imperialist globalization crisis & resistance. economic slowdown since 1970s
TRANSCRIPT
Imperialist Globalization
Crisis & Resistance
Economic Slowdown since 1970s
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DP
Gro
wth
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(%)
1960-69 4.6 10.2 4.4 5.3 5.1
1969-79 3.3 5.2 3.6 3.7 3.6
1979-90 2.9 4.6 2.15 2.4 3
1990-95 2.4 1.7 2 1.6 2.5
1995-2000 4.1 0.8 1.7 2.5 1.9
US Japan Germany Euro-12 G-7
Declining Productivity
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ork
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1960-69 2.5 8.6 4.3 5.2
1969-79 1.3 4.4 3 3.2
1979-90 1.15 3 1.5 1.9
1990-95 1.2 0.7 2.1 1.9
1995-2000 2.3 1.2 1.2 1.3
US Japan Germany Euro-11
Slowdown in Capital Stock Formation
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%)
in N
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ap
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tock
1960-69 3.9 11.3 6.6
1969-79 3.8 9.5 4.5
1979-90 3 6.9 3
1990-95 2 5.3 3
1995-2000 3.8 4.5 3.1
US (net) Japan (gross) Germany (gross)
Decline in Profitability
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Ave
rag
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Pro
fit
Ra
te (
%)
1950-70 21.6 23.2 12.9 17.6
1970-93 17.2 13.8 9.9 13.3
Japan Germany US G7
Slowdown of World EconomyChart 4: Growth Rate of Real World Gross Domestic Product,
1970-2001 (market exchange rate w eighted)
0.00.51.01.52.02.53.03.54.04.55.05.56.06.57.0
1970
1972
1974
1976
1978
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
Year
% g
row
th
Grow th rate
Linear (Grow th rate)
In the last decade, at least one major financial crisis erupted somewhere in the world every two or three years – Japan in 1990, Mexico, Argentina and Brazil in 1994-95, East Asia in 1997-98, Russia and Brazil in 1998-99, and so on.
Fundamental Contradiction in the Capitalist System
Social ProductionDivision of laborMore trade; diverse products & inputs
Ever widening scale of production & distribution under centralized control
Private Profit Wage restraintLabor-displacement Anarchy of productionM&As, layoffs
vs. Constricted Markets
Crisis of Overproduction
Countervailing the Crisis of Overproduction
State Monopoly Capitalism
Keynesian State-interventionismnature: expansionary programs to counter contracting markets & falling effective demandeconomic basis: post-depression recovery (1930s) & post-war reconstruction (1950s-1960s) i.e. after massive destruction of productive forcessocial basis: social unrest and agitation of trade union movement political basis: anti-communist containment strategy
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Ave
rage
Ann
ual C
hang
e in
Rea
l Wag
es (%
)
Japan Germany US
Growth in Real Wages
1950-73 1973-93
-
2.0
4.0
6.0
8.0
10.0
ave.
ann
ual %
cha
nge
U.S. Germany Japan G-7
Growth in Real Social Expenditures
1960-75 1975-80 1980-85
From long-boom to long-downturn(Average annual rates of change, except for net profits which are averages)
Manufacturing
1950-70 1970-93 1950-73 1973-93 1950-73 1973-93 1950-73 1973-93U.S. 24. 35 14. 5 4. 3 1. 9 3. 8 2. 25 - -Germany 23. 1 10. 9 5. 1 0. 9 5. 7 0. 9 6. 4 1. 7Japan 40. 4 20. 4 14. 1 5 14. 5 5 14. 7 5G-7 * 26. 2 15. 7 5. 5 2. 1 - - 4. 8 3. 7
Private business
1950-70 1970-93 1950-73 1973-93 1950-73 1973-93 1950-73 1973-93U.S. 12. 9 9. 9 4. 2 2. 6 3. 8 3 - -Germany 23. 2 13. 8 4. 5 2. 2 6 2. 6 5. 1 3Japan 21. 6 17. 2 9. 1 4. 1 - - 9. 35 7. 1G-7 * 17. 6 13. 3 4. 5 2. 2 - -5 4. 5 4. 3
* G7 net profit rate extends to 1990; German net capital stock covers 1955-93Source: Robert Brenner, The Boom and the Bubble: The U.S. in the World Economy (Verso, New York, 2002), Table 1.1, p. 8.
Net profit rate Output Net capital stock Gross capital stock
Net profit rate Output Net capital stock Gross capital stock
Neoliberal “Globalization”tight credit fiscal austeritylaissez-faire erosion of social rights and entitlementseven as monopoly capital continues to enjoy protection and support
neoliberal policy conditionalities imposed by imperialist-controlled multilaterals (IMF-WB-WTO) on oppressed countries
Crisis of Overproduction Falling ProfitsTo Overcome Crisis of Overproduction & Boost Profits, monopoly capitalists must secure:
cheaper raw materials cheaper labor access to markets
“Globalisasyon” = estratehiya ng Imperyalista para makaalpas sa Krisis ng Sobrang Produksyon
Capital Exports takes on increasing importance
I tem1982 1990 2000 2001 1986-1990 1991-1995 1996-2000 1999 2000 2001
FDI Inflows 59 203 1,271 735 23.6 20.0 40.1 56.3 37.1 -50.7FDI Outflows 28 233 1,150 621 24.3 15.8 36.7 52.3 32.4 -55.0FDI Inward Stock 734 1,874 6,314 6,846 15.6 9.1 17.9 20.0 22.2 9.4FDI Outward Stock 552 1,721 5,976 6,582 19.8 10.4 17.8 17.4 25.1 7.6Cross border M&As .. 151 1,144 601 26.4 23.3 49.8 44.1 49.3 -47.5Sales of Foreign Affiliates 2,541 5,479 15,680 18,517 16.9 10.5 14.5 34.1 15.1 9.2Gross Product of Foreign Affiliates 594 1,423 3,167 3,495 18.8 6.7 12.9 15.2 32.9 8.3Total Assets of Foreign Affiliates 1,959 5,759 21,102 24,952 19.8 13.4 19.0 21.4 24.7 9.9Exports of Foreign Affiliates 670 1,169 3,572 2,600 14.9 7.4 9.7 1.9 11.7 0.3Employment of Foreign Affiliates (thousands) 17,987 23,858 45,587 53,581 6.8 5.1 11.7 20.6 10.2 7.1
MemorandumGDP (in current prices) 10,805 21,672 31,895 31,900 11.5 6.5 1.2 3.5 2.5 2.0Gross Fixed Capital Formation 2,285 4,841 6,466 6,680 13.9 5.0 1.3 4.0 3.3 ..Royalties & Licence Fees Receipts 9 27 66 73 22.1 14.3 5.3 5.4 5.5 ..Exports of goods & non-factor services 2,081 4,375 7,036 7,430 15.8 8.7 4.2 3.4 11.7 -5.4
Selec ted Indicators on FDI and International Production
Source: Table I.1 of UNCTAD WIR 2002
Value at Current Prices(billions of dollars)
Annual growth rate(percent)
FDI outflows increased 41 times
# of TNCs = 64,592 as of 2001
# of Foreign Affliliates = 851,167
Sales = US$ 18.5 Trillion or 2 ½ times value of world exports (58% of Global GDP)
FDI Concentrated in Advanced Capitalist Countries
Distribution of Population & FDI, 2001
0%
20%
40%
60%
80%
100%
Population Inflows Outflows InwardStock
OutwardStock
Central & Eastern Europe
Developing Countries
Other Developed Countries
United States
Japan
Other Western Europe
European Union
Centralization of Capital through M&As
Foreign Direct Investments (FDI) Inflows
-
200
400
600
800
1,000
1,200
1,400
1990 1995 1996 1997 1998 1999 2000 2001
in b
illio
n US
$
Cross border M&As Greenfield FDIMost FDI in recent yrs. has been in the form of monopolies merging their existing productive capacity or monopolies taking over existing assets in other countries, rather than creating new productive capacity.
Monopoly Capital taking over key sectors
Figure 8. Cross-border M&As, by industry of seller
0
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1995 1996 1997 1998 1999 2000 2001
mill
ions
US
$
Others
Business Services
Trade
Social Services
Transport, Storage & Commn
EGW
Finance
Manufacturing
Mining & Agri
For instance, there were US$438 million worth of M&As in the education sector in 2001 compared to just US$4 million worth in 1996. In the health sector, the value of M&As concluded jumped from US$336 million in 1996 to US$3.4 billion in 1997; this slowed in 2001 but was still worth a substantial US$1.9 billion.
Finance Capital
The combined assets of 50 of the world’s largest banks and diversified financial companies account for 60% of the Economist’s estimate of a $20 trillion global stock of productive capital (Hoover’s Handbook of World Business, 1993).
Global Auto Industry: Strategic AlliancesMajor Alliance Share (%) of
as of July 2000 Global ProductionGeneral Motors-Fiat GM (100%), Isuzu (49%), Fiat (20%), Fuji (20%), Suzuki (10%) 23.9Ford-Mazda-Daewoo Ford (100%) Volvo Cars (100%), Mazda (33%), Land Rover (100%), Ssangyong (52%) 17.2DaimlerChrysler-Mitsubushi-Hyundai DaimlerChrsyler (100%), Mitsubishi Cars (34%), Hyundai (100%), Kia (51%), Asia (16%) 13.6Toyota Toyota (100%), Daihatsu (51%), Hino (34%) 8.6Renault-Nissan Renault (100%), Nissan (37%), Samsung (70%) 9.5Volkswagen-Scania VW group (100%), Scania (19%) 4.4Honda 4.6Pegeot-Citroen 4.4BMW 1.6Others 6.3
Partners (% stake)
Source: Global Auto 2000, International Metalworkers' Federation
Oil Industry: From “7 Sisters” to 3
Oil Reserves(billion barrels)
Exxon-Mobil (US) 21 130,000 British Petroleum (UK) 15 100,000 Royal-Dutch Shell (UK/Netherlands) 19 102,000 Source: Data on oil reserves and employment from Brar 2002, op.cit.
Top 3 Oil Majors Employees
Oil SupermonopoliesRank in Assets Revenues Profits Capitalization
Forbes 500 ($ millions) ($ millions) ($ millions) ($ millions)Exxon-Mobil (US) 4 143,174 187,510 15,105 270,805 British Petroleum (UK) 6 141,158 174,218 8,010 191,054 Royal-Dutch Shell (UK/Netherlands) 8 111,543 135,211 10,852 192,256 TotalFinaElf (France) 17 77,275 94,243 6,853 104,063 Chevron-Texaco (US) 21 77,572 97,863 3,931 93,137 Source: Revenues, Profits, Assets, Capitalization from Forbes Global, World's 500 Biggest Companies, July 22, 2002;
Oil Major
Blood for Oil Profits scramble to control the
world’s dwindling non-renewable energy reserves
demand for oil continues to rise especially in the advanced industrialized countries. The imperialist countries have a greater dependence on oil today than at any other time in the past.
the more desperately they struggle for control of territories
in their attempts to corner oil reserves, there is not a crime that these giants will not commit:o BP maintains paramilitary
thugs in in Colombia o Shell enlists services of
army, with all the attendant brutality, in Nigeria
o BP was implicated in overthrowing nationalist Mossadeq regime in Iran
“Oiligarchy” move smoothly from the industry’s boardrooms to the corridors of government
Biggest TNCs based in a handful of imperialist countries
Country Distribution of Top 100 TNCs
1990 1995 1999 1990 1995 1999 US 28 30 26 31.5% 33.3% 33.3% EU 48 39 46 45.5% 43.8% 43.0% UK 12 10 8 8.9% 12.2% 12.3% Germany 9 9 12 8.9% 12.2% 12.3% France 14 11 13 10.4% 8.9% 11.6% Netherlands 4 4 5 8.9% 8.2% 5.3% Belgium 1 2 - 1.0% 0.9% - Japan 12 17 18 12.0% 15.1% 15.4%Impe Triad 88 86 90 89% 92% 92%Top 100 Total 100 100 100 100.0% 100.0% 100.0% Total Assets in billion US$ 5,092 Total Foreign Assets in billion US$ 2,124 Total Sales in billion US$ 4,318 Total Foreign Sales in billion US$ 2,123 Total Employment 13,279,327 Total Foreign Employment 6,050,283 Source: UNCTAD World Investment Report 2001, Table III.4 & III.5, p. 94-95
Number of TNCs in Top 100 Share of Foreign Assets of Top 100
Monopoly over Technology
0%
10%
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R&D expenditure US Patents Tech Fees
Rest of the World
Switzerland
Sweden
Netherlands
Canada
Italy
UK
France
Germany
Japan
USA
International Division of Labor
1980 1997 1980 1997Developed Countries 82.3 70.9 64.5 73.3Developing Countries 10.6 26.5 16.6 23.8 Latin America 1.5 3.5 7.1 6.7 Argentina 0.2 0.2 0.9 0.9 Brazil 0.7 0.7 2.9 2.7 Chile 0 0.1 0.2 0.2 Mexico 0.2 2.2 1.9 1.2 South & East Asia 6.0 /a 16.9 7.3 14 NIEs 5.1 8.9 1.7 4.5 Hong Kong 0.2 0.6 0.3 0.2 South Korea 1.4 2.9 0.7 2.3 Singapore 0.9 2.6 0.1 0.4 Taiwan 1.6 2.8 0.6 1.6 ASEAN 0.6 3.6 1.2 2.6 Indonesia 0.1 0.6 0.4 1 Malaysia 0.2 1.5 0.2 0.5 Philippines 0.1 0.5 0.3 0.3 Thailand 0.2 1 0.3 0.8 China 1.1 /b 3.8 3.3 5.8 India 0.4 0.6 1.1 1.1 Turkey 0.1 0.5 0.4 0.5
b/ 1984 dataSource: Table 3.5 UNCTAD Trade and Development Report 2002, p. 81
Share (%) in World Share (%) of WorldExports of Manufactures Manufacturing VA
Share of Selected Economies in World Exports of
Manufactures and Manufacturing Value Added
Economy
a/ excluding China
The imperialist powers still monopolize both finance and productive capital and high value-added production. The majority of other countries, on the other hand, are consigned to raw materials production with a limited number allowed a place in low value-added assembly manufacturing for export.
Global Inequality
0%
10%
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Population GDP
Hi-income OECD
Eastern Europe & the CIS
Sub-saharan Africa
South Asia
Latin America & Carribean
East Asia & Pacific
Arab States
LDCs
Overproduction & Financial SpeculationAggregate Net Resource Flows to
Developing Countries
(50.0)
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50.0
100.0
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1970 1980 1990 2000 2001
US$
bill
ions
Grants
Portfolio Equity Flow s
Net FDI
Net Flow of Long-termDebt
•In 1976, 80% of all international transactions involved the buying and selling of goods and services. By 1997 only 2.5% of international transactions involved the buying and selling of the same; some 97.5% were for speculation
•In the last decade, at least one major financial crisis erupted somewhere in the world every two or three years – Japan in 1990, Mexico, Argentina and Brazil in 1994-95, East Asia in 1997-98, Russia and Brazil in 1998-99, and so on.
•These crises have severe and enduring adverse impacts on working people while multinational creditor banks and financial speculators make a killing, literally and figuratively.
Destruction of Productive Forces
“Accumulation of wealth at one pole is at the same time accumulation of toil, slavery, ignorance, brutality, mental degradation, at the opposite pole.”
- Karl Marx
Global unemployment = 160 M as of 2000. 3 B or 1/3 of the world’s labour force are either
unemployed, underemployed or earn less than is needed to keep their families out of poverty.
a growing share of the working population is forced into lower-income and insecure forms of employment. In unindustrialized countries, more and more people are forced to survive in the informal sector where earnings are low and erratic and labor standards are not enforced.
1.2 B live on less than US$1 a day, around 1.1 billion people lack access to safe drinking water, and 2.4 billion lack access to improved sanitation
Third World Debt1970 1980 1990 2000 2001
Total Debt Stock (US$ billion) 72.80 609.40 1,458.40 2,492.00 2,442.10 Long-term Debt 86% 74% 81% 82% 82% Public & Publicly Guaranteed 65% 63% 76% 60% 60% Short-term Debt 13% 24% 17% 15% 15% IMF Credit 1% 2% 2% 3% 3%
Total Debt Service (US$ billion) 9.2 93.4 163.8 398.8 381.9 Principal Repayments 73.9% 47.6% 57.1% 68.2% 68.0% Interest Payments 26.1% 52.4% 42.9% 31.8% 32.0%
Debt Stock as % of Exports .. 88.0 161.0 113.3 112.2 Debt Stock as % of Gross National Income 10.9 21.0 34.1 39.1 38.2 Debt Service as % of Exports .. 13.5 18.1 18.1 17.6 Interest Payments as % of Exports .. 7.1 7.8 5.8 5.6 Source: World Bank Global Development Finance 2002, pp. 188-89
* Cumulative debt service from 1980-2000 = US$4.2 trillion.• total debt stock has grown 33 times in just 3 decades. Now over US$2.4 trillion• 3W debt stock is now equivalent to 40% of the combined gross national incomes of these countries, from just over 10% in 1970.