarizing model, in existence since the evolution of the market economy in the 16th century, rests today on the massive influence of financial institutions - banks, brokerage firms, and insurance companies - over the state. However, the model also rests on large corporate influences and the phenomenon of comprador bourgeois political and socioeconomic class.

What is COMPRADOR bourgeois class? This class of middlemen emerged during the era of European colonialism when the colonizers needed local operatives as middlemen to function, whether in Africa, India, China, or Latin America. The fortunes of the comprador socioeconomic class were totally dependent on the colonial economic system that also gave rise to a comprador political class when decolonization took place in the 20th century, especially after WWII. Through the formation of such a class, the Great Powers were able to reduce the dependent country's economic system into an extension of the mother country under the imperial system as we can see by examining the global operations of the European colonial powers since the 16th century as well as US after the Spanish-American War.

This is not to suggest that the market economy has not rested since its inception on uneven development, uneven terms of trade, and preponderate influence of market forces on state policy. As the cradle of capitalism, northwest Europe became the core of a world economy that began to integrate the rest of the world into its system, an integration process that usually entailed colonization, or division of markets into spheres of influence. The process of integration into the world economic system means that the local and national economies would be subservient to the international one. In the absence of a local and national cooperation by middlemen - comprador class whose fortunes depended on the foreign capitalist system - the process of integration would not be possible.

It would not be possible for England to operate in 19th century China without comprador bourgeoisie any more than it would be for the US to operate in Latin America after the Spanish-American War. Both puppet bourgeois class and puppet regimes were and are necessary for the operation of the polarizing global system. Comprador economics necessarily created a comprador political class. Without the political class advancing policies intended to promote thorough economic integration of the national economy with the international economic system where the large corporations enjoy clear dominance integration would not be possible. In fact, where there is no colonial structure, the comprador political class is a precondition to the creation of comprador socioeconomic class. This means that while capitalism operates under a more representative model in the advanced countries, there is considerably less representation and less sovereignty in the countries under the comprador political and socioeconomic class. This is evident not just in underdeveloped nations, but in much of Southern and Eastern Europe.

In the early 21st century, we have many examples of this process not just in Africa, but also in Latin America and Europe as well. This became evident when Hungarian Premier Viktor Orban blatantly stated in a Budapest rally that: "We will not be a colony. We will not be second class citizens". Orban made these comments to more than 100,000 cheering Hungarians on the anniversary of the Revolution of 1848, a revolution that swept across Europe and marked the publication of the Communist Manifesto by Marx and Engels. Similar speeches have been made by politicians in Spain, Portugal, Greece, Ireland, and East European countries that are under the economic hegemony of northwest Europe; a northwest Europe dominated by Germany operating as a patron over client member EU states.While Southern and Eastern Europe undergo austerity measures that in essence entail weakening the middle class and national bourgeoisie, the beneficiaries short and longer-term are international capital concentrated in Germany and Northwest Europe.

In the early 21st century, governments of the Great Powers (G-8) struggle to strengthen the national capitalist class by providing varieties of assistance, ranging from diplomatic and other ministerial services such as Commerce and Trade departments provide, to pouring money in the national capitalist class through the fiscal system. The same holds true for nations pursuing quasi-statist policies, including China, India, Russia and Brazil; all nations that endeavor to escape the fate of having the Great Powers impose their hegemony by using the integrative market system, namely, globalization under neoliberalism.

Within the Great Powers there is global competition for market share and the way to achieve the goal is by having a strong state structure while endeavoring to weaken the state structure of 'dependent societies'. Whether it is the UK, US, or Germany, the goal is the same, given that the state - mainstream political parties in power -  is the pillar of the economic system whose backbone is banking and the ultimate goal is capital accumulation concentrated in core nations where there is a strong national bourgeoisie. Naturally, without the state behind it, the national bourgeoisie would be unable to survive, just as the comprador bourgeoisie would be equally unable to survive in the absence of the state supporting it.

In the case of the weaker countries, the bottom 180 nations that collectively own 20% of the world's assets owing to the economic system rooted in grossly uneven distribution of wealth, the struggle is to opt for development by following the rules of dependent capitalism - comprador politics and economics - that the Great Powers impose, or to deviate from those rules by trying to strengthen national capitalism.

In mid-April 2012, Argentina announced nationalization of YPF, the oil and gas company that was part of Spanish energy giant REPSOL company since 1999 when Argentina was undergoing very serious financial and economic problems operating under IMF austerity. Considering that US-led sanctions on Iran have meant that the Islamic Republic recently decided to cut off oil supplies to Spain's REPSOL, the YPF expropriation is more bad news for debt-ridden Spain, which has replaced some of the lost Iranian supply with Saudi oil.

Not just Spain, but the entire EU argued that Argentina's move signals a violation of the rules of international free enterprise economic system; a system that has always worked to keep dependent capitalist countries like Argentina from having a strong national economy that caters to internal needs of society. By making the bold move to nationalize a privately-owned oil company under foreign ownership, Argentina asserted state-supported economic nationalism, a long-standing tradition in Latin America, and one that is not associated with Mexico in the 1930s or Cuba in the 1960s, but more recently with Venezuela, Bolivia and other republics.

Argentina has been on the path of national capitalism for about a decade when it decided to throw out the IMF and try its fate with a different policy mix that would afford it greater control over the economy and society. National capitalism is antithetical to the neo-liberal ideology and to globalization that helps to strengthen multinational corporations and international finance capitalism intended to transfer wealth from the bottom 180 nations of the world to the top 20 nations.

The Argentinian example is the one that the Great Powers, along with the WTO, IMF and World Bank do not want other countries to follow, for it would mean the undermining of international capitalism benefiting the core nations. While the Great Powers and the IMF encourage privatizing public enterprises and deregulating the economy while making assets cheaper for foreign ownership, Argentina is trying to go the opposite direction as a means to gain control of its assets. Note that one reason for the expropriation of YPF is that new oil and natural gas reserves would fall under national control instead of going to foreign-owned REPSOL.

Comprador politics and economics is not merely a question of economic and political dependency as we see in the case of hegemonic US over some Latin American countries or northwest Europe (mainly Germany) over Southern and Eastern Europe, but it is also a question of national sovereignty. The issue of national sovereignty was at the root of Arab uprisings, although the US and northwest Europe made sure that they were involved in the opposition so they can integrated those economies into the international market system once the dust settled. The global division between strong national sovereign countries limited to the G-20 and within those the G-8, on the one hand, and the weak comprador nations as represented by the bottom 180 poses a major question of whether democracy can exist in societies whose destiny rests in the hands of the Great Powers.

The most significant question is whether the model of a divided world between national and comprador bourgeoisie, strong national state structures confined mainly to the G-8 vs. weak ones for all others can yield global economic development, and social harmony that is essential to political stability. The signs we have so far from the situations in the Arab Spring uprisings, in the European grassroots movements and other popular protests from Russia to Chile is that the global model of concentrated capitalism that divides the world geographically and politically results in lack of development and lack of stability. One solution on the part of the Great Powers to impose the polarizing world order is to wage war and use military means combined with or independently of economic sanctions.

There are of course limits to military solutions - judging by results in Iraq and Afghanistan - and the question still remains whether growth and development on a sustainable basis can be achieved under the polarizing model of national vs. comprador bourgeoisie. Now that China has opted for an imperial expansionist economic model so it can compete with Japan, EU and US, the global division becomes even more intense. How long will the waning middle and lower classes endure exploitation before they take to the streets to overthrow a system of socioeconomic and political inequality?

Revolution may be inevitable in the 21st century, and as was the case in the 20th century, it will come from countries where the state is weak and dependent and society operates under a comprador political economic model. The comprador societal model was the root cause of revolutions in Russia, China, Vietnam, Cuba, and it will be so again in this century. More than Communist revolutions, these were anti-imperialist-nationalist revolts intended to take back the national sovereignty from the Great Powers.

This is not to suggest that early 20th century Communist regimes would be making a comeback in the 21st century. Nor is this to suggest that in the absence of policies and institutions based on social justice, national sovereignty by itself is just fine for society. Nor is this to say that national capitalists are any less exploitative than international ones supported by comprador bourgeoisie and politicians.However, given that the nation-state structure remains strong, no matter the efforts of the globalized market economy to erase it, national sovereignty remains at the core of the social contract as many people in pluralistic societies understand it; and its absence entails not only surrendering the right to have a society that caters to its own population first, but it means surrendering rights that are fundamental to any concept of democracy.

We are at the beginning of a new era of revolution in the early 21st century, a  revolution that can be prevented if the global polarizing model is somehow modified to permit for the social contract to accommodate the majority of the people.

1 comment:

Gonzalo said...

Simply thanks,
very well said!