Iraq is creating an enormous crisis for US imperialism. The US is in a situation very similar to when it faced the Tet Offensive in Vietnam, in February 1968 – a situation in which most of the sectors of the US ruling class have decided they are in danger of losing, but from which they do not see any easy way to withdraw. It took seven more years after Tet for the US to get out of Vietnam. They lost two presidents, the army fell apart, and US imperialism suffered an immense crisis in terms of its ability to impose its will elsewhere in the world.
US imperialism faces the same danger today. If you read articles in the Financial Times, the Washington Post, the Economist or the New York Times, all of which supported the war 12 months ago, they’re now warning US imperialism about the dangers it faces. For instance, there was an article in the Financial Times recently called, ‘Iraq is a Disaster, But the World’s Future Looks Worse’ – by that it means the future for the capitalist world.
To understand what is happening, we must have an understanding of imperialism, a more profound understanding than is often found on the left. There is a tendency to understand imperialism solely as the domination of the advanced countries over the backward countries. This is an important element, but the classical theory of imperialism as developed by Lenin and Bukharin was about the coming together of the state and the giant monopolies in the advanced countries so that competition between capitals became competition between states, leading to military conflicts between states. Giant monopolies in each country use the state in order to expand their control at the expense of the monopolies of other imperialist countries. So, according to the classical theory, imperialism led to war, followed by periods of armed peace and followed by further periods of war.
A change has taken place in this process in the last 30 or 40 years. In the 1960s, production in a great imperialist country was very much for controlled markets inside that country. What we’ve witnessed over the last 30 years is a growing interpenetration of economies. But interpenetration does not do away with the conflicts between the states, because the multinational corporations are usually based in one particular country. The people in control of any multinational corporation are usually integrated into the ruling class of a particular country and see the state power of that country as one weapon for negotiating with and pressurising other multinational corporations based in other countries.
If you look through the board of directors of top US companies you will find that nearly all of the directors are from the US. Microsoft has one non-US director, Boeing has none, Exxon has one. The corporations have national bases and they see the national state as a means to impose their will on companies based in other countries.
There’s a fashionable theory from people such as Antonio Negri who say that the interpenetration of national capitals means that you have to move towards an abstract thing called ‘Empire’, and away from the notion of imperialism. In reality the multinationalisation of capital, far from leading away from conflicts between national states, leads to more conflicts between them. World Trade Organisation talks are negotiations between national states acting on behalf of national capitalisms. All sort of facts come into play; not only economic strength, but also military strength – the ability of some capitalisms to exercise hegemony over others.
The most important forms of interpenetration are between the advanced countries themselves. China is a very big recipient of foreign investment, Brazil and Mexico are small recipients, but most other countries in the world get very little foreign investment at all. What the flows of investment indicate is where the real centres of the production of surplus value are in the world today. The most vital are the US, Europe and Japan. Beneath them, China is increasingly important, and then Brazil, Mexico and one or two other countries. There is something like 500 times as much US investment in Europe as there is in India. The population in India is three times that of Europe, but US capitalists regard Europe as much more important for them.
Fight for control
The concentration of their foreign investments in other advanced countries creates complications for capitalists when it comes to using the state to assert themselves over their rivals. US capitalists are not very keen on bombing their factories in Europe. European capitalists, if they had the strength, would not be very keen on bombing their factories in the US. But what they can do is use various sorts of struggles elsewhere in the world to exercise leverage over one another. And this is where the central question of the Middle East comes in because it is the centre of the production of the raw material that every capitalist country in the world needs – oil. The fight for control of the oil is a fight for control of power of one bloc of capitalists over other blocs of capitalists.
Most of the oil the US uses comes from the western hemisphere – from the US itself, Canada, Mexico and, very importantly, from Venezuela. It doesn’t come from the Middle East. But much of the oil that Europe uses comes from Middle East, nearly all the oil that Japan uses comes from the Middle East and increasingly the oil China depends upon comes from the Middle East.
What is the balance of forces between the different capitalist powers? The US is not all-powerful as its economy is only the same size as the economy of the enlarged European Union. It is stronger economically than it was ten years ago, but compared to 1945 it is much weaker. In 1945 half of world production took place inside the US. Today the figure is closer to 22 percent. The change has led to a long-term debate inside the US ruling class. It used to have hegemony everywhere outside the Soviet Union. The problem for the ruling class is how to reassert such hegemony.
One way has been through the rationalisation of US industry. In terms of production per person employed, American industry is more productive than French and German industry; but in terms of production per hour worked, French industry is more productive than American industry. The US has a lead over France and Germany because American workers work an average of 400 hours a year longer.
Part of the neoliberal project is the attempt by other capitalists to impose American methods of work on the rest of the world – for example, to increase the working year in France from 1,400 to 2,000 hours a year. The other side of the aggression of US imperialism internationally is the increased exploitation of American workers, which the capitalists of other countries are attempting to imitate.
For the last ten to 15 years there has been a discussion within the US ruling class about how it can maintain its global dominance. Books by key thinkers such as Henry Kissinger and Zbigniew Brzezinski are all about how the US can preserve its position in the world relative to the other powers, no one of which is as powerful as the US, but which have a much greater combined economic weight. Faced with this, two strategies have been attempted by US governments.
The first, under Reagan 20 years ago, was to build up armed might in order to crush the main opponent, at that stage Russia, at an enormous cost to the US economy. Reagan built up the armaments but by the end of the 1980s the US economy could no longer afford that level of armaments production. Fortunately for Reagan Russia cracked first.
Then there was a period under the Bush Senior administration and under Clinton, in which the US relied upon doing deals with the other capitalist powers in order to maintain a balance of power in its favour. But throughout this period there were continuing questions: could US imperialism just continue like this? Or would it face new threats?
With the new Bush administration a group within the ruling class gained office that had argued for some years that US imperialism could not remain idle while other countries emerged to challenge its power. For example they argued that if the Chinese economy continued to grow at the present rate, in 20 years time it would be more powerful than the US economy. That’s a rather stupid argument because a capitalist economy – subject as it is to crises and slumps – doesn’t just keep growing at the same rate indefinitely. But this is what they were worried about. They went on to argue that, faced with this situation, there was a window of opportunity for US imperialism to assert itself and ensure its hegemony for the whole of the 21st century.
This would require a new phase of massive arms production in order to establish complete military hegemony. Then the US had to create examples to prove that power. And the key example they spoke about was the question of Iraq because it is potentially the world’s second biggest oil producer. If you control Iraqi oil, then you control the oil that Japan, China and much of Europe is dependent upon. Thus the US would have greater leverage in negotiations over trade, investments and so forth. This was the thrust of the ‘Project for the New American Century’ pushed by Bush’s brother Jeb, Paul Wolfowitz, Donald Rumsfeld, and other key figures in the present US administration.
Asserting US hegemony meant being able to exploit everywhere else in the world, but centrally involved was dominance over the European Union, Russia, China, and Japan, as the most important centres of the world economy.
This was based upon the gamble that the expenditure involved would not be so great as to cost the US more than it gained. The level of arms expenditure is much lower than in the Korean War. But the capacity of the US economy to afford arms expenditure is also much lower now than then. If you have got 50 percent of world production you can afford to expend 20 percent of your production on arms, which is what happened at the time of the Korean War. If you have got only 20 to 25 percent of world production you cannot afford to spend the same proportion. In 1968, at the height of the Vietnam War, the US could not afford to spend 8 percent of its production on arms and so began to cut back its arms spending.
So the Bush administration took a gamble over Iraq. At the centre of it was the Rumsfeld doctrine that the US, by using high-technology military equipment, could wage war on the cheap, using very few troops.
They forgot some elementary things. Firstly, if you want to smash opposition in another country, you don’t just need arms, you need massive numbers of soldiers. When the Russians invaded Hungary in 1956 they used 500,000 troops against 10 million people. When they invaded Czechoslovakia in 1968 they again used 500,000 troops against 10 million people. The US in Iraq tried to use 130,000 troops against a population of 20 million people.
The second thing that they forgot is that the population anywhere in the Third World today is not like the population of 50 or 60 years ago. It’s a population integrated into the modern world, with some access to the knowledge, techniques and the weaponry available in that world. The US forgot why France was forced to leave Algeria, or why Britain was forced to leave India. They believed sheer force would be sufficient to win. More than a year ago Socialist Review argued that the Americans would create more and more opposition to their position in Iraq and get increasingly bogged down there. That’s the situation we face today.
Controlling the oil
The US cannot easily get out of Iraq, but there seems no way they can destroy resistance. There is only one way they could get a government that could maintain any real base of support while cooperating with them: they would have to allow it to control the oil. But that would mean abandoning the whole point of the war. And that would be an incredible admission of defeat from US imperialism. They’re stuck. The logic is to pour more resources into Iraq, which will create more problems for them and mean more humiliation for them when they’re finally forced to withdraw. Therefore the question of Iraq is the central strategic problem for imperialism today and it puts all the other problems in the shade.
There’s a tendency in Latin America, for good reasons, for people to overestimate the power of imperialism. But we should be clear: the US is not currently in a position to invade any country where there is any genuine popular movement prepared to resist it. It could invade Haiti because Aristide had destroyed any popular movement of support, provoking a very ambiguous opposition that had both popular and reactionary elements. If the popular movements in Venezuela continue to develop, it’s very difficult for the US to intervene directly. It may try to intervene through Colombia, but direct US military intervention is another matter: the US just does not have the troops. It even had to withdraw troops from South Korea to send them to Iraq.
The present weakness of US imperialism has other implications. Reformist forces in Latin America point to the possibility of US intervention in order to justify conciliation with the US. This is central to the argument of Evo Morales in Bolivia: the revolution can’t be pushed forward, because when revolution is pushed forward you have US intervention. But the argument should be quite different. The US is in a weak position, its weakest since the Vietnam War, and this situation is precisely the point at which popular mobilisation could move forward.
There is a tendency for some of the Latin American left to talk as if the US manipulates the local capitalists and makes them hate the working class. This is the language traditionally used by the Stalinist parties, because they wanted to ally with the local capitalists. But the Latin American capitalists do not need any lessons from the US about class hatred for the workers and peasants. The generals in Brazil did not need any lessons in 1964, Videla in Argentina did not need any lessons, and neither did Pinochet in Chile. They got assistance from the US – intelligence, coordination, and so forth – but it was the local ruling class and the local army which did the fighting, often using nationalist slogans to attack the working class. And there is certainly this danger in the present period.
Something else must also be understood. The dynamic of the local capitalist class and the dynamic of the US interests are not always the same. What is interesting about Venezuela is that the attempted coup of two years ago was driven by the local capitalists and generals – the US State Department was not keen on it because they thought that they could control Chavez. The local capitalists moved, and then the US supported the coup, before realising that it had made a mistake. This was even more the case with the bosses’ strike last year. I do not believe the US wanted to shut down its supplies of Venezuelan oil just as it was preparing for a war against Iraq.
We have to understand imperialism and the local capitalists often work at cross-purposes and so commit terrible mistakes from which we can benefit. At the same time, we also have to remember they will seize upon any mistakes the left make in order to intervene. That is why the question of revolutionary leadership remains absolutely vital.
In Venezuela the masses have supported Chavez as he has pushed forward a number of reforms which have annoyed the ruling class. But there has not been a revolution. The same people who organised the coup two years ago control the radio, the television, the newspapers. The crisis of US imperialism in Iraq creates time for Venezuela. But if the revolutionary process does not move forward to challenge the central question of capitalist power, there can be a repeat of Chile. It’s not a question of denigrating Chavez. He’s a military man with the best motivations, carrying through reforms. But he has not overthrown capitalism and he doesn’t show any intention of doing so. And that shows the need for independent revolutionary action.
To summarise: this is not an accidental crisis of US imperialism. It’s fighting in a situation now in which every development of capitalism creates new forces which, in one way or another, can challenge its hegemony. It responds in two ways: by restructuring, by increasing the exploitation of its working class, but also by trying to demonstrate its superiority. The Project for the New American Century said it was going to deal with Iraq, then Syria, then Iran, then Cuba, then Venezuela, and the end of the list was China. Today they cannot move forward because of Iraq.
This does not mean that they are going to go away peacefully. I think they’re quite likely to hit out in some other direction. If there’s anywhere in the world where there’s a weak movement that annoys US imperialism they will try to intervene there to show that they can do it, as they did in Haiti. It is worth remembering that after the US in principle had decided it could not hold Vietnam, Nixon and Kissinger went on to kill a million people in Cambodia. We can’t rule out Bush – or for that matter Kerry – doing a horrific repeat performance. The struggle against the US in Iraq is not finished because the US is in a terrible situation. It’s going to be the central strategic question for revolutionaries in the period ahead.
This speech was made by Chris Harman during a seminar of the revolutionary left in Porto Alegre in May 2004.
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