Beginning in the 1970s, the world-system entered into a multifaceted global crisis, as a consequence of the fact that it had reached the geographical limits of the earth, taking away its historic mechanism for productive and commercial expansion, which had been the conquest of new lands and peoples.  The elites of the core nations responded to the crisis by launching the neoliberal project, a global economic war against the popular classes and the nations of the world. Neoliberalism has been characterized by the imposition of economic recipes, utilizing pressure by international finance agencies supplemented by interventionist wars and political interference in the affairs of nations seeking autonomy.

      The response of the global elite to the structural crisis of the world-system has given rise to a popular revolution in the Third World, in which the people, organized and led by charismatic leaders, are seeking to take power away from the elite.  The peoples of the Third World in movement are repeatedly putting forth the slogan of a just, democratic and sustainable world-system.  They are constructing such an alternative world-system in theory and practice.

      A just world-system.  The ethical concept of a just society has ancient religious roots.  In the earliest sacred texts of Ancient Israel, we find a concept of a God who acts in history to liberate the people from oppression and to defend justice for the oppressed. Later, as Israel evolved to a nation, the prophets of Israel denounced economic injustices as well as the luxury in which kings lived while people were living in poverty.  The prophets condemned the lust for economic power; and they declared economic inequality and social injustice to be sins.  They defended poor farmers who suffered at the hands of powerful landlords.  They called for a change in lifestyle and for social justice.  And they proclaimed that history is not governed by powerful empires but by God.  Subsequently, the religious traditions of Israel influenced the development of Christianity and Islam, and the concept of the ethical responsibility of the faithful to construct a just society became central to liberation theology in both religious traditions.  Today, the peoples of the world, influenced directly and indirectly by these religious traditions, have appropriated the ethical principle of social justice, and they are demanding a just world-system.  For specific biblical texts of Ancient Israel, see Anderson (1986:108, 198, 278, 287-88, 293, 297-98, 337, 345, 372, 383, 480, 495, 503, 523); for liberation theology in Christianity, see Gutierrez (1973, 1983) and Brown (1984, 1993); for liberation theory in Islam, see Ansary (2009) and Schulze (2000).

     A democratic world-system.  The bourgeois revolutions of the late eighteenth century established the principle of a society in which all citizens are equal and all have inalienable rights.  But at first, the rights were confined to political and civil rights for white men with property or education.  For the next two hundred years, social movements emerged that would attain respect of citizenship rights for all persons, regardless of class, race, ethnicity, or gender.  And the popular movements would deepen the concept of democracy to include social and economic rights, such as the right to a decent standard of living, education, and health care.  When the anti-colonial and anti-neocolonial movements of the national liberation emerged in the Third World, they proclaimed that nations have rights, such as the rights to sovereignty, equal participation in the community of nations, self-determination and development.  When the peoples of the Third World today demand a democratic world-system, they have in mind a concept of democracy in this expanded and deeper sense that includes social and economic rights as well as the rights of all nations to self-determination.  They seek true independence, so that they can put into practice the most fundamental of all human rights, the right to development, in order to protect the right of the people to a decent standard of living (see “Universal human values” 4/16/2014).  

    A sustainable world-system.  Historical world-systems have risen and fallen.  The great majority of them were not sustainable, many because the center of the empire was gluttonous, and others because of ecological factors.  In the world-system today, ecological contradictions and political conflicts constitute the greatest threats to the stability and sustainability of the world-system.  The peoples of the world today proclaim that the world-system must have a harmonious relation with the natural environment, and it must develop in accordance with the ethical norms of cooperation among nations and solidarity among peoples.  The peoples of the world today demand a just, democratic & sustainable world-system (see “Sustainable development” 11/12/13).
     
     Justice, democracy and sustainability cannot be developed in the context of the structures and logic of the capitalist world-economy.   The attainment by humanity of a just, democratic and sustainable world-system will require a transition to socialism.  This will be the subject of our next post.

​References
 
Anderson, Bernhard W.  1986.  Understanding the Old Testament, Fourth Edition.  Englewood Cliffs, NJ: Prentice-Hall.
 
Ansary, Tamim.  2009.  Destiny Disrupted: A History of the World Through Islamic Eyes.  New York: Public Affairs.
 
Brown, Robert McAfee.  1984.  Unexpected News: Reading the Bible with Third World Eyes.  Philadelphia: The Westminster Press.
 
__________.  1993.  Liberation Theology.  Louisville, Kentucky: Westminster/John Knox Press.
 
Gutierrez, Gustavo.  1973.  A Theology of Liberation, English translation.  Maryknoll, New York:  Orbis. 
 
__________.  1983.  The Power of the Poor in History.  Maryknoll, N.Y.:  Orbis Books.
 
Schulze, Reinhard.  2000.  A Modern History of the Islamic World.  New York: New York University Press.
 
 
Key words: social justice, democracy, sustainability, world-system, popular movements, Third World

     Inside the socialist projects of Cuba and Venezuela, bureaucratism has been defined as a problem.  It is said that bureaucratism contributes to inefficiency in the production of goods and in the provision of services.

      Let us first understand what bureaucracy is.  As formulated in classical sociological theory by the German sociologist Max Weber, bureaucracy is characterized by a hierarchy of positions, with each position assigned particular duties and responsibilities (Gerth and Mills 1946:196-99).  Bureaucracy is an efficient form of organization.  By establishing a hierarchy of authority, a clear direction with respect to goals and policies of the organization is promoted.  And by developing a division of labor, proficiency in the performance of tasks is facilitated.  But bureaucracy can be inefficient, in that it can give rise to bureaucratism, an infirmity with two symptoms: (1) a stifling of creativity and initiative, as people who occupy positions passively wait for instructions from above; and (2) a lack of imagination, as the persons in the bureaucratic structure develop the habit of looking at things only from the vantage point of their particular position.

      Bureaucracy is a modern form of social organization, and it exists in modern states as well as in modern non-state organizations of all kinds, including corporations and educational and religious institutions. Indeed, modern life has become bureaucratized, a fact that Weber lamented, inasmuch as it was placing us in an “iron cage” of our own making.

      Bureaucracy is a highly impersonal form of social organization, and as such, it goes against “human nature,” or what perhaps is better described as a common human tendency, nurtured in human societies, to form social relationships.  Bureaucracy is impersonal in two senses.  First, it establishes a network of functional relations that are separate from the “natural” or “traditional” personal relations formed in families and societies.  We are expected to leave behind these personal relations when we enter a bureaucratic world, and to give our attention for a determined number of hours each day to the functions that we are assigned in a bureaucratic structure.  Secondly, within the bureaucratic world itself, we are expected to relate to one another on the basis of our assigned tasks, leaving aside any personal sentiments that we may have toward one another.  If we hold a position of bureaucratic authority, we are required to leave personal likes and dislikes aside in promoting or dismissing persons and in assigning tasks, rationally following the bureaucratic rules.

      Because of its impersonality, the bureaucratic form of organization, be it a factory, a school, a university or any other bureaucratic structure, has to be imposed on the people.  Since it goes against their “nature,” the people always resist, and like wild horses, they must be “broken in.”  

     In the development of capitalism in the modern West, the imposition of bureaucratic impersonality and rationality has been more advanced than other regions of the world.  The reason is that the modern West was developing on a foundation of superexploitation of vast regions of the world, thus providing it with the capacity to offer high levels of material rewards for its employees in industry, commerce, education and human services.  Thus there have been significant material incentives for leaving the “traditional” and the “natural” behind.

      In addition to material rewards, advanced capitalist societies motivate people by generating fear of being dismissed from their positions.  Fear of unemployment, particularly in a system with high levels of material reward, is a powerful psychological tool and motivator. 

     In the advanced capitalist societies, the mechanisms of material reward and fear were accompanied by an ethic of individualism, which gave priority to the rights of the individual over the needs of society, a cultural dynamic that has been especially deep-seated in the United States.  The nation proclaimed itself to be a “land of opportunity,” where individual upward social mobility was possible for all capable individuals willing to work.  This led to a devaluation of persons of low social status, for it implied that they lacked a work ethic and/or intelligence.  These cultural dynamics gave additional incentive to individuals to adjust to the impersonal demands of bureaucracy, in order to facilitate their ascent in a bureaucratic structure, which would affirm their worth as superior to those of lower social status.

     In spite of the mechanisms of reward, fear, and the promise of upward mobility, people in the modern West are not entirely broken. They continue to bring the personal into the impersonal bureaucratic environment: they attend to family and other personal matters at work; and they hire and promote people that they like or with whom they have a personal relation.  Furthermore, they may demonstrate little creativity or initiative, and they can be indifferent to the goals of the organization or factory.  The people have a natural resistance to bureaucratic impersonality, and they value their personal lives beyond the reach of the bureaucratic world and its demands.

     The natural resistance of the people to bureaucratic organization is particularly advanced in the formerly colonized regions of the world, where bureaucracy was imposed as an integral dimension of colonial domination.  Psychologically and politically, personal resistance to bureaucracy was hard to distinguish from resistance to colonialism.

     When socialist revolutions in the Third World triumph, they must restructure economic, financial, political, educational, health, and foreign policy institutions and the media of communication, seeking to establish the sovereignty of the nation and the protection of the social and economic rights of the people.  This enormous task, always carried out in the context of the aggression and oppositionist maneuvers of the global powers, requires that many people effectively carry out productive, commercial, political, educational, social and technical tasks.  That is to say, the development of the socialist project requires bureaucratic structures, and it requires that people submit to the bureaucratic hierarchy, carrying out fully the tasks that are assigned to them, and doing so with intelligence and creativity.  There can and should be mechanisms for the communication from below of possible strategies and goals, but direction and coordination from above must be maintained, if organizational goals are to be attained. Any thought that socialist societies, in the current stage of human development, could eliminate bureaucracy, is idealistic and utopian. National projects must be directed and coordinated, if the nation and the people are to be defended.

     As they develop bureaucracies, necessary for carrying out challenging tasks, socialist nations of the Third World must overcome the problem of bureaucratism.  But they find that the mechanisms for doing so are limited.  As formerly colonized societies whose economic structures had been converted to the supply of cheap raw materials, what they can offer to the people in the form of material rewards has been limited.  Moreover, as socialist societies, they sought to develop structures for the protection of the rights of workers, so that employees are much less driven by fear of unemployment.  And as socialist societies, they have wanted to be more humane, thus they have been oriented to flexibility with respect to family responsibilities and tolerance with respect to personal relations at work.  In addition, as socialist societies, rather than a promise of individual upward mobility, they affirm the intrinsic value of all persons, regardless of their level of educational attainment or occupational achievement.  Such structures and values of socialist societies are far more humane than those of capitalist bureaucracies, but they are less efficient, in that they are less able to motivate people to produce, to work hard, and to work with creativity and imagination.  

       So in Third World socialist societies, the mechanisms available to Western capitalist societies can be applied only in a far more limited form, because of limited resources, or because they run counter to socialist values.  This is the essence of the problem of bureaucratism in socialist societies.

     In the case of Cuba, the problem of bureaucratism and the issue of work productivity has been dealt with by exhortations to duty: all persons should contribute to the development of the nation and to the improvement of the socialist society.  This call to duty was most strong during the time of Che Guevara, who expressed the hope and the goal that socialist societies would produce a new kind of person, driven above all by a sense of duty, who would be hard-working, creative and productive, seeking to contribute to the common good.  The call to duty continues to be a part of the Cuban socialist project today.

     Fifty years after the historic moment of Che, it could not reasonably be said that Cuba has succeeded in creating the “new person” as a general phenomenon.  Examples of lack of responsibility abound among the people.  However, the constant messages calling the people to social responsibility, existing in various forms, certainly have had their effect.  In the first place, an informed and socially responsible vanguard, comprising perhaps twenty-five or thirty percent of the people, has been created.  These persons occupy leadership positions in a wide variety of institutions, offering a constant example to the people.  The quality of the Cuban leadership, and not merely at the highest levels, sharply contrasts with the characteristics of those who occupy positions of authority in institutions in various fields in the capitalist nations of the West, who typically are neither informed nor socially responsible.  In the second place, among the mass of the Cuban people, there is a level of appreciation for socially responsible behavior, even though many do not conform to this norm in practice. Thus it can be said that, although the people are not always virtuous, they have not redefined vices as virtues.     

      The nineteenth century Cuban revolutionary José Martí taught us that persons can be truly free only by being educated.  Education is the key to the liberation of humanity, not education in the formal sense, but education in the sense of developing, first, an informed understanding of human history and current global dynamics, and secondly, a commitment to universal human values.  Socialist Cuba in fifty years has not been able to form a new people, but it has been able to from a new leadership, which is appreciated by the people. This is more than other nations have attained, and it represents an important advance in human development.  The spread to the people as a whole of a more informed understanding and of an attitude of long-term self-sacrificing commitment constitutes a new terrain of challenge for humanity, which the Cuban socialist project is undertaking as it continues to evolve.

References
 
Gerth, H. H. and C. Wright Mills, Eds.  1946.  From Max Weber: Essays in Sociology.  Translated by H. H. Gerth and C. Wright Mills.  New York: Oxford University Press
 
 
Key words: bureaucracy, bureaucratism, socialism, Cuba, Weber, work ethic, work incentives, individualism
 

      In the December 6, 2015 elections for the 167 seats of the National Assembly of Venezuela, a coalition of opposition parties attained 109 seats, against 54 won by the Great Patriotic Pole, a coalition of progressive parties headed by the United Socialist Party of Venezuela (PSUV for its initials in Spanish).  It is the first time in sixteen years that the forces of the Left will not have a parliamentary majority.  The factors in the setback for PSUV were discussed in yesterday’s post (“Economic war in Venezuela” 1/7/2016).

      The results of four elections are being challenged, so the seating of four legislators has been delayed.  As a result, 163 deputies were installed on January 5, 2016.  Depending on the outcome of the court review of the disputed elections, the opposition could attain 111 seats and a two-thirds majority, which could empower it to take measures that would reverse the gains of the Bolivarian Revolution.  But on the other hand, the revolutionary forces will have the support of the Constitution of 1998, which was a creation of the revolution.  And the executive and judicial branches of the government as well as the armed forces remain under the control or influence of the popular revolution of the Left that has transformed the political reality of the country since 1998.  Moreover, the revolutionary project likely will continue to have the support of the majority of the people, for the voting in the December legislative elections reflect dissatisfaction with economic conditions during the last eighteen months, and they do not necessarily imply popular rejection of the Bolivarian Revolution.  Without doubt, the PSUV remains the largest single political party, and its members are among the most committed and most politically active sector of the people.

     The December 6 elections have created a situation of political polarization, as the opposition and the parliamentary majority, on the one hand, and President Nicolás Maduro and the PSUV, on the other, are aggressively pursuing their political agendas.  It is a question not only of different political parties, but of the radically opposed models of neoliberal capitalism and popular revolutionary socialism.  The former represents the interests of national and international corporations, and the latter seeks to protect to the sovereignty of the nation and the social needs of the people. 

     Maduro and PSUV have in no sense retreated since the electoral setback.  Maduro maintains that the setback was due to incidental circumstances and that the Bolivarian Revolution will recover and continue to advance. He called on December 9 for a self-critical dialogue in popular assemblies in order to reconstruct a revolutionary majority, which led to the mobilization of popular assemblies by Chavist forces in the entire country.  At the same time, the United Socialist Party of Venezuela is undertaking an analysis of the strengths and weaknesses of the Presidential Councils of Popular Power, with the intention of re-launching this popular organization.  

     Meanwhile, the Chavist-controlled National Assembly, in its last days in December, passed protective measures in response to the threatening declarations of some of the opposition representatives.  It approved the granting of control of the television and radio stations to the workers themselves, and it emitted a decree against the dismissal of public employees for the next three years.

    In addition, an Economic Congress of Socialist Thought was announced on December 11, with the goal of redesigning the guidelines for the development of a productive economy, in order to effectively respond to the withholding of supplies and the financial speculation launched by the Right (see “Economic war in Venezuela” 1/7/2016).  On January 6, the president announced new cabinet members, including the creation of five new ministries that are dedicated to various areas of economic productivity.   

     At the same time, by a vote of 62 to 49 in the opposition quorum, the opposition has chosen the ultra-rightist Henry Ramos Allup as President of the National Assembly.  Ramos Allup is recognized as one of the most recalcitrant representatives of the oligarchy and bitter enemy of the Bolivarian Revolution.  He was among the architects of the neoliberal policies of the 1980s, and he was involved in destabilizing maneuvers after the 1998 triumph of the revolution, such as the failed coup d’état against President Hugo Chávez in 2002 and the petroleum stop of the same year.  He has been known over the years for his hostile verbal attacks critical of the public media (developed by the Chavist government), the National Assembly (under Chavist control), community doctors (a program developed with Cuban cooperation), artists and other public figures.  And he sought to discredit the National Electoral Council for its certification of electoral victories by the Chavist forces, in spite of the fact that it recognized his own election to the legislature on three previous occasions, and in spite of the confirmation of the legitimacy of the electoral process by international observers.    

     Since the December 6 elections, Ramos Allup has announced possible measures that would dismantle the gains and social reforms of the Chavist government.  And he declared that the opposition legislators will seek to bring down the Executive Branch in the first three months of the year.  He also has confirmed the opposition’s promotion of an Amnesty Law, which would free Leopoldo López and others who were found guilty of corruption or of inciting violence during the vandalism of 2014, which resulted in the deaths of forty-three people.

     In the installation of the deputies of the National Assembly on January 5, the oppositionist majority ignored the decision of the Supreme Court of Justice to review four disputed elections, and it attempted to present three deputies whose elections are under review.  Following the swearing in of 163 deputies, when member of the revolutionary bloc took the floor, they were greeted with violent gestures by the oppositionist deputies.  And there were various procedural irregularities on the part of Ramos Allup as presider.  As a result of these factors, the revolutionary deputies withdrew from the legislative hall and joined in popular mobilizations in the city.  Later in the day, Ramos Allup ordered the removal of the portraits of Simon Bolívar and Hugo Chávez from the legislative hall, provoking popular protest.

    Continued polarization and conflict is expected. Some commentators maintain that the Right does not have sufficient political support to govern legitimately and carry out its neoliberal agenda, so it is seeking to create civil conflict and political instability, thus creating conditions for US intervention, which would remove the Bolivarian revolutionary forces from all positions of political authority.  Meanwhile, the Bolivarian Revolution, confident that it will have the support of the majority, particularly in light of the conflictive and destabilizing conduct of the parliamentary majority, proclaims that “a parliamentary majority is not a social majority.”  It intends to use the political authority that it possesses in the executive and judicial branches and the armed forces, sanctioned by the Constitution of 1998.  And it is further developing the popular assemblies as a popular voice that is an alternative to the parliament.


Key words: Venezuela, United Socialist Party of Venezuela, Bolivarian Revolution, Maduro, Ramos Allup

      The opposition in Venezuela waged economic war against the socialist governments of Hugo Chávez and Nicolás Maduro.  The central strategy was for privately-owned importing companies to reduce the importation of goods and to horde goods in warehouses, causing shortages and price increases, and thereby stimulating discontent among the people.

      Venezuela was declared socialist by Chávez, and so it is.  The United Socialist Party of Venezuela is the largest single party, and it is by far the largest party in a progressive popular coalition that has governed the country for seventeen years.  Prior to Chávez, the state-owned petroleum companies in Venezuela functioned autonomously, in collusion with international petroleum interests.  The government of Chávez took effective control of the industry, incorporating it into a comprehensive plan for national development, which has included the development of a wide variety of social missions, attending to the social and economic rights of the people; and which has included a foreign policy of cooperation and the promotion of Latin American unity and integration.  At the same time, popular councils have been developed, seeking to facilitate popular participation and education.   

      But socialist Venezuela has a mixed economy, which includes private ownership of importing companies.  Venezuela is highly dependent on the importing companies, since the country imports seventy to seventy-five percent of the goods that it consumes.  When these companies, with foreign financial support, reduced the availability of food, medicine and consumer goods through hording and the reduction of imports, a wave of price speculation was unleashed, leading to an increase in the cost of living.  The government responded by purchasing goods in the international market and making goods available in state stores, but the desire of the people for goods could not be completely satisfied by the state-owned system.  Moreover, the price speculation forced the state stores to also raise prices, in order to prevent buying from state stores in order to sell in an informal market.  So the result of these dynamics was that desired goods were not always available, and when they were available, there were long lines to purchase them at high prices.

    Other international factors have contributed to economic difficulties in Venezuela.  (1) In the last eighteen months, the price of oil has fallen from 155 to 30 dollars per barrel.  This has had a dramatic effect, inasmuch as petroleum accounts for ninety percent of the income from foreign trade.  (2) China has adopted a model of slower economic growth, which has reduced the prices of metals and soy bean exported by Venezuela’s trading partners in Latin America.  (3) The value of the US dollar has increased, resulted in a higher cost for all imported goods in Venezuela.  
      
      In conjunction with a media barrage against the government (most of the media remains privately owned in Venezuela) and the economic problems, the economic war was effective in stimulating a lack of satisfaction with the government among the people.  Most people think concretely.  They focus on the shortage of goods and higher prices, and they attribute the problem to those who have political power, without understanding the dynamics that created them.  They blame the government for its inability to manage things well.

     But rather than blame the government, it would be more on the mark to blame the capitalists and their political allies for adopting an unethical and unpatriotic political strategy.  Is it morally acceptable for a capitalist to withhold desired goods from the people in order to advance a political project of opposition against the government, elected by the people?  Is it patriotic to promote political instability in order to defend particular interests?  

     The economic war and media campaign had its impact on the December 6, 2015 elections for the national assembly, converting a majority for the coalition of progressive parties headed by the United Socialist Party of Venezuela into a nearly two-thirds majority for the opposition coalition.  

      As occurred in Argentina (“The Right takes power in Argentina” 1/4/2016), the Right in Venezuela played a political game of pretending to be in support of the people but in reality representing corporate interests.  The French journalist Ignacio Ramonet observes that the opposition candidates hid their intention of neoliberal restauration during the election campaign.  But once the results were in, they announced their plan of privatizing companies, reducing public services, revoking labor laws, eliminating social gains, and dismantling international agreements.  Ramonet further notes that the Bolivarian Revolution continues to have the support of the majority of the people, and that those who voted for an opposition candidate for the national assembly in the context of the current economic difficulties did not imagine a dismantling of the revolution.  Ramonet argues that to proceed to dismantle the gains of the revolution would be an error by the opposition, for it would provoke popular rejection.

     With respect to the political game of the Right, questions should be asked.  Is it ethical for a candidate for public office to speak vaguely in support of change, with the full intention of implementing specific measures that promote corporate interests?  If a candidate intends to return to the neoliberal agenda of the 1990s, should it not be fully declared?   Should not political campaigns be characterized by open, honest and respectful debate among the candidates?  The difference between the Left and the Right in Latin America is not merely a difference in political parties.  It is a difference between two alternative ways of being political.  The one is rooted in an informed understanding and a commitment to the people; and the other seeks to manipulate the people and defend corporate interests.

      The election of an oppositionist majority in the National Assembly creates a situation of political polarization in Venezuela, which will be discussed in the next post.


Key words: Chávez, Maduro, Venezuela, United Socialist Party of Venezuela, Latin American Right, opposition, socialism

      A government that pretends to defend the people but in fact defends the interests of corporations must play a constant political game.  The government of Mauricio Macri, which took power in Argentina on December 10, 2015, is in this situation (see “The Right takes power in Argentina” 1/4/2016).  In pursuit of this political game, the government of Macri has indicated its interest in establishing free-trade agreements with the United States and the European Union.  “Free trade” pretends to promote economic development for all, but in reality it serves the exclusive interest of corporate profits.

     “Free trade” has been a powerful ideological tool of the bourgeoisie since Adam Smith extolled the virtues of the market in opposition to government-issued overseas monopolies in the era of mercantilist capitalism.  Smith’s classic work, The Wealth of Nations, was published in 1776, at the beginning of the transition of the capitalist world-economy from agricultural capitalism to industrial capitalism.  In opposing government-issued monopolies, Smith was taking the vantage point of the newly emerging industrial bourgeoisie, and he was seeking to eliminate restraints on the development of industry. Smith’s analysis constituted an important advance in the science of political economy.  His concepts, however, were formulated before the emergence of large-scale and concentrated capitalism, and they therefore must be reformulated, taking into account this development and others in the evolving world-system (McKelvey 1991:61-64).

      When concentrated industry emerged during the nineteenth century height of British hegemony, British economists used the concept of free-trade to argue against the government protection of national industries, seeking to promote the sale of British manufactured goods in other core nations.  In spite of its contradiction with the interests of their nations, the economists of other industrializing nations used the concept, because it justified the determination of workers’ wages on the basis of the market principle of supply and demand, thwarting state intervention in support of workers’ needs.  

     In removing the concept of free trade from the theoretical and historical context of Adam Smith, and in using the concept to justify national and international policies, economists were taking free trade from the domain of science and placing it in the sphere of ideology, where ideas distort reality in order to defend and promote particular interests.  But as is typical of ideological distortions, free trade as ideology was characterized by contradictions: it was not followed in practice by core nations that needed to protect their industries; nor by governments with respect to labor, as courts intervened to declare union activities to be restraints of trade and police intervened violently to repress workers’ strikes.

     The ideology of free trade suffered a setback during the era of welfare state capitalism, which was provoked by the Great Depression of the 1930s.  The period was dominated by the concepts of Keynesian economics, which advocated state investment in order to expand the economy, increase employment, and create greater social equality.  The capacity for core states to invest in the economy and society was made possible by the colonial and neocolonial superexploitation of vast regions of the earth, providing core nations with high levels of capital and revenue.  The idea of free trade did not completely die; its virtues were proclaimed by a few economists, including Milton Friedman, a well-known economist of the University of Chicago.  But most economists considered that events had shown that free trade was limited in its validity, and that governments would never again be guided by it.

     During this period of welfare state capitalism from 1929 to 1980, global elites made concessions to the Third World project that sought independence and national sovereignty for the colonized regions of the planet.  The concessions gave Third World states a degree sovereignty, in order that they could adopt measures for the protection of their national industries and national currencies.  The protective measures had benefits for the people, however limited.  During this period, there ruled in the Third World the idea that sovereign states had the right and the duty to take necessary measures to promote national economic and social development.  

     In the 1970s, the first signs of a long structural and possibly terminal crisis of the world-system emerged.  Historically, since the sixteenth century, the world-system had expanded by conquering new lands and peoples, thus making available new sources of cheap raw materials and cheap labor as well as new markets for surplus manufactured goods.  But by the 1970s, two factors emerged to block this historic mechanism of expansion.  First, the world-system had reached the geographical limits of the earth, so that there were no more lands and peoples to conquer.  Secondly, the colonized peoples of the earth had attained a capacity to politically mobilize in defense of their natural resources and the rights of the people (see various posts on the crisis of the world system).  

     In response to this situation, the global elite launched the neoliberal project, giving new life to the ideology of free trade.  Core governments and think tanks launched an ideological attack on the state, seeking to reverse the modest concessions that had been made to Third World governments during the era of welfare state capitalism.  They maintained that state intervention by Third World states in their economies had promoted poverty, and that the implementation of free market principles would allow them to finally overcome poverty.  This claim of the global elite represented the highest form of deceit and hypocrisy: in fact it was imperialist interventions by core states in the affairs of Third World nations, in pursuit of the particular interests of the core, which had deepened the underdevelopment of the Third World since the attainment of political independence.  The deception was understood in the Third World, where popular movements could not lose sight of the fact that colonialism is the author of underdevelopment, and that imperialist policies maintain the economic and cultural structures of colonialism.  But because national elites in the Third World, in collusion with international financial actors, had betrayed their nations and accepted untenable loans, Third World governments were now in debt, providing a lever for the core to impose the neoliberal project.

      The global elite was able to impose the neoliberal project and resurrect the free-trade ideology as a result of the vulnerability of the Third World project during that historic moment.  In the first place, there was the high indebtedness of Third World governments, exacerbating their lack of capital for investment in industry, infrastructure and education.  But in addition, the Third World project from the outset had been forged by a mixture of reformers and revolutionaries, with the former having economic interests tied to international capital, and with the latter seeking a decisive rupture with colonial economic, financial, cultural and ideological structures.  Although some nations, like Cuba and Vietnam, took decisive revolutionary steps, many did not sufficiently seek transformation of colonial structures, with the result that promises of improvement in the material conditions of the nation could not delivered.  So by the late 1970s, the hopes of the people had not been fulfilled, and the governments were in debt, rendering the Third World project powerless to prevent the implementation of neoliberal policies.

     But the neoliberal project further impoverished the impoverished, thus giving rise to waves of popular indignation.  At first the popular protests focused on concrete issues, such as the price of water.  But charismatic leaders emerged to teach the people a more comprehensive understanding of neoliberal policies, exposing the ideological character of the free-trade doctrine.  Proclaiming that a “Better world is possible,” the movements brought to power alternative political parties that would defend the rights of the people, a process particularly advanced in Latin America, where a number of progressive governments have been established on a foundation of popular support since 1998.  These governments reversed the trend toward free-trade agreements with the United States and other core governments, and they have moved toward the development of South-South cooperation (see also “The fall of FTAA” 3/7/2014 and other posts in the category of Latin American union and integration).  The Right in Latin America today seeks to bring down these progressive governments.

     We should not lose sight of fundamentals.  An objective analysis of human history and the modern world shows that the state commonly has played a central role in the development of a nation and in the formation of a national social project.  An unregulated market contributes to economic development, under conditions in which buyers and sellers are small scale and more or less equal.  But such conditions do not pertain to today’s world-system, characterized by the concentration of production and by the concentration of power in the hands of a few states.  And they did not pertain to many empires in the past.  Throughout human history, in pre-modern empires as well as in the development of the modern capitalist world-economy, the state has played a central role in economic development.  The important role of strong state action to promote national development has been historically demonstrated, and this lesson from history especially applies to nations today that have been made underdeveloped through colonial and neocolonial domination.  

     The fundamentals that we should keep in mind include moral principles.  In accordance with the democratic value of the equal sovereignty of nations, all states have the right to pursue projects of national development, seeking to utilize natural and human resources in accordance with long-term national needs.  Those nations that have been historically colonized should be free to exercise this right, without being subjected to ideological attacks, in which false assumptions and distortions abound in order to justify military interventions and political interferences in defense of the particular interests of the powerful.  

     The long-term negative consequences of free-trade agreements in today’s global reality are not self-evident.  Charismatic leaders were able to delegitimate the ideology of free trade in the immediate aftermath of the imposition of the neoliberal project.  But only a minority of people, twenty-five or thirty percent, are able to internalize an historical and global understanding of the problems that the nation confronts.  The majority is susceptible to the distortions of the major news media, which is characterized by selectivity and superficiality, driven by corporate interests.  In the contest between, on the one hand, educating the people, and on the other hand, manipulating and seducing the people, the latter is easier to do, especially when undertaken by those with wealth, power, and control of the means of communication.

     The concept of free trade once pertained to science.  But it now belongs to ideology.  We who are committed to the development of a just, democratic and sustainable world-system must undertake the difficult task of educating the people.  This mission includes the delegitimation of “free trade,” an idea that is inconsistent with empirical reality and that has vibrancy, not because it is valid, but because its serves the interests of the wealthy and the powerful.

     See further “Imperialism as neoliberalism” 10/7/2013 in the category US Imperialism; and “Free trade in the 19th century” 8/26/2013 in the category Colonialism, semi-colonialism, and neocolonialism in Latin America. 

​Reference

McKelvey, Charles.  1991.  Beyond Ethnocentrism:  A Reconstruction of Marx’s Concept of Science.  New York:  Greenwood Press. 
 
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Key terms: free trade, unregulated market, Adam Smith, political economy, neoliberalism, free-trade agreements, FTA, Third World project, Third World socialism

     On November 22, Mauricio Macri, of the rightist party Cambiemos (Let us change) won the presidential elections in Argentina, defeating Daniel Scioli, candidate of the Front for Victory, by a margin of 51.32% to 48.68%.  He assumed office on December 10, 2015.

      The Front for Victory is the party of Nestor Kirchner, who assumed the presidency in 2003, initiating an era of policies in defense of the needs of the people, continued by the presidency of Cristina Kirchner.  The policies of the Front for Victory have established a low rate of unemployment of 5.9% in Argentina and a reduction of government debt to its lowest level since 1976, and they have led to significant gains in education, health, and science and technology, including the establishment of nineteen universities.  In addition, the Kirchner governments have nationalized the petroleum industry and the airlines, and they have created other public companies that have contributed to national development.  The Kirchner governments brought to an end an era of neoliberal governments that had defended corporate interests and that had generated intense waves of popular protest.  In addition to defending the rights of the people in Argentina, they also played an important role in the process of Latin American union and integration.

     The Right won the November 22 presidential elections in Argentina with the strategy that the Latin American Right has been using in opposition to the progressive governments that have taken power during the last fifteen years:  forming a new political party, taking into account the fact that the traditional political parties have been discredited by their collusion in the implementation of the neoliberal project of the global powers during the 1980s and 1990s;  making promises that are supportive of popular desires, such reducing poverty, expanding the economy, extending the reach of social programs, improving housing, and launching campaigns against corruption and crime, without providing specifics or a developed plan; developing a media campaign designed to discredit the progressive governments, playing on the fact that no government, no matter how committed to the people, can fully deliver on all of the people’s hopes; and offering candidates with a certain degree of popular appeal.  Corporate ownership of the media, which plays an intense role in the campaigns, makes the success of the strategy possible.  Representative democracy, as distinct from popular democracy, is vulnerable to this kind of demagogic maneuver, and it is particularly successful in influencing the middle class (see “Popular Democracy” 11/6/2013, found in the category on the American Revolution).

     This is not the first setback of the Left in the current wave of Latin American governments, initiated by the election of Hugh Chávez as president of Venezuela in 1998: the party of Chávez failed to win a constitutional reform referendum in 2007; the president of Paraguay, a former Catholic Bishop who emerged to defend the poor and who was elected in 2008, was removed from office by a legislative coup d’état; and the constitutionally-elected president of Honduras, who represented a traditional political party but was moving toward closer relations with the most radical governments of the region, also was removed from office in a legislative coup d’état in 2009.  But the presidential elections in Argentina on November 22 mark the first time in the current progressive stage in Latin America that a Leftist government has been removed from power by an electoral process.

     What happens now in Argentina?  The Front for Victory remains strong in the legislature and in the provincial governments.  It likely will attempt to block any effort to reverse the policies that have resulted in an improvement of conditions of life for the people.  Insofar as the new government considers certain progressive policies untouchable, as a result of their evident benefits for the people, such policies would become consolidated, accepted even by governments of the Right.  On the other hand, to the extent that the government seeks to reverse policies that defend the needs of the people, it could generate intense popular mobilizations that would undermine its capacity to govern, as occurred with the governments of the neoliberal era.   The political game of the Right is inherently contradictory: it comes to power through a vaguely populist rhetoric, but then it seeks to govern in the interest of national and international corporations.  To the extent that it adopts pro-corporate measures that have anti-popular consequences, its true character is made manifest. 

      Thus far, on the one hand, the government of Macri has promised to keep intact the nationalizations and the social programs of the Kirchner governments and to continue cooperation with the governments of the region in the process of Latin American and Caribbean union and integration.  On the other hand, the Macri cabinet has been staffed with former directors of multinational corporations and with persons who are linked to the military dictatorship of 1976; and the government has indicated its orientation to free-trade agreements, it has eliminated protection of the national currency, and it has decreed a new law over the media of communication.  

     The Media Law of Argentina was approved by the National Congress in 2009.  It sought to democratize the media, which has been under the control of the media conglomerates, and to ensure a plurality of voices.  It established the Federal Authority of Audiovisual Communication Services (AFSCA for its initials in Spanish) and the Federal Authority of Information and Communication Technologies (AFSTIC) as state organisms with autonomy.  The new Macri government issued a decree placing the functions AFSCA and AFSTIC under the direct authority of the Ministry of Communications through a newly-created National Entity of Communications (ENACOM).  The degree has generated popular protest in defense of the 2009 Media Law.

     The Macri government’s elimination of protection of the national currency defends the interests of corporations and has negative consequences for the people.  The value of Argentinian peso fell with respect to the US dollar, with the rate of exchange going from 9.7 to 14.7 pesos for the dollar, a devaluation of 34%.  The result was an increase in prices for domestic goods sold in pesos, such as beef, wheat and water, according to a consumers’ association, diminishing the purchasing power of the people.  A leader in the truckers’ union has calculated that the workers would need a salary increase of 28% to compensate for the devaluation and attending inflation.  On the other hand, the devaluation benefits exporting companies, which receive dollars for exported goods and at the same time pay salaries in Argentinian pesos.  It is estimated that the estate bourgeoisie will have an additional four to eight billion dollars in profits for their sales of beef, wheat, corn and soy bean.  

     Such elimination of government protection of national currencies was one of the principal components of the neoliberal project imposed on the peoples of the world in the 1980s and 1990s, giving rise to popular movements of indignation, which in Latin America led to the sweeping aside of traditional political parties and the establishment of a different political reality from the period of 1998 to 2015.  The Latin American Right at the present time hopes that the presidential elections in Argentina are the beginning of the end of the era of progressive governments in Latin America.  But we could be in a moment in Argentina in which the reforms of the Left are consolidated, accepted even by governments of the Right; or in which a new wave of popular rejection demonstrates the political impossibility of the agenda of the Right in Latin America.  Either would reinforce the Latin American movement toward governments that defend the people and the nation, standing in opposition to the neoliberal and militarist policies of the global elite, which seeks to defend its privileges and its interests at all costs, creating a precarious condition for humanity.  

Key words: Macri, Scioli, Front for Victory, Argentina, Kirchner, devaluation, media