The empire of capital and the remaking of centre–periphery relations

Abstract

Through most of the second half of the 20th century the idea of ‘development’ served as a key conceptual marker for understanding global hierarchies of wealth and power. The development initiative acquired epochal significance at the intersection of three world-historical processes: the transition in the regulation of economic activity from laissez-faire to nationally managed economies; the dismantling of colonial empires and the emergence of a Third World; and the shift in the locus of hegemony from Britain to the USA, and the parallel cold war bifurcation of the world order. The promise and optimism generated by development was unevenly sustained during the long postwar boom, although the subsequent downturn altered many of the co-ordinates within which development was conceived, but outside which it could not survive. In this context, neoliberal globalisation has emerged as a new, albeit tenuous, framework for articulating global hierarchies. By historicising the development framework, and its links to the making and unmaking of the Third World, this article provides one plausible vantage point from which to survey the current dynamics between power and plenty.

Notes

Fouad Makki lectures in sociology at Wells College. He can be contacted at 516 South Plain Street, Ithaca, NY 14850, USA. Email: [email protected].

These studies include A Escobar, Encountering Development: The Making and Unmaking of the Third World, Princeton, NJ: Princeton University Press, 1995; MT Berger, Under Northern Eyes: Latin American Studies and US Hegemony in the Americas 1898–1990, Bloomington, IN: Indiana University Press, 1995; C Leys, The Rise and Fall of Development Theory, Bloomington, IN: Indiana University Press, 1996; MP Cowen & RW Shenton, Doctrines of Development, New York: Routledge 1996; JL Love, Crafting the Third World: Theorizing Underdevelopment in Rumania and Brazil, Stanford, CA: Stanford University Press, 1996; F Cooper & R Packard (eds), International Development and the Social Sciences: Essays on the History and Politics of Knowledge, Berkeley, CA: University of California Press, 1997; ME Latham, Modernization as Ideology: American Social Science and ‘Nation Building’ in the Kennedy Era, Chapel Hill, NC: University of North Carolina Press, 2000; KC Pearce, Rostow, Kennedy, and the Rhetoric of Foreign Aid, East Lansing, MI: Michigan State University Press, 2001; D Engerman (ed), Staging Growth: Modernization, Development and the Global Cold War, Amherst, MA: University of Massachusetts Press, 2003; and MT Berger, The Battle for Asia: From Decolonization to Globalization, London: Routledge, 2003. Some of these studies appeared after the completion of this article, and it has not been possible to incorporate their insights here.

M Bienefeld, ‘Rescuing the dream of development in the nineties’, Silver Jubilee Paper 10, Institute of Development Studies, University of Sussex, 1991.

The shorthand use of the term ‘empire of capital’ should not detract from the structurally different forms of European geopolitical expansion since the later Middle Ages. Justin Rosenberg has pointed out that: ‘the early modern empires were reproduced as composite social orders: structured sets of relations which resist attempts to distinguish between “power and plenty” ’. The contemporary sovereign states system could not be more different: ‘Lines of political jurisdiction halt at fixed national borders, while those of economic activity speed on through a myriad of international exchanges without undermining the ramparts of formal sovereignty above’. J Rosenberg, The Empire of Civil Society: A Critique of the Realist Theory of International Relations, London: Verso, 1994. See also E Meiksins Wood, Empire of Capital, London: Verso, 2003.

This is a revised version of F Makki, ‘The genesis of the development framework: the end of laissez-faire, the eclipse of colonial empires, and the structure of US hegemony’, in R Grosfoguel & AM Cervantes-Rodri´guez (eds), The Modern/Colonial/Capitalist World-System in the Twentieth Century, New York: Praeger, 2002.

According to Perry Anderson: ‘The combination of the Industrial Revolution at home and the destruction after Waterloo of any barrier or competition to English global hegemony overseas brought into being a quite new form of world economy, in which British manufacturers possessed overwhelming preponderance amid generalized international free trade’. P Anderson, ‘Figures of descent’, in Anderson, English Questions, London: Verso, 1992, pp 121–192.

E Hobsbawm, Nations and Nationalism Since 1780: Program, Myth, Reality, Cambridge: Cambridge University Press, 1990, p 26.

Ibid, p 30.

H van der Wee & E Buyst, ‘Europe and the world economy during the inter-war period’, in C Ludwig Holtfriech (ed), Interactions in the World Economy: Perspectives from International Economic History, New York: New York University Press, 1989, pp 239–259.

K Polanyi, The Great Transformation: The Political and Economic Origins of Our Time, Boston, MA: Beacon Press, 1944, p 23.

Hobsbawm, Nations and Nationalism Since 1780, p 132.

E Hobsbawm, The Age of Extremes: A History of the World, 1914–1991, New York: Pantheon, 1994, p 107.

JM Keynes, The Collected Writings of John Maynard Keynes, Vol VII, The General Theory of Employment, Interest and Money, London: Macmillan, 1973.

T Mitchell, ‘Origins and limits of the modern idea of the economy’, Working Papers Series, No 12, Advanced Study Center, University of Michigan, 1995.

A sense of the expansion of ‘development economics’ in the USA is imparted by David Landes: ‘I compared the volume of publication of articles on growth and development theory in the Index of Economic Journals of the American Economic Association: for the period 1925–1939, a little over one page of citations; of 1940–49, a little over two pages; for 1950–54, over seven pages; and the next quinquennium, sixteen pages … A new sub discipline had been born.’ DS Landes, ‘Introduction: technology and growth’, in P Higonnet, DS Landes & H Rosovsky (eds), Favorites of Fortune: Technology, Growth, and Economic Development Since the Industrial Revolution, Cambridge, MA: Harvard University Press, 1991, p 23.

R Prebisch, ‘Five stages in my thinking on development’, in G Meir & D Seers (eds), Pioneers of Development, Oxford: Oxford University Press, 1984, pp 175–191.

G Kolko, Confronting the Third World: United States Foreign Policy, 1945–1980, New York: Pantheon, 1988, p 36.

C Keyder, ‘The rise and decline of national economies in the periphery’, Review of Middle East Studies, 6, 1995, pp 3–14.

M Adas, Machines as the Measure of Men, Ithaca, NY: Cornell University Press, 1989. While Michael Adas provides a careful consideration of this shift, he nonetheless locates the rise of scientific rationality as the legitimating ethos of empire earlier than I do here. It is doubtful that racism and cultural essentialism were marginalised until the horrors of fascism brought their consequences into the heart of Europe itself.

F Cooper & R Packard, ‘Introduction’, in Cooper & Packard, International Development and the Social Sciences, pp 1–44.

HS Wilson, African Decolonization, London: Edward Arnold, 1994, p 149. For British colonial policies with regard to ‘development’ see S Constantine, The Making of British Colonial Development Policy, 1914–1940, London: Cass, 1984; and M Havinden & D Meredith, Colonialism and Development: Britain and its Tropical Colonies, 1850–1960, London: Routledge, 1993. For French policy see JS Canale, ‘From colonization to independence in French tropical Africa: the economic background’, in P Gifford & WR Louis (eds), The Transfer of Power in Africa: Decolonization, 1940–1960, New Haven, CT: Yale University Press, 1982, pp 445–482.

Wilson, African Decolonization, p 152.

The dynamics of colonial racism always worked against claims to a wider and inclusive citizenship. With the exception of a handful of tiny islands such as Martinique and Guadeloupe, full citizenship rights were never seriously on offer for the rest of the colonised world. For a discerning discussion of these dynamics in the context of the British and French Empires in Africa, one to which the above summary discussion is indebted, see F Cooper, Decolonization and African Society, Cambridge: Cambridge University Press, 1996.

D Washbrook, ‘The rhetoric of democracy and development in late colonial India’, in S Bose & A Jalal (eds), Nationalism, Democracy & Development, New Delhi: Oxford India Paperbacks, 1998, p 37.

Cooper, Decolonization and African Society, p 471. African labour movements were also caught in an ideological trap, in this case by the logic of nationalism. It became more difficult for them to assert that the metropolitan standard for wages and benefits should apply to all workers. On the ironies of this contrasting logic, framed in the context of Africa, see F Cooper, ‘The dialectics of decolonization: nationalism and labor movements in postwar French Africa’, in F Cooper & A Stoler (eds), Tensions of Empire: Colonial Cultures in a Bourgeois World, Berkeley, CA: University of California Press, 1997, pp 406–435.

Discussing the impact of the First World War on African colonial conscripts, a French colonial official noted that, ‘the 175 000 soldiers enrolled during the years 1914–1918 dug the grave of the old Africa in the trenches of France and Flanders’. Similarly, the French governor-general of Indochina stated that, ‘The war which covered Europe with blood has … awakened in lands far distant from us a feeling of independence … All has changed in the past few years. Both men and ideas and Asia herself are being transformed.’ Quoted in LS Stavrianos, Global Rift: The Third World Comes of Age, New York: William Morrow, 1981, p 514. World War II further accentuated these changes.

S Corbridge, N Thrift & R Martin (eds), Money, Power and Space, Oxford: Blackwell, 1994.

M Davis, Prisoners of the American Dream, London: Verso, 1986, p 190.

In his study of the making of an Atlantic ruling class, Kess van der Pijl has documented the manifold pressure exerted by the US corporate and financial establishment to reconfigure European economic development away from cartelism to auto-centred growth based on consumer durable consumption. K. van der Pilj, The Making of an Atlantic Ruling Class, London: Verso, 1985.

G Arrighi, The Long Twentieth Century, London: Verso, 1994, pp 280–295; L Mjøset, ‘The turn of two centuries: a comparison of British and US hegemonies’, in DP Rapkin (ed), World Leadership and Hegemony, Boulder, CO: Lynne Rienner, 1990, pp 21–48; and M Aglietta, ‘World capitalism in the eighties’, New Left Review, 136, 1982, pp 5–41.

This eventually led to the promotion of a Soviet version of the modernisation paradigm not surprisingly privileging the USSR itself as a model of a ‘non-capitalist road’ to modernity. For some perceptive reflections on ‘modernisation’ in the context of the Soviet empire's own periphery, see D Kandiyoti, ‘Modernization without the market? The case of the “Soviet East” ’, Economy and Society, 25 (4), 1996, pp 529–542. For the articulation of a theory of ‘a non-capitalist road’ to development, see P Bellis, ‘The non-capitalist road and Soviet development theory today: a critique of some recent accounts’, Journal of Communist Studies, 4 (3), 1988, pp 258–281.

DC Tipps, ‘Modernization theory and the comparative studies of societies: a critical perspective’, Comparative Studies in Society and History, 15, 1973, p 210.

WW Rostow, The Stages of Growth: A Non-Communist Manifesto, Cambridge: Cambridge University Press, 1960.

I Gendzier, Managing Political Change: Social Scientists and the Third World, Boulder, CO: Westview Press, 1985.

P McMichael, Development and Social Change: A Global Perspective, Thousand Oaks, CA: Pine Forge Press, 1996, p 30. Gustavo Esteva, commenting on Truman's declaration, notes: ‘Underdevelopment began, then, on January 20, 1949. On that day, two billion people became underdeveloped. In a real sense, from that time on, they ceased being what they were, in all their diversity, and were transmogrified into an inverted mirror of other’s reality … a mirror that defines their identity … simply in terms of a homogenizing and narrow minority.' G Esteva, ‘Development’, in W Sachs (ed), The Development Dictionary, London: Zed Books, 1992, p 7.

Adas, Machines as the Measure of Men, p 402.

Between 1948 and 1952 the USA transferred $13 billion—an estimated 4.5% of its gross national product—to Western Europe. The Marshall Plan was viewed as critical to the project of constructing ‘a prosperous and stable European community secure against the dangers of Communist subversion and able to join the United States in a multilateral system of world trade’. MJ Hogan, The Marshall Plan: America, Britain, and the Reconstruction of Western Europe, 1947–1952, Cambridge: Cambridge University Press, 1987, p 427.

R. Packenham, Liberal America and the Third World: Political Development Ideas in Foreign Aid and Social Science, Princeton: Princeton University Press, 1973.

H Alavi & T Shanin (eds), Introduction to the Sociology of ‘Developing Societies’, New York: Monthly Review Press, 1980; B Hettne, Development Theory and the Three Worlds, London: Methuen, 1990; and Leys, The Rise and Fall of Development Theory. Discourses of development often presented themselves as detached centres of objectivity and rationality, and tended to conceal relations of power and inequality both at the local and the international level. For two illuminating critiques of development discourse, see J Ferguson, The Anti-Politics Machine: ‘Development,’ Depoliticization and Bureaucratic Power in Lesotho, Cambridge: Cambridge University Press, 1990; and T Mitchell, ‘The object of development’, in Mitchell, Rule of Experts: Egypt, Techno-Politics, Modernity, Berkeley, CA: University of California Press, 2002.

A Glynn, A Hughes, A Lipietz & A Singh, ‘The rise and fall of the Golden Age’, in SA Marglin & JB Schor (eds), The Golden Age of Capitalism: Reinterpreting the Postwar Experience, Oxford: Oxford University Press, 1991, pp 41–42. Immanuel Wallerstein points out that ‘the absolute expansion of the world-economy—in population, in value produced, in accumulated wealth—has probably been as great as the entire period of 1500–1945’. I Wallerstein, Unthinking Social Science: The Limits of Nineteenth Century Paradigms, Cambridge: Polity Press, 1991, p 113.

E Hobsbawm, ‘Today’s crises of ideologies', New Left Review, 192, 1992, p 56. Especially dramatic cases of urbanisation are Colombia, where between 1951 and 1973 the rural population fell from 64% to 36.4% while the metropolitan population rose from 6.2% to 27.6%; and Paraguay, where the corresponding figures for 1950–1972 were 65% and 22.9%, and from 0% to 24%, respectively. Commenting on the bewildering pace of social transformation during this period, Eric Hobsbawm notes, ‘Never before in history has ordinary human life, and the societies in which it takes place, been so radically transformed in so short a time: not merely within a single life time, but within part of a lifetime’. Ibid, pp 55–64.

M Mamdani, Citizen and Subject: Contemporary Africa and the Legacy of Late-Colonialism, Princeton, NJ: Princeton University Press, 1996; and J-F Bayart, The State in Africa: The Politics of the Belly, London: Longman, 1993.

Numerous studies from different theoretical perspectives attempt to explain the end of the postwar expansion and the subsequent long downturn. For representative approaches, see Arrighi, The Long Twentieth Century; R Brenner, ‘The economics of global turbulence’, New Left Review, 229 (special issue), 1998, pp 1–265; D Harvey, The Condition of Postmodernity, London: Blackwell, 1989; E Mandel, Late Capitalism, London: New Left Books, 1975; and Marglin & Schor, The Golden Age of Capitalism.

The growth of Third World debt occurred in the context of a phenomenal expansion of public and private credit in the world economy. From 1964 until 1987 net international bank loans rose 11 times faster than world trade, 20 times faster than world-wide fixed capital formation and 21 times faster than the global gross national product. Trade and Development Report, New York: UN Conference on Trade and Development, 1990, p 110 (table 28).

G Arrighi, S Ikeda & A Irwan, ‘The rise of East Asia: one miracle or many?’, in RA Palat (ed), Pacific–Asia and the future of the World-System, Westport, CT: Greenwood Press, 1993, pp 41–65.

A Amsden, ‘Third World industrialization: “global Fordism” or a new model?’, New Left Review, 182, 1990, pp 5–31. For the attempt by the Japanese government to convince the World Bank to consider East Asia's actually existing economic models, and for the way in which the US view prevailed when the World Bank finally produced the report entitled The East Asian Miracle, see R Wade, ‘Japan, the World Bank, and the art of paradigm maintenance: the East Asian miracle in political perspective’, New Left Review, 217, 1996, pp 3–37. For the long-term structural causes of East Asian ascendancy see Arrighi et al, ‘The rise of East Asia’, pp 41–65.

F von Hayek, The Road to Serfdom, Chicago, IL: University of Chicago Press, 1944.

P Anderson, ‘Histoire et lec¸ons du ne´o-liberalisme: la construction d’une voie unique', La Pense´e, 320, 1999, pp 47–59.

Philip McMichael notes that: ‘The world is on the threshold of a major transition in the political regulation of economic activity: from a primarily national to a primarily global form of regulation. The current restructuring of states proceeds via limitation of democratic politics, declining economic sovereignty, and the enlistment of state administrations in the service of global circuits.’ P McMichael, ‘The new colonialism: global regulation and the restructuring of the inter-state system’, in DA Smith & J Bo¨ro¨cz (eds), A New World Order? Global Transformations in the Late Twentieth Century, Westport, CT: Greenwood Press, 1995, pp 37–38.

A Glynn & B Sutcliff, ‘Global but leaderless? The new capitalist world order’, Socialist Register, 1992, pp 76–95.

The case of India is perhaps the most instructive: from the status of one of the early modern world's leading manufacturing and merchandising economies, according to Bairoch, South Asia had shrunk to possessing barely 1% of world industrial output and trade by the middle of the 20th century. P Bairoch, ‘International industrialization levels from 1750 to 1980’, Journal of European Economic History, 11 (2), 1982, pp 269–334.

Writing in the Grundrisse (1857), Marx noted: ‘While capital … must strive to tear down every barrier … to exchange and conquer the whole earth for its markets, it strives on the other side to annihilate this space with time’. Karl Marx, The Grundrisse: Foundations of the critique of Political Economy, London: Penguin, 1973, pp 538–539.

P Cammack, ‘Attacking the global poor’, New Left Review, 13, 2002, pp 125–134.