Posted July 22, 2016

      From the beginning of the emergence of Third World anti-colonial movements, there was a sector of the Third World national bourgeoisie that had an economic interest and/or ideological orientation to develop national independence in a form that preserved the economic structures established during the colonial period.  Those members of the national bourgeoisie who owned enterprises dedicated to the exportation of raw materials or the importation of manufacturing goods had a vested economic interest in the preservation of the core-peripheral relation.  In addition, significant numbers of the national bourgeoisie had been educated in Western institutions, facilitating the dissemination of ideas that justified the established world-system.  

     Thus, in reflecting on the Third World, we have to continually keep in mind a distinction between moderate and radical, or between accommodationist and revolutionary, leaders and intellectuals of the Third World project.  During the transition to independence and the subsequent evolution of the neocolonial world-system, the global powers continually gave support to the accommodationists and attempted to undermine or assassinate the revolutionary leaders. Many Third World states emerged in which the government tried to maintain a balance, making concessions to revolutionary aspirations and popular demands, but trying to maintain friendly relations with the global powers.  Some political leaders adopted the balancing act out of genuine concern for the people and the nation, but others became skilled at presenting themselves as defenders of the people as they protected the particular interests of the national bourgeoisie.  In contrast, in those nations that developed a clearly revolutionary project, there emerged charismatic leaders with an exceptional capacity to explain the necessary transformations to the people, to delegitimate the moderates as representatives of colonial and neocolonial interests, and to lead the nation in the development of a radical national liberation project.  Such charismatic leaders included Fidel, Ho, Nasser, Sukarno, Nu, Nkrumah and Nyerere, who in the eyes of the people became heroic figures in the formulation and defense of the Third World project.

      During the period 1946 to 1979, the global powers were aggressive in attacking and undermining the radical Third World project, and they were determined and persistent in constructing obstacles to any transformation of neocolonial structures that would be detrimental to their interests.  As a result, the Third World project was able to accomplish less improvements in the material conditions of the formerly colonized nations than had been hoped.  The people became disappointed, and popular dissatisfaction tarnished the image of the Third World project and its revolutionary leaders, even as the most insightful understood that the cause was the uncompromising commitment of the wealthy and the powerful to the protection of their privileges.

     At the same time, the world-system as a whole entered a long structural crisis during the 1970s, as a result of the fact that it had reached the geographical limits of the earth, and it could no longer expand by conquering and peripheralizing new lands and peoples.  In response to the crisis, the global powers launched an accelerated ideological attack on the Third World project, particularly its insistence that the state must play a central role in the national development project.  Intellectuals and academics were called to the attack on the state, arguing that a corrupt and overly bureaucratic state was to blame for persistent Third World underdevelopment.  This implied not only an attack on the Third World revolutionaries, but also on the host of Third World states that had sought to balance the needs of their peoples with Western demands.  State concessions to popular demands now had to be rolled back.  Modest protections of national industries and national currencies, moderate regulation of capital flows, state ownership of key national industries, and inadequate social programs in defense of the people had to be eliminated.  The “free market,” neoliberalism (resurrecting the classical liberalism of Adam Smith), and the “Washington Consensus” (for the apparent agreement among policies makers in the US capital) became the clarion call.   

     The global ideological turn of 1979-80, signaled by the elections of Ronald Reagan in the United States and Margaret Thatcher in the United Kingdom, provided the opportunity for moderate Third World leaders, economically and ideologically tied to the neocolonial powers and transnational corporations, to seize upon the weakened international position of the radical leaders and to derail the radical Third World project.  At the 1983 Summit of the Non-Aligned Movement in New Delhi, moderate accommodationists gained the upper hand, led by Sinnathamby Rajaratnam, Minister for Foreign Affairs of Singapore.  Rajaratnam maintained that the world had entered a “systemic crisis” in the 1970s, and as a result, each Third World nation needed to be motivated primarily by national interest. The best policy, he maintained, is the elimination of state-directed development, reducing the role of the state to the protection of the people from extreme inequalities by redistributing income, but “without deadening competitive spirit” (Prashad 2007:211-212).  

     Rajaratnam spoke on behalf of a Third World national industrial bourgeoisie that had been born after colonialism and the anti-colonial movements.  The members of this class had benefitted from the protective measures of the national liberation state, but they now experienced the structures that had enabled them to flourish as shackles.  They were a self-confident class that were emboldened to defend their particular interests rather than the interests of the people as a whole.  They envisioned the development of new information technology in the Third World, through their expertise and entrepreneurship, thus taking advantage of opportunities provided by the technological development of the world-economy.  They rejected the radical Third World project and adopted an anti-Soviet, pro-US stance (Prashad 1007:212).  

     Many of the accommodationists to neoliberalism had been socialized in international organizations, such as the IMF and the World Bank, or in transnational corporations.  And they were especially well represented by the national bourgeoisies from the better-off Third World nations, such as the Asian Tigers (Prashad 2007:212, 215).

      Standing against accommodation, Fidel powerfully defended the radical Third World project of national liberation.  His speech, “The World Economic and Social Crisis,” was enthusiastically received by the delegates, and it was the only speech at the Summit to receive a standing ovation.  Many delegates felt emotional attachments to the classic Third World agenda of national liberation, even as the world political and economic situation and the political situations in their own countries compelled them to adapt (Prashad 2007:210-11).

     Indian prime minister Indira Gandhi, in her capacity as chair of the Non-Aligned Movement, steered a middle ground between the two positions, not wanting to concede too much to the revolutionary camp, but at the same time not wanting to adopt a pro-US line.  Nevertheless, the New Delhi Summit marked a definite move toward neoliberal ideology (Prashad 2007:213).  

     However, as the world turned to neoliberalism, the Third World project of national liberation remained alive in the aspirations of many. Fidel remained “the moral embodiment of what the Third World was,” and his speech on the social and economic crisis of the world was published in a more complete version and distributed in various countries in different languages (Prashad 2007:210-13, 221).

      The expanded and printed version of Fidel’s 1983 speech at the New Delhi Non-Aligned Movement was entitled: The Economic and Social Crisis of the World: Its repercussions for the underdeveloped countries, its dismal prospects, and the need to struggle if we are to survive.  It is at once a comprehensive historical, economic and political analysis and a prophetic moral call, proclaimed on behalf of the colonized peoples of the world.  We shall look at this remarkable document, largely ignored by academics of the North, in the following post.
​

​References
 
Prashad, Vijay.  2007.  The Darker Nations: A People’s History of the Third World.  New York: The New Press.
 
 
Key words:  Non-Aligned Movement, Third World, Rajaratnam, Prashad

Posted July 25, 2016

     Prior to the 1960s, historical scholarship tended to emphasis the role of great men in shaping human history.  Reacting to this, there emerged a tendency to give emphasis to underlying social forces in explaining the events the shaped the direction of human history.  But the error of the previous scholarship was not that it emphasized the importance of exceptional individuals.  Rather, its fundamental error was that it was written from above, from the perspective of the dominating classes, nations and gender.  Somewhat off base in its critique of the previous scholarship, the new scholarship of the North, concentrating on social forces, did not reflect profoundly on the possible development of knowledge from below.  It thus could not see the important role of exceptional individuals in forging anti-colonial, anti-neocolonial, and anti-imperialist revolutions in the formerly colonized regions of the world.  

     If we of the North could escape from the lens that blinds us to exceptional leadership, we would be able to discern that Third World leaders were not only unifying the people for effective collective and political action, they also were creating new understandings, and thus were implicitly advancing the possibilities for a comprehensive philosophical-historical-social science from below.  And we would be able to see that in Third World national liberation revolutions that had significant gains, the presence of leaders with an exceptional capacity to analyze and to lead was the norm.  This suggests that Max Weber was on to something when he identified charismatic authority as one of the three forms of authority in human history, and it leads to the conclusion that the emergence of charismatic leaders is integral to revolutionary processes when they have success in attaining a major part of their goals.

      One of these charismatic leaders was Fidel Castro.  He is perhaps the most important of the charismatic leaders of the modern era, considering that the Cuban Revolution in the 1960s was a symbol to the hopes and aspirations of subjugated peoples throughout the world, and the Cuban nation today continues to be a symbol for the peoples of the Third World as they seek to create a more just and democratic world-system.  As Fidel led the Cuban Revolution and the revolutionary project of the independent Cuban nation, he repeatedly demonstrated an exceptional capacity to analyze the global structures of domination and exploitation, understanding them to be structures of colonial and neocolonial domination, class exploitation, and gender domination; and to understand the steps necessary for creation of a sovereign Cuban nation characterized by the protection of the political, civil, social and economic rights of the people.  And he also demonstrated mastery of the art of politics: he was able to unify the people to lead them in the taking of power, in the consolidation of state power, in the institutionalization of an alternative political process of popular power, and in the necessary economic adjustments at different historic moments in the development of the world-economy.  

      One example of the charismatic leadership of Fidel was his role as chair of the Non-Aligned Movement from 1979 to 1983, which occurred during the historic movement in which the global powers were turning to the implementation of the neoliberal project on a global scale.  In accordance with the rules of the Non-Aligned Movement, Cuba and Havana had been previously selected to be the host country and city for the 1979 Summit, with Cuba serving as president of the Non-Aligned Movement until the following summit, held in 1983 in New Delhi, where the presidency was turned over to India.  As we have seen (see “Derailing the Third World project” 7/22/2016), as outgoing chair of the Non-Aligned Movement, Fidel addressed the New Delhi Summit.  His speech, “The Economic and Social Crisis of the World,” was enthusiastically and emotionally received by the delegates, even though political realities prevented nearly all nations from following its suggestions.  The speech was printed in an expanded form and distributed in various languages.  The expanded version was prepared by Fidel with the support of scholars of the Cuban Center for Research on the World Economy, the Center for Research on the International Economy of the University of Havana, and the Economics Faculty of the University of Havana.  It provided a thorough and informed analysis of the problems that the world-economy confronted, and it proposed an alternative direction to that being implemented by the global powers.  Although dated with respect to statistics cited, the document’s proposals remain viable, and indeed they are more urgent than ever, as the world-system enters increasingly into crisis, led by a global elite that ignored the proposals of Fidel and the Third World, and that could conceive of no other response to the structural crisis of the world-system than a global economic war against the poor and the unleashing of neo-fascist wars.
 
     The Economic and Social Crisis of the World: Its repercussions for the underdeveloped countries, its dismal prospects, and the need to struggle if we are to survive: Report to the VII Summit of the Non-Aligned Countries was published by the Cuban government in 1983.  It understands the global crisis to be fundamentally rooted in the structures of a neocolonial world-system that is based on centuries of colonial and neocolonial exploitation.  At the same time, it identifies particular steps taken during the 1960s and 1970s by the hegemonic power that sent the system spiraling toward crisis.  In the view of the report, these steps were taken by the United States in an effort to preserve its hegemony in the system; and the results were disastrous, because the preservation of US hegemony was not possible, a fundamental fact never understood by US leaders.

      The report notes important characteristics of the post-World World II period of 1946 to 1970, a period that began with uncontested US hegemony.  It was above all a period of commercial expansion and long economic growth for the developed capitalist nations, uninterrupted by depression or long recessions.  And it was a period characterized by: important technological and scientific advances, which facilitated the emergence of consumer societies in the developed capitalist nations as well as a tremendous increase in the destructive capacity of military weapons; the emergence of transnational corporations to a position of dominance accompanied by increasing concentration of power, capital, and production; an increasing role of states in their economies, including state ownership or co-ownership of companies in many countries; and a relative decline in industry and the emergence of service as a more dynamic sector of the economies of the developed capitalist nations.  And the same time, it was a period of enormous inequality between the developed and underdeveloped worlds, during which the underdeveloped world developed mechanisms to challenge the structures of the system.  And during the period Japan and Western Europe (especially Germany) emerged to challenge US hegemony, establishing by 1970 three centers of power in the capitalist world, namely, the United States (still dominant), the European Economic Community, and Japan, all of which were united in their opposition to the protest movements in the underdeveloped countries (Castro 1983:17-19, 54-55).  

     The report notes that from the 1944 Bretton Woods conference to 1971, the US dollar enjoyed a privileged position in the international monetary system.  Since the value of the dollar was fixed in gold, possession of it was equivalent to the possession of gold itself, and thus the US dollar functioned in practice as the fundamental holding for international reserves.  As a result of its privileged position in the international monetary system, in conjunction with its unchallenged dominance in production and commerce, the United States could obtain financing through the simple mechanism of a policy of monetary expansion, so long as there were sufficient gold reserves to support the money in circulation.  An expansionist monetary policy was the mechanism used from 1946 to the late 1950s to finance massive exportations of capital as well as programs of reconstruction in Europe and an enormous military budget that included maintenance of military bases throughout the world (Castro 1983:79-80). 

     But in the late 1950s, the favorable position of the United States began to suffer erosion.   Of primary importance was the emergence of competition from Japan and Western Europe, reducing the growth of US exportation of goods and services.  Beginning in the early 1960s, the United States responded to its declining position by the emission of dollar bonds, which were increasingly less backed in gold, other currencies, or in the exportation of goods and services.  This strategy was described by commercial bankers as “creating money with the stroke of a pen.” It financed investments by US transnational corporations as well as programs of “foreign aid” (tied to political conditions) and military expenditures abroad.  This was a successful strategy for the attainment of political and economic objectives in the short term, but it had the consequence of undermining the position of the dollar, and it was one of the primary sources of the high level of inflation of the 1970s, which began in the late 1960s.  In spite of the weakened position of the dollar, the price of the dollar remained fixed in gold, so that the dollar was overvalued, until it was freed from the gold standard in 1971, when it suffered devaluation and a subsequent devaluation in 1973 (Castro 1983:80-81).

     The 1970s was a decade of high levels of inflation.  From 1973 to 1981, the inflation rate varied from 7.0% to 13.3% for the seven principal capitalist countries.  The inflation was caused by the issuance of bonds by the US government to sustain unproductive state expenditures, especially military expenditures, as well as by control of prices by the transnational corporations that controlled international commerce, including international commerce in petroleum.  Although some Western economists blamed the inflation of the 1970s on the 1973 OPEC price increase for crude petroleum, the 1983 Castro report argues that that nationalized petroleum companies of the OPEC countries controlled only the supply of petroleum, while the transnational petroleum companies maintained control over technological and commercial aspects.  The report maintains that the transnational petroleum companies profited enormously during the 1970s as a result of the rapid increase in the prices of the derivative products as well as speculation in combustibles.  Making a distinction between inflation generated from imported products, including petroleum, and inflation generated internally by US producers and distributors, the report finds that the US inflation rate during the 1970s was almost entirely generated by domestic inflation.  In 1974, for example, 11% of the 12% total US inflation rate was generated domestically, while only 1% was generated from importations (Castro 1983:80-82, 157, 160-61).

      The weakened position of the dollar and high levels of inflation were signs of an international monetary system in crisis.  The crisis had particularly negative effects on the nations of the Third World. The inflation rate was higher for the underdeveloped world: underdeveloped countries that were exporters of petroleum had inflation rates from 10.5% to 18.8% during the period 1973 to 1981; underdeveloped countries that were importers of petroleum had inflation rates from 22.1% to 36.9% during the period (Castro 1983:82-83).

      Moreover, changes in financial relations between the North and South during the 1970s had negative consequences for the Third World.  Private banks in the core significantly increased the amount of lending to Third World governments and decreased investment in Third World production, inasmuch as profits from loans became higher than profits from production.  As result, capital flows between the banks of the North and Third World governments increased, while the participation of Third World countries in world commerce declined.  By the end of the decade, Third World debt payments to the banks of the North greatly exceeded investments by banks, governments and corporations of the core in Third World production (Castro 1983:20-23, 54-55, 95, 146-47).  

      High prices for manufactured goods and low prices for raw materials historically has been central to an unequal exchange between the developed capitalist countries and the underdeveloped world, inasmuch as for the latter, income from agricultural and mineral raw materials constitutes the principal source of income from exportation.  However, during the 1960s and 1970s, declining terms of exchange between raw materials and manufactured goods occurred. For example, in 1960, the sale of a ton of coffee enabled purchase of 37.3 tons of fertilizer, but by 1982, a ton of coffee could buy only 15.8 tons of fertilizer; in 1959, twenty-four tons of sugar could buy a sixty-horsepower tractor, but in 1982, 115 tons of sugar were needed to buy the same tractor; and in 1959, six tons of jute fiber could buy a seven-ton truck, but in 1982, twenty-six tons of jute were needed.  The declining terms of trade were aggravated during the 1970s by inflation and the high cost of petroleum, generating a chronic situation of a commercial balance deficit for the underdeveloped countries.  The negative commercial balance of the Third World countries during the period 1973 to 1981 became the basis for the Third World debt problem (Castro 1983:23, 59-66, 88).

     The 1983 Report to the Non-Aligned Movement especially focused on dynamics of the world-economy from 1979 to 1982, the period of the Cuban presidency.  In 1979, responding to the unprecedented situation of stagnation combined with inflation, the developed capitalist countries departed from Keynesian economic policies and adopted a monetary-fiscal recipe of combining a monetary policy of high interest rates (to increase money reserves and reduce money in circulation) with a fiscal policy of reduced government spending (by reducing budgets for social programs and rationalizing of government employment), thus giving priority to the problem of inflation.  The result was moderation in the inflations rates but reduced industrial production and high levels of unemployment in the seven most developed countries of the world by 1982 (Castro 1983:30-37). 

     The Report considers that “the indiscriminate elevation of the rate of interest, promoted by the government of the United States, constitutes, without doubt, one of the most arbitrary economic measures of recent years.”  The policy had negative consequences for the economy of the United States, and it deepened the crisis of the international financial system.  And it had “disastrous economic repercussion for the underdeveloped countries,” for which it has meant the “nearly complete ruin of their economies and the cancelation of hopes for improvement.”  The high-interest rate policy increased the cost of the servicing of the external debt of Third World governments, thus increasing government budgetary deficits as well as increasing the percentage of capital flow to the core in the form of interest payments on loans as against profits from production.  At the same time, the policy increased the value of the dollar, leading to its overvaluation, and a corresponding reduction in the value of the national currencies of the nations of the Third World.  It thus intensified the problem of the balance of payments deficit of the underdeveloped countries (Castro 1983:30-31, 36-38, 46-48, 82).

      The severity of the situation, the Report maintains, has obligated an increasing number of countries to adopt “adjustment” policies that are not a result of their own decisions in the context of a development plan formulated in the exercise of their sovereignty.  Rather, these policies are adopted as emergency measures in response to balance of payments and government deficits.  And they are adopted as conditions for the reception of loans from the International Monetary Fund.  The measures include devaluation of national currencies, reduction of government expenditures, and opening the economy to the merchandize and investments proceeding from the developed capitalist countries.  The measures do not reduce the deficits, because foreign capital invests in its own profit and not in forms of production that promote the development of the nation.  They are presented as measures that follow from technocratic considerations, but they are in reality neocolonial measures that are integral to an international monetary system that responds to a small group of five countries (Castro 1983:48-49, 87).

     Thus, there has occurred in the period 1979 to 1982 a deterioration in the situation of the less developed countries: a decline in the value of national currencies with respect to the dollar, a fall in the prices of raw materials and declining terms of trade with the advanced capitalist nations, a reduction in rates of growth, and a spiraling escalation of the external debt (Castro 1983:12, 14, 41-44).  With respect to the external debt, the report states:

     The Report on the world economic and social crisis also describes the alarming increase in the influence of transnational corporations on the economic relations of the world.  The spectacular growth and proliferation of transnational corporations began in the 1960s, but it particularly took off in the 1970s.  US transnational corporations profit highly from its Third World investments.  In 1981, US corporations attained 16.6% profit from its investments in the developed capitalist countries, in contrast to 24.1% profit from investments in the underdeveloped world.  However, the transnational profits from Third World investments have principally been in the form of loan interest payments to transnational banks (Castro 1983:66-69, 131, 141-44).

      The transnational corporations have a perspective on the development of the Third World countries, which the Castro report refers to as the “transnational ideology.”  It proposed a model of development based on transforming underdeveloped countries into “exporting platforms.”  This model of development, the Report maintains, does not respond to the basic requirements for the true economic development of these countries; rather, it responds to the needs of capital, and in particular, the need of capital for a cheap work force that elevates profitability.  The exporting platforms, although they in degree contribute to employment, are isolated from the rest of the economy in the countries where they are located.  They therefore have an extremely limited effect on the national economy, and they could not be considered as promoting independent economic development. In order to attract investments by international corporations in exporting platforms, governments grant enormous liberties to foreign capital, including unlimited transfer of capital out of the country and exemptions from taxes, as well as unlimited access to cheap labor and to natural resources.  By 1975, exporting platforms had been developed in seventeen countries in Asia, thirteen in Africa, and twenty-one in Latin America (Castro 1983:148-49).

     The 1983 Report maintains that the growing presence of transnational corporations in the underdeveloped countries constitutes a serious threat to the national sovereignty of these countries. Transnational corporations do not adjust their operations in accordance with the legislation of the countries in which they are located.  They interfere directly or indirectly in the internal affairs of the countries in which they operate.  They ask the governments of the countries from which they come to pressure the governments of the countries in which they are operating, in support of their particular interests.  They attempt to obstruct governments of the underdeveloped countries from exercising control over their natural resources (Castro 1983:150-51). 

    The 1983 Report also discusses the environment.  It maintains that “human action on the natural environment is provoking in an accelerated manner changes without precedent in the stability, organization, equilibrium, interaction, and even the survival of the principal ecological systems of the planet.”  Issues of concern include desertification, the accelerated erosion of agricultural soil, the increasing contamination of water and the exhaustion of its sources, and deforestation.  The Report maintains that “the market economies of the developed countries are directly responsible for an important part of the degradation of the environment,” including contamination of the air, lakes, rivers, and oceans as well as an enormous quantity of chemical and nuclear residues that have been deposited in the atmosphere, the fresh waters, and the seas.  It also maintains that transnational enterprises are responsible for the exhaustion of mineral, agricultural and forest resources of numerous underdeveloped countries (Castro 1983:118-25)

     Fidel Castro did not consider that these maladies of the international financial system and the neocolonial world-system could be rectified within the structures of the international economic order.  But he believed that they could be overcome through the mobilization of a global political will for the creation of a New International Economic Order.  This will be the subject of our next post.  

​

​References
 
Castro, Fidel.  1983.  La crisis económica y social del mundo.  La Habana: Oficina de Publicaciones del Consejo de Estado.
 
 
Key words: Fidel, Non-Aligned Movement, global crisis, structural adjustment, transnational corporations

Posted July 27, 2016
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     According to Cuban legend, Che Guevara once said, “When Fidel speaks, I am not sure if he is expressing his own ideas, or those of the people.”  Indeed, one of the gifts of Fidel was his capacity to listen to the people, and to reformulate their hopes and needs on a political and moral plane. 

      This dynamic was present with respect to Fidel’s leadership of the progressive forces in the Non-Aligned Movement during the period 1979 to 1982.  He adopted the 1974 Third World proposal for a New International Economic Order and made it his own, placing the proposal in the context of the increasingly aggressive and destructive policies of the global powers and the consequent eclipse of Third World hopes, and at the same time further developing the proposal, bringing it to a more complete and more advanced formulation.

     In the 1983 Report to the Seventh Summit of the Non-Aligned Movement (Castro 1983), Fidel’s call for a more just and democratic world-system was based in an analysis of the adverse effects of world-system dynamics on the Third World, including elevated interest rates, high levels of inflation, declining terms of trade, increasing external debt payments, and declining foreign investment in production.  This economic state of affairs was compounded by global political realities: the global powers, rather than recognizing their historic debt before the situation, seized upon it as an opportunity to rescue declining corporate profits, imposing structural adjustment policies on the governments of the Third World.  At the same time, transnational corporations were promoting their own development ideology for the Third World, seeking to undermine the sovereignty of Third World nations in order to promote and defend their particular interests (see “Fidel speaks on the global crisis” 7/25/2016).

      Confronting this reality, the peoples of the Third World, Fidel concluded, must struggle to create a more just world order, recognizing that the peoples of the Third World constitute the immense majority of humanity, and that the development of the Third World economies would be beneficial to the world-system as a whole and enable it to overcome its structural crisis.  Accordingly, the peoples of the Third World must struggle: to transform the structures that promote unequal exchange and declining terms of exchange; for the cancellation of the Third World debt; for new and more equitable international monetary and financial systems; for a form of industrialization that responds to the interests of the Third World; for necessary socio-economic structural changes, such as agrarian reform; for the adoption of measures by states that control and limit the activities of transnational corporations; and for an elevation of the prestige of the United Nations.  The struggle requires the unity of the peoples of the Third World, in spite of political and cultural differences, in recognition of their common experience of colonial domination (Castro 1983:223-29).

      In the 1983 Report, Fidel formulates a concept of development that is not based on the model of Western development, which Fidel considers impossible to repeat in present global conditions.  The development model proposed by Fidel involves strong state action in order to break the core-peripheral relation, in which the underdeveloped countries export raw materials and leave industrial production in the hands of the developed countries.  To overcome core-peripheral structures, the underdeveloped countries must mobilize national resources for the development of technically-advanced industries.  In this vein, Fidel maintains that the forms of industry that have been developed recently in the underdeveloped world will not lead to their economic development.  Recent industrial expansion in the Third World has been in labor-intensive industries that have low levels of technical development, such as textiles or manufactured food products, which have been attractive to transnational capital because of the Third World cheap labor supply. In contrast to emphasis on low-wage export-oriented manufacturing, Fidel advocates investment in the Third World in those branches with technological-industrial complexity, such as nuclear, chemical, or petrochemical energy, or the aerospace industry; this would stimulate the growth of Third World internal markets (Castro 1983:127-40).

    Fidel’s understanding of Third World development included the concept of South-South cooperation.  The 1983 Report notes that cooperation among the underdeveloped countries has been an historic objective of the Non-Aligned Movement, and it is an important component of the 1974 program for a New International Economic Order.  Cooperation among the countries of the Third World would be a weapon of struggle against neocolonial dependency, which derives from the colonial empires, reinforces underdevelopment and poverty, and aggravates the present crisis of the world-system; it would be a powerful, dynamic factor contributing to autonomous development (Castro 1983:165-67).  

     Fidel maintains that South-South cooperation is a real practical possibility.  The Third World as a whole has ample petroleum, agricultural and mineral resources, and some of the Third World nations possess a certain level of industrial development as well as a sufficient supply of highly-qualified specialists, technicians and doctors. If developed with a strong political will to protect the sovereignty of the nation over its natural resources, South-South cooperation could be a mechanism for controlling the actions of transnational corporations.  At the same time, the concept of cooperation among the nations of the Third World does not negate the possibility for North-South cooperation.  The Third World continues to seek mutually beneficially commerce with developed countries; it seeks to put an end only to unequal exchange and exploitative trade with the developed capitalist countries (Castro 1983:167-70).  

     Fidel concludes The Economic and Social Crisis of the World: Its repercussions for the underdeveloped countries, its dismal prospects, and the need to struggle if we are to survive: Report to the VII Summit of the Non-Aligned Countries with a call for Third World unity, proclaiming that the Non-Aligned Movement has the objective:

     Fidel stood at central stage, the spokesperson for the colonized peoples of the earth, at an historic moment when the global powers were preparing to roll back modest concessions to the Third World nations as well as the popular movements of the core, as they endeavored to preserve material privileges in the context of a world-economy confronting structural crisis.  Fidel was like the ancient biblical prophets who denounced the greed and hypocrisy of the kings, in defense of the poor.  But unlike the prophets of old, Fidel’s denunciation was rooted in scientific analysis.  In the tradition of Marx, Fidel, with the support of economists formed by the Cuban revolutionary project, was analyzing social scientific knowledge of the world-economy from below, from the vantage point of the history and the human needs of the overwhelming majority of the peoples of the planet, common victims of European colonial domination.  From such vantage point, Fidel could arrive at insights that the defenders of the established order could not see, driven as they were to defend the privileged minority.  

     The guardians of the established order were driven not primarily by the desire to know, but by the defense of the particular interests of the wealthy, the corporations, and the powerful nations.  They were not merely mistaken; they were morally culpable, for they chose to align themselves with power and privilege, and to ignore the basic human needs of the majority.  But unlike the ancient prophets, Fidel did not predict the unleashing of the vengeful wrath of God, punishing the powerful and the privileged for their transgressions.  Rather, driven by a moral commitment to the people, Fidel was led to dream, to envision a world in which the people would have the capacity to defend their interests.  He thus called the peoples of the Third World to a unified and dignified struggle in defense of themselves, for the sake of the future of humanity.

      The global powers could have no reasonable response to the words of the twentieth century prophet.  They could only ignore them, pretending that the prophetic words in defense of humanity had never been uttered.  As we will see in the following post, they would proceed to implement their economic war against the people, confusing the people for a time.  But the people did not forget the words of the prophet, nor the ignoring of them by the global powers.  By the beginning of the twenty-first century, the peoples of the Third World would rediscover their resolve and their spirit of struggle, as we will see in subsequent posts in this series on the Third World project.  The peoples of the Third World would begin again to strive together for the creation of an alternative, more just, democratic and sustainable world-system, proclaiming Fidel as their comandante.

​References
 
Castro, Fidel.  1983.  La crisis económica y social del mundo.  La Habana: Oficina de Publicaciones del Consejo de Estado.
 
 
Key words: Fidel, Non-Aligned Movement, global crisis, New International Economic Order

Posted July 29, 2016

     There were numerous impediments to the Third World project that was proposed from 1948 to 1979 and defended by Fidel and Cuba from 1979 to 1982.  

     The declining terms of trade continued to be manifest during the 1980s.  The Third World strategy of forming public primary product cartels (“The Third World Project, 1948-79” 7/20/2016) was not able to reverse the process.  The necessary cooperation among producing nations could not be attained with respect to many raw materials, for various economic, technical and political reasons.  Even in the case of the oil industry, the formation of OPEC and the nationalization of oil companies had limited results, for they did not overturn the overwhelming power of the seven largest oil transnationals (Prashad 2007:186-89, 227-28).

     In addition, South-South cooperation required the development of a transportation infrastructure and new investments in appropriate industries.  It was difficult to implement, in light of the limited capital of the Third World and the continuing opposition of the core powers, who correctly saw South-South cooperation as a threat to the structures of neocolonial domination (Castro 1983:177).

      But it was above all the external debt that killed Third World hopes.  In 1960, the total debt of 133 underdeveloped countries was US$18 billion.  By 1970, it had risen to $75 billion; and by 1982, it had risen to $612 billion (Prashad 2007:229).  The escalating debt was driven by the desire of Northern commercial banks to lend.  With excess liquidity due to the high levels of deposits from the OPEC countries that resulted from the oil price hike, and with loans to Third World countries being more profitable than investment in production, representatives of Northern banks traveled to the nations of the Third World during the 1970s with low interest loan offers, but with variable rates of interest. The funds were not destined to projects that could improve the productive capacity of the receiving nation, thus ensuring its ability to repay the loans; rather, they were emergency funds that represented a short-term solution to declining government revenues due to the declining terms of trade and high rates of inflation.  During 1979-80, the interest rates were elevated, making their repayment impossible. The impact of the elevated interest rates was such that from 1982 to 2003, the payments of underdeveloped countries in service of the debt was twice the amount of money that had actually been lent.  In 2002, debt service payments by Third World countries were five times what they received in “aid” (Hernández 2006:82-86; Millet and Toussaint 2004).

     At the 1983 New Delhi Summit of the Non-Aligned Movement (“Derailing the Third World project” 7/22/2016), Fidel led the radicals in putting forth the proposal that the Third World states suspend their payments on the external debt.  He maintained that a debt payment strike would constitute a collective action strategy that would strengthen the bargaining position of the Third World governments. Fidel continued to speak on the Third World debt and the need for a strike of debtor nations.  In a number of speeches in Havana in 1985, at the 1986 Summit of the Non-Aligned Movement in Zimbabwe, and at a 1987 ministerial meeting of the G-77, Fidel maintained that payment of the debt: is financially impossible, as interest rates escalate the balances; would be politically impossible to impose, as the consequent reduction of necessary human services would lead to widespread popular revolt; and cannot be justified morally, as it imposes the greatest sacrifice on the poorest, who are the least responsible for it (Castro 1989).  But the accommodationists of the Non-Aligned Movement argued against Fidel’s proposal for a strike of debtor nations; they advocated that each nation should individually negotiate a restructuring of debt payments.  The accommodationists prevailed (Prashad 2007:214).

     The negotiation of debt payment restructuring by individual nations did not have positive results for the Third World.  The US Treasury Department and the IMF established conditions for the rescheduling of debt payments.   The IMF negotiations prevented the Third World governments from defaulting, and they also prevented the Northern commercial banks from failing.  However, the debt rescheduling plans resulted in a continuing escalation of the total debt.  Moreover, the imposition of economic policies by the IMF as a condition for debt rescheduling undermined of the sovereignty of Third World states (Hernández 2006:91-92; Prashad 2007:222, 229-32, 239).

      The conditions established by the IMF were in accordance with what came to be called “Structural Adjustment Policy,” which was exactly the opposite of what Fidel and the Third World were proposing. Structural adjustment policy demanded: (1) the elimination of government protection of currency, thus devaluating national currencies; (2) the elimination of government protection of national industry, thus undermining the import-substitution development project that was the plan of many Third World nations; (3) the facilitation of an export-oriented economy, thus expanding the access of core corporations to Third World raw materials, cheap labor, and markets; (4) reduction of the role of the state in the economy, thereby reducing restrictions on foreign participation in the economy; and (5) the selling of state-owned economic enterprises to private companies, thus increasing foreign ownership.  The Structural Adjustment Policy was based on the premise that the state should abdicate its role in the formulation of a national development project and the management of the economy, and it should leave everything to the market (Prashad 2007:232-33, 236).

     The IMF justified the Structural Adjustment Policy with an ideological attack on the state.  It maintained that that the central problem was the over-involvement of the state in the economy as well as state corruption and inefficiency.  It thus blamed the Third World state for persistent Third World underdevelopment and poverty, as though neocolonialism and imperialism existed only in the minds of a few Leftist intellectuals (Prashad 2007: 233, 236).

      The neoliberal view of the primacy of the market in promoting economic development overlooks fundamental historical facts.  Throughout history, states have played an integral role in commercial and technological development and in the emergence of civilizations.  In the modern era, the colonial, neocolonial and imperialist policies of powerful states have played a central role in the economic development of some regions and in the underdevelopment and impoverishment of other regions.  The neoliberal project, in ignoring the Third World proposal for a New International Economic Order, was violating an epistemological premise that is a legacy of Marx, namely, that philosophical, historical and social scientific understanding is advanced by taking the vantage point from below of the exploited classes and dominated nations.  Promoted by individuals and centers associated with the most prestigious universities of the world, the neoliberal project was not based on a quest for understanding the true and doing the right, but in promoting the interests of Northern banks, transnational corporations and core countries.  Neoliberalism represented the triumph of particular interests over the common good and of ideological justification over truth, demonstrating a profound indifference to the tremendous thirst of humanity for social justice.  It was a project of domination carried out not by soldiers or mercenaries conscripted from the lower classes and oppressed nations, but by an educated and privileged class dressed in expensive business suits, who became the conquistadores of our time.

      In imposing the neoliberal project, the International Monetary Fund violated a fundamental right embraced by various documents of the United Nations: the right of the sovereignty of nations, which necessarily includes the right of each nation to formulate a national development plan and to define the role of its state in its economy. The International Monetary Fund assassinated the Third World national liberation state, the embodiment of the hopes of the formerly colonized peoples of the earth.  

     But the Third World would rise again, as we will see in subsequent posts in this series on the Third World project.  The Third World would recover its revolutionary faith and its spirit of struggle, invoking such words as: “A better world is possible;” “No to neoliberalism;” “The dignified example of Cuba;” “Fidel: the comandante of all excluded peoples;” and “Socialism for the twenty-first century.”  Hugo Chávez would exalt: “We are making real the dreams of Bolívar and Martí;” “We again are singing The International in the streets of our America.”

​References
 
Castro, Fidel.  1983.  La crisis económica y social del mundo.  La Habana: Oficina de Publicaciones del Consejo de Estado.
 
__________.  1989.  Fidel Castro y la Deuda Externa.  La Habana: Editora Política.
 
Hernández Pedraza, Gladys.  2006.  “Evolución de la Deuda Externa del Tercer Mundo,” in Libre Comercio y subdesarrollo.  La Habana: Editorial de Ciencias Sociales.
 
Millet, Damien, and Eric Toussaint.  2004.  Who owes who?  50 questions about world debt.  Translated by Vicki Biarlt Manus with the collaboration of Gabrielle Roche.  NY:  Zed Books
 
Prashad, Vijay.  2007.  The Darker Nations: A People’s History of the Third World.  New York: The New Press.
 
 
Key words: Neoliberalism, structural adjustment policy, SAP, International Monetary Fund, IMF, Non-Aligned Movement, Third World
 

Posted August 1, 2016

     The Structural Adjustment Policy of the International Monetary Fund was developed in response to the structural crisis of the capitalist world-economy, and it was defined by defense of the interests of the upper class, the transnational corporations, and the powerful nations, resulting in negative consequences for the poor nations and the lower classes (see “USA & IMF attack the Third World project” 7/29/2016).

      Exempt from the maneuvers of the International Monetary Fund by virtue of its revolutionary commitment to true independence, Cuba nonetheless would confront in the 1990s the need for its own structural adjustment plan.  The collapse of the Soviet Union and the socialist bloc had created an economic crisis in Cuba, inasmuch as socialist Cuba had developed extensive commercial relations with the socialist world.  The impact of the economic crisis on Cuba was much greater than the global impact of the simultaneous world-system crisis, since Cuba’s principal trading partners had disappeared; and Cuba remained ineligible for credits and loans through international finance agencies, as a consequence of the US blockade.  In three years, the Gross Domestic Product was reduced by 23%, due principally to the impossibility of importing capital goods and raw materials.  The purchasing capacity of the country was reduced from 8 billion dollars to 1.7 billion dollars.  The supply of petroleum declined from 13.4 million tons to 3.3 million tons, while national production of petroleum fell 17.8%.  As a result, electric energy was reduced to 70% of its 1989 level, and steel production was at 19% of its 1989 level.  The sugar cane harvest declined from 7 to 4.3 million tons, and agricultural production and animal husbandry declined by 53%.  As a result, consumption declined dramatically, and the people began to live under conditions of extreme scarcity.  A good part of the day was spent without electricity.  The system of public transportation was drastically reduced, and many people walked or rode bicycles (Arboleya 2008:199-201).  

     The Cuban plan of structural adjustment plan was formulated by Fidel, now in his sixties, who continued to be everywhere present as the leader of the Cuban revolutionary project.  The Cuban adjustment plan demonstrated once again the exemplary character of the Cuban Revolution and its historic leader, for it showed how to adjust to economic crisis in a form that gives priority to the needs of the people.

     The Cuban adjustment policies were in important ways different from the structural adjustment policies adopted in Latin America during the same time period (López 1994).  First, the Latin American structural adjustment was being imposed by international finance agencies, such as the International Monetary Fund and the World Bank, as a condition for restructuring debts, whereas the Cuban adjustment policies emerged from the Cuban national political process in response to the new international economic and political situation. Cuba had to adjust to new international realities, but it was Cuba herself who was deciding what to do in the new situation; policies were not being imposed by outside agencies.  Secondly, whereas the Latin American structural adjustment policies were designed to increase corporate profits in an era of stagnating profits and markets, without regard for the social consequences of the measures; the Cuban adjustment was designed to protect the standard of living of the Cuban masses and to preserve the social and economic gains of the Cuban Revolution, giving priority to the maintenance of the system of health, education and social security.  Thirdly, unlike the Latin American structural adjustment, the Cuban adjustment policies were developed in a context of wide citizen participation.  There was a “popular consultation” in regard to the measures during 1993 and 1994, involving the mass organizations of workers, peasants, students, , and women as well as neighborhood organizations.  The popular consultation gave the people an opportunity to make recommendations, many of which were implemented, as well as to gain a greater understanding of the international and national economic situation and of the necessity for the measures.  

     The Cuban adjustment plan was oriented toward the diversification of trading and commercial relations, and on the expansion of production in industries with higher wage rates than the classical peripheral exports, such as sugar.  Accordingly, Cuba sought to expand investments in certain branches, such as tourism (with foreign and Cuban state capital), the pharmaceutical industry and biotechnology (with Cuban state capital), petroleum (with foreign and Cuban state capital), and nickel (with foreign and Cuban state capital). This expansion included efforts to attract foreign capital, but under conditions of strong regulation by the Cuban government, fundamentally distinct from the privatization of companies and the opening to foreign capital that was occurring throughout the world with the imposition of the neoliberal project.  For example, most agreements with foreign hotel companies are joint ventures with the Cuban state, and the foreign firm does not employ the Cuban workers directly.  Cuba attracts foreign investment not by selling natural or human resources cheaply, but by providing an educated workforce, political stability and an opportunity for reasonable profitable investment.  

     Various measures were adopted to improve productive efficiency, including: the decentralization of government-owned enterprises, with many state companies expected to become fully or partially self-financing; the conversion of state enterprises in agricultural production and animal husbandry into cooperatives, along with an expansion of the sale of agricultural products under market conditions; and a significant expansion in the possibilities for self-employment.  In addition, a plan for the rationing of electricity and gasoline was implemented.

     Cuban adjustment policies adopted during what Cuba calls the “Special Period” enabled the country to emerge from the depths of the crisis in 1993 to a level of recovery by 2001.  Beginning in 1994, there was a steady growth in the gross domestic product.  Hamilton observes:  “The net economic effect of the changes introduced during the Special Period was positive.  The economy was saved from collapse and after 1995 began to show significant rates of growth—0.7 percent, 2.5 percent, and 7.8 percent in 1994, 1995, and 1996, respectively, compared with an average annual rate of growth of 4.3 percent from 1959 to 1989 and a 3.5 percent average for Latin America and the Caribbean in the mid-1990s.  Expansion has continued, with growth in GDP of 2.5 percent in 1997, 1.2 percent in 1998, and 6.2 percent in 1999” (2002:24).  The recovery largely was stimulated by growth in tourism, biotechnology, and mining.  

     Tourism has become the principal industry of the country.  During the 1990s, it grew at a rate of 18% per year, increasing from 340,000 tourists in 1989 to 1,774,000 in 2000, reaching 2 million tourists annually in 2007.  The hotel capacity on the island increased threefold from 1989 to 2007 (Arboleya 2008:204).  Hotel capacity continues to expand, supplemented by the incorporation of private rental rooms. The number of annual tourists in Cuba now surpasses three million.

     During the Special Period, there were significant investments in the biopharmaceutical industry, with the intention of developing high-technology exports that commands high prices in the world economy, as Fidel had proposed in the debates in the Non-Aligned Movement in the early 1980s.  Cuban scientific research centers have developed fifty products and services that have received international patents, including a Hepatitis B vaccine.  These centers have begun to sell these products and services in the international market, although there are obstacles due to the US blockade as well as monopolization of the market by the large pharmaceutical corporations (Arboleya 2008:205).

    Petroleum production increased six fold from 1991 to 2001, and Cuba now produces enough petroleum to be self-sufficient in the generation of electricity (Arboleya 2008:205).  Joint ventures in the nickel industry brought its production to a record level by 2001.  Cuba is the sixth largest producer of nickel in the world, and it has the largest nickel reserves in the world (Arboleya 2008:205).

     During the Special Period, the system of health and education developed prior to 1989 was in essence preserved (Arboleya 2008:206).  After 1998, Cuba began to expand its international medical missions in the countries of the Third World, and in 2001, there began a project to reconstruct school buildings and reduce class sizes as well as the development of municipal universities in a project for the “universalization of education.”   

    As a result of the willingness to sacrifice on the part of the Cuban people, the Cuban Revolution survived.  There has been some degree of erosion of socialist values as a result of the dynamics of the Special Period, but the popular commitment to the Cuban revolutionary process remains strong, and the Cuban political process continues to be characterized by extremely high levels of mass participation and legitimacy.  As Arboleya writes:  “Few imagined [in 1994] that Cuba would be capable of overcoming this crisis.  Even a good part of the international Left predicted the anticipated internment of the Cuban Revolution. . . .  The overcoming of the crisis to the present level constitutes a fact explainable only on the basis of the cohesion created by the Revolution and the virtues of the socialist distributive system. There were great shortages, but not starvation; unemployment, but not alienation; there were tensions, but not uprisings, much less generalized repression, as would have been normal in the rest of the world.  In the worst moments, the health system was maintained and the schools continued functioning with used books, paper, and pencils” (Arboleya 2008:201-2, 206). 

     Arboleya maintains the Cuban Revolution today possesses legitimacy and popular support as a consequence of the fidelity of the revolution to the interests of the popular classes that are its social base, and as a result of its defense of the sovereignty of the nation, consistent with the nationalism and anti-imperialism that have been central to the Cuban Revolution since the days of José Martí.  And the popular support of the Cuban Revolution has given it legitimacy before international public opinion (2008:209-10).

     The Cuban structural adjustment plan stands in sharp contrast to that imposed by the International Monetary Fund and the global powers.  On the one hand, the Cuban plan is more moral, for it is based on the universal human values proclaimed by humanity, such as the rights of nations to sovereignty, and the rights of all citizens to education, health care, and meaningful political participation.  But the Cuban structural adjustment policy is also more politically intelligent and economically effective: Cuba is recovering, but the world-system falls deeper into crisis, each day increasingly demonstrating its unsustainability.

     The Cuban adjustments during the 1990s is yet one more example of the exceptional capacities of the historic leader of the Cuban Revolution, who will soon celebrate the ninetieth anniversary of his birth, an event which is widely anticipated in Cuba and Latin America.

References
 
Arboleya, Jesús.  2008.  La Revolución del Otro Mundo: Un análisis histórico de la Revolución Cubana.  La Habana: Editorial de Ciencias Sociales.
 
Hamilton, Douglas.  2002.  “Whither Cuban Socialism? The Changing Political Economy of the Cuban Revolution,” Latin American Perspectives (Issue 124, Vol.29 No.3, May, Pp. 18-39).
 
López, Delia Luisa.  1994.  “Crisis Económica, Ajustes y Democracia en Cuba,” FLACSO Documentos de Trabajo III

​ 
Key words: Cuba, Special Period, Structural Adjustment Policy (SAP)

​

Posted August 2, 2016
​
     In 1994, there were two significant events.  First, there was the Zapatista uprising in Chiapas, Mexico, which marked the first internationally-known protest of the neoliberal project of the global powers.  Secondly, Hugo Chávez, a military officer who had led a failed coup d’état in 1992, was released from prison in response to popular demand.  The goal of the coup had been to take power and immediately convoke a constitutional assembly, in order that the Venezuelan peoples could develop a constitutional order more protective of the rights and needs of the people and the sovereignty of the nation. Upon his release from prison, Chávez continued to work for a new constitution, and to this end, he established the Bolivarian Fifth Republic Movement.  Chávez would become President of Venezuela and would lead the nation and the region of Latin America and the Caribbean toward the overthrowing of the neoliberal project.

     Accordingly, the year 1994 marks the beginning of the renewal of the Third World project, during which the peoples and nations of the Third World retook the radical Third World agenda that had been formulated by the charismatic leaders, social movements and revolutions of the Third World during the period 1948 to 1979 (see “The Third World Project, 1948-79” 7/20/2016).  The renewal was born in rejection of the neoliberal project by the people, who experienced the negative consequences of neoliberal policies, such as: the devaluation of their currencies; increases in the costs of water, electricity, natural gas, and buses; reduction in government programs and services; the undermining of local agricultural production; and higher levels of unemployment, crime and violence.  Drawing upon decades of anti-colonial, anti-neocolonial and anti-imperialist movements, leaders emerged that were able to reformulate the concrete demands of the people with respect to specific grievances into a broader political and social critique of neoliberalism, imperialist policies, and the neocolonial world-system.  Thus there emerged a popular movement across Latin America, the Movement for an Alternative World, proclaiming that “A Better World is Possible.”

       The Alternative World Movement spawned new political parties that sought to take power away from the traditional political parties that had cooperated with the global powers and transnational corporations in the imposition of the neoliberal project.  The movement had such a wide following that the new popular parties were able to win presidential and/or parliamentary elections in the number of Latin American states, including Venezuela, Bolivia, Ecuador, Brazil, Argentina, Uruguay, Nicaragua, El Salvador, and Paraguay.  In addition, led by the Leftist and progressive states, Latin America and the Caribbean developed new regional organizations of economic, political and cultural cooperation, challenging US imperialist policies and seeking to develop alternatives to the structures of neocolonial domination.  The charismatic leaders of four of these nations (Venezuela, Bolivia, Ecuador and Nicaragua) proclaimed the process of change as one that sought to build “Socialism for the Twenty-First Century,” and leaders from throughout the region proclaimed their admiration for Cuba as a “model of Latin American dignity.”  

      The new political reality in Latin America affected the Third World as a whole, as can be seen in the dynamics of the G-77 and the Non-Aligned Movement as well as in the emergence of BRICS, an international organization formed by Brazil, Russia, India, China and South Africa.  The nations of BRICS have been deepening relations with Latin America and its progressive governments, thereby seeking to sidestep the structures of the neocolonial world-system dominated by the Western powers.

      Since 1994, then, there has occurred a renewal of the Third World project and a retaking of the radical Third World agenda of the period 1948 to 1979.  The following fourteen posts in the series of twenty-three posts on the Third World project will be devoted to the post-1994 renewal of the Third World project, according to the following plan:
“The neocolonial era in Venezuela;”
“Hugo Chávez Frías;
“The Bolivarian Republic of Venezuela;”
“The Chávist presidency of Nicolás Maduro;
“The Movement toward Socialism in Bolivia;”
“The Citizen Revolution in Ecuador;”
“The Sandinista Revolution in Nicaragua;”
“Latin America and Caribbean unity;” 
“The renewal of South-South cooperation;” 
“The spirit of Bandung lives;”
“The new counterrevolution of the Right;”
“The subtle Eurocentrism of the Left;”
“Beyond Eurocentrism;” and
“The possible and necessary popular coalition.”

​
Key words:  Third World, neoliberalism, Alternative World Movement

     I continue today with the third and final post of critical reflections on the Marxist-Humanist Initiative (see “The relation between theory and practice” 9/9/2016; “Third World socialism” 9/13/2016).  

      In its Statement of Principles, the Marxist-Humanist Initiative asserts:

     Note that white middle class men of the United States are not invited to participate in the revitalized reflection and action envisioned by the Marxist-Humanist Initiative.  I maintain that this is a dysfunctional formulation, not only because white middle class men form a significant part of the population, but also because a call to action formulated in such a manner may not be well received by those middle class white women who identify more with their professions than with their gender with respect to their social and political consciousness.  What are the reasons for this politically absurd exclusion of white middle class men?

      Lenin had good reason to be distrustful of the middle class.  In the Russian Revolution and the Western European socialist revolutions, there was a strong tendency for middle class radicals to proclaim themselves socialist revolutionaries but to abandon socialism for reformism in moments of challenge and crisis.  Lenin considered middle class socialists to be pseudo-socialists (Lenin 1943). The problem was that the middle class and the working class lived and worked in different objective conditions.  The middle class revolutionaries were prepared to settle for the reforms that would improve their political and economic situation, but they were not committed to make the sacrifices that would be necessary for the fundamental transformations that the emancipation of the working class required.  So Lenin and many Marxists that followed were oriented to the concept of a proletarian vanguard, a revolution led by the industrial working class and not the middle class.

       But as socialism evolved in practice in the Third World, the leaders of socialist revolutions were most often from the middle class.  As the anti-colonial revolutions of national and social liberation unfolded, a number of middle class leaders took the reformist road, but an equal or greater number followed the revolutionary path, and in many cases made heroic sacrifices in defense of it.  This phenomenon was a consequence of objective conditions in the Third World.  The colonial and neocolonial situation restrained the economic possibilities for the middle class, thus giving the middle class an objective interest in revolutionary transformation, in which the various popular sectors take power and implement fundamental structural transformations.  At the same time, the middle class, as the more educated popular sector, is more exposed to the colonial ideological distortions, so that it also is well represented in reformist movements and/or the counterrevolution. Thus, in the colonial/neocolonial situation, the middle class is actively present in the revolution, but also in reformism and in the counterrevolution.  The middle class is divided, often playing a leading role in both the revolution and the counterrevolution.

         In the case of the Cuban Revolution, for example, many of the great revolutionaries were of the white middle class: Máximo Gómez, José Martí, Julio Antonio Mella, Ruben Martínez Villena, Antonio Guiteras, Fidel Castro, and Che Guevara. They played an important role in a revolutionary process that that sought to develop an alternative to colonial and neocolonial domination and to implement a fundamental social transformation.  It was a revolution that creatively synthesized Marxism-Leninism with the Third World perspective of national liberation, developing in practice a revolution that was led by the various sectors that formed the people, including professionals, workers, peasants, women, blacks, whites, peasants, and mulattoes.  And it formulated its revolution as such, as revolution of, by and for the people (see various posts in the category Cuban history).

     In the case of the United States, there was a strong tendency for Marxist political parties to rigidly, uncreatively and superficially assume that a socialist revolution in the United States would be led by the working class, understood as the industrial working class and manual workers, and not middle class entrepreneurs, bureaucrats and professionals.  This approach limited the capacity of the Marxist parties to seize the opportunity provided by the popular revolution of 1968, which in fact was a revolution in which white students played a role far more central than the organized industrial working class.  

      With the collapse of the US popular revolution in the 1970s, there emerged in the United States a species of identity politics, in which reformist proposals were put forward by and on behalf of particular sectors, such as blacks, women, Latinos, and gays, with environmentalists also making specific reformist proposals.  Sensing that its classic formulation of a working class vanguard has been out of touch with the post-1960s trends, the Marxist parties have moved to adjustment of their classic formulation, appealing not only to workers but also to blacks, Latinos, women and gays.

      There is in this the failure to appreciate the pivotal role that the middle class will play in the revolutionary processes of our era.  Prior to 1970, when the world-system entered a profound systemic crisis, the middle and working classes of the core nations had a short-term interest in reform as against revolution, because the world-system could afford to concede reforms to the middle and working classes of the core, on the economic base of the superexploitation of Third World labor.  But the world-system is now in crisis.  In order to maintain the system, the global elite since 1980 has been rolling back all concessions to the core popular classes, and it has waged an attack on states in a form that threatens the future of humanity. The middle and working classes in the core no longer have a short-term interest in preserving the structures of the system.  Like the middle class in the colonial-neocolonial situation from 1917 to the present, the middle and working classes of the core today have an interest in revolutionary transformation, that is, the taking of power by the people so that fundamental transformations in the interest of the people will be implemented.  

     But can they discern this interest?  Can the middle and working classes see through the ideological distortions and see their interest in revolutionary transformation?  We do not yet know.  What we can see is a battle of ideas in the core, in which the consciousness and political comportment of the middle class will be of central importance.

     So we have to set aside the historically dated conception of a working class vanguard, even as adjusted by the also inadequate identity politics of the time.  We have to call our people to historical and political reflection, so that they can understand the social sources and the social solutions to the structural crisis of the world-system.  We have to call our people to alliance and solidarity with the anti-imperialist movements of social and national liberation in the Third World, for they represent the key to the socialist transformation of the world-system. And we have to call all of our people, including white middle class men.  
​
     Think carefully before you dismiss white middle class men, for some of them are the descendants of Irish, Italian and Polish immigrants, who brought with them to American shores the teachings of the Irish nationalists and of Marx.  Let us call them to reflection and action.  They just might remember from where they came and who they are, if we remind them.  The history of revolutions teaches us that not all will respond, but surely some will, and their participation will be decisive.
​

​Reference
 
Lenin, V.I.  1943.  State and Revolution.  New York: International Publishers.
 
 
Key words: Humanist-Marxist Initiative, Marx, vanguard, working class, middle class, revolution       

     In my last post, I maintained that the Marxist-Humanist Initiative does not discern the evolution of Marx’s philosophy in connection with the Russian Revolution and subsequent revolutions of national and social liberation in the Third World (“The relation between theory and practice” 9/9/2016).  I continue today with critical reflections on the Marxist-Humanist Initiative.  

     The Marxist-Humanist Initiative maintains that when socialist revolutions arrived to power, they did not proceed to establish “a truly new, human socioeconomic system” in accordance with the philosophy of Marx.  It maintains that nationalization of the economy and the financial system does not transform capitalism.  It argues that, in nationalizing industry, agriculture and banking, socialist revolutions were developing structures not essentially different from capitalist nations that regulate the economy and intervene in the economy in defense of the interests of the capitalist class.  It asserts that both state ownership of economic enterprises and state regulation in support of private capital belong to the state-capitalist stage of capitalism, as was analyzed by Raya Dunayevskaya.

     Marx’s vision of the abolition of alienated labor, hierarchy and the state was rooted in his observations of the technological development of large-scale capitalism toward automated industry.  However, the anti-colonial movements for national and social liberation took power in social and economic conditions very different from those that Marx was observing.  Moreover, the triumphant revolutions confronted serious political and economic obstacles: the determined and morally unconstrained resistance of the global powers and their allies within the nation seeking liberation; the deep roots of national economic structures, designed to facilitate the wealth of the few and the poverty of the many; and the established weight of global commercial and financial structures, designed to protect the interests of the Western power elite.  At the same time, triumphant revolutions faced the challenge of feeding the people and providing for their materials needs, in order to maintain popular support for the revolution.

     Accordingly, in Third World nations in which socialist revolutions triumphed, charismatic leaders reformulated the meaning of socialism on the basis of reflection on their particular conditions.  And recognizing that their societies did not have the possibility to fully develop socialism, even in accordance with their reformulated socialist vision, they declared their nations to be in transition to socialism.  

       Thus, we can understand Third World socialist nations as characterized by the political will to take steps toward socialism, to the extent that such steps are politically and economically possible.  In spite of their incomplete and imperfect character, the socialist revolutions maintain that they have established political and economic structures significantly different from capitalist societies, for they have developed: structures of popular democracy, eliminating the electoral farce of representative democracy and establishing a decision-making process of, by and for the people; protection of the social and economic rights of the people, including universal and free health care and education; defense of the sovereignty of their nations, blocking imperialist and neoliberal intentions; and a foreign policy based on cooperation and solidarity, rather than domination and superexploitation.  They see themselves, and they are seen by progressive and Leftist social movements throughout the Third World, as in the vanguard of a global movement that seeks a transition from a capitalist world-economy to a socialist world-system. 

     Certainly, if a triumphant socialist revolution does nothing more that nationalize industrial and agricultural enterprises and convert them into state property, this step in and of itself does not imply a significant move toward socialism.  However, this step is integral to a transition to socialism, when it is accompanied by other measures, such as: the elimination of representative democracy and the development of popular democracy; the nationalization of the media of communication, thus restricting the capacity of the wealthy to ideologically manipulate the people; the cultivation of values of cooperation and solidarity through educational institutions and the media; the teaching of national and world history in a form that is liberated from the distortions of the previous ruling class; and the formation of community and political leaders, intellectuals, and artists with advanced scientific understanding of national and global social dynamics.  Third World socialist revolutions have taken such steps, and we intellectuals of the North, whose own nations are floundering between reform and reaction, should obverse these revolutions, as we seek to understand socialism and envision a future socialist world-system.

     The development of the capitalist world-economy since Marx’s time has made some of his conclusions dated.  We should take today not Marx’s conclusions, but his method, and seek to understood capitalism and socialism from the vantage point of social movements from below, most fully expressed in Third World socialist nations.  In Third World nations that have declared their intention to build socialism, the delegates of the people are taking concrete steps in the transition from a capitalist world-economy to a socialist world-system.  They are building socialism in practice each day, and it is through reflection on that experience that we intellectuals of the North must construct our theory of socialism.


Key words: Third World, socialism, Marx, Marxist-Humanist Initiative

     In my last post (“The Dangers of Trump and Trumpism” 9/5/2016), I expressed my agreement with the editors of With Sober Senses: A publication of Marxist-Humanist Initiative, who maintain that Trump represents a potential serious threat to civil liberties, and I supported their recommendation that voters in key Electoral College states where the outcome is uncertain should vote for Hillary Clinton.  In this post, I offer reflections on the Marxist-Humanist Initiative.

     The Marxist-Humanist Initiative maintains that “past revolutions have changed forms of property and political rule, but have failed to go on to uproot capital, abolish alienated labor and hierarchical society, and establish a truly new, human socioeconomic system.”  It maintains that a central reason for this failure has been “the lack of internalization of Karl Marx’s philosophy of revolution” and insufficient “theoretic preparation.” It seeks to contribute to the transformation of the world on the basis of a more complete understanding of Marx’s philosophy and its further development by Raya Dunayevskaya, whose writings span the period from 1941 until her death in 1987 (Statement of Principles of Marxist-Humanist Initiative).  

      I appreciate the Marxist-Humanist Initiative’s recognition of the importance of intellectual work and the necessary role of theory in forging emancipatory revolutionary processes. And I appreciate its recognition of the foundational significance of Marx’s work and the exemplary character of Marx, an intellectual educated in the university system of a relatively advanced Western European nation, for US intellectuals and academics.  However, Marx understood that concepts are shaped by social position, and he intuitively grasped that this limitation can be overcome and scientific knowledge attained through encounter with social movements formed from below.  The implications of this methodological insight for our understanding today are that intellectuals of the developed nations of the North ought to encounter the anti-neocolonial movements of the Third World as the foundation for the development of their understanding.  Such commitment has not been central to the Marxist-Humanist Initiative.

      In the 1840s, Marx, who had previously attained a doctorate in philosophy in his native Germany, encountered a social movement formed by workers, artisans and socialist intellectuals in Paris.  This personal encounter enabled him to discover relevant questions that were previously beyond his horizon, empowering him to formulate a critique of German philosophy and British political-economy from the vantage point of the worker.  Marx’s groundbreaking analysis of human history and the system of capitalism demonstrated that advances in understanding could be attained by analyzing the political-economic-social-cultural system from below.  Moreover, his life exemplified a methodological principle: intellectuals not organically tied to social movements from below can overcome the limitations imposed on their understanding by their social position through personal encounter with the social movements emerging from below, taking seriously the understandings of the leaders and organic intellectuals of the movements (McKelvey 1991).

      The work of Marx must be understood in relation to its time and place.  During the period 1750 to 1914, the modern-world system experienced a tremendous geographic expansion, as vast regions of Africa and Asia were conquered by the Western European colonial powers and incorporated into peripheral zones of the world economy, thereby facilitating the ascent of the United States and its imperialist projection toward Latin America.  The resulting increase in the material wealth of the Western colonial and imperialist powers enabled them to seduce, coopt and assimilate the working-class movements, undermining their revolutionary and emancipatory potential and channeling them toward reformism.  At the same time, the expanding and deepening structures of colonial domination and imperialist penetration gave rise to anti-colonial movements in Africa and Asia and popular anti-imperialist movements in Latin America.    

     Marx did not and could not fully anticipate these developments.  As a result of his social-temporal location, he could not have foreseen: the reformist turn of the proletarian movement in the West; the triumph of a proletarian-peasant revolution in Russia in 1917, resulting in a reformulation of Marx by Lenin and the emergence of “Marxism-Leninism;” the turn of the Russian Revolution to Stalinism; nor the rise of anti-colonial and anti-imperialist movements in the Third World that would challenge the political and economic structures and the ideological constructs of the neocolonial world-system, ultimately endeavoring to construct an alternative in theory and practice.  The most radical of the Third World revolutions have sought not only national liberation from European colonial and neocolonial domination and imperialist penetration, but also social liberation from national ruling classes that were tied to the Western-centered transnational capitalist class and that were accommodating to the interests of the Western powers.  The revolutions have been led by charismatic leaders, persons with exceptional capacities for political leadership and for understanding social dynamics, giving each of the revolutions a unified direction.  Of the six paradigmatic revolutions, three (China, Vietnam and Cuba) emerged during the stage of imperialism and transition to neocolonialism, and persist to the present; and three (Venezuela, Bolivia and Ecuador) emerged in the current post-imperialist stage of neoliberalism, in which the structural crisis of the neocolonial world-system is increasingly manifest.

     Just as Marx’s encounter with the revolutionary proletariat of Western Europe in the 1840s enabled him to formulate an advanced and comprehensive analysis from below, so today intellectuals of the developed nations can arrive to an advanced understanding of the capitalist world-economy and the modern world-system through personal encounter with the Third World movements of national and social liberation. Third World charismatic leaders and organic intellectuals have forged an evolution of Marxist-Leninist theory on a foundation of a constantly evolving political practice.   This theoretical development in Marxist theory must be taken seriously by Western Marxist intellectuals, if we are to arrive at an understanding that is not utopian and that is connected to existing global political-economic-social-ideological conditions.

Reference
 
McKelvey, Charles.  1991.  Beyond Ethnocentrism:  A Reconstruction of Marx’s Concept of Science.  New York:  Greenwood Press. 
 
 
Key words: Marx, Marxist-Humanist Initiative, Third World socialism

     In the context of discussion of my post, “Hillary Clinton or the Greens?” 8/24/2016, on the Progressive and Critical Sociologist Network List, Andrew Kliman sent a link to an editorial, “The Extraordinary Dangers of Trump and Trumpism,” published on August 29 in With Sober Senses: A publication of Marxist-Humanist Initiative.

      The Marxist-Humanist Initiative takes the works of Marx as the foundation of its perspective.  It maintains that socialist revolutions have not been guided by Marx’s philosophy of revolution, and that so-called socialist societies in reality are forms of “state capitalism.” Based on the writings of philosopher, activist and feminist Raya Dunayevskaya (1910-1987), the Marxist-Humanist Initiative maintains that “past revolutions have changed forms of property and political rule, but have failed to go on to uproot capital, abolish alienated labor and hierarchical society, and establish a truly new, human socioeconomic system” (Statement of Principles of Marxist-Humanist Initiative).

     In contrast, my perspective is based in the writings and speeches of Third World revolutionary leaders that have synthesized Marxism-Leninism with the Third World perspective.  In my view, Marx correctly discerned that the most advanced understanding of social dynamics could be attained by taking the vantage point of a revolutionary class, and in Marx’s time, the Western European working class was at the vanguard of the revolution seeking to transform the expanding capitalist world-economy.  However, the subsequent development of the capitalist world-economy and the modern world-system put the Russian proletariat at the vanguard of the world revolution from the period 1905 to 1924.  Subsequently, with the failure of the Western European working-class revolution, evident to Lenin by the early 1920s, and with the fall of the Russian Revolution to a bureaucratic counterrevolution with Stalin at the head, the role of vanguard of the global revolution passed to the colonized of the world, as Lenin understood.  From 1917 to the present, anti-colonial movements of national and social liberation in Asia, Latin America and Africa have reformulated Marxism-Leninism, in theory and practice, from the vantage point of the colonized.  There emerged charismatic leaders, persons with exceptional understanding and leadership capacity, such as Mao, Ho, Fidel, Nkrumah, Nyerere, and Nasser; and Chávez, Evo Morales and Rafael Correa in the neoliberal stage.  Third World charismatic leaders have led the revolutionary political process, and they have played a central role in the formulation of an understanding of human history and the capitalist world-economy from below, continuing the project that Marx initiated.  Third World Marxism-Leninism sees current socialist nations not as undemocratic forms of state capitalism but as characterized by popular democracy, as against representative democracy; and as making necessary economic adjustments to the changing conditions of the capitalist world-economy, seeking to defend the sovereignty of the nation and to defend the social and economic rights of the people, while reformulating the meaning of political and civil rights.  

      In spite of our different perspective, I and the editors of With Sober Senses have arrived to similar conclusions with respect to Trump. First, we agree that there is a significant difference between Trump and Clinton, because Trump represents a serious threat to civil liberties and freedoms of speech, press and organization.  The editors maintain that “we are witnessing the beginnings of what could develop into a modern Americanized version of the Nazis’ Schutzstaffel (SS).” They assert that “to falsely equate Trump and Clinton is to ignore the grave threat to our civil liberties and lives that Trump represents. He and Clinton are not ‘basically the same.’”  They further argue:

      Secondly, we agree that common sense requires taking the threat seriously, which means that US citizens voting in key Electoral College states, in which neither Clinton nor Trump have a decisive advantage, ought to vote for Clinton.  It is not a question of supporting Clinton or the democratic party, believing that she or the party is capable of leading the nation toward participation in the development of a more just, democratic or sustainable world-system.  Rather, it is a question of a strategic decision to cast a vote, as With Sober Senses expresses it, not in support of the lesser evil, but to order to prevent a greater evil.  

     In the long term, constant and diligent efforts should be maintained to develop an alternative party of the Left, whether it be in accordance with the vision of the Marxist-Humanist Initiative, or the Third World Marxism-Leninism to which I am committed.  A strategic decision to vote for Clinton in the 2016 presidential elections in no sense precludes efforts on behalf of the development of an alternative political party of the Left.

       A factor in our common strategic recommendation to vote for Clinton (and not the Green Party) in key Electoral College states is that the Marxist-Humanist Initiative and I share a similar view with respect to the limitations of the Green Party.  It clearly is not a Marxist party, and this is a serious limitation, inasmuch as Marx’s work represents the breakthrough to a more advanced understanding forged from below.  I view the Green Party has a popular party that seeks to develop a political force independent of the control of the corporate class, and it should be appreciated by the people for this effort.  But it is lacking in philosophical and political understanding and historical consciousness, and therefore, at the present time it does not have the capacity to lead the people toward their emancipation from corporate domination.  However, it could overcome these limitations in the long term, if it were to recognize them and to take decisive steps to overcome them, seeking to further develop its theory and practice (see “The Green Party Platform” 8/26/2016; “Can the Green Party evolve?” 8/29/2016).

​Key words: Trump, Clinton, presidential elections, Marxist-Humanist Initiative