A few days before the annual gathering of business and political elites at the World Economic Forum at Davos, the British prime minister David Cameron set out his vision of capitalism that is popular and responsible. At a time of acute crisis, Cameron put up a staunch defense of capitalism. He asserted his belief that open markets and free enterprise were the best imaginable force for improving human wealth and happiness. He described them as the engine of progress to lift people out of poverty and give them opportunity. “When open markets work properly,” he said, “they create morality, because there is something for something.”

Can today’s capitalism be responsible? Can it be popular in the sense that people in great numbers embrace it and benefit in a fair way? Distinguished British Marxist historian Eric Hobsbawm does not think so. In a sharp critique, Hobsbawm made the point that capitalism as practiced in the last 40 years was all about growth and profit and not much else.

The “trickle-down theory” associated with free enterprise and open markets has failed. We have again entered an era of mass unemployment, poverty, malnutrition and disease, and wars. The root cause of inequalities lies in the fact that the powerful in society have engineered systems that suck most of the wealth up rather than allow it to trickle down. Capitalism has become a distorted and twisted version of Adam Smith’s original idea.

Technological advances, particularly since the 1970s, have massively and rapidly altered the capitalist system in one crucial respect. As Hobsbawm suggested, computers and robots have created a large surplus of people around the globe. And capitalism, which is about growth, profit and speed of production, is unable and unwilling to deal with the surplus of humans.

Agriculture, automobile and shipbuilding industries once employed workers in their millions or more. Today, they employ a tiny proportion of the population. Feudalism, which preceded modern capitalism, and communism, which competed with it, engaged many more people. Communism failed because, despite all its idealism, it was conservative, nationalistic and coercive. The capitalist system suffers from the same type of orthodoxy today. It is polluted by narrow individualism and nationalism.

In Britain, with business closures and job cuts in the private and public sectors, three million unemployed and many more under-employed or simply staying home, Prime Minister David Cameron’s message to people is, “Don’t complain about welfare cuts, go and find work.”

Profit-driven manufacturing practices and outsourcing have brought about a collapse of the job market. To tell vulnerable people to “go and find work” is a contradiction in itself. It is a serious dereliction of responsibility by politicians who are viewed by many to have contributed to the present crisis.

Once fertile landscape of capitalism, the United States and Europe, is barren. The race for control of energy resources is increasingly desperate, affecting foes and friends alike. The new cold war around Iran and the Persian Gulf has escalated to a point where China, India and Russia, three main Eastern powers, are drawn into open confrontation with America and the European Union.

The Eastern powers are refusing to obey the Western sanctions regime against Iran, driven by U.S. law and outside the United Nations. Washington’s offer to compensate the Iranian supplies lost with extra crude from Saudi Arabia and other U.S. allies will inevitably give the United States more leverage on energy supplies to China and India. These countries find it unacceptable.

The world’s only superpower is no longer credible if it cannot force others to follow its writ. But that scenario is before us, because capitalism has become irrational and sick. It is looking to transfer the cost of securing its own interests to others who are not prepared to accept that cost. In a candid admission, the Chinese ambassador in Britain, Liu Xiaoming, said that his government had to think of nearly half of China’s 1.3 billion population living in the countryside, and more than 150 million people earning as little as a dollar a day.

Like China’s overall growth in percentage terms, India’s growth, too, is impressive. The proportion of Indians living below the poverty line has dropped from about 60 to 40 percent in two decades. But the story it tells is partial. The latest available World Bank data shows nearly half a billion Indians living below the international poverty line of 1.25 dollars per day, and their number is not falling. Half of the children are underweight and 45 percent under the age of three suffer from malnutrition.

Inequalities have worsened alarmingly while corporate predators like Wal-Mart make an aggressive push into China and India. The gap between India’s richest and poorest states is nearly three-and-a-half times. As a result of government policies, there have been dramatic rises in the prices of hybrid seeds and fertilizers. In a country where 60 percent of the population is directly or indirectly dependent on agriculture, more than 200000 farmers in debt have committed suicide in the last 15 years. And the number continues to rise.

The India government’s recent move that would have given unprecedented access to mega retail houses like Wal-Mart to the middle-class market, amid widely feared consequences for small farmers and merchants, had to be put off, at least temporarily, following a huge national outcry.

In their anxiety to move India from the Soviet-style economic model to the U.S. model, and haste to transform the country into a superpower, successive governments in Delhi have been tempted to go to very significant lengths. But the capitalist model has become distorted and twisted. Having wreaked havoc at home, free-market capitalism seeks to penetrate societies where many more vulnerable people need greater protection. Only governments acting responsibly can provide that safeguard.

[END]

Filed under: Comments Tagged: Capitalism, David Cameron, economic crisis, Eric Hobsbawm, Persian Gulf crisis, responsibility ]]> http://deepaktripathi.wordpress.com/2012/01/29/on-capitalism-and-responsibility/feed/ 0 deepaktripathi http://deepaktripathi.wordpress.com/2012/01/15/on-exceptionalism-and-deviance/ http://deepaktripathi.wordpress.com/2012/01/15/on-exceptionalism-and-deviance/#comments Sun, 15 Jan 2012 10:31:55 +0000 deepaktripathi http://deepaktripathi.wordpress.com/?p=2027 ]]> The Wall Street Journal recently carried a speculative article by Ian Tally suggesting a link between the International Monetary Fund’s bailout loans to the European Union’s worst hit economies and sanctions against Iran. In essence, the article said that the Obama administration would likely support bailout loans to Greece, Italy and Spain in exchange for the EU agreeing to an embargo on Iran’s oil.

The source of the WSJ article was Jacob Kirkegaard of the Peterson Institute for International Economics in Washington. Kirkegaard speculated that the timing of the European Union’s “newly-proposed ban on Iranian oil imports” was too fortuitous to be purely coincidental. Greece, Spain and Italy are all heavily dependent on Iranian oil and therefore most resistant to an embargo. According to the WSJ, they are no longer resisting a ban. Italy says that it would support the measure “in principle” while Greece and Spain have indicated that they would not veto the idea.

What has changed? First of all, both Italy and Greece have new prime ministers, installed as part of an understanding with external rescuers, notably Germany and the IMF. The new prime ministers are not politicians, but technocrats, who took office within a week of each other in November 2011. Mario Monti of Italy, a former EU commissioner, became the prime minister, as well as the minister for economy and finance, replacing the colorful and highly controversial Silvio Berlusconi. The new prime minister of Greece, Lucas Papademos, was formerly the vice president of the European Central Bank.

These events were the most obvious evidence of an extraordinary shift in power from elected politicians to supranational institutions. There was also a change of government in Spain last November, when the center-right Popular Party came to power, defeating the governing Socialist Party. These changes were a political earthquake in the midst of an economic crisis. It struck in defiance of the popular mood on the streets.

The disconnect between the rulers, including and backed by wealthy corporate interests, and the subjects has consequences for domestic as well as foreign policies of the countries concerned. The mood in the main street everywhere is anti-war. But such sentiment cannot control governments’ propensity to fight foreign wars while corporations are given freedom to operate in an environment with minimal regulation. While the state withdraws from policy making and essential service provision, private corporations are allowed practices which determine employment, wages, and consequently money circulation. The accumulation of wealth by one percent greatly reduces the purchasing power of the 99 percent. High unemployment and depressed economy result in lower interest rates. If banks are threatened with failure, the tax payer is there as the rescuer of last resort.

What does it have to do with sanctions and the current talk of military action against Iran in Western capitals? The economic crisis has made all but the wealthiest countries susceptible to supranational powers. It enables the IMF, and the United States, to exercise control over countries in need, in both domestic and foreign policies.

The Wall Street Journal referred to one issue, that of an embargo on Iranian oil sales. There are other examples where pressure tactics have been used against foreign governments to tow the American line. The increasingly aggressive U.S. campaign against Iran ranges from the European Union to countries in Asia, including India, China, Japan and South Korea to name a few.

The veto powers of China and Russia rule out further sanctions on Iran with the UN Security Council’s approval. So the Obama administration and Congress have adopted the tactic of forcing other countries to obey American law and go along with sanctions imposed by Washington. The temptation to look and act tough from Obama to Republican presidential aspirants, Congressmen and Senators is irresistible as the November 2012 elections approach. American policy of making the world obey U.S. domestic law is blatant and bizarre.

It makes a mockery of other nation-states’ independence and sovereignty and their right to formulate and pursue their own policies. The United Nations is rendered irrelevant while the United States goes Rambo on the international stage. That such behavior is causing widespread alienation among other countries, and ultimately threatens America’s own interests, is a message lost in Washington.

[END]

When great leaves fall, the winter is at hand;

When the sun sets, who doth not look for night?

– William Shakespeare, Richard III

The year gone by has been one of civil protests, upheaval and violence in many parts of the world. Old wars continued, most notably in Afghanistan and Iraq. Peaceful awakening movements that sprang up with much hope in Algeria and Tunisia turned violent as they spread east from North Africa to the Gulf region. A brief and bloody war in Libya, with an overt display of NATO’s military power on behalf of the anti-Gaddafi forces, resulted in his overthrow and brutal killing. For NATO, the Libya war was over, but not for Libyans. A fledgling government now competes with warlords for territorial control and legitimacy in a fragmented country.

External intervention in Syria is more vocal internationally, but shrouded in secrecy on the ground. Accounts of the conflict are based on claims and counterclaims and not much independent evidence to corroborate. If detractors are to be believed, the Ba’athist regime of President Basher al-Assad is on the brink of collapse. The outcome of the Syrian conflict will have profound consequences for the balance of power in the Middle East, in particular for Syria’s ally Iran, as well as in Lebanon and Palestine.

Human aspirations for liberty and freedom from oppression defined the year 2011. Paradoxically, great powers who played a role in sustaining oppressive systems, and still do where it suites them, declared themselves on the side of liberty in other places. The result is confusion, division, conflict and a more insecure world. Afghanistan and Iraq in the last decade were America’s “bleeding wounds,” a term first coined by Mikhail Gorbachev in the 1980s Soviet war in Afghanistan. With both Iraq and Afghanistan far from stable, there is an unwelcome prospect of Libya and Syria also extracting a high price in terms of security threats and energy costs in the current decade.

Past events cannot be reversed, nor are their consequences easy to contain. So I have in mind events which I believe the world in 2012 would be better off without. In the United States, from President Obama and administration hawks to his Republican opponents have been talking about punitive action against Iran and others in this election year. Powerful voices in the ruling circles of Israel, France and Britain are egging the American president on. The gap between rhetoric and posturing can lead to something far more serious. How civil movements can be manipulated by external forces for their own interests has been demonstrated during the current upheaval in the Arab world.

The overthrow and killing of Gaddafi may have resolved the conflict in Libya in the West’s view. Now the prospect of real power remaining with the militias, and an ineffective Western-supported government, reminds one of Afghanistan following the 1992 collapse of the last Communist leader Najibullah. Libya, with its porous borders, surrounded by Tunisia, Algeria, Niger, Chad, Sudan and Egypt, is vulnerable itself and threatens others. The year 2012 could be decisive, not only for Libya, but for the region and beyond.

The situation in Syria is very dangerous. Unlike Libya, Syrian state institutions are more robust. The regime’s friends are not many, but Russia and China are taking a much tougher line with the West. Iran, its ruling allies in Iraq, and Lebanese and Palestinian groups have huge stakes in Syria. On the other hand, Saudi Arabia and Qatar, supported by the West, are determined to see the end of the current Syrian regime.

Turkey, a NATO member, has moved from its previous “independent” position to a stance much more in tune with the Western interests in the Middle East. Once a close ally of Syria, Turkey hosts the anti-Assad Free Syrian Army and allows the group to train its fighters and orchestrate attacks inside Syria. The Turkish military guards the Syrian rebel base, and a refugee camp, just across the Syrian border.

For Turkey’s governing Justice and Development Party, which professed to seek close relations with its neighbors, this is a complete about face. Two factors appear to be at work here. The Sunni support base of the party is one. The prospect of joining the European Union, an idea that France and Germany in particular oppose, may be the other.

How far Turkey’s moderate Islamic government will go is difficult to predict. It has its own Kurdish insurgency to contend with, so the strategy is risky. Turkey’s growing involvement in Syria reminds one of the 1980s when, from a small beginning, Pakistan, in the midst of ethnic insurgencies, became a base for anti-Communist Afghan forces. The consequences were disastrous.

The conflict in Syria continues to simmer. The sanctions on Iran are steadily being tightened. The talk of military action is persistent and the risk of a weak U.S. president facing reelection being pushed into a war against Iran is haunting. Sectarian violence in Iraq is on the rise. The country faces a new political crisis after an arrest warrant was issued for the Sunni Vice-President Tariq al-Hashemi on terrorism charges, prompting the mainly Sunni party al-Iraqiya to boycott parliament. The Syrian conflict threatens further instability in Lebanon and the wider region. And between Libya in North Africa and Pakistan on the edge of South Asia lies an ominously explosive region, waiting for a trigger strong enough to stage a catastrophe.

[END]

The American military involvement in Iraq has wound down after nine years. But Defense Secretary Leon Panetta has reaffirmed America’s determination to maintain its military presence in the region. As the West and its regional allies increase the pressure on Syria, close to civil war, and the brinkmanship with Iran continues, Russia announced that it was sending warships to its naval base in Syria, in a demonstration of support for Damascus. Russia and China look determined not to allow NATO to launch a Libya-style intervention in another country under the United Nations Security Council’s mandate. On matters of war and peace, the Security Council has become deadlocked, such is the loss of trust.

What does all this mean? A little more than twenty years after U.S.-Soviet hostilities ended with the collapse of the Soviet Union, we are in the midst of a new cold war. The term is not used widely yet, for many twenty-first century conflicts in South and West Asia, and Africa, are being fought in the name of the “war on terror” or “humanitarian intervention.” However, the true characteristics of these interventions are becoming clear. The current hostilities involving the West and its allies––and the rest––in many of the same arenas where the last cold war was fought amount to a new cold war.

The primary objective of Western powers is two-fold: to secure the energy resources and markets in dollar-rich oil exporting countries, and to see that those owning strategic resources do not become too independent of the West. The challenge to the West this time comes not from one superpower like the defunct USSR. The challenge comes from Russia, China, India, South Africa and Brazil, South America’s economic giant.

The twentieth-century Cold War between the Soviet Union and the West was for the spoils left after the defeat of Germany and Japan in the Second World War. The devastating defeat of the Axis Powers and the emergence of two ideologically opposite superpowers in 1945 meant that the world map was ready to be redrawn.

That the United States and the Soviet Union became locked into hostilities for control of resources after 1945 was no surprise. The surprise was how short-lived the Soviet-U.S. Cold War was, lasting just about four decades. And how rapid was the collapse of the USSR, the other superpower that had fought so gallantly against Hitler’s army and looked invincible merely a decade before its demise in late 1991.

Events since then, particularly in the last decade, illustrate certain characteristics of imperial behavior. Imperial powers do not disarm willingly. Either the presence of rivals is a reason to stay ahead in the race or to catch up. Or the ambition to expand the empire for resources and markets, and grandiose delusions, are powerful incentives to continue militarization. Imperial decline occurs only when forced by events.

During the Cold War in the last century, wealth was concentrated in the capitalist West. The Soviet Union made an historic blunder in investing disproportionately vast resources in the military-industrial complex and weaponization instead of uplifting the people’s living standards and encouraging them to create wealth.

The new century is very different. The United States has the largest and most destructive arsenal in the world. But it is because too much of the dollar money earned by the people goes to America’s military-industrial complex. Of the total military expenditure worldwide, the United States, a country under enormous debt, spends nearly 43 percent on defense. It is six times greater than China and twelve times more than Russia. The cost is gigantic, $698 billion in 2010. Others must pay the price.

In a distorted capitalist system, workers are jobless, or on depressed wages, in increasing numbers. Wealth inequalities, already alarming, continue to widen. Businesses close and unemployment rises. Public services are cut, productivity sinks and, most crucially, access to higher education becomes more and more difficult. It all points to a bleak future.

The new cold war is unlike the twentieth-century U.S.-Soviet hostilities, for there is not one power challenging America’s global supremacy, but many disparate forces. One significant factor responsible for the new cold war is the movement of economic power from the West to countries like China, Russia emerging as an energy giant, and India with its vast young population. Another is that the West finds itself up against ideological challenges from an array of nationalist forces, religious and secular, from Asia to Africa and South America.

One of the main differences between the West and the rest is that while the United States has become prone to waging wars, the others do not display the same readiness to go to war. They are more tactical. The former indicates the thinking in the West that time is limited to reverse the tide, which can only be done by military interventions. The latter is a more artful approach based on the foundations of patience and strategic collaboration. Remember the words of Confucius: “It does not matter how slowly you go as long as you do not stop.”

 [END]

Filed under: Comments Tagged: Brazil, China, cold war, HIstory, India, new cold war, Obama Middle East, Russia, South Africa, U.S. Foreign Policy, U.S.-Soviet relations ]]> http://deepaktripathi.wordpress.com/2011/12/18/a-new-cold-war/feed/ 0 deepaktripathi http://deepaktripathi.wordpress.com/2011/12/11/iran-the-revolution-and-the-language-of-war/ http://deepaktripathi.wordpress.com/2011/12/11/iran-the-revolution-and-the-language-of-war/#comments Sun, 11 Dec 2011 11:51:06 +0000 deepaktripathi http://deepaktripathi.wordpress.com/?p=2002 ]]> The Palestine Chronicle, 12 December, 2011

A few days ago, I revisited a lecture given by Fred Halliday, FBA, an intellectual giant among scholars of Middle East and Cold War history, at the London School of Economics in 2009. His topic was “The Islamic Republic of Iran After 30 Years.” For nearly a quarter century, Halliday was professor of International Relations at the LSE and recognized worldwide as a leading expert in the study of Islam, the Middle East and great power relations in the region.

He died just over a year ago, but for more than three decades before that he was also in great demand in media outlets, including the BBC World Service at Bush House, my professional base next door to the LSE. He often came to take part in World Service programs and I came to regard Fred as a friend. Watching him interpret the Iranian Revolution thirty years after was an enlightening experience once again.

An important lesson I have learned in my life is to engage the best when in doubt. For me, going back to Fred Halliday was prompted by a recent experience during an exchange about an article I had written on Iran. My exchange was with an editor. Young, bright and overbearing on this occasion, he thought I was giving Iran a mild treatment, otherwise widely denounced these days as a “dictatorship” representing dark ages and which threatens the world.

Needless to say, I am one of those who do not subscribe to this version of history, past or present. The world is much more complex. It is tempting and easy to grab a news agency copy and throw it at someone to prove our own view of events, based on a narrow interpretation of recent knowledge and conventional wisdom of the present time that is temporary by its nature. It is worse when the agency report thrown at the person contains claims made on a website by one side about casualties at the hands of the other, with no way of checking independently. Anyway, I moved on without rancor on my part.

To recognize, indeed to reflect with caveats, the significance of propaganda war is one thing. It is quite different to be blown away by a current political storm when the objective is to attempt a serious historical analysis.

Halliday had a remarkable capacity to interpret. He used to speak of similarities between the world’s major revolutions in the twentieth century: the Russian (1917), the Chinese (1949), the Cuban (1959), the Nicaraguan (1979) and the Iranian Revolution in the same year. It is a mistake to regard the point in time of a revolution as “Year Zero” and insist that all bad things follow. Neither the claim that “everything has changed” nor that “nothing has changed” is correct. The culture of a country that undergoes a revolution does not change at once.

The truth is very different. As Halliday would say, revolutions are extremely messy phenomena. They involve great chaos, cruelty and generosity. That chaos and cruelty precedes revolutionary upheaval, as well as follows. Revolutions represent dreams, hopes and disappointments. However, they occur because of the fragmentation of societies and exclusion of important sections of populations. There are both internal and external factors responsible for revolutions. Often, the outcome is a realignment of forces. Beneficiaries of the past become losers; victims, at least some of them, gain.

No revolution, as far as I know, has achieved all that it promised. A revolution is a response, rather than a solution, to the problems that triggered it.

In Iran’s case, there had been years of repression under an absolute monarch who was installed by external powers following an Anglo-Soviet invasion in 1941; an Anglo-American intelligence plot that overthrew an elected government in 1953; gradual fragmentation of a traditional society and exclusion of important sections thereof, the clergy and the traders in particular; severe restrictions and coercion directed at the opposition; the offense and the suffering caused by the Shah’s dreaded secret police SAVAK (1957–1979), establishment by the United States Central Intelligence Agency and Israel’s Mossad.

Suppression of liberals and others on the Left, like the Tudeh (party of the masses), had gone on under the monarchy in Iran. Tudeh supported the 1979 revolution while others on the Left opposed it. However, the alliance between the Tudeh Party and Iran’s emergent ruling clergy collapsed in the early 1980s. Then it was back to the past. For the leader of the revolution, Ayatollah Ruhollah Khomeini, the United States was the “Great Satan,” and Iran had to follow a course that was neither East (meaning Russia) nor West. America was held responsible for what went wrong in Iran in the decades before the overthrow of the Shah. And the fact about the Soviets having invaded Iran could not be forgotten.

We are into the fourth decade since the founding of the Islamic Republic. It has been a long period of crisis between Iran and the West, with some notable exceptions: the Iran-Contra affair involving the Reagan administration flirting with the Iranian regime to facilitate arms sales to its military to fund Nicaragua’s rightwing Contra guerrillas in the 1980s while the United States was also supporting Iraq that had invaded Iran; during the U.S.-led invasion of Afghanistan in 2001 and for a short period thereafter; and Iran’s acquiescence to getting Shia militias to cease fire in the Iraqi conflict. Each time, hopes of reconciliation between the two bitter enemies were dashed. We are now at a point where war clouds are looming.

Despite all that is said about the 1979 Islamic Revolution in Iran, it was, in fact, a very modern revolution. It was a populist response to an unpopular ruler. Nothing illustrates it better than the way the Shah’s armed forces collapsed in the end. More than thirty years on, we see men and women mixing in Iranian society at the workplace and in the streets. Women learn and teach with men at co-educational institutions. Iranian scientists are engaged in research in medicine, other scientific and technological fields and, more controversially, in the nuclear program.

Is Iran a dictatorship? Power certainly resides in Ayatollah Ali Khamenei, the Guardian Council, the president, the Majlis (parliament) and institutions like the judiciary. It is more dispersed than we are led to believe. There are instances of strong-arm tactics against some opponents and publications regarded as “outside the system,” for instance during and after the 2009 presidential election. But other critics have a surprising degree of freedom to express dissent––more than in some neighboring countries in the region.

Have miscalculations and errors of judgment been made? Sure. The Carter administration’s support in the late 1970s until the very end of the Shah’s regime was one such error; and the American hostage crisis (November 1979–January 1981) at the U.S. embassy in Tehran was a miscalculation which sealed the fate of Carter’s presidency, ensuring the victory of Ronald Reagan and all that followed in the 1980s. Opportunities have presented themselves in the last thirty years for Iran and the West to improve relations, only to be lost.

Where is Iran’s nuclear program going? I do not know. Nor do in my view most other people who talk endlessly in the media about the Iranian threat and how to deal with it. Despite the amount of coverage, Iran’s nuclear program remains a subject of inference, speculation and conspiracy theories. The Iranians have before them examples of China, North Korea, India and Pakistan. They know realpolitik. A nuclear power has a greater sense of security and others look up to it. Given the past and the present, the idea of their country having nuclear weapons is popular among Iranians. If one were to make a guess, it would be that Iran would probably want to acquire the capacity to make the bomb, but would not actually go ahead unless it was felt in Tehran that external events warranted that step.

As the governments in London, Paris and Washington continue to play the game of brinkmanship, wiser heads have warned against the current dangerous path and have advised engagement with Iran. At a recent conference at the International Institute of Strategic Studies in London, former British ambassador and one of the foremost Iran experts, Sir Richard Dalton, was very critical of the West’s policy on Iran, in particular of the British foreign secretary William Hague. Lord (Norman) Lamont, former Conservative chancellor of the exchequer, agreed. But in the light of escalating rhetoric and military maneuvers, the prospects of the situation taking a ruinous turn are real.

 [END]