11
William I. Robinson
World capitalism has been undergoing a profound restructuring since the 1970s. Many have come to refer to this process as globalization, although what this concept exactly means, the nature, extent and importance of the changes bound up with the process, is hotly debated.1 In my view, globalization is a concept useful intellectually and enabling politically. It helps us to organize empirical information on the restructuring of capitalism in such a way as to provide explanation on the nature and direction of world social change at the dawn of a new millennium, and therefore to gain a better grasp on the prospects for emancipatory social action. In this chapter I will analyse capitalist globalization and develop an historical materialist analysis of the transnationalization of the state. Some of what Marx had to say about the world in his day no longer applies but the method of historical materialism as knowledge grounded in praxis is not restricted to particular historical circumstances. Indeed, historical materialism is emancipatory precisely because it allows us to cut through the reification that results from naturalizing historical arrangements and reveals the historical specificity of existing social forms.
I will argue here that the nation-state is an historically specific form of world social organization that is in the process of becoming transcended by capitalist globalization. The debate on globalization has increasingly centred on the relation of the nation-state to economic globalization. But the issue of globalization and the state has been misframed. Either the nation-state (and the inter-state system) is seen as retaining its primacy as the axis of international relations and world development in a dualist construct that posits separate logics for a globalizing economic and a nation-state based political system, or the state is seen, as in diverse ‘end of the nation-state’ theses, as no longer important. Rejecting these frames by critiquing and moving beyond this global-national dualism, I call for a return to an historical materialist conception of the state, and on this basis explore three interrelated propositions: (1) economic globalization has its counterpart in transnational class formation and in the emergence of a transnational state (henceforth, TNS) which has been brought into existence to function as the collective authority for a global ruling class; (2) the nation-state is neither retaining its primacy nor disappearing but becoming transformed and absorbed into this larger structure of a TNS; (3) this emergent TNS institutionalizes a new class relation between labour and capital world-wide. Exploring these issues is of major import for popular struggles and socialist politics in the new century. Globalization is anything but a peaceful process. It has involved protracted and bloody social conflict. As an open-ended process, it is highly contested from below and subject to alterations in its course. But strategies for an alternative ‘globalization from below’ must part from a critique that identifies how this process has unfolded, the contradictions it confronts, and new sites of political contestation, such as a TNS.
This chapter is divided into five parts. The first discusses globalization as a new stage in the development of world capitalism. The second calls for a break with the Weberian conception of the state that underlies much discussion of globalization and develops the concept of a TNS. The third situates the rise of a TNS in the context of a new class relation between global capital and global labour. The fourth reviews empirical evidence for the rise of a TNS between the 1960s and the 1990s. Finally, the fifth refers by way of conclusion to the prospects for emancipatory social action in light of the preceding. I should note, as a caveat, that space constraints preclude a full discussion of the theoretical and analytical issues at hand. The propositions advanced here are of course tentative in nature and require further exploration elsewhere.
Globalization: the latest stage of capitalism2
Periodization of capitalism is an analytical tool that allows us to grasp changes in the system over time. In my view, globalization represents an epochal shift, the fourth in the history of world capitalism. The first, mercantilism and primitive accumulation, was ushered in with the birth of capitalism out of its feudal cocoon in Europe and outward expansion. The second, competitive, or classical capitalism, marked the industrial revolution, the rise of the bourgeoisie, and the forging of the nation-state. The third was the rise of corporate (monopoly) capitalism, the consolidation of a single world market and the nation-state system into which world capitalism became organized. The first epoch ran from the symbolic dates of 1492 through to 1789, the second to the late nineteenth century, and the third into the early 1970s. Globalization as the fourth (the current) epoch began with the world economic crisis of the 1970s and the profound restructuring of the system that has been taking place since. It features the rise of transnational capital and the supersession of the nationstate system as the organizing principle of capitalist development. As an epochal period globalization constitutes not a new process but the near culmination of the centuries-long process of the spread of capitalist production relations around the world and its displacement of all pre-capitalist relations. The system is undergoing a dramatic intensive expansion. The era of the primitive accumulation of capital is coming to an end. In this process, those cultural and political institutions that fettered capitalism are swept aside, paving the way for the total commodification or ‘marketization’ of social life world-wide.
Economic globalization has been well researched.3 Capital has achieved a newfound global mobility and is reorganizing production world-wide in accordance with the whole gamut of political and factor cost considerations. This involves the worldwide decentralization of production together with the centralization of command and control of the global economy in transnational capital. In this process, national productive apparatuses become fragmented and integrated externally into new globalized circuits of accumulation. Here we can distinguish between a world economy and a global economy. In the earlier epochs each country developed national circuits of accumulation that were linked to each other through commodity exchange and capital flows in an integrated international market (a world economy). In the emerging global economy, the globalization of the production process itself breaks down and functionally integrates these national circuits into global circuits of accumulation. Globalization, therefore, is unifying the world into a single mode of production and bringing about the organic integration of different countries and regions into a global economy and society. The increasing dissolution of space barriers and the subordination of the logic of geography to that of production, what some have called ‘time–space compression’, is without historic precedence. It compels us to reconsider the geography and the politics of the nation-state (Robinson 1998). As we shall see, the TNS embodies new social practices and class relations bound up with this global economy.
The political reorganization of world capitalism has lagged behind its economic reorganization, with the result that there is a disjuncture between economic globalization and the political institutionalization of new social relations unfolding under globalization. Nevertheless, as the material basis of human society changes so too does its institutional organization. From the seventeenth-century treaties of Westphalia into the 1960s, capitalism unfolded through a system of nation-states that generated concomitant national structures, institutions, and agents. Globalization has increasingly eroded these national boundaries, and made it structurally impossible for individual nations to sustain independent, or even autonomous, economies, polities, and social structures. A key feature of the current epoch is the supersession of the nation-state as the organizing principle of capitalism, and with it, of the inter-state system as the institutional framework of capitalist development. In the emerging global capitalist configuration, transnational or global space is coming to supplant national spaces. There is no longer anything external to the system, not in the sense that this is a ‘closed’ system but in that there are no longer any countries or regions that remain outside of world capitalism, any pre-capitalist zones for colonization, or autonomous accumulation outside of the sphere of global capital. The internal social nexus therefore is now a global one. Such organic social relations are always institutionalized, which makes them ‘fixed’ and makes their reproduction possible. As the organic and internal linkage between peoples become truly global, the whole set of nation-state institutions is becoming superseded by transnational institutions.
Globalization has posed serious difficulties for theories of all sorts. The embedded nation-state centrism of many extant paradigms, in my view, impedes our understanding of the dynamics of change under globalization (Robinson 1998). My propositions regarding the integration of the entire superstructure of world society is a conception of the current epoch that differs from that of world system analysis, which posits a world system of separate political and cultural superstructures linked by a geographic division of labour, and from many Marxist analyses, which see the nation-state as immanent to capitalist development. The notion that the continued internationalization of capital and the growth of an international civil society has involved as well the internationalization of the state has been recognized by a number of traditions in the social sciences. And the interdisciplinary literature on globalization is full of discussion on the increasing significance of supra-or transnational institutions. However, what these diverse accounts share is a nation-state centrism that entraps them in a global-national dualism. They assume phenomena associated with a TNS to be international extensions of the nation-state system. The conception is one of international institutions created by nation-states individually or collectively as mechanisms to regulate the flow of goods and capital across their borders and to mediate inter-state relations. Here I distinguish between international and transnational (or global). The former is a conception of world dynamics founded on an existing system of nation-states while the later identifies processes and social relations that tend towards superseding that system.
Conceptualizing a transnational state apparatus: from Weber to Marx
The question of the state is at the heart of the globalization debate. But this debate has been misinformed by the persistent conflation of the nation-state and the state. The two are not coterminous. Here we need to distinguish analytically between a number of related terms: nation, country, nation-state, state, national state, and transnational state. Nation-states are geographical and juridical units and sometimes cultural units, and the term is interchangeable as used here with country or nation. States are power relations embodied in particular sets of political institutions. The conflation of these two related but analytically distinct concepts is grounded in a Weberian conception of the state that informs much analysis of this subject, even analyses by many Marxists. For Weber, the state is a set of cadre and institutions that exercise authority, a ‘legitimate monopoly of coercion’, over a given territory. In the Weberian construct, the economic and the political (in Weberian terms, ‘markets and states’) are externally related, separate and even oppositional, spheres, each with its own independent logic. Nation-states interact externally with markets (Weber 1978: 353–4). Consequently, globalization is seen to involve the economic sphere while the political sphere may remain constant, an immutable nation-state system. State managers confront the implications of economic globalization and footloose transnational capital as an external logic (see, inter alia, Vernon 1971; Strange 1996; Sassen 1996; Boyer and Drache 1996). This state-market dualism has become the dominant framework for analysis of globalization and the state, and is closely related to the global-national dualism. Globalization is said to be overstated or even imaginary since nation-states ‘have more power’ than is claimed, or because there are ‘national’ explanations that explain phenomena better than globalization explanations (see, inter alia, Weiss 1998; Hirst and Thompson 1996; Gordon 1988). In this construct, what takes place ‘within’ a nation-state becomes counterposed to what takes place in the global system. In these recurrent dualisms, economic globalization is increasingly recognized but is analysed as if it is independent of the institutions that structure these social relations, in particular, states and the nation-state. Separate logics are posited for a globalizing economy and a nation-state based political system.
The way out of these antinomies is to move beyond Weber and return to a historical materialist conception of the state. In the Marxist conception, the state is the institutionalization of class relations around a particular configuration of social production. The separation of the economic from the political for the first time under capitalism accords each an autonomy – and implies a complex relationship that must be problematized – but also generates the illusion of independent externally related spheres. In the historical materialist conception, the economic and the political are distinct moments of the same totality. The relation between the economy, or social production relations under capitalism, and states as sets of institutionalized class relations that adhere to those production relations, is an internal one. It is not possible here to revisit the theoretical debates that have raged since the revival of interest in the state in the 1960s – which have remained inconclusive and open-ended (but see, inter alia, Jessop 1982; Held 1989; Clarke 1991). Note, however, that (1) Marxist theories on the relative autonomy of the state, whether emphasizing a ‘structuralist’ or ‘instrumental’ subordination of the state to economically dominant classes, do not posit an independent state as a separate sphere with its own logic (in Marx’s words, there is no state ‘suspended in mid-air’ (Marx 1978: 607)). The task of analysis is to uncover the complex of social processes and relations that embed states in the configuration of civil society and political economy; (2) there is nothing in the historical materialist conception of the state that necessarily ties it to territory or to nation-states (see also Hannes Lacher’s chapter in this volume). That capitalism has historically assumed a geographic expression is something that must be problematized.
States as coercive systems of authority are class relations and social practices congealed and operationalized through institutions. In Marx’s view, the state gives a political form to economic institutions and production relations.4 Markets are the site of material life while states spring from economic (production) relations and represent the institutionalization of social relations of domination. Consequently, the economic globalization of capital cannot be a phenomenon isolated from the transformation of class relations and of states. In the Weberian conception, states are by definition territorially bound institutions and therefore a TNS cannot be conceived as long as the nation-state system persists. Weberian state theory reduces the state to the state’s apparatus and its cadre and thereby reifies the state. States are not actors as such. Social classes and groups are historical actors. States do not ‘do’ anything per se. Social classes and groups acting in and out of states (and other institutions) ‘do’ things as collective historical agents. State apparatuses are those instruments that enforce and reproduce the class relations and practices embedded in states. The institutional structures of nationstates may persist in the epoch of globalization, but globalization requires that we modify our conception of these structures. A TNS apparatus is emerging under globalization from within the system of nation-states. The material circumstances that gave rise to the nation-state are presently being superseded by globalization. What is required is a return to an historical materialist theoretical conceptualization of the state, not as a ‘thing’ but as a specific social relation inserted into larger social structures that may take different, and historically determined, institutional forms, only one of which is the nation-state.
To summarize and recapitulate: a state is the congealment of a particular and historically determined constellation of class forces and relations, and states are always embodied in sets of political institutions. Hence states are: (a) a moment of class power relations; (b) a set of political institutions (an ‘apparatus’). The state is not one or the other; it is both in their unity. The separation of these two dimensions is purely methodological (Weber’s mistake is to reduce the state to ‘b’). National states arose as particular embodiments of the constellations of social groups and classes that developed within the system of nation-states in the earlier epochs of capitalism and became grounded in particular geographies. What then is a transnational state? Concretely, what is the ‘a’ and the ‘b’ of a TNS? It is a particular constellation of class forces and relations bound up with capitalist globalization and the rise of a transnational capitalist class, embodied in a diverse set of political institutions. These institutions are transformed national states plus diverse international institutions that serve to institutionalize the domination of this class as the hegemonic fraction of capital world-wide.
Hence, the state as a class relation is becoming transnationalized. The class practices of a new global ruling class are becoming ‘condensed’, to use Poulantzas’ imagery, in an emergent TNS. In the process of the globalization of capital, class fractions from different countries have fused together into new capitalist groups within transnational space. This new transnational bourgeoisie or capitalist class is that segment of the world bourgeoisie that represents transnational capital. It is comprised of the owners of the leading world-wide means of production as embodied principally in the transnational corporations and private financial institutions. What distinguishes the transnational capitalist class from national or local capitalist fractions is that it is involved in globalized production and manages global circuits of accumulation that give it an objective class existence and identity spatially and politically in the global system above any local territories and polities.
The TNS comprises those institutions and practices in global society that maintain, defend, and advance the emergent hegemony of a global bourgeoisie and its project of constructing a new global capitalist historical bloc. This TNS apparatus is an emerging network that comprises transformed and externally integrated national states, together with the supranational economic and political forums and that has not yet acquired any centralized institutional form. The rise of a TNS entails the reorganization of the state in each nation – I will henceforth refer to these states of each country as national states – and it involves simultaneously the rise of truly supranational economic and political institutions. These two processes – the transformation of nation-states and the rise of supranational institutions – are not separate or mutually exclusive. In fact, they are twin dimensions of the process of the transnationalization of the state.
The TNS apparatus is multi-layered and multi-centred, linking together functionally institutions that exhibit distinct gradations of ‘state-ness’ and which have different histories and trajectories. The supranational organizations are both economic and political, formal and informal. The economic forums include the International Monetary Fund (IMF), the World Bank (WB), the World Trade Organization (WTO), the regional banks, and so on. Supranational political forums include the Group of 7 and the recently formed Group of 22, as well as more formal forums such as the United Nations (UN), the European Union (EU), and so on. They also include regional groupings such as the Association of South East Asian Nations (ASEAN), and the juridical administrative and regulatory structures established through regional agreements such as the North American Free Trade Agreement (NAFTA) and the Asia-Pacific Economic Cooperation (APEC) forum. These supranational planning institutes are gradually supplanting national institutions in policy development and global management and administration of the global economy. The function of the nation-state is shifting from the formulation of national policies to the administration of policies formulated through supranational institutions. However, it is essential to avoid the national–global duality: national states are not external to the TNS but are becoming incorporated into it as component parts. The supra-national organizations function in consonance with transformed national states. They are staffed by transnational functionaries that find their counterparts in transnational functionaries who staff transformed national states. These transnational state cadres act as midwives of capitalist globalization.
The TNS is attempting to fulfil the functions for world capitalism that in earlier periods were fulfilled by what world-system and international relations scholars refer to as a ‘hegemon’, or a dominant capitalist power that has the resources and the structural position that allows it to organize world capitalism as a whole and impose the rules, regulatory environment, etc., that allows the system to function. We are witnessing the decline of US supremacy and the early stages of the creation of a transnational hegemony through supranational structures that are not yet capable of providing the economic regulation and political conditions for the reproduction of global capitalism. Just as the national state played this role in the earlier period, the TNS seeks to create and maintain the preconditions for the valorization and accumulation of capital in the global economy, which is not simply the sum of national economies and national class structures and requires a centralized authority to represent the whole of competing capitals, the major combinations of which are no longer ‘national’ capitals. The nature of state practices in the emergent global system resides in the exercise of transnational economic and political authority through the TNS apparatus to reproduce the class relations embedded in the global valorization and accumulation of capital.
The power of national states and the power of transnational capital
As class formation proceeded through the nation-state in earlier epochs, class struggle world-wide unfolded through the institutional and organizational logic of the nation-state system. During the nation-state phase of capitalism, national states enjoyed a varying but significant degree of autonomy to intervene in the phase of distribution and surpluses could be diverted through nation-state institutions. Dominant and subordinate classes struggled against each other over the social surplus through such institutions and fought to utilize national states to capture shares of the surplus. As a result, to evoke Karl Polanyi’s classical analysis, a ‘double movement’ took place late last century (Polanyi 1944), made possible because capital, facing territorial, institutional and other limits bound up with the nation-state system, faced a series of constraints that forced it to reach an historic compromise with working and popular classes. These classes could place redistributive demands on national states and set some constraints on the power of capital (these possibilities also contributed to the split in the world socialist movement and the rise of social democracy). Popular classes could achieve this because national states had the ability to capture and redirect surpluses through interventionist mechanisms. The outcome of world class struggles in this period were Keynesian or ‘New Deal’ states and Fordist production in the cores of the world economy and diverse multiclass developmentalist states and populist projects in the periphery (‘peripheral Fordism’), what Lipietz and others have called the ‘Fordist class compromise’ (Lipietz 1992).
In each of these cases, subordinate classes mediated their relation to capital through the nation-state. Capitalist classes developed within the protective cocoon of nation-states and developed interests in opposition to rival national capitals. These states expressed the coalitions of classes and groups that were incorporated into the historic blocs of nation-states. There was nothing transhistoric, or predetermined, about this process of class formation world-wide. It is now being superseded by globalization. What is occurring is a process of transnational class formation, in which the mediating element of national states has been modified (on transnational classes, see, inter alia, van der Pijl 1998; Sklair 1995; Gill 1990; Robinson 1996a; Robinson and Harris, 2002). As national productive structures become transnationally integrated, world classes whose organic development took place through the nation-state are experiencing supranational integration with ‘national’ classes of other countries. Global class formation has involved the accelerated division of the world into a global bourgeoisie and a global proletariat and has brought changes in the relationship between dominant and subordinate classes. Specifically, by redefining the phase of distribution in the accumulation of capital in relation to nation-states the global economy fragments national cohesion around processes of social reproduction and shifts the site of reproduction from the nation-state to transnational space. The consequent liberation of transnational capital from the constraints and commitments placed on it by the social forces in the nation-state phase of capitalism has dramatically altered the balance of forces among classes and social groups in each nation of the world and at a global level towards the transnational capitalist class and its agents. (Indeed, the restraints on accumulation imposed by popular classes world-wide in the nation-state phase of capitalism was what drove capital to transnationalization in the first instance.)
The declining ability of the nation-state to intervene in the process of capital accumulation and to determine economic policies reflects the newfound power that transnational capital acquired over popular classes. Different classes and groups contest (national) state power but real power in the global system is shifting to a transnational space that is not subject to ‘national’ control. This structural power of transnational capital over the direct power of national states has been utilized to instil discipline or to undermine policies that may emanate from these states when they are captured by popular classes or by national fractions of local dominant groups, as popular forces that won state power in Haiti, Nicaragua, South Africa, and elsewhere in the 1970s-1990s discovered. This appears as an institutional contradiction between the structural power of transnational capital and the direct power of states (see, e.g., Gill and Law 1989). But this is a structural contradiction internal to an evolving capitalist system, at whose core are class relations, as the inner essence of a condition whose outward manifestation is an institutional contradiction. One set of social relations reflects a more fundamental set of social relations. On the surface, the structural power of capital over the direct power of states is enhanced many times over by globalization. In its essence, the relative power of exploiting classes over the exploited classes has been enhanced many times over, at least in this momentary historic juncture.
The newfound relative power of global capital over global labour is becoming fixed in a new global capital-labour relation, what some have called the global casualization or informalization of labour, or diverse contingent categories, involving alternative systems of labour control associated with post-Fordist ‘flexible accumulation’ (on the crisis of Fordism/Keynesianism and restructuring, see, inter alia, Kolko 1988; Harvey 1990; Cox 1987; Lipietz 1987; Lash and Urry 1987). Central to this new capital–labour relation is the concept of a restructuring crisis. The crisis of the long post-war boom in the 1970s ushered in a radical shift in the methods and sites of global capitalist accumulation, resulting, in Hoogvelt’s analysis, in a transformation in the mechanisms of surplus value extraction (Hoogvelt 1997). These new systems of labour control include subcontracting and contract labour, outsourcing, part-time and temporary work, informal work, home-work, the revival of patriarchal, ‘sweatshop’, and other oppressive production relations. Well-known trends associated with the restructuring of the labour-capital relation taking place under globalization include ‘downward levelling’, deunionization, ‘ad hoc’ and ‘just-in-time’ labour supply, the superexploitation of immigrant communities as a counterpart to capital export, the lengthening of the working day, the rise of a new global ‘underclass’ of supernumeraries or ‘redundants’ subject to new forms of social control and even to genocide, and new gendered and racialized hierarchies among labour.
These new relations have been broadly discussed in the globalization literature. What interests us here is the larger social and political context in which they are embedded, and the extent to which states and nation-states continue to mediate these contexts. State practices and the very structure of states are negotiated and renegotiated in specific historic periods through changes in the balance of social forces as capitalism develops and classes struggle. Capital began to abandon earlier reciprocities with labour from the 1970s onwards, precisely because the process of globalization has allowed it to break free of nation-state constraints. These new labour patterns are facilitated by globalization in a dual sense: first, capital has exercised its power over labour through new patterns of flexible accumulation made possible by enabling ‘third wave’ technologies, the elimination of spatial barriers to accumulation, and the control over space these changes bring; second, globalization itself involves the culmination of the primitive accumulation of capital world-wide, a process in which millions have been wrenched from the means of production, proletarianized, and thrown into a global labour market that transnational capital has been able to shape. In this new capital-labour relation, labour is increasingly only a naked commodity, no longer embedded in relations of reciprocity rooted in social and political communities that have historically been institutionalized in nation-states.
The dissolution of the ‘welfarist’ or Keynesian ‘class compromise’ rests on the power acquired by transnational capital over labour, which is objectively transnational but whose power is constrained and whose subjective consciousness is distorted by the continued existence of the system of nation-states. Here we see how the continued existence of the nation-state serves numerous interests of the transnational capitalist class. For instance, central to capitalism is securing a politically and economically suitable labour supply, and at the core of all class societies is the control over labour and disposal of the products of labour. Under capitalist globalization, the linkage between securing labour and territoriality is changing, and national labour pools are merging into a single global labour pool that services global capitalism. The global labour supply is, in the main, no longer coerced (subject to extra-economic compulsion) due to the ability of the universalized market to exercise strictly economic discipline, but its movement is juridically controlled. Here, national borders play a vital function. Nation-states are about the configuration of space, what sociologist Philip McMichael (1996) has called ‘population containment zones’. But their containment function applies to labour and not to capital. Globally mobile capital is not regulated by centralized national political authorities but labour is. The inter-state system thus acts as a condition for the structural power of globally mobile transnational capital over labour which is transnational in its actual content and character, but is subjected to different institutional arrangements and to the direct control of national states.
How then is the newfound relative power of global capital over global labour related to our analysis of the transnationalization of the state? Out of the emerging transnational institutionality the new class relations of global capitalism and the social practices specific to it are becoming congealed and institutionalized. For instance, when the IMF or the WB condition financing on enactment of new labour codes to make workers more ‘flexible’, or on the rollback of a state-sponsored ‘social wage’ through austerity programmes, they are producing this new class relation. Similarly, the types of practices of national states that became generalized in the late twentieth century – deregulation, fiscal conservatism, monetarism, tax regressivity, austerity, etc. – produce this relation, resulting in an increase in state services to, and subsidization of, capital, and underscoring the increased role of the state in facilitating private capital accumulation. With this comes a shift in income and in power from labour to capital. These outcomes generate the broader social and political conditions under which the new capital-labour relation is forged.
But now we need to specify further the relationship of national states to the TNS. Capital acquires its newfound power vis-à-vis (as expressed within) national states, which are transformed into transmission belts and filtering devices. But national states are also transformed into proactive instruments for advancing the agenda of global capitalism. This assertion that transnational social forces impose their structural power over nations and the simultaneous assertion that states, captured by transnational fractions, are proactive agents of the globalization process, only appear as contradictory if one abandons dialectics for the Weberian dualist construct of states and markets and the national-global dualism. Governments are undertaking restructuring and serve the needs of transnational capital not simply because they are ‘powerless’ in the face of globalization, but because a particular historical constellation of social forces now exists that presents an organic social base for this global restructuring of capitalism. Hence it is not that nation-states become irrelevant or powerless vis-à-vis transnational capital and its global institutions. Rather, power as the ability to issue commands and have them obeyed, or more precisely, the ability to shape social structures, shifts from social groups and classes with interests in national accumulation to those whose interests lie in new global circuits of accumulation.
The contradictory logics of national and global accumulation are at work in this process. Class fractionation is occurring along a new national/transnational axis with the rise of transnational corporate and political elites (for discussion, see Robinson 1996a, 1996b; Robinson and Harris, 2000). The interests of one group lie in national accumulation, including the whole set of traditional national regulatory and protectionist mechanisms, and the other in an expanding global economy based on world-wide market liberalization. The struggle between descendant national fractions of dominant groups and ascendant transnational fractions was often the backdrop to surface political dynamics and ideological processes in the late twentieth century. These two fractions have been vying for control of local state apparatuses since the 1970s. Transnational fractions of local elites have ascended politically in countries around the world, clashing in their bid for hegemony with nationally based class fractions. In the 1970s and the 1980s incipient transnationalized fractions set out to eclipse national fractions in the core capitalist countries of the North and to capture the ‘commanding heights’ of state policy-making. From the 1980s into the 1990s, these fractions became ascendant in the South and began to vie for, and in many countries to capture, national state apparatuses. National states, captured by transnational social forces, internalize the authority structures of global capitalism. The global is incarnated in local social structures and processes. The disciplinary power of the global capitalism shifts actual policy-making power within national states to the global capitalist bloc, which is represented by local social forces tied to the global economy. Gradually, transnational blocs became hegemonic in the 1980s and 1990s within the vast majority of countries in the world and began to transform their countries. They utilized national state apparatuses to advance globalization and established formal and informal liaison mechanisms between the national state structures and TNS apparatuses.
By the 1990s the transnational capitalist class had become the hegemonic class fraction globally. This denationalized bourgeoisie is class conscious, and conscious of its transnationality. Its interests are administered by a managerial elite that controls the levers of global policy-making and exercises transnational state power through the multilayered configuration of the TNS. But this transnational bourgeoisie is not a unified group. ‘The same conditions, the same contradiction, the same interests necessarily called forth on the whole similar customs everywhere’, noted Marx and Engels in discussing the formation of new class groups. ‘But separate individuals form a class only insofar as they have to carry on a common battle against another class; otherwise they are on hostile terms with each other as competitors’ ( Marx and Engels 1970: 82). Fierce competition among oligopolist clusters, conflicting pressures, and differences over the tactics and strategy of maintaining class domination and addressing the crises and contradictions of global capitalism make any real internal unity in global ruling class impossible. In sum, the capturing of local states by agents of global capitalism resolves the institutional contradiction discussed above between transnational capital and national states, that is, local state practices are increasingly harmonized with global capitalism. But this only intensifies the underlying class and social contradictions. Before discussing these contradictions, let us reconstruct in brief the emergence of a TNS in the latter decades of the twentieth century, tracing how the transnational capitalist class sought to institutionalize its interests within a TNS.
Some empirical reference points: the emergence of a transnational state: 1960s-1990s
Under the political-military canopy of US supremacy, national capitals began a new period of internationalization and external integration in the post-Second World War period. Escalating international economic activity unfolded within the institutional framework of the nation-state system and the cross-border regulation of ‘international regimes’, in particular, the Bretton Woods system. As multinational corporations extended their reach around the world they sought to evade the central bank controls associated with the Bretton Woods system by depositing their capital in foreign currency markets. Economic internationalization thus brought the massive spread of dollars and other core country currencies around the world. Eurodollar deposits ballooned from just $3 billion in 1960 to $75 billion in 1970 – prompting the Nixon administration to abandon the gold standard in 1971 – and then climbed to over $1 trillion in 1984. The collapse of the Bretton Woods system of fixed currency exchange and national economic regulation via capital controls was the first step in the liberation of embryonic transnational capital from the institutional constraints of the nation-state system.
Liquid capital became accumulated in offshore capital markets established by nascent transnational banks seeking to evade the regulatory powers of national states. In the 1970s the transnational banks began to recycle this liquid capital through massive loans to Third World governments. International bank lending jumped from $2 billion in 1972 to $90 billion in 1981, before falling to $50 billion in 1985 (Strange 1994: 112). These newly liberated global financial markets began to determine currency values, to destabilize national finances, and to undermine the national macro-economic management of the earlier Keynesian regime of capitalism. By the early 1990s some $1 trillion in various currencies was being traded daily, all beyond the control of national governments (ibid.: 107). The dramatic loss of currency control by governments meant that state managers could no longer regulate the value of their national currency. The power to influence state economic policy-making passed from these state managers to currency traders, portfolio investors, and transnational bankers – precisely, the representatives of transnational finance capital – by virtue of their ability to move funds around the world. Offshore capital markets grew from $315 billion in 1973 to over $2 trillion in 1982, and by the end of the 1970s, trade in currencies was more than eleven times greater than the value of world commodity trade. And because this global movement of liquidity created unpredictable conditions of profitability, transnational corporations reduced their risks by diversifying their operations around the world, thus accelerating the entire globalization process and the political pressures for a TNS apparatus.
As transnational corporate and political elites emerged on the world scene in the 1980s they made explicit claims to building and managing a global economy through restructured multilateral and national institutions. They pressured for the dismantling of Keynesian welfare and developmentalist states and the lifting of national controls over the free movement of globally mobile capital. They pushed for public sectors and non-market community spheres to be opened up to profit making and privatized (what Marx termed the ‘alienation of the state’ (Marx 1959: 754–5)), and set about to impose new production relations of flexible accumulation. The transnational bourgeoisie also became politically organized. The formation in the mid-1970s of the Trilateral Commission, which brought together transnationalized fractions of the business, political, and intellectual elite in North America, Europe, and Japan, was one marker in its politicization. Others were: the creation of the Group of 7 forum at the governmental level, which began institutionalizing collective management of the global economy by corporate and political elites from core nation-states; the transformation of the OECD, formed in the 1950s as a supranational institution by the twenty-four largest industrialized countries to observe their national economies, into a forum for economic policy coordination and restructuring; and the creation of the World Economic Forum, which brought together the top representatives of transnational corporations and global political elites.
The diverse activities, strategies, and power positions of global elites as they sought practical solutions to the problems of accumulation around the world gradually converged around a programme of global economic and political restructuring centred on market liberalization – the so-called ‘Washington consensus’ (Williamson 1993). This programme became cohesive in the 1980s. The global elite set out to convert the world into a single unified field for global capitalism, amidst sharp social struggles and multiple forms of resistance from subordinate groups and also from dominant groups not brought into this emerging global capitalist bloc. It pushed for greater uniformity and standardization in the codes and rules of the global market – a process similar to the construction of national markets in the nineteenth century but now replicated in the new global space. The G-7 in 1982 designated the IMF and the World Bank as the central authorities for exercising the collective power of the capitalist national states over international financial negotiations (Harvey 1990: 170). At the Cancun Summit in Mexico in 1982, the core capitalist states, led by the United States, launched the era of global neoliberalism as part of this process and began imposing structural adjustment programmes on the Third World and the then Second World. Transnational elites promoted international economic integration processes, including the NAFTA, the EU, and the APEC, among others. They created new sets of institutions and forums, such as the WTO, the Multilateral Agreement on Investment (MAI), and so on.
In this process, the existing supranational institutions, such as the Bretton Woods and the UN institutions, were not bypassed but instrumentalized and transformed. The reformed Bretton Woods institutions took the reins in organizing global economic restructuring, especially through neoliberal programmes. Similarly, the UN conference system helped achieve consensus on reshaping the world political and economic order, while UN agencies such as the United Nations Development Programme and the UN Conference on Trade and Development began to promote the transnational elite agenda of economic liberalization. Speaking before the World Economic Forum in 1998, UN Secretary General Kofi Annan explained how the UN seeks to establish the international security and regulatory environment, and the social, political and ideological conditions, for global markets to flourish:
[The UN agencies] help countries to join the international trading system and enact business-friendly legislation. Markets do not function in a vacuum. Rather, they arise from a framework of rules and laws, and they respond to signals set by Governments and other institutions. Without rules governing property, rights and contracts; without confidence based on the rule of law; without an overall sense of direction and a fair degree of equity and transparency, there could be no well-functioning markets, domestic or global. The UN system provides such a global framework – an agreed set of standards and objectives that enjoy worldwide acceptance. A strong United Nations is good for business.
(Annan 1998: 24)
The Uruguay Round of world trade negotiations that began in 1986 established a sweeping new set of world trade rules to regulate the new global economy based on: (1) freedom of investment and capital movements; (2) the liberalization of services, including banks; (3) intellectual property rights; (4) a free movement of goods. On the conclusion of the Uruguay Round the GATT created the WTO, in 1995, to supervise this new ‘free trade’ regime. Although its powers are far from absolute, the WTO is perhaps the archetypical transnational institution of the new era. The WTO assumes unprecedented powers to enforce the GATT ‘free trade’ provisions. It has independent jurisdiction, its rules and rulings are binding on all members, and has the power to sanction, to overrule state and local powers, and to override national regulatory powers. The theoretical import here is that the WTO is the first supranational institution with a coercive capacity not embedded in any particular nation-state but rather directly in transnational functionaries and the transnational corporate elite.
By the late 1990s the TNS as an institution attempting to impose its authority on a fluid and spatially open process of capital accumulation was assuming some powers and historic functions that the nation-states had lost in organizing collective action to facilitate and reproduce this process in the global economy. The creation of a capitalist superstructure which carries out at the transnational level functions indispensable for the reproduction of capital, especially those that national states are unable to perform, is not to say that a TNS has fully become consolidated as a fully functioning political, administrative, and regulatory structure. There is no clear chain of command and division of labour within the TNS apparatus, or anything resembling, at this time, the type of internal coherence of national states, given the embryonic stage of this process. Instead of a coherent TNS there seem to be multiple centres and partial regulatory mechanisms. Moreover, diverse institutions that comprise a TNS have distinct histories and trajectories, are internally differentiated, and present numerous entry points as sites of contestation.
Nonetheless, the TNS has developed mechanisms to assume a growing number of functions traditionally associated with the national state, such as compensation for market failure (e.g. IMF bailouts), money creation (e.g. EU currency), legal guarantees of property rights and market contracts (the powers of the WTO), and the provision of public goods (social and physical infrastructure), and so on. Despite this expanded TNS activity, there are numerous functions that the TNS has not been able to assume, such as reining in on speculation and excesses that so characterize the frenzied ‘casino capitalism’ of the global economy (Strange 1986). Identifying these functions of the TNS does not imply functional analysis so long as the conditions under which these functions are unfulfilled are specified and problematized, as I do later on, and provided as well that analysis of historic change demonstrates the mechanism of agency or how a determined outcome could have been otherwise.
It is out of the process summarized here that a TNS apparatus began to emerge, not as something planned as such, but as the political consequences of the social practice and class action of the transnational capitalist class in this historic juncture, and as an apparatus that is not replacing but emerging out of the pre-globalization infrastructure of world capitalism. But the transnational elite has also operated through an array of private transnational business associations and political planning groups that have proliferated since the 1970s and point to the expansion of a transnational civil society as part of the globalization process and parallel to the rise of a TNS. They include such well-known bodies as the Trilateral Commission, the International Chamber of Commerce, and the World Economic Forum. A more complete study on the TNS than is possible here may explore the relationship between the TNS and transnational civil society, employing Antonio Gramsci’s notion of an extended (or enlarged) state incorporating both political society (the state proper) and civil society. The matter of transnational civil society is of great significance since the TNS exists as part of a larger totality and because the practices of an emerging global ruling class take place at both levels. This ruling class is attempting to establish the hegemony of a new global capitalist historic bloc at the broader level of an extended state (Robinson 1996a).
Far from the ‘end of the nation-state’, as a slew of recent studies has proclaimed (see, inter alia, Guehenno 1995; Ohmae 1996), we are witness to its transformation into ‘neo-liberal national states’. As component elements of a TNS, they perform three essential services: (1) adopt fiscal and monetary policies which assure macro-economic stability; (2) provide the basic infrastructure necessary for global economic activity (air and sea ports, communications networks, educational systems, etc.); and (3) provide social order, that is, stability, which requires sustaining instruments of direct coercion and ideological apparatuses.5 When the transnational elite speaks of ‘governance’ it is referring to these functions and the capacity to fulfil them. This is made explicit in the World Bank’s World Development Report for 1997, The State in a Changing World, which points out that the aegis of the national state is central to globalization. In the World Bank’s words, ‘globalization begins at home’ (1997: 12). But the functions of the neo-liberal state are contradictory. As globalization proceeds, internal social cohesion declines along with national economic integration. The neo-liberal state retains essential powers to facilitate globalization but it loses the ability to harmonize conflicting social interests within a country, to realize the historic function of sustaining the internal unity of nationally conceived social formation, and to achieve legitimacy. The result is a dramatic intensification of legitimacy crises, a contradiction internal to the system of global capitalism.
Concluding remarks: transnational mobilization from below to counter transnational mobilization from above
So what is to be done? Smash the TNS and attempt a return to nation-state projects of popular social change? The problem with such propositions is that globalization, although it involves agency as much as structure, is not a project conceived, planned and implemented at the level of intentionality. I think we need to look forward rather than backward. Such historic processes cannot be reverted as such, but they can be influenced, redirected, and transcended. This returns us to my opening affirmation that historical materialism is emancipatory precisely because it reveals the historical specificity of existing forms of social life. Emancipatory projects operate in history. As Marx would have us recall, we do make our own history, but we do not make it just as we please, ‘but under circumstances directly found, given and transmitted from the past’.
It is not inevitable that a new transnational elite will consolidate its economic and political hegemony. A major economic crisis or collapse could stymie the process or push it into unforeseen directions. Transnational capital currently enjoys an unprecedented structural power over popular classes world-wide, but this is an historic conjuncture and not a fixed feature of the system. The confidence exuded by the transnational bourgeoisie in the latter decades of the twentieth century – with its ‘end of history’ thesis and so on – is giving way to fear of looming crisis as contradictions internal to global capitalism have become increasingly manifest. The world recession of the 1990s exposed the fragility of the world monetary system and caused rising alarm and growing fissures in the inner circles of the global ruling class. As the decade drew to a close a rising chorus of voices from within the global elite called for centralized global financial regulation and numerous proposals were put forward for achieving it, ranging from the creation of a world central bank to the transformation of the IMF into a veritable ‘lender of last resort’. These developments highlight the attempt by the transnational capitalist class to achieve some regulatory order given the inability of an incipient TNS to stabilize the system.
Capitalism has always been a violent and unstable system fraught with contradictions. All of the contradictions germane to the capitalist system are rising to the surface in the new epoch of globalization, in particular, overaccumulation and world-wide social polarization. In the past, these contradictions have led to periodic crises that tend to result each time in a reorganization of the system. Imperialism, for instance, allowed core countries to displace to the colonial world, momentarily, some of the sharpest social antagonisms that capitalism generated, while Keynesian absorption mechanisms such as credit creation postponed overaccumulation crises. But many if not all of capitalism’s recurrent crises have been mediated by the nation-state. Under globalization the national state is less able to address these manifold crises, yet the emergent TNS is similarly ill-equipped to resolve them, especially those of overaccumulation and social polarization. Even if the global financial system can be brought under regulation, the mechanisms simply do not exist for absorption strategies, nor does the system provide a material basis for a project of legitimation.
It is not clear in the new epoch how the contradictions of the system will be played out, but certainly new opportunities for emancipatory projects are on the horizon. To speak of globalization as the culmination of capitalism’s extensive enlargement and its accelerated conquest of pre-capitalist spheres is to posit that there are a series of world historic dynamics and of contradictions that are being modified or supplanted by these new circumstances. The system will not be defeated by challenges from outside its logic such as those of the former Soviet bloc countries and Third World liberation movements. Rather, defeat will be from within the global system itself. The contradictions between capitalist and pre-capitalist classes, for instance, are increasingly irrelevant. Resistance to capitalist colonization from without is giving way to resistance to capitalism from within. The universal penetration of capitalism through globalization draws all peoples not only into webs of market relations but also into webs of resistance.
To defend the relevance of Marx and the continuing vitality of historical materialism is not to say all of what Marx had to say is still applicable to the conditions humanity faces in the new millennium. To the contrary, any such proposition becomes dogma, intellectually sterile and politically disabling. Marx and Engels’s argument that ‘the proletariat of each country must, of course, first of all settle matters with its own bourgeoisie’, is now outdated. ‘Its own bourgeoisie’ is now transnational; each ‘national’ bourgeoisie is as well the bourgeoisie of the proletariat of numerous countries. Popular classes in the age of globalization need to transnationalize their struggles. The mobilization of the transnational bourgeoisie from above can only be countered by a transnational mobilization from below. Working and popular classes whose fulcrum has been the nation-state needs must transpose to transnational space their mobilization and their capacity to place demands on the system. This means developing the mechanisms – alliances, networks, direct actions and organizations – that will allow for a transnational resistance. It also means developing a transnational socialist ideology and politics, and targeting the TNS as contested terrain.
Acknowledgements
I would like to thank James R. Maupin, Gioconda Espinosa, Jeffrey Mitchell, George Lambie, Leslie Sklair, Kees van der Pijl, Hazel Smith, and Mark Rupert for their comments on earlier drafts of this chapter. The content and all of its inevitable shortcomings are of course my sole responsibility.
Notes
1. The literature on globalization is burgeoning – too vast to reference here – although a transnational institutionality, such as I examine in this chapter, remains underexplored. For basic studies, see, inter alia, Waters (1995); Sklair (1995); Holton (1998).
2. This section advances major propositions that cannot be explored here due to space limitations. A more elaborate treatment of my conception of globalization is found in Robinson (1996a, 1996b, 1998); Burbach and Robinson (1999).
3. Works on the global economy are voluminous. On the globalization of production, which is of most concern here, see, inter alia, Dicken (1998); Howells and Wood (1993); Burbach and Robinson (1999).
4. Marx and Engels (1970 [1846]) note:
Since the state is the form in which the individuals of a ruling class assert their common interests, and in which the whole civil society of an epoch is epitomized, it follows that the state mediates in the formation of all common institutions and that the institutions receive a political form.
(80)
Marx’s discussion on so-called primitive accumulation in Capital, Book VIII, highlights the role of the state in facilitating the conditions for new economic and social relations. Here I want to highlight the role of the TNS in facilitating the conditions for the new types of relations developing under globalization.
5. The World Bank’s 1997 annual report was a virtual blueprint for the transformation of national states along these lines.
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