(C) Daily Kos
This story was originally published by Daily Kos and is unaltered.
. . . . . . . . . .



EARTHQUAKES IN GLOBAL POLITICAL ECONOMY: The tectonic plates of world systems are shifting [1]

['This Content Is Not Subject To Review Daily Kos Staff Prior To Publication.']

Date: 2025-03-06

It’s not just the United States. Across Europe and in western-oriented industrial countries around the world, from Socialist Scandinavia to volatile Argentina, the established order is flailing. And it’s not just that every governing party facing election in an industrial country this past year lost vote share. It’s in the economy, governance, culture, the norms of civil society – everything is shaking. Something very deep and fundamental about the way the world works is in transition: the post-WWII systems of global interactions that shaped everything from the economy to our daily lives has run out of steam; its problems have reached critical mass. Those who used to run the world are no longer able to manage things.

In particular, it's hard to wake up each day to another set of insanities coming out of the White House. There are moments when it feels like Kate Atkinson’s floundering detective in One Good Turn: “Sometimes, when Jackson turned on the television, he got the feeling that he was living in a terrible version of the future, one he didn’t remember signing up for.”

The good news is that the current chaos isn’t where we’re going to end up; it’s more of a symptom of the weakening of the old order than a stable solution to the still-emerging shape of the next set of global systems. The bad news is that there is no inevitable curve to history: the future is shaped by those who most effectively push it. And the currently surging forces of racism, sexism, violence, and greed have a head start. Resistance to right-wing attacks is vital but not enough. Especially in the US, we need to go beyond defense to offense, both in the short term to take advantage of the Republican’s immediate electoral weak points, and in the long term by responding to the challenge of this new era.

Those of us with alternative visions shaped by more egalitarian, inclusive, democratic, humanist, and ecological values need to develop a better understanding of the underlying tectonic forces reshaping the world; develop policies that both address the new dynamics and incorporate our values; embed those proposals within a narrative that builds on the national history and cultural of each of our societies; and build movements capable of winning back political power. A starting point is to describe the forces that are dismantling the world as we knew it.

THIS IS NOT GOING TO BE EASY

Economies always evolve, with phases seeping into each other. However, the changes don’t happen quickly or all at once. That’s especially true for the type of deep, fundamental transition we’re entering now – and the changes are neither smooth or painless. Changes this large upset all the systems that ruling elites have created to maintain their wealth, status, and power. They have less ability to repress or absorb opposition. Competing elite factions fight each other and reach out for allies among the broader population. Things get out of control, bringing both chaos and opportunity, both insecurity and hope. The effects spread into every aspect of local, national, and global institutional and daily life – on one hand promising revolutionary possibilities and on the other unleashing horrific violence.

It's like the movement of the tectonic plates underlying the earth’s surface. Their interaction creates growing tensions that only get released through unpredictable and devastating earthquakes, tidal waves, and volcanoes. It also creates the continental landscape that life requires. It’s inescapable: shifting happens.

The last major shift in the global political economy, the shift from territorial colonialism to corporate-financial imperialism, started in the late 1800s and took until 1945. Working through the changes took multiple boom-bust cycles, a devastating Great Depression, several genocides, and two world wars. It also saw the rise of violently racist authoritarian movements such as the archetypical Italian Fascists, German Nazis, Spanish Nationalist, USA’s uneasy coalition of KKK, Coughlinites, and America Firsters. And yet, at the same time, the loosening of old hierarchies and limits unleashed enormous waves of creativity and advances in the arts, technologies, human comfort, and overall economic productivity. The Modernist movement affected everything from painting to music, from architecture to poetry. The development of internal combustion engines moved the economy from steam powered trains on fixed tracks to the flexibility of automobiles and the speed of airplanes as well as supercharging the national economy via the petroleum, steel, and car-components industries. Electrification lit up urban evenings. And scientific medicine made healthcare enormously more effective.

LIMITS OF SUCCESS

Even more impressively, the post-WWII world that the previous transition helped birth was a remarkable time – if only because there wasn’t another world war. Direct fighting between the two superpowers was constrained by atomic doomsday arsenals and their commitment to “mutually assured destruction” if ever directly attacked. Warfare, murderous and destructive, didn’t stop, but it was relegated to the margins of each superpower’s spheres of influence, which kept it mostly contained to proxy actors and non-superpower populations – meaning in mostly non-white areas. Former colonies won their independence. The open seas, Antarctica, space, and the moon were declared international areas not subject to territorial claims. Globally, new technologies and the relative stability allowed productivity and trade to escalate, connecting former colonies to the mainstream market and raising living standards in nearly every part of the world to historically unheard-of levels. New international financial institutions, dominated by Western powers, facilitated and enforced the expanding markets. Science and the arts flourished.

Eventually, however, the post-WWII systems of global functioning created problems that were too big or too inherent to its core functioning to be successfully managed by the dominant political and economic coalitions. The post-Cold War “Washington Consensus” – in fact the entire domestic and international “post-war order” -- began to fracture. New economic, cultural, and social forces began to affect political life.

We’re now entering another transition. If we’re lucky, we can get through this one quicker, with less carnage, than last time. But that’s not going to happen on its own – those who wish for a better future will have to create it.

DISRUPTIVE FORCES

There are two big, interlocking dynamics underlying current events. The first emerges out of the disintegration of the Post-Cold War Unipolar “New World Order” of US dominance into the current Multipolar division into regions, countries, and new alliances. This appears to be a military and political phenomena but spreads out into economics, religion, and culture. The second dynamic is the changing nature of the global economy -- capital flows, business decision-making, and production/distribution systems. These changes are enabled by technology innovation, especially in computational and communication tools. This appears to be an economic phenomenon but spreads out into politics, culture, and social dynamics.

The appearing-more-rapid-than-expected devastating effects of climate change, along with the world-wide disruptions of human and animal pandemics, have raised the flame under an already boiling pot. All together, these multi-dimensional forces have created conditions that the old systems of world order can no longer manage. Into the space created by the failure of the old, new forces have emerged seeking to take advantage of the crisis for their own benefit and to take control of shaping the new systems of interaction that will eventually consolidate.

MULTIPOLAR CONTRADICTIONS

The collapse of the Soviet Union left the US as the only global Superpower. Tales of a forthcoming “American Century” and a “Pax Americana” started circulating. But rather than using the “peace dividend” to increase the American standard of living, successive Presidents of both parties justified continued increases in military spending through “wars” on drugs and terrorism. However, the primary use of the military was to impose US interests on other countries as part of a New World Order of US hegemony. The eastern borders of the anti-Russian NATO Alliance was provocatively pushed right up to the Russian border. And US involvement in the rest of the world, both open and covert, was stepped up. However, as it turned out, controlling the world was more difficult, and eventually less successful, than anticipated.

Europe’s economies had recovered and started competing with US businesses. Europe’s former colonies began developing their own economies – as well as lining the pockets of their leaders. Suddenly the oil producing countries realized that they had enormous negotiating power, allowing petty tribal tyrants to become rulers of unimaginably rich kingdoms. (The turning point was the near collapse of the US economy during the Arab Oil Embargo of 1973, enacted after Egypt and Syria lost a war to regain land lost during their 1967 invasions.) US and European corporations are no longer the sole major players in world markets. Western-dominated financial institutions are still enormously powerful, but no longer the sole pilot of global capital flows. In 2009, Brazil, Russia, India, and China started the BRIC coalition as an alternative financial and trading framework to Western-dominated institutions. South African signed up the following year, changing the name to BRICS. Since then, 19 more countries have joined or been invited. BRICS nations constitute nearly half the world’s population. The original five alone have a combined 35% of the global GDP. The total output of goods and services in the BRICS is significantly larger already than the total output of the United States and its major allies. There is growing talk about creating an alternative to the dollar as an international currency standard, which would pull the rug out from the profits and leverage of Western financial power.

Militarily, the Vietnamese had shown that with sufficient discipline, willingness to accept damage, brilliant strategy, and some outside help, even the US could be defeated. And then the surprise destruction of the two World Trade Towers sent shock waves into assumptions about American invincibility – including (perhaps especially) within the American population. Bush 2 tried to reclaim unitary supremacy and nationalist self-confidence but the abject disasters left behind after US interventions in Iraq, Libya, Haiti, and eventually Afghanistan made much of the world doubtful of the continuing ability of the US to shape the world in its own image.

Without the disciplining tensions of a bipolar Cold War, it became increasingly hard to keep other countries in line. The disruptions of Covid and climate change -- blocking supply chains and trade, causing famine and migrations, unleashing civil wars and military takeovers -- escalated the destabilizing forced displacement of rural populations to unprepared cities in the developing world, where the decline of local food production was already happening as multi-national agribusinesses took over markets. Urban gangs and northward migration were coping strategies of desperate people – with additional waves of uprooting triggered by regional religious and anti-dictatorship uprisings. China started leaning on Southeast Asia and threatening Tiwan. And, most alarmingly, resurgent nationalism in Russia, coupled with the cultural militarization caused by the crushing of the Chechen rebellion, and the growing imperial authoritarianism of President Putin led to increasingly alarming direct confrontation with Europe and the United States.

At the same time, without the motivating rivalry with the Soviet Union, there was a slow erosion within the US of the political will needed to police the world -- the voting population no longer felt such an outward-looking political framework was relevant for their own well-being. And policing the world was expensive.

SQUEEZING PROFITS, OPENING SPACE

In this increasingly multipolar world, US-based conglomerate multinationals weren’t able to generate the same levels of profit. Starting with Regan, repeated efforts to prop up US businesses through tax cuts and subsidies had also pressured the federal budget. The Vietnam-era diversion of huge numbers of young people into the armed forces and defense-related activity led to a tight labor market, pushing up wages and drawing previously marginalized workers – particularly women, African-Americans, and (later) Latino recent arrivals into the labor force. With them came the grass-roots militance that had energized the Civil Rights and Women’s movements as well as new laws to protect their presence – which were eventually pushed into more “personal identity” areas of gender, language, and relationships. Labor discipline was increasingly hard to maintain. Profits were getting squeezed.

Although from an earlier era, one instructive example of the effect of this kind of foundational shift is what happened to Britain when its empire spun off in the post-WWII era. After nearly bankrupting itself during WWII, and unable to convince the US to subsidize its revitalization as it was doing to German-occupied areas through the Marshal Plan, Britain went through a devastating economic contraction, coupled with a rise of racist nationalism. We’re now seeing the same process rolling through increasingly broad swaths of life in the rest of the “developed” world. Normal purchases – food, clothes, entertainment, housing -- are becoming unaffordable. Jobs are insecure. And future improvements seem questionable. People feel left adrift, abandoned, betrayed, desperate, angry.

In the political and cultural space this created, alternatives to the US’s version of global relations and lifestyles found room to grow. Over the previous 150 years, rebellion against the established order on behalf of “the people” had usually understood and expressed itself within the socialist tradition. The Soviet Union, for all its monstrous faults, gave visible credence to the belief that an alternative to Western capitalism was possible. The implosion of the USSR, along with the failure or corruption of most of the post-WWII surge of socialist anti-colonial movements, closed that option. Instead, religious fundamentalism, usually with an anti-Washington bias, emerged as powerful trends within most major religions. And nationalism, with its inevitable ethnic-cleansing undertones, became a way of asserting local demands against (mostly Western) multinational conglomerate mistreatment.

CAPITALIST CREATIVITY

As the international situation evolved, major corporations moved to take advantage of the new political realities through globalized resource, production, distribution, and consumption markets. The rise of digital technologies has enabled intimate remote control of not only local management but even the machinery brought in (until it’s moved elsewhere) to make the process less reliant on local workers’ skills. Markets have become flexibly multi-jointed, each system divided into small segments capable of being moved with relative ease away from any place or government that a business finds less than fully compliant. Local and even national governments have limited leverage to counter global firm’s demands for cheap and compliant labor, high pressure work in unsafe conditions, low taxes and opaque reporting, ease of profit transfers, and efficient import/export operations. The rise of Artificial Intelligence will rapidly escalate the ability of top executives to oversee local operations and to shift the focus of activity whenever desired.

Also enhanced by digital technologies and its tendency toward quantification is finance capital, which has gained increasing control of investment decisions and therefore over the economy as a whole. High tech and bio-pharma -- entirely new industries that are now central drivers of the global economy have joined the giants of the fossil-fuel business as generators of gargantuan fortunes which are then fed back into the Venture Capital, Private Equity, Commercial Banking, and other financial sectors. The huge amounts of capital needed to become a “corporate player” in this highly leveraged game increased the power of the biggest businesses and investors, as well as giving enormous influence to the risk-taking sources of speculative finance operating outside “normal” regulatory bounds – derivatives, crypto, Private Banking. Merger and Acquisition firms flourished. Suburban malls filled with big box “category killer” stores bankrupted even mid-sized downtowns, pulling profits out of local economies.

The economy began bouncing from boom to bust bubbles as big investors accepted ever higher level of risks in pursuit of higher levels of profit: junk bonds, savings bank conversions, dot-com start-ups, housing mortgage derivatives, crypto currencies, and more. And after each financial crisis, taxpayers were forced to bail out the losers.

Shareholder empowerment and stock-rewarded CEOs began looting their corporation’s physical assets to increase profits. As a result, wealth became more concentrated and the most profitable types of investments had little direct connection to actual things, factories, or people. As money floated around in society’s upper regions, it funded enormous expansion of luxury markets – including the Arts and culture, whose high-end world view further alienated people in “rust-belt” and “fly-over” areas where the runaway disappearance of well-paid (unionized) jobs for non-college graduates had erased hope for a better future – leading to deep anxieties, growing anger at “the establishment,” and social disfunction as marriage stability declined and drug addiction rose. As the general level of wages stagnated and prices continued to rise – with a sharp spike caused by Covid disruptions -- small business profits also stagnated, prompting demands for tax relief that fed into the Libertarian-financed Tea Party movement that opened the Republican Party for its subsequent lurch to the far right. Discontent arose from below as the widespread acquiescence required for the smooth functioning of society began to recede.

DIGITAL DISRUPTIONS

The rise of digital businesses added an entire new dimension to the mix. Computers had already transformed management and production. The new online platform companies transformed sales and distribution, wiping out entire sectors of existing businesses and turning previously decentralized customer data into marketing gold: Amazon, Uber, Google, Facebook, and others. The desperate need to revive the Covid-stricken economy made financial regulators in nearly every country cut interest rates to functionally zero – essentially providing interest free loans that the new digital firms used to finance massive expansion and create an explosive increase in their paper value despite their initial lack of profit. In the process, their technologies also totally transformed media and mass communications as well as the norms and methods of social interactions – the increased ability of once-marginalized people who find each other and aggregate their voice, the escalating incivility allowed by often anonymous interactions with people you disagree with, the growing isolation and anxiety of individuals caught up in the carefully designed addictive attraction of constant connection with some version of the world.

Most disruptively, the new digital billionaires were not beholden to the established financial or corporate systems. They had created something out of nearly nothing – even though much of their technology was based on government funded university-based research. They really believed in their own personal genius and held utopian visions of technologies effect on the world. Libertarian politics and the enormous cash flowing through their hands give them unprecedent autonomy from the country’s mainstream establishment. They were willing to support disruption.

HINTS OF THE FUTURE

Some general outlines of the future are already visible. The world will obviously be more multipolar in every dimension, with some aggregation into small spheres of influence around each of the (currently) three major powers: US, China, and Russia. However, none of them will dominate the others or the world. Oil producing nations, particularly in the Arab world, will retain their wealth and clout as the global transition to renewable energy continues to crawl. But the nature of international relations is still unsettled. Trump’s approach is totally transactional and self-centered, each nation seeking maximum gain solely for itself without any moderating pressure from international organizations or norms. But it is also possible that less powerful countries will work together enough that we’ll end up with more multi-national, cooperative, horizontally-relational systems.

Similarly, the rules of international trade and investment are up for grabs. How freely will multinational conglomerates remain able to move investment and production and profits from one place to another? National governments will continue to be the vehicle for negotiating those rules. But they’ll also play a more direct role as investors, with the Gulf-states’ Sovereign Funds as a model. This could lead to the high-leverage and very anti-democratic presence of one country inside another’s economy. On the other hand, it could also provide methods for more direct public control of domestic economies. Domestic political dynamics will decide.

Working conditions and wages are another question mark. Which countries will experience a slowing (which will see an acceleration) of the massive movement of people from rural to urban areas in response to agri-business takeover of food production? Historically, rural atrophy has flooded urban areas with “surplus labor” desperately willing to work for low wages and bad conditions while creating a base for working class organizing. Which tendency will get the upper hand in which country? The historical record isn’t very comforting. Still, it is always possible that some national governments will lean towards workers and farmers as a strategy for keeping itself in power.

Climate damage will grow. Animal and human pandemics will occur. Floods, droughts, storms, tornadoes will ruin crops and homes. Public health will deteriorate. Civil order will weaken; social violence increase; wars be more likely. The resulting forced migrations will be more dangerous and opposed. Survival will be harder. But the technologies needed for a leap to less damaging energy sources, consumption patterns, residential and commercial structures already exist and the world may be forced to deploy them at some point.

The biggest black box is artificial intelligence. As with renewable energy and electric vehicles, China has already leap-frogged the United States in finding less expensive and resource-intensive methods of creating and deploying AI. It may all turn out to be simply another bubble, quickly bursting once insiders have made their millions. But the experience of the computer industry, moving from science fiction to world-changing power and ubiquity in a quick decade or two suggests otherwise.

Domestically, Trump’s centralization of power in the Presidency at the cost of constitutional divisions of power and personal rights, devastating cuts to social services in favor of tax cuts primarily for the rich, and his disruption of trade as a tool for gaining concessions from other governments – all tilt us towards an “all against all” society that embodies Margret Thatcher’s belief that “there is no society, just individuals and families” and a much more vicious social reality for anyone considered an outsider in any way. At the same time, the wells of generosity and idealism among the American people are as deep as Trump’s cynicism. It may still be possible to channel those into more inclusive forms of solidarity and mutual aid.

THROWING GAS ON THE FIRE

Donald Trump’s rise is an indication that the old national establishment has lost the cohesion and ability to control things at home or abroad. And his blitzkrieg of Executive Orders and Musk-actions are smartly designed to make it extremely difficult for the old order to rebuild itself in the future. Decades of institutional memory and professional expertise are being fired. Property is being sold. Databases are being erased. Budgets and grants are being slashed, leading to a domino effect across the entire society as every organization, business, school, and research program drops staff, eliminates entire areas of activity, and lets go of assets in order to conform to the new rules for survival. There will be no return to what existed before.

Trump’s international moves can be seen as brutally effective short-term bargaining ploys that break through long-standing logjams of inaction around vital issues. He is forcing Europe to step up defense spending; Mexico and Canada to clamp down on immigrant crossings; the Arab world to come up with plans for Palestine; creating ties with Russia. But, as with everything about Trump, it’s not clear that his actions aren’t actually longer-term strategies. In which case these will simply add to the catastrophic effects of his alienation of nearly all our allies, his total reversal of climate and environmental protections, his decimation of our public health system, his dismantling of our social services, the diversion of federal funds to tax cuts for the rich, and his house-cleaning of both military leadership and ranks.

It is important to note that this does not mean the end of capitalism. Despite its inherent drive towards concentration, its inescapable pattern of increasing inequality even as the overall GNP grows, and its socially destructive boom-and-bust cycles, capitalism is amazingly adaptable and creative. It repeatedly spins off new business sectors, finds new sources of energy, implements new technologies, and works around legal restrictions. It has survived repeated predictions of imminently hitting various resource “peaks” – from fossil fuels to water to agricultural land to rare earth minerals. Not only is capitalism innovative, it occasional goes through a major epochal shift on the scale of the rise of machine-based industry, the development of electricity and fossil fuels, the switch from a manufacturing-driven to financially-driven national economies. Each of these “changed everything” – from population patterns to political participation, from culture to religion, from life expectancy to average educational levels, from economic leadership to institutional structures. We are now going through another one of these lurches.

And, so far, as with the first Trump Presidency, the business community seems willing to trade their personal dislike for Trump’s narcissism and personal grift in exchange for deregulation and tax cuts. As columnist Steven Rattner wrote in the New York Times (3/3/25), “While very few businessmen have been publicly praising the president and his actions, in private, many of them voice support for him…..many, maybe even most, of the people I’m talking to in private are still quietly cheering his move-fast-and-break-things approach — even if they are starting to feel doubts about specific issues, particularly Ukraine and tariffs. … the Conference Board just reported that confidence among chief executives has reached its highest level in three years….One Wall Street executive told me that Mr. Trump remains better than any of the alternatives.”

Nonetheless, despite all the Republican chants about an overwhelming mandate, Trump’s – and the Republican – margins of victory were relatively narrow in 2024. The more their cutbacks hurt average people, the more the cost of living goes up, the more mistakes the DOGE meatcutter makes – the more a careful focus on close elections in key states can swing the mid-term elections to, at least, take away GOP control in the House of Representatives. A lot of damage will have been done by then, but if the juggernaut isn’t slowed there may not be – as Trump once suggested – any need (or, if gerrymandering and voter restrictions aren’t checked, no opportunity) for future elections.

-----------------

Steve Miller is a life-long political activist. His most recent book is Advocacy Organizing: Smarter Strategies, Bigger Victories (KeepOn Press, 2022). This is the first part of a series about moving forward out of the MAGA wreckage.

[END]
---
[1] Url: https://www.dailykos.com/stories/2025/3/6/2308452/-EARTHQUAKES-IN-GLOBAL-POLITICAL-ECONOMY-The-tectonic-plates-of-world-systems-are-shifting?pm_campaign=front_page&pm_source=more_community&pm_medium=web

Published and (C) by Daily Kos
Content appears here under this condition or license: Site content may be used for any purpose without permission unless otherwise specified.

via Magical.Fish Gopher News Feeds:
gopher://magical.fish/1/feeds/news/dailykos/

You are viewing proxied material from magical.fish. The copyright of proxied material belongs to its original authors. Any comments or complaints in relation to proxied material should be directed to the original authors of the content concerned. Please see the disclaimer for more details.