Taking notes 16: The rebellion has started

zap1

by Jeffrey Harrod

Rebellions are special social events. They are special because once they start they never end and because they provoke other events which eventually change the world. The Indian Rebellion of 1857 against the British heralded the defeat of the British some 90 years and millions of Indian deaths later.

The power of a rebellion is that it confronts the supporting images of power of its invincibility, of its claimed logic of superiority and of its absolute control of subordination.

A tactical but failed rebellious challenge is eventually a strategic victory.

In the global political economy the rule from the boardrooms of large banks and corporations has been sustained by powerful and seemingly unassailable ideologies such as free trade, growth through competition, freedom though private enterprise and democracy through markets.

For thirty years the bulk of leaders and governments throughout the world have accepted the distorted logic of the benefits of privatization, liberalization and foreign investment. Partly they did this because it served their personal interests and partly from fear of economic and possible military reprisals but above all they could not see anywhere in the world an alternative model, could not see anywhere a leadership which was rebelling and founding a new model with a degree of practical legitimacy.

cap4

Now such a model exists. The rebellion started, not in the countries host to street protests against international capitalism, not in demonstrations against EU policies but in the distinctive national settings of several countries of Latin America.

In Venezuela, Argentina, Ecuador and also Brazil and Chile actions have been taken which confront and attack the dogma of neo-liberalism. Governments of these countries have developed integrated post-neoliberal policies. They have nationalized foreign corporations or incrementally expropriated their power; they have intervened in all markets, favored local industry over imports, and used state taxation for redistributive purposes.

Through bitter experience the people and policy-makers in Latin America realized, what has yet to be understood in Europe, that regional and international organs have been captured by finance and industry and twisted to apply excessively business-friendly policies. Governments of the region have had to directly deal with the IMF and World Bank in a way which revealed how the agencies were organizing the extraction from the national economies. The international agencies were shown to be the problem not the solution but their basic objective, the installation of foreign corporate investment, remained in place.

But again though many political battles, such as that in Bolivia over foreign control of water supplies, it became clear that foreign ownership and foreign corporations are an expression of imperial relations. They are imperial for two reasons. First, because they intervene in an economy at a distance with no concern for the lives of people in the target country and second because the products, processes and practices are designed by, and often for, the country of the corporate headquarters and therefore do not always fit (are dysfunctional to) the country in which they are  introduced.

rebwat1

The Japanese have always realized the imperial nature of foreign corporate investment which is why they call it the “Black Ships” after the black-hulled ships of the American expedition against Japan and the forced signing of a trade treaty in 1854. They continue to resist foreign corporate investment. Kwame Nkrumah the first President of independent Ghana realized from his experience and then explained it his 1965 book that there was a “neo-colonialism” of foreign corporate rule. In Latin America a new generation has emerged who see, as Evo Morales President of Bolivia, the need to “decolonize” the country by securing ownership of its natural resources, or the late President Chavez of Venezuela who talked of raising the national flag over their oil fields. Likewise the current government of Argentina has seen that uncontrolled foreign investment impedes a reconstruction which requires control of trade at the borders. Brazil and Argentina have some of the highest rates of protection for local industry in the world.

Like all rebellions the best evidence of the importance of its challenge is the response of its opponents. Judging then by the response of the European Union the rebellion in Latin America is a major threat.

In 2012 Argentina renationalized its oil corporation which had been a state-owned corporation for most of the 20th century.  In the early 1990s it was privatized basically to a Spanish corporation.

After the nationalization announcement on 16 April 2012, the Spanish Ministry of Industry, Energy and Tourism declared “any act of hostility against a Spanish company anywhere in the world will be interpreted by the Government of Spain as an act of hostility against Spain and its Government.” This must be one of the more frank statements of the current integration of corporation, state and government in Europe today.

reb3

In support of Spain and shortly thereafter Catherine Ashton the European Union’s High Representative for Foreign Affairs, stated concerning Argentina’s announcement of nationalisation of the oil corporation: “This announcement is cause for grave concern. The YPF is an important European Union investment in Argentina. A takeover sends a very negative signal to international investors and it could seriously harm the business environment in Argentina.”

This was followed with considerable speed by the European Parliament which passed a resolution by 458 votes to 71 against and 16 abstentions condemning the action of Argentina. Reminding the world of the European Parliaments’ commitment to unrestrained private interests it noted that it “deplores the decision taken by the Argentine Government… maintains that this represents a unilateral and arbitrary decision which entails an attack on the exercise of free enterprise …”

Then in an ominous aside the majority of the Parliament urged “the European Commission and the European Council to explore and adopt any measures to safeguard European interests in order to avoid such situations arising again.”

Finally, apparently believing that they could speak for the “international community” the 458 voting members of the European Parliament warned “about the negative effects that such measures might have, such as international disinvestment and adverse consequences for Argentina in the international community.”

banks3

In short the full force of economic power and threat is to be unleashed on Argentina. For the European Union Commission and Parliament any rebellion involving an alternative model must be forcefully opposed.

Departure from the core orthodoxy cannot be tolerated anywhere in the world.

The Latin American rebellion may falter. It cannot be certain that there will not be military coups or that left populism will not decay into authoritarian rule favoring both the nations’ high incomes and further extraction by foreign corporations. But even if this were the case the rebellion exists today and the poorer and more just-minded people of the world can look forward to an eventual strategic victory.

[Note:  (1) This first appeared as “Against Global Domination: the Rebellion Has Started” on http://jeffreyharrod.blogspot.nl

(2) We are also now on Facebook]

fist1.1

[Thank you Jeffrey for this contribution]

The writer is an academic and supervises research on global political economy and has published in that field on debt, labour and theory. He lives and works in the Netherlands. His website is www.jeffreyharrod.eu

Advertisements