David Yaffe critique of SR

[Louis Proyect <lnp3@xxxxxxxxx>]

(A biting critique of Leo Panitch by David Yaffee, a former colleague of 
Frank Furedi. On that basis alone, I just might back whatever Panitch has 
written sight unseen.)

http://www.revolutionarycommunist.com/
FRFI 185 June/July 2005

    New imperialism ?
    old opportunism

    Socialist Register 2005
    The Empire Reloaded
    Edited by Leo Panitch and Colin Leys, Merlin Press 2004 £14.95.

    ?Let us rebel against poisonous academics and their preposterous 
claptrap of exclusion?
    Robert Fisk The Independent
    14 May 2005

    Imperialism has re-emerged in the common vocabulary of the left and 
progressive movement since the US-British war on Iraq. However there is a 
great deal of confusion over what the term means. The academic editors of 
Socialist Register set about addressing this in a series of articles, which 
extend over two issues of Socialist Register. The New Imperial Challenge 
(NIC) in Socialist Register 2004 deals with the overall nature of what the 
editors call the ?new imperial? order and The Empire Reloaded (ER) in 
Socialist Register 2005 offers an analysis of finance, culture and how the 
new imperialism is penetrating major regions of the world. What 
characterises both volumes is a rejection of classical theories of 
imperialism, with the articles by Leo Panitch and Sam Gindin, academics at 
York University, Canada, creating the ideological framework for the analysis.

    Their articles are written in modern jargon and lines of reasoning are 
difficult to follow. Typical is the following: capitalist imperialism has 
to be understood through an extension of the ?theory of the capitalist 
state, rather than derived directly from the theory of economic stages or 
crises?. To understand the relations between states over different 
historical periods we have to ?historicise the theory?. So ?the transition 
to the modern form of imperialism may be located in the British state?s 
articulation of its old mercantile formal empire with the informal empire 
spawned in the mid-nineteenth century during the era of ?free trade??. 
Lenin failed to grasp this due to his ?too crude an understanding of the 
separation of the economic from the political under capitalism? (NIC p7).1 
I fail to grasp this because it is often impossible to understand. Many 
arguments throughout the two volumes are little more than descriptions and 
assertions masquerading as explanations.

    How then can we judge them overall? As our review of the first volume 
showed, their ?new imperialism? analysis of the world, immediately after 
the US-British war on Iraq, is vastly inferior to one based on a classical 
Leninist understanding of imperialism.2 More than a year later this has 
been reinforced by significant international developments throughout the 
world. So let us look at the second volume to see how it deals with this.

    All the contributors to The Empire Reloaded see globalised capitalism 
and US imperialism as two dimensions of a single phenomenon. All recognise 
that US supremacy in the ?new imperial order? is not due to its military 
and surveillance power but to the penetration of the states, economies, and 
social orders of other leading capitalist countries by the US state, US 
corporations, and US values. The articles by Panitch and Gindin and Rude go 
further and argue that the US economy and the US-led global financial 
structure are inherently strong and stable, with the other ?leading 
capitalist states? and their ruling classes locked into this stability and 
having a crucial collective stake in it.3 Inter-imperialist rivalry is 
effectively ruled out although two contributors, Cammack on Latin America 
and Kagarlitsky on Russia, suggest there is sufficient competition and 
rivalry between the US and Europe to put serious restraints on US 
supremacy. These two contributions are short commentaries (28 pages out of 
333 in this volume), which suggest that recent economic developments in 
Latin America (where the EU lately overtook the US as the largest source of 
foreign direct investment in Latin America) and the differences between 
Europe and the US over Iraq, Eastern Europe and Russia run counter to the 
dominant ideological standpoint of the two volumes, at least on the issue 
of growing inter-imperialist rivalry.

    In an article ?Finance and the American Empire? Panitch and Gindin 
attempt to explain the growing dominance of the US empire. Much of it is 
assertion and exaggeration and there is a total inability to understand the 
relationship between capital accumulation, imperialism and financial 
capital. They are keen to show that it was not the neo-liberal ?revolution? 
of the 1980s and 1990s that finally unleashed the forces that made Wall 
Street the central location of the world economy ? whatever this means (ER 
p46). In their view the process began after World War II when New York took 
its place as the world?s principal financial centre.

    This is far too simple. Even by the end of the 1940s sterling still 
accounted for nearly half of all international transactions. The role of 
the City of London as a major, if not leading, financial centre for a great 
deal of the post-war period is hardly commented on other than to assert 
that its dominance of the Eurodollar market had the effect of moving ?the 
City ? and through it, European finance in general ? more closely into the 
American imperial embrace? (ER p54). This is simply not true. Even today 
the City of London has a greater share of important financial markets than 
New York. London?s share of the foreign exchange market at 31% ? a trade of 
some $1,900bn a day ? is far larger than that of New York (19%). In 2002 
London had the leading share of cross border banking with 20% of the 
market. Half of all global turnover in foreign equities is carried out in 
London (Financial Times 29 September 2004 and 6 November 2002). It also has 
major shares of the world derivatives and hedge funds market.

    Unsurprisingly Panitch and Gindin do not discuss Britain?s 
relationship to Europe and the impasse the British ruling class finds 
itself in over this question, whose resolution must have dramatic 
consequences for the rivalry between European and US imperialism, given the 
continuing importance of London as a major world financial centre. These 
facts underlie the Labour Party?s commitment to the war on Iraq, its 
efforts to draw in the other European imperialist countries, and also the 
divisions in the British ruling class on the war.

    Throughout the article Panitch and Gindin turn everything upside down. 
Surface phenomena become substance and cause. The expansion of finance ? 
whatever that means! ? is integral to the deepening of accumulation ? 
whatever that means! ? and the continuing strength of the US economy. The 
deepening of financial markets ? whatever that means! ? ?has become ever 
more fundamental to the reproduction and universalisation of American 
power?. For them finance, which is unproductive of surplus-value, could 
apparently could lead to increased capital (!) productivity and profit 
rates through the power and role of institutions.4 For them the US empire 
is strengthened rather than weakened by its financialisation. All this 
makes a major run on the dollar less likely, and there is no evidence that 
the euro is to replace the dollar as dominant currency (ER pp47, 67, 72, 73).

    The classical Marxist view, in contrast to this, sees the massively 
increased role of financial capital, increasing speculation, and the 
ever-expanding credit bubble built on a relatively declining productive 
base, as a result of the overaccumulation of capital in the heartlands of 
capitalism. Fictitious capital careers round the world desperately 
searching for new sources of short-term profit. ?Financialisation?, to use 
their awful terminology, is the product of a crisis of profitability in the 
capitalist system. Such a crisis will necessarily lead to economic, social 
and political developments similar to those which Lenin dealt with in his 
numerous articles on imperialism, written during the First Imperialist War.

    Panitch and Gindin belong to a ?super-imperialist school? which 
assumes the unchallenged dominance of the US. Panitch in fact rejects the 
term ?superpower? to describe the role the US state plays in the world 
because this implies merely more power than others. For Panitch, US power 
is qualitatively different ?because of the way it penetrates and structures 
other states?.5 A ?super-duper? state then. But this only compounds the 
error. In fact there is much in common here with Kautsky?s 
?ultra-imperialism?, the opportunist position that Lenin devastatingly 
dealt with in his writings on imperialism. Instead of the international 
capitalists negotiating away inter-imperialist rivalries as in Kautsky?s 
position, we have the all-embracing US state and its institutions. Indeed 
Panitch and Gindin take Kautsky?s side in the debate with Lenin but say 
that Kautsky made his case ?reductively? from ?a purely economic 
standpoint, rather than in terms of a theory of the state? (NIC p9). Lenin 
called Kautsky a renegade because he broke a solemn commitment to the 
Second International to hold a ?no defence of the fatherland? 
anti-imperialist position.

    Totally neglected in their analysis is the role of the Soviet Union 
and national liberation struggles since World War II, which forced Europe 
and Japan to align with the US to prevent the rise of other areas of the 
world closed to rampant imperialist exploitation. This situation completely 
changed with the counter-revolution in the Soviet bloc.

    A correct understanding of imperialism is not an academic exercise but 
critical in dealing with the rampant opportunism which exists in the left 
movement today. This can be seen by the decision of the editors to give 
space to a reactionary interview with Tony Benn, the ?foremost voice of the 
left in the British Labour Party? (ER pviii) in Socialist Register 2005. In 
this interview Benn tries to rationalise away Blair?s support for the Iraq 
war and covers up for British imperialism?s global interests. For Benn, 
British imperialism does not exist. Indeed, Benn tells us not only that ?we 
haven?t got an empire? now but also that ?we are a colony of the United 
States?. We apparently have ?a puppet government in Britain? and need a 
?liberation movement in Britain? to free us from the US. Britain, whose 
imperialist interests spread out all over the world, which still has some 
13,000 troops in its oldest colony Ireland and whose forces brutally occupy 
Iraq, is a colony! Little wonder that Benn was easily recruited by Blair to 
canvass disillusioned Labour voters, during the recent British General 
Election, for the imperialist Labour Party. The standpoint on imperialism 
in Socialist Register cannot combat Benn?s reactionary position but rather 
tends to reinforce it.

    Lenin argued that the essence of imperialism is the division of the 
world between oppressor and oppressed nations. Nationalism and national 
struggles increase under imperialism. ?Imperialism is the era of the 
oppression of nations on a new historical basis? (CW39 p736). However the 
standpoint of the new imperialism in Socialist Register is opposed to this. 
Articles by Chibber and Greenfield fail to see the vital significance of 
national struggles against imperialism by crudely associating nationalism 
with the ?myth of the national bourgeoisie? (ER pp144, 166). They attribute 
this standpoint to Lenin and the Third International and argue the world 
has moved on since then. They merely demonstrate their ignorance. Lenin, in 
fact, had already argued in 1920 that ?perhaps in most cases?the 
bourgeoisie of the oppressed countries, while it does support the national 
movement, is in full accord with the imperialist bourgeoisie? (CW31 p242). 
That is why the Third International replaced the term 
?bourgeois-democratic? with ?national-revolutionary? to describe the 
national movements supported by the Third International. Unsurprisingly, 
Chibber can brush aside Hugo Chavez?s Bolivarian Revolution and fail to see 
the significance of the revolutionary national struggle that is taking 
place in Venezuela today.

    Events have already overtaken Socialist Register. If it is to have any 
relevance to the newly developing international movements against 
imperialism it is surely time to have new editors, who understand the 
reality of imperialism and the tasks facing the socialist movement today.
    David Yaffe


    1 This point re Lenin on economics and politics is simply a 
distortion. As J M Blaut in ?Evaluating Imperialism? Science and Society 
Fall 1997 has so clearly argued, Lenin was attacking precisely ?the 
economistic thesis that, since capitalism as an economic system ?has become 
fully international,? ?has transcended the bounds of the national state? 
(much used expressions at the time), wars between states are no longer 
functional for capitalism.? He was attacking the standpoint of Kautsky, 
Hilferding and others who were arguing along such lines. Lenin?s criticism 
could also be directed at Panitch and Gindin who clearly agree with 
Kautsky, although reaching their conclusions with an even more dubious line 
of reasoning.
    2 For a review of Socialist Register 2004 see FRFI 177 February/March 
2004.
    3 See David Yaffe ?Globalisation: parasitic and decaying capitalism? 
in FRFI 158 December 2000/January 2001 for a totally different argument 
based on a Marxist and Leninist understanding of capitalism and imperialism.
    4 In fact financial corporations can only take a greater share of 
surplus-value produced by productive labour elsewhere, for example, in the 
oppressed nations via measures imposed on those nations by the IMF, World 
Bank, and World Trade Organisation.
    5 See Monthly Review Vol 54 No 2 June 2002 p16.

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