Material World: The End Of National Sovereignty? (2008)

The Material World Column from the October 2008 issue of the Socialist Standard

Globalization versus National Capitalism

In 1648 the first modern diplomatic congress established a new political order in Europe, based for the first time on the principle of “national sovereignty.” This principle drew a sharp dividing line between foreign and domestic affairs. Each “national sovereign” was given free rein within the internationally recognized borders of his state. No outsider had any right to interfere. Recognized borders were inviolable. The “sovereign” was originally simply a prince; later the term was applied to any effective government.

National sovereignty facilitated the undisturbed development of separate national capitalisms – British, French, German, American, and so on. Interstate boundaries were stabilized. Governments were able to take protectionist measures to defend home manufacturers against foreign competition.

Even today the principle of national sovereignty is far from dead. It is enshrined in the United Nations Charter: Chapter VII authorizes the Security Council to impose sanctions or use armed force only in the event of a “threat to the peace, breach of the peace or act of aggression.”

National sovereignty undermined

But in practice national sovereignty has been deeply undermined – first of all, by the emergence of a global economy dominated by huge transnational corporations. International financial institutions such as the World Trade Organization and IMF have largely taken over economic policy making. Indebtedness leaves many states with merely the formal husk of independence.

Some groups of states have “pooled” part of their sovereignty in supranational regional institutions. The prime example is the European Union.

The old interstate system has also been destabilised by the breakup of Yugoslavia and the USSR into 26 new states, four of which lack international recognition. The decision of the West to recognize the independence of Kosovo from Serbia has set a precedent that makes it easier to carve up other states. Of course, the “independence” of Kosovo – occupied by NATO forces, governed by officials from the European Union, its constitution drafted at the US State Department – is purely notional. Russia has now retaliated by recognizing Abkhazia and South Ossetia. Although this will encourage secessionist movements inside Russia, blocking Georgia’s accession to NATO is evidently a higher priority (see September’s Material World).

Legitimising aggression

National sovereignty is not only undermined in practice, but also contested in theory.

Thus, in recent years the United States and its closest allies have sought to legitimise their military attacks on other states. True, such attacks are nothing new. What is new is open advocacy of the principle of aggression. The main rationales used are the prevention of nuclear proliferation, counter-terrorism and humanitarian intervention (see August’s Material World).

It is instructive to compare the Gulf War of 1991 with the current war against Iraq. The Gulf War, at least ostensibly, was launched in defence of the principle of national sovereignty, violated by the Iraqi invasion of Kuwait. The elder Bush resisted pressure to “finish the job” – occupy Iraq and throw out the Ba’athist regime – out of concern that it would lead to the breakup of Iraq and, in particular, a new Kurdish state that would destabilise the whole region. Such considerations have not deterred his son.

Globalisation of capital, fragmentation of states

Paradoxically, the fragmentation of states is a natural corollary of the globalisation of capital. From the point of view of the transnational corporations, states no longer have important policy-making functions. It is enough if they enforce property rights and maintain basic infrastructure in areas important for business. Small states can do these jobs as well as large ones. In fact, they have definite advantages. They are more easily controlled, less likely to develop the will or capacity to challenge the prerogatives of global capital.

Global versus national capitalism

All the same, there is nothing inevitable about globalisation. It has lost impetus recently, and may even have passed its zenith. One sign is the disarray within the WTO. Another is Russia’s change of direction: in contrast to the Yeltsin administration, which was politically submissive and kept the country wide open to global capital, the Putin regime reasserted national sovereignty, expelled foreign firms from strategic sectors of the economy, and ensured the dominant position of national (state and private) capital.

Global versus national capitalism has emerged as an important divide in world politics. This divide exists, first of all, within the capitalist class of individual countries. Thus, even in the US, the citadel of globalisation, some capitalists – currently excluded from power – are oriented toward the home market and favour national capitalism. And even in Russia some capitalists support globalisation.

Nevertheless, the pattern of political forces differs from country to country, and as a result the global/national divide is reflected in international relations. Here the “globalisers,” led by the US, confront in the Shanghai Cooperation Organization (Russia, China and the Central Asian states) an embryonic alliance of national capitals bent on restoring the principle of national sovereignty to its former place in the interstate system.

A different perspective

This context clarifies the difference between our perspective as socialists and the attitude of anti-globalisation activists. Being against capitalist globalisation is not the same as being against capitalism in general. We have ample past experience of a world of competing national capitalisms – quite enough to demonstrate that there is no good reason for preferring such a world to a world under the sway of global capital. The main problem with the movement against globalisation is that it can be mobilized so easily in the interests of national capital, whatever the intentions of its supporters.

To be fair, some anti-globalisation activists are aware of this danger. Acknowledging that humanity faces urgent problems that can only be tackled effectively at the global level, they emphasize that they are not against globalisation as such: they are only against the sort of globalisation that serves the interests of the transnational corporations. This then leads them to explore ideas of globalisation of an “alternative” kind. These ideas at least point in the right direction. Socialism is also an alternative form of globalisation – a globalisation of human community that abolishes capital.

Stefan

What is Behind the Fight for Suez (1956)

From the September 1956 issue of the Socialist Standard

Because they do not understand the workings of the social system that dominates the world we live in most people see the struggles between political parties and governments in terms of good and evil; good men and good doctrine against evil men and evil doctrine. They see their own "honest, self-sacrificing and reasonable leaders" being prevented from applying just and beneficial policies by the greedy and unprincipled leaders of the other party or nation, and in the atmosphere of fear and anger that conflict arouses they are only too anxious to believe that all the fine sounding principles of law, morality, religion and humanity are on their side; they feel no need to probe deeper for explanations.

The men at the top see more clearly the economic issues and interests involved but as they need to rouse the emotions and win the support of the mass of the people they dress up most of their declarations in the rabble-rousing language likely to move their listeners and readers. So over Suez we have had from the Western politicians a spate of talk about law and illegality, international rights, and wrongs. Fascist acts of plunder, etc., while from the Middle East Nasser and his defenders have worked up themselves and their audiences with passionate speeches about imperialism, oppression, insults to dignity, sovereignty and nationhood.

Not all the utterances are like these. From the “take a strong line" Sunday Express (12 August, 1956) came the following:—

“Forget all about the legalistic quibbles, about the rights and wrongs of the Suez dispute. Forget the mumblings of the self-styled moralists about the sort of example Britain should show the world. They do not matter. Only one thing counts. Say it again and again to yourself. If the Suez Canal falls into the control of Nasser, or any other enemy, then Britain is finished. And so are all our hopes for ourselves and our children."

and the like-minded Daily Mail (14 August), chiding the News Chronicle’s opposition to forcible methods and its appeal to “the moral conscience of the world,” replied:—

"In international affairs there is, in the ultimate, no moral conscience. . . . It may be sad, but it is true, that self-interest is still the first law of nations. Nasser understands this, even if some people here do not. So do Nehru, Kruschev and Mao Tse-tung. The nation that neglects it goes to the wall."

The News Chronicle stands on this issue with those who pride themselves on not being either narrow nationalists or believers in using force in the first place to settle disputes; they believe that an appeal to reason through United Nations will produce solutions good for all parties and harmful to none. Only with United Nation’s endorsement should force be used.

The Socialist does not belong to any of these groups, holding that capitalism cannot help engendering conflict and wars and that the only solution is not in the vain hope of running capitalism a different way but of ending capitalism and replacing it by a new and different system of society.

To the Socialist the world is not capable of being divided into the good and the bad statesman and the good and bad nations; they are all Capitalist and all are impelled by the nature of the social system to struggle for markets for their products, for sources of cheap raw materials, and for control of trade routes like Suez and strategic points like Cyprus. These are the things for which they fight, no matter what the fine phrases and slogans in which their aims and motives are garbed.

The crux of the Suez dispute is firstly the oil that exists in abundance in the countries of the Middle East, and secondly the Canal through which much of it, as well as other cargoes, is transported. Oil is now an indispensable fuel for the motors and tractors, aeroplanes and warships, merchant vessels and factories of the countries of the world. With cool production and hydro-electric power failing to keep up with rapidly growing demand for fuel and with atomic power only a development of the not very near future, all countries need oil and many of them, including Britain, have practically none within their own frontiers.

But though the Middle East is reputed to have the biggest oil reserves in the world and extraction is expanding fast, it has a long way to go to catch up with the older oil producing areas.

The world’s greatest oil production is still in U.S.A. and Venezuela, which, between them, produce well over half the world’s oil. The output of U.S.A. alone in 1955, 2,748 million barrels, is almost equal to that of South America, Europe and the Middle East, and Russia and her satellites, added together (see report of Shell Co. l955, from which the following figures on oil production are also taken). The total production of the Middle East now exceeds 1,000 million barrels, mostly in Kuwait, Saudi Arabia, Iraq and Persia; Egypt has only the trifling output of 13 million. Russia and her satellites produce under 600 million barrels, less than a quarter of the output of U.S.A. Among the late comers, but growing fast, is Canada, with 131 million barrels last year. The great attraction of Middle Eastern oil is that it is much cheaper to extract than oil in the Americas, and the source or Europe’s supplies has been switched from West to East. “Before the war most of Europe's oil came from the Western hemisphere; even in 1947 nearly two-thirds of the imports came from the Caribbean or the United States. But in 1955 four-fifths of the imports came from the Middle East” (Times, 14 August). At the same time America’s internal demand for oil has grown so enormously that some oil is now taken from the Middle East to U.SA, in preference to using high cost American wells.

The oil industry in the Middle East is mostly controlled by American, British, Dutch and French companies, to whose shareholders large profits flow after paying royalties to the Arab Governments in whose territories they operate and maintain pipe lines.

The magnitude of profits made in the oil business is shown by results for one group, Royal Dutch-Shell, about an eighth of whose output comes from the Middle East. In 1955 the group made a net profit, after paying taxes, of £160,000,000, of which £33 million was paid out six dividends.

In the Middle East, then, is a great prize for the Power or Powers that can gain control. Each of the Arab countries looks hopefully to being able to squeeze out the oil companies. Egypt’s position is different With practically no oil of its own it has the, at present, irreplaceable Canal through which much of the oil must be shipped. Immediately British troops left the Suez base the way was open for Egyptian capitalism to strike its first blow, which, if it succeeds, will enlarge hopes of achieving the ambition phrased by Col. Nasser as “creating a great Arab Power, stretching from the Atlantic to the Persian Guff.” (Observer, 12 August, 1956); an ambition about which the other Arab States may have their own ideas.

Faced with this situation the Western countries, now dependent on the Canal, are being forced to consider the much more expensive voyage round South Africa (some new oil tankers are already too big for the Canal), and building more pipe-lines like the American-owned £80 million “Tapline” that stretches over 1,000 miles from Arabia to the Mediterranean—but these too are tempting objects for “nationalisation" by the Governments through whose territory they have to pass.

The Lebanon has already threatened to nationalise pipe-lines, and the Financial Times (15 August) expresses the opinion that though existing pipe-lines may be extended it is unlikely that any company will put vast sums into new pipe-lines in view of the risk of nationalisation.

Seemingly the Arab countries are being encouraged to attack the oil companies by the Russian Government, which may hope to get much needed oil in the Middle East or even some form of control of oil resources if Western companies are pushed out. It will be remembered that in 1946, with its armies in occupation, Russia forced Persia to agree to put North Persia oil under Russian control for 50 years; but when the troops withdrew Persia blandly declined to ratify the concession.

It has been a matter for comment that the American Government held back from the more belligerent Anglo-French threats of using force against Egypt. Apart from pre-occupation with winning the forthcoming presidential election and the fact that Suez is not a major American interest, the American Government and even the American companies with big holdings in Middle Eastern oil, are not greatly concerned with the Anglo-French fear that if Egypt nationalises the Canal this will encourage the Middle East Governments to nationalise the oil wells. The American Government has in the past encouraged Middle East oil production partly in order to conserve her home oil resources but the growing importance of Canadian oil may reduce this need. Also the Observer's Washington correspondent reports a divergent view among American oil companies themselves:—

“Another group opposed to any military action over the Suez Canal is the American oil industry. Several oil companies are reported to have expressed the view that they can protect their interests best for quite a long time by making monetary concessions to the Arab States if necessary. This, the companies think, is possible because the cost of extracting oil is much lower in the Middle East than it is in North America, or even Latin America." (Observer, 12th August, 1956.)

The South African and Canadian Governments were also lukewarm in their attitude to the issuer and why not? South Africa would welcome more shipping going round the Cape, and Canadian capitalism has its hands full building up its own oil industry.

At the time of writing the discussions between the Powers have not produced a settlement though the evident lack of war-fever among British workers and the disinclination of other Governments to back up Britain and France in forcible action against Egypt have had some effect in restraining the Eden Government and its supporters.

On the other hand Arab workers, misled by the belief that nationalisation of the Canal Co. (and eventual nationalisation of the oil industry) is in their interest, have been reported as giving vigorous backing to their Governments.

This is the real tragedy of the Suez dispute, that there is no unity among the workers of the different countries in opposing the war-talk of their Governments. In the main the trade unions in each country give such large measure of support to the claims of their own Capitalists and Governments that the basis does not exist on which they could act in unity with the workers of other countries when a clash of Capitalist interest is involved. Not realising the possibility and necessity of building a social system in which production solely for use will replace production for sale in competitive markets, because private property is the means of production and distribution will have given place to common property, the workers of the world do not realise that their common interest should unite them impartially against Eden, Nasser, Kruschev, Eisenhower, and all their kind. The trouble, as we said at the beginning, is that most people do not yet understand the workings of the social system, Capitalism.

Edgar Hardcastle

War and Secret Diplomacy (1948)

From the September 1948 issue of the Socialist Standard

With a fine bold air as of someone daring to tell the truth in face of popular prejudice the editor of the “New Statesman” (31/7/48) declares that “the first necessity is to get back to secret diplomacy.” But immediately his courage failed him, and he hastened to add, as if to excuse his boldness, that “no sane advocate of open diplomacy ever urged that difficult and detailed discussions between great Powers should be carried on in public.” Whether it is sane or not in the eyes of Mr. Kingsley Martin, there certainly have been and are plenty of people who hold that secrecy only serves the interests of the ruling class groups of the world and not the interests of the working class. Even in the ranks of the rulers there have been some who on occasion have declared for the abolition of secrecy. The well-known “Fourteen Points,” proclaimed by President Wilson during the first World War as a basis for reaching peace included as point number one, ‘‘Open covenants of peace openly arrived at, after which there shall be no private international understandings of any kind, but diplomacy shall proceed always frankly and in the public view.”

It happened to be the view of the President at that time that America had no interest in seeking to enforce the secret treaties made by Britain, France and Russia for the dismemberment of Germany and Turkey, but the Second World War showed that America like the other Powers was quite prepared to enter into secret treaties of her own.

Another and more telling example of the avoidance of secrecy was the declaration of the Russian Bolsheviks when they got power in 1917, that they too would have nothing to do with secret diplomacy. They backed up their words by insisting that the negotiations between Russia and Germany in 1918 should be carried on in the open. But here again there was a reason why the Bolsheviks favoured open negotiations then but have since reverted to the traditional secrecy of diplomacy. In the Proclamation addressed to the peoples and governments on 29th December, 1917, on behalf of the Russian Government, Trotsky declared that “in these negotiations, with the condition that there should be complete publicity, the Russian Delegation would continue to defend the programme of International Socialist Democracy as opposed to the Imperialistic programme of the Governments, Allied and enemy alike” (“Documents and Statements Relating to Peace Proposals and War Aims,” 1916—1918. Pub. Allen & Unwin, p. 107).

At that time the Russian Bolsheviks were hoping to get much support from the war-weary workers of all countries, and therefore had everything to gain by exposing the sordid imperialist aims of the governments on both sides. They had no imperialist aims themselves at the time and were therefore not afraid to make all their declarations about war and peace in the full light of day. By the same token the present Russian Government with troops in half-a-dozen countries beyond its borders, and cherishing the same imperialist designs as every other Power, has, like Kingsley Martin, been converted back to the belief in secret diplomacy—one set of declarations published openly for purpose of propaganda and another set for the secret archives.

War between the Powers in a capitalist world is not caused by secret diplomacy or by open diplomacy but by the clash of economic interests. Only those, therefore, who, in Trotsky's words, are defending “international socialistic Democracy” can afford to put all their cards on the table. It is in the interest of the world working class, though not in the interest of their masters, that all negotiations should be in the open, but overshadowing the secondary question of open or secret diplomacy it is in the interest of the working class that they should repudiate capitalism and its aims and methods at home and abroad, and seek emancipation and peace by organising to achieve Socialism.

Edgar Hardcastle

Where Do They Go From Here? (1946)

From the April 1946 issue of the Socialist Standard

A Slight Dilemma for the War-Supporting "Friends of Democracy"

Wanting to pay tribute to the likeableness of the Italians, the late Lord Castlerosse once remarked that, though every war ends with the war-time allies disliking each other more than they do “the enemy," nobody hates the Italians—not even their allies. It was not a profound thought, but it touched on a truth about the wars of capitalism. Alliances are temporary associations forced upon rivals by the menace of another Power or group of Powers grown dangerously strong. Once the menace is removed the normal rivalries of the allies again come to the surface. (Italy, not being strong enough to be a menace on its own, is wooed by all and has a habit of changing sides—hence Lord Castlerosse's observation.)

We have now reached the normal stage that follows wars of alliances, with the former allies regrouping and jockeying for position for the coming struggle over markets, air bases, spheres of influence and so on. Everyone knows what may be the outcome in a few years' time, though war-weariness, food shortage and the need to make costly preparations for new kinds of warfare, determine that for the present the struggle shall be waged with words.

There is still some talk of “no more war," but preparations hurry on. In Britain and U.S.A. the talk is of permanent conscription and the maintenance of armed forces much greater than they were before 1939. A new Sea Lord is appointed, in Britain, Admiral Sir John H. D. Cunningham. His job, according to the Daily Express (1/3/46), will be retrenchment, but also “the reorganisation of the Navy with new weapons." In Canada the Air Force is to have a strength of more than 30,000, including auxiliary and Reserve units, and the regular force of 16,100 is to be “capable of rapid expansion" (Times, 23/2/46). Its function is to be the “air defence of Canada"—against whom is not stated, but the anxiety to prevent Russia from hearing what is going on and the anxiety of Russia to uncover military secrets there, shows how the military minds are moving. Russia, too, is showing how little confidence is really placed in the United Nations Organisation, and a sign of the times is the unification of land, air and naval forces into a single Commisariat under Generalissimo Stalin (Soviet News, 28/2/46). America keeps its atom bomb from its allies while Russia encourages its scientists to discover the death-dealing secret by giving handsome prizes of £5,000 to several of them (Daily Express, 28/1/46). Australia demands air and naval bases in New Guinea and Stalin declares that “the Soviet people love their army and are constantly concerned to strengthen its might . . . we must . . . raise still more the military and economic might of the Soviet State" (Daily Express, 23/2/46). Russia feels strong enough to pursue an expansionist policy with the inevitable result of provoking hostility in the ranks of the ruling groups in the countries affected, China, Persia, Turkey, etc., and of alarming the British and American capitalists whose economic interests are also concerned. Under the secret agreement at Yalta, Russia, as a condition of declaring war against Japan, obtained from Britain and U.S.A. the right to pre-eminent Russian interests over the Chinese Eastern and South Manchurian railways while nominally preserving full Chinese sovereignty in Manchuria (Manchester Guardian, 12/2/46). China was not consulted and it is ironical to recall how the Labour and Communist Parties, back in 1931, demanded immediate aid to China to stop the Japanese invasion of Manchuria.

Lenin once described the older colonial powers as the “older and fatter bandits," and sought to stir up resistance movements in all the colonies. Russia now, with its many encroachments on territories round all its frontiers and its demand for Mediterranean Islands and North African colonies, is seeking to enter the ranks of the fatter bandits. This threatens both British and American capitalism, hence the clash between Mr. Bevin and Mr. Vishinsky and the American note to Russia and China protesting that Russian policy in Manchuria “ would be contrary to the open-door policy and would constitute clear discrimination against Americans who wanted to join Manchuria’s industrial development ” (Manchester Guardian, 6/3/46). Britain, however, is not strong enough alone to hold the too far flung empire in the face of the growing strength of the Capitalist-Nationalist movements and the emergence of Russia as a world Power, and it is to meet this situation that Mr. Churchill proposes what is, in effect, an Anglo-American alliance against Russia. In an editorial the Manchester Guardian (5/3/46) puts the point of view of the more sober and far-seeing sections of the capitalist class, a view that may be summed up in the phrase "It is better to give up something in order to more firmly hold the remainder.” The Guardian says:—

  "What the Government must do during this transitional period is to think out again from the beginning what are the vital interests of the British Empire and how these can best be defended. Even if we can rid ourselves of our temporary commitments it is difficult not to feel that our imperial strategy will have to be trimmed a little from nineteenth century ideas if we are not to overstrain our resources. Much will depend on the development of India during the next twelve months, but we should not forget that the map of the Empire will look very different when India is a free and independent country. This in turn will affect our judgment as to the value of the Middle East and the Suez Canal, though the latter will certainly remain high on the list of priorities. But it may be that we shall have to rely more . . . on co-operation with the Dominions (and Egypt?) and less on our own strength for the defence of outlying bases.”

Here then is the situation in the matter of postwar groupings of the Powers, and what do those who supported the war against German and Japanese capitalism in the simple belief that it would make the world safe from dictatorship and war think of it now? With Russia taking the place of Germany as the threatening expansionist Power what are they going to do? Where do they go from here? Already the language of the capitalist Press is precisely the same as it was about the Nazis. The Daily Mail (5/3/46) demands a "showdown.” The Russian demand on Persia is the “latest example of power-politics. Russian policy in Persia is dictated by strategic considerations and the search for oil. If Persia gives in, the vital interests of the British Empire will be affected.”

Soviet methods, says the Mail, “bear a depressing resemblance to those practised by Hitler between 1933 and 1939.”

The Liberal Manchester Guardian talks in the same tone: "We can try 'appeasement ’—which could not end until we, too, became a Communist colony, or we can try firmness on behalf of the things in which we believe ” (6/3/46).

"Firmness,” of course, is a nice way of saying that we must have military force and be prepared, in the last resort, to use it.

Where, we may ask, will the Labour Party "friends of democracy” be standing in the coming clash with Russian interests? On the side of  "democracy”? But do they not recall how, between 1941 and 1945, they were able to swallow their denunciations of Russian dictatorship and sing the praises of that alleged "democracy”? Will they be asking us to fight against Russia because it is not a democracy?

Before they drift into that tragic situation it would he well to pause and consider just how successful was the recently ended "war for democracy.” What have they to say about Mr. Churchill’s reading of the present condition of Europe? "From Stettin in the Baltic to Trieste in the Adriatic an iron curtain has descended across the Continent. Behind that line lie all the capitals of the ancient states of Central and Eastern Europe . . . all these famous cities and the populations around them lie in the Soviet sphere, and all are subject, in one form or another, not only to Soviet influence, but to a very high and increasing measure of control from Moscow. . . .

The Communist parties, which were very small in nil these Eastern States of Europe, have been raised to pre-eminence and power far beyond their numbers and are seeking everywhere to obtain totalitarian control. Police governments are prevailing in nearly every case, and so far, except in Czechoslovakia, there is no true democracy.” (Churchill’s speech in U.S.A., Manchester Guardian, 6/3/46.)

Mr. Churchill added the revealing admission: "Whatever conclusions may be drawn from these facts —and facts they are—this is certainly not the liberated Europe we fought to build up. Nor is it one which contains the essentials of permanent peace.”

So the second world war for democracy has produced, according, to the man who presided over the British Government with the enthusiastic approval of the Labour and Communist Parties, not liberation, but Russian totalitarianism in place of German totalitarianism. The crusade for democracy has not succeeded, it has still to be fought.

Addressing our remarks to the workers of all lands, we ask again that consideration be given to the Socialist case against supporting capitalism's wars. Our position is clear. We asserted in 1914 and again in 1939 that war arises because of the clash of capitalist trade and strategic interests. It does not solve the problems of the working class and does not safeguard democracy. Russia is indeed a dictatorship, and the clique that holds power there, like ruling groups in the rest of the capitalist world, will stick at nothing to maintain their own power and privilege, but we are not in any circumstances prepared to be drawn into supporting a future war against Russia any more than we were prepared to support the past wars. We urge the workers of all lands, no matter whether their exploiters are of their own nationality or foreigners, to abandon the fatal doctrine of nationalism and concentrate on the one thing that matters, ridding the world of capitalism and establishing Socialism. For this it is necessary for the workers to turn their backs on the rivalries of the Powers and give their allegiance to the international Socialist movement.

Edgar Hardcastle