DISPATCHES FROM AMERICA
How to rule the world after Bush
By Mark Engler
May 20, 2008
http://www.atimes.com/atimes/Global_Economy/JE20Dj09.html
Picture January 20, 2009, the day George W Bush has to vacate the Oval
Office.
It's easy enough to imagine a party marking this fine occasion, with
antiwar protesters, civil libertarians, community leaders,
environmentalists, health-care advocates and trade unionists clinking
gl***** to toast the end of an unfortunate era. Even Americans not
normally inclined to political life might be tempted to join the
festivities, bringing their own bottles of bubbly to the party.
Given that presidential job approval ratings have rarely broken 40%
for two years and now remain obdurately around or below 30% - historic
lows - it would not be surprising if this were a sizeable celebration.
More surprising, however, might be the number of people in the crowd
drinking finer brands of champagne. Amid the populist gala, one might
well spot figures of high standing in the cor****ate world, individuals
who once would have looked forward to the reign of an MBA president
but now believe that neo-conservative bravado is no way to run an
empire.
One of the more curious aspects of the Bush years is that the
self-proclaimed "uniter" polarized not only American society, but also
its business and political elites. These are the types who gather at
the annual, ultra-exclusive World Economic Forum in Davos,
Switzerland, and have their assistants trade business cards for them.
Yet, despite their sometime chumminess, these powerful few are now in
disagreement over how American power should be shaped in the post-Bush
era and increasing numbers of them are jumping ****p when it comes to
the course the Republicans have chosen to advance these past years.
They are now engaged in a debate about how to rule the world.
Don't think of this as some conspiratorial plot, but as a perfectly
commonsensical debate over what policies are in the best interests of
those who hire phalanxes of Wa****ngton lobbyists and fill the coffers
of presidential and congressional campaigns. Many business leaders
have fond memories of the "free trade" years of the Bill Clinton
administration, when chief executive officer salaries soared and the
global influence of multinational cor****ations surged.
Rejecting neo-conservative unilateralism, they want to see a renewed
focus on American "soft power" and its instruments of economic
control, such as the World Bank, International Monetary Fund (IMF),
and World Trade Organization (WTO) - the multilateral institutions
that formed what was known in international policy circles as "the
Wa****ngton Consensus". These cor****ate globalists are making a bid to
control the direction of economic policy under a new Democratic
administration.
There is little question that the majority of people on the planet -
those who suffered under both the cor****ate globalization of the
Clinton years and the imperial globalization of Bush - deserve
something better. However, it is far from certain that social justice
advocates who want to encourage a more democratic approach to world
affairs and global economic well-being will be able to sway a new
administration. On the other hand, the damage inflicted by eight years
of neo-con rule and the challenges of an increasingly daunting
geopolitical scene present a conundrum to the cor****ate globalizers:
Is it even possible to go back to the way things were?
The revolt of the cor****atists
Throughout their time in office, despite fulsome evidence of failure,
Bush and Vice President Dick Cheney have maintained a blithe
self-confidence about their ability to successfully promote the
interests of the United States, or at least those of their
high-rolling "Pioneer"-class donors. Every so often, though, the
public receives notice that loyalists are indeed scurrying to abandon
the administration's sinking ****p of state. In October 2007, for
instance, in a front-page story entitled "GOP Is Losing Grip On Core
Business Vote", the Wall Street Journal re****ted that the party could
be facing a brand crisis as "[s]ome business leaders are drifting away
from the party because of the war in Iraq, the growing federal debt
and a conservative social agenda they don't share".
When it comes to cor****ate responses to the president's "war on
terror", we mostly hear about the likes of Halliburton and Blackwater
- companies directly implicated in the invasion and occupation of
Iraq, and with the mentality of looters. Such firms have done their
best to score quick profits from the military machine. However, there
was always a faction of realist, business-oriented Republicans who
opposed the invasion from the start, in part because they believed it
would negatively impact the US economy. As the administration's
adventure in Iraq has descended into the morass, the ranks of
cor****ate complainers have only grown.
The "free trade" elite have become particularly upset about the
administration's focus on go-it-alone nationalism and its disregard
for multilateral means of securing influence. This belligerent
approach to foreign affairs, they believe, has thwarted the advance of
cor****ate globalization. In an April 2006 column in the Wa****ngton
Post, globalist cheerleader Sebastian Mallaby laid blame for "why
globalization has stalled" at the feet of the Bush administration. The
White House, Mallaby charged, was unwilling to invest any political
capital in the IMF, the World Bank or the WTO. He wrote:
Fifteen years ago, there were hopes that the end of Cold War splits
would allow international institutions to acquire a new cohesion. But
the great powers of today are simply not interested in creating a
resilient multilateral system ... The United States remains the only
plausible quarterback for the multilateral system. But the Bush
administration has alienated too many players to lead the team
effectively. Its strident foreign policy started out as an
understandable response to the fecklessness of other powers. But
unilateralism has tragically backfired, destroying whatever slim
chance there might have been of a workable multilateral alternative.
Frustrated by Bush's failures, many in the business elite want to
return to the softer empire of cor****ate globalization and,
increasingly, they are looking to the Democrats to navigate this
return. As a measure of this - the capitalist equivalent of voting
with their feet - political analyst Kevin Phillips notes in his new
book, Bad Money, that, in 2007, "[h]edge fund employees' contributions
to the Senate Democratic Campaign Committee outnumbered those to its
Republican rival by roughly nine to one".
This quiet revolt of the cor****atists is already causing interesting
reverberations on the campaign trail. The base of the Democratic Party
has clearly rejected the "free trade" version of trickle-down
economics, which has done far more to help those hedge-fund managers
and private-jet-hopping executives than anyone further down the
economic ladder.
As a result, both Senators Barack Obama and Hillary Clinton are
running as opponents of the North American Free Trade Agreement
(NAFTA) and of a newer bilateral trade deal with Colombia, a country
in which organizing a union or vocally advocating for human rights can
easily cost you your life. The tenor of the current campaign
represents a significant ****ft from the 1990s, when top Democrats were
constantly trying to establish their cor****ate bona fides and
"triangulate" their way into conservative economic policy.
Still, both candidates are surrounded by business-friendly advisors
whose views fit nicely within an older, pre-Bush administration
paradigm of cor****ate globalization. The tension between the
anti-NAFTA activists at the base of the party and those in the
campaign war rooms has resulted in some embarrassing gaffes during the
primary contest.
For Hillary Clinton, the most notable involved one of her chief
strategists, Mark Penn, a man with a long, nefarious record defending
cor****ate abuses as a Wa****ngton lobbyist. As it turned out, Penn's
consulting firm received US$300,000 in 2007 to sup****t the "free
trade" agreement with Colombia. Even as Clinton was proclaiming her
heartfelt opposition to the deal and highlighting the "history of
suppression and targeted killings of labor organizers" in that
country, a key player in her campaign was charting strategy with
Colombian government officials to get the pact passed.
The Obama campaign found itself in similar discomfort in February.
While the candidate was running in the Ohio primary as an opponent of
NAFTA, calling that trade deal a "mistake" that had harmed working
people, his senior economic policy adviser, University of Chicago
professor Austan Goolsbee, was meeting with Canadian government
officials to explain, as a memo by the Canadians re****ted, that
Obama's charges were merely "political positioning".
Goolsbee quickly claimed that his position had been mischaracterized,
but the incident naturally raised questions. Why, for example, had
Goolsbee, senior economist to the Democratic Leader****p Council, the
leading organization on the cor****ate-friendly rightwing of the party,
and a person praised as "a valuable source of free-trade advice over
almost a decade", been positioned to mold Obama's economic stances in
the first place?
If pressure from the base of the party lets up after the elections, it
would hardly be surprising to see a victorious candidate revert to
Bill Clinton's cor****ate model for how to rule the world. However, a
return to a pre-Bush-style of international politics may be easier
dreamed than done.
The neo-con paradox
To the chagrin of the "free trade" elite, the market fundamentalist
ideas that have dominated international development thinking for at
least the past 25 years are now under attack globally. This is largely
because the economic prescriptions of deregulation, privatization,
open markets and cuts to social services so often made (and enforced)
by the IMF and the World Bank have proven catastrophic.
In 2003, the United Nations' Human Development Re****t explained that
54 already poor countries had actually grown even poorer during the
"free trade" era of the 1990s. The British Guardian summarized well
the essence of this re****t:
Taking issue with those who have argued that the "tough love" policies
of the past two decades have spawned the growth of a new global middle
class, the re****t says the world became ever more divided between the
super-rich and the desperately poor. The richest 1% of the world's
population (around 60 million) now receives as much income as the
poorest 57%, while the income of the richest 25 million Americans is
the equivalent of that of almost 2 billion of the world's poorest
people.
Such findings led United Nations Development Program administrator
Mark Malloch Brown, in a remarkably blunt statement, to call for a
"guerilla assault on the Wa****ngton Consensus".
In fact, in 2008, such an assault is already well under way - and
Wa****ngton is in a far weaker position economically to deal with it.
The countries burned by the Asian financial crisis of 1997-98, for
instance, are now building up huge currency reserves so they never
again have to come begging to the IMF(and so suffer diktats from
Wa****ngton) in times of crisis. Moreover, virtually the whole of Latin
America is in revolt. Over 500 million people reside in that region,
and over two-thirds of them now live under governments elected since
2000 on mandates to split with "free trade" economics, declare
independence from Wa****ngton, and pursue policies that actually
benefit the poor.
In late April, economist Mark Weisbrot noted that, with so many
countries breaking free of its grasp, the IMF, which once dictated
economic policy to strapped governments around the world, is now but a
shadow of its former self. In the past four years, its loan ****tfolio
has plummeted from $105 billion to less than $10 billion, the bulk of
which now goes to just two countries, Turkey and Pakistan. This leaves
the US Treasury, which used the body to control foreign economies,
with far less power than in past decades. "The IMF's loss of
influence," Weisbrot writes, "is probably the most im****tant change in
the international financial system in more than half a century."
It is a historic irony that Bush administration neo-cons, smitten with
US military power, itching to launch their wars in Central Asia and
the Middle East, and eschewing multinational institutions, actually
helped to foster a global situation in which US influence is waning
and countries are increasingly seeking independent paths. In 2005,
British journalist George Monbiot dubbed this "the unacknowledged
paradox in neo-con thinking". He wrote:
They want to drag down the old, multilateral order and replace it with
a new, US one. What they fail to understand is that the "multilateral"
system is in fact a projection of US unilateralism, cleverly packaged
to grant other nations just enough slack to prevent them from fighting
it. Like their opponents, the neo-cons fail to understand how well
[presidents Franklin D] Roosevelt and [Harry S] Truman stitched up the
international order. They are seeking to replace a hegemonic system
that is enduring and effective with one that is untested and (because
other nations must fight it) unstable.
Battered by losing wars and economic crisis, the United States is now
a superpower visibly on the skids. And yet, there is no guarantee that
the coming era will produce a change for the better. In a world in
which the value of the dollar is plummeting, oil is growing ever more
scarce relative to demand, and foreign states are rising as rivals to
American power, the possibility of either going ahead with the
Bush/Cheney style of unilateralism or successfully returning to the
"enduring and effective" multilateral cor****atism of the 1990s may no
longer exist. But the failure of these options will undoubtedly not be
for lack of trying. Even with cor****ate globalization on the decline,
multinational businesses will attempt to consolidate or expand their
power. And even with the imperial model of globalization discredited,
an overextended US military may still try to hold on with violence.
The true Bush administration legacy may be to leave us in a world that
is at once far more open to change and also far more dangerous. Such
prospects should hardly discourage the long-awaited celebration in
January. But they suggest that a new era of globalization battles -
struggles to build a world order based neither on cor****ate influence
nor imperial might - will have only just begun.
Mark Engler, an analyst with Foreign Policy in Focus, is the author of
How to Rule the World: The Coming Battle Over the Global Economy (just
published by Nation Books). He can be reached via the website
Democracy Uprising.
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