The return of the national imperialist state – Jörg Nowak, Ekrem Ekici

The return of the national imperialist state[i]

The ultimate political consequence of the great financial crisis is the retreat into and renewal of the national imperialist state, centred around an authoritarian-nationalist project. Nevertheless, this ‘return of the national imperialist state’ that was never absent is deeply embedded into the neoliberal form of today´s global capitalism. It pretends to cater to working class interests of its citizens to some greater extent; but this remains largely a symbolic gesture. That fake interpellation of the national proletariat – not much unlike classical fascism – is accompanied by a profound political weakness and instability of these regimes. While this tendency itself seems to be a global phenomenon, it is at the same time fraught with the challenge to establish an economic nationalism in the framework of a globally interconnected capitalism, thus placing an enormous contradiction in the heart of this very tendency.

Not only are the national imperialist states haunted by their promises of welfare and employment, they also are confronted with deeply divided and fragmented state apparatuses in which different state agencies pursue radically different strategies. This goes far beyond the institutional chaos that reigned over German fascism in the 1930s and 1940s with its sprawling multiplicity of state and para-state agencies, and is also completely different from the usual competition between different corporate factions that expresses itself in a certain but limited extent of elite fragmentation in liberal democracies. The splits within state elites and state apparatuses in the national imperialist state are profound and radical.

Contours of the renewed imperialist national state

We identify five countries as the main imperialist states: The US, China, Germany, the United Kingdom and Japan. These countries are connected to a broader range of subimperialist states like Canada, Mexico, Brazil, France, Spain, Russia, India, Turkey, Egypt, South Korea, Taiwan etc. These subimperialist states often dominate other countries, but are highly dependent on the main imperialist states in economic terms. For example, although Canada is much more stable as a social formation as Mexico, and has a much higher medium income, its economic dependency on the US is quite similar to that of Mexico, if not higher.

Before we start to look at some details, we will define some general features of this new emerging form of state:

  1. Economic and political strategies are focused on a strengthening of national industries and companies and employment creation in the national territory. This includes a shift away from former transnational strategies. It does not involve any strengthening of unions or working class power, or participation of workers in decision-making, and also not a strengthening of welfare aspects or social security aspects. This economic strategy involves strong competition to attract investments on the own national territory and signals a move away from directing investment to low wage areas in other countries, at least to some extent. But this does not go along with any positive changes in terms of wages or working conditions in the main imperialist countries.
  2. Strong collusion of government and corporate interests, including the presence of corporate leaders and/or strong corporate interests in the government itself. This allows almost no meaningful distinction between corporate and government interests – as can be observed on the inclusion of the representatives of global corporations, such as Goldman Sachs, Exxon Mobil, in the Trump cabinet; most notably, Rex Tillerson being the Foreign Secretary; the close collusion of corporate interests and political rule in the People’s Republic of China; the millionaire cabinet in the UK; the government protection of car companies that manipulate emission devices in Germany; and the government of Japan that restarted various nuclear power plants after the Fukushima disaster in 2011 in spite of adverse seismic conditions (currently two nuclear power plants are operational in Japan).
  3. The tendency to lure investments away from smaller to the main national imperialist states is reinforcing the contradictions between imperialist and subimperialist states of which some are a lot more volatile in their economic situation than the more stable imperialist states. Since employment creation on the own territory (as precarious as those jobs might be) is one of the means of legitimation for the imperialist states, this type of competition will enhance the pressure for subimperialist countries to lower the standards of salaries and social security and to offer even more tax breaks, subsidies and the like to investors. It will also involve a high volatility for the currencies of some of the subimperialist countries. Thus, imperialist domination is severely enhanced.
  4. Imperialism in its classical form involves competition between imperialist powers, both on the economic and on the political and military level. It is obvious that competition and cooperation go hand in hand on the economic level, and until now there is no protectionist trade war in sight, but rather empty threats – and a full-on trade war is also highly improbable given the level of mutual interconnectedness of all major imperialist economies. This does of course not preclude a constant and fiercer renegotiation of terms of trade and national economic policies. The governments of all major economic powers are more keen to protect their own national champions from hostile takeovers by other national champions. And for sure this competition is present concerning investments in third countries, often resulting in zones of influence not much unlike earlier 19th century colonial policies.
  5. As has been noted in the introduction, the regimes of the new national imperialist states are not strong regimes backed by a huge consensus and a stable legitimacy. This is, on the one hand, the result of serious conflicts within state elites and state apparatuses. That aspect is less pronounced for the cases of Japan and Germany. The political agendas of the increasingly authoritarian leaderships are controversial for a large part of the state apparatuses and the political elite, and are causing serious rifts in the state apparatuses: The Trump administration is facing a high amount of resistance by various state agencies; the Brexit scenario created a huge rift between different factions both within the main political parties, but also between state agencies; the Xi Jinping government faces enormous difficulties to align provincial governments to a more coherent national policy; and the tensions in Japan due to Abe’s nationalist and militarists line are considerable. For a while it seemed that the conservative pole of German politics could be torn apart due to its stance on migration, but these tensions seem to ebb away more recently. On the other hand, the political leaderships do not dispose of a stable consensus in the population that would back their rule. Electorates are as quickly pulling away their support as they were flocking to vote for authoritarian candidates. The volatility of voters and/or citizens in supporting leaderships has increased immensely. If candidates do not deliver on election or agenda promises quickly and appear to move on with collusion between corporate and public interests, they are losing a seemingly overwhelming support in record speed. This increases the pressure on political leaderships to come up with ideological spectacles or campaigns that target so-called enemies and increases the likelihood that those leaderships engage in erratic or not carefully designed moves that might increase the lack of legitimacy.
  6. The biggest pitfall for the leaderships of the national imperialist states are for sure the economic contradictions within those social formations. Suffice to say that these economic contradictions are neatly linked up with the issue of popular support for these regimes. For most of these countries, the economic contradictions that the governments are facing are enormous. Again, Germany and Japan are exceptions and see less pronounced economic contradictions at first sight. A lot of the trajectory of these states will depend on the fact if they will be able to maintain a general economic stability and an improvement of the living conditions of at least some significant part of the population. Dissatisfaction is widespread in all the populations of the major imperialist states and might erupt at any time in unexpected convulsions.

The renewed emergence of the national imperialist state responds to a certain conjuncture and to long-term economic and political developments of global capitalism. There is, first, the growing lack of legitimacy of the global economic and political order – the idea of the “strong state” responds with nationalism, traditional ideas of community, violence and what is currently traded as “economic nationalism”. There is, second, the growing lack of stable rates of profit, or better, the lack of profitable investments that can only be reinstalled temporarily with the help of the state, public funds, national or transnational development banks or state-supported acts of violent appropriation. Thus, the mixture of authoritarian politics and plundering of public budgets for corporate undertakings aims to restore both legitimacy and profitability – the strong state becomes the political and economic lender of last resort for a failing economic system. It is the inner contradictions of the national imperialist state and the shaky ground that it is supposed to remedy that make up for the fragility and instability of this form of state.

In terms of recent theories of imperialism there might be two contending lines of theory. The theory of a global Empire (Hardt/Negri 2000) that is only symbolically centred in the USA is adequate in highlighting the aspect that the global system of rule has become a unitary global system with a uniform shape and logic. But it underestimates the very real aspect of competition between national imperialist states that do not neatly work together but exhibit their own irrational excess of nationalism. The other extreme is the theory that ultimately all other states are still subjected to the rule of US imperialism (Panitch/Gindin 2010; Bellamy Foster 2015). This theory is adequate in the aspect that the USA is still the largest economic and military power of all imperialist states. But it fails to acknowledge the moment of competition and power rivalry, too. It is an important moment even if the US is still dominant in some respect.

The diagnosis of the revival of the national imperialist state raises inevitably the question about the transnational nature of the ruling classes. The question whether a transnational capitalist class exists cannot be answered with a clear yes or no. It is obvious that a more or less unified transnational capitalist class is coexisting with a vast number of national oriented capitalist classes that favour different policy sets than the transnational faction of capitalists (Hirsch/Wissel 2011). This response seems to evade a clear cut answer and raises questions as to how many percent of capitalist classes belong to the transnational or national ones. The turn to the national imperialist state signals that the earlier hegemony of the transnational faction of the capitalist class is in a serious crisis. At least some part of the transnational faction is reorienting towards a stronger national orientation, both in the US and in the PRC. This national reorientation of a part of the earlier transnationalists is much weaker in Germany, Japan and the UK – despite the Brexit strategy of a part of the Tories. The resurgence of the national imperialist state means that earlier rifts between the transnational and national factions of the global capitalist class are becoming serious rifts. But it is significant that the national factions seem unable to formulate a coherent strategy which reflects the national interdependence of economic networks today. The state of things is that both factions of the capitalist classes unite in the sense of urging national states to secure their conditions of investment: access to resources in other countries, military protection, access to markets. It’s the beggar-thy-neighbour policy that becomes the common ground for all factions of capitals in a time of sinking profit rates.

Thus, the issue of inter-imperialist competition should not be neglected. It is crucial since it is the form in which the contradictions of contemporary global capitalism are moving and in which these contradictions find their political expression. There is a clear move to focus on the domestic development of these national imperialist states in order to alleviate and minimise the social contradictions within these countries, but as stated this does not include a significant power shift towards the working classes in these countries. The hope of the authoritarian regimes is that a mixture of nationalist ideology, repression, manhunt against so-called internal and external enemies and creation of employment opportunities will be enough to deal with the internal contradictions of these regimes. At the same time, the surge in authoritarian rule is a desperate attempt to get the competing rackets within the state apparatus and the corporate elites united that are disintegrating due to strong contradictions between their interests, fueled by the lack of profitable investments and a long-term economic depression (Roberts 2016).

The 2008 crisis and the aftermath

But before we elaborate more on these issues, we have to look at the economic background for all this to happen. As said, the reappearance of the nationalist imperialist state is the outcome of the 2008 crisis and its long aftermath. But what does that mean in economic terms? First, growth rates did come back after the crisis, but did not reach the pre-crisis levels in any significant country, especially not in the BRICS states on which much of hope and economic growth rested before 2008. Second, Michael Roberts (2017) has highlighted the fact that the profit rates are going down both in the established and in the emerging economies and that the pre-crisis growth rate in labour productivity could not be restored. The European Central Bank and the OECD have recently published reports on these questions (McGowan et al. 2017: Acharya et al. 2017). These reports have found out that the most advanced large corporations are increasing their productivity at the same speed as pre-2008. In other words, there is a big group of medium and small companies that does not have enough capital stock in order to catch up with new technological developments.

The OECD finds that the amount of resources sank in those companies rose since the mid-2000s, and it estimates that across nine European countries that were in the focus of this study the capital in those zombie companies – those companies that are not making any profit after serving the interest payments for credits – makes up between 5 and 20 percent of the total private capital. This signals a concentration of profits in the large companies after the great crisis and explains some of the serious contradictions between large and smaller companies, thus also the renewed focus on renationalization among much of the middle classes.[ii] Due to the ECB report: “While banks that benefitted from the announcement increased their overall loan supply, this supply was mostly targeted towards low-quality firms (…) As a result, there was no positive impact on real economic activity like employment or investment. Instead, these firms mainly used the newly acquired funds to build up cash reserves.” (Acharya et al. 2017) Thus, from the perspective of a Gesamtkapitalist, those companies should disappear from the market (or should have already disappeared during the cleanup during the last crisis). They cannot deal with today´s requirements of competition, i.e. immense investment into research and development. Roberts interprets this correctly as one expression of the tendency of the rate of profit to fall, i.e. a higher technological composition of capital. This phenomenon is not confined to Europe, as the Bank of International Settlements (BIS) identifies it in all Western and large emerging economies (BIS 2017, 13), Japan proves to be the only exception in that respect. While in the Eurozone and the UK about 9 %, and in the US about 17 % of the largest companies are identified as zombie companies by the BIS, it is important to note that the numbers of BIS only relate to listed companies. It is significant that the amount of listed zombie companies is more or less stable in the US since 2003, but has risen steeply both in the UK (since 2014) and the Eurozone (since 2012). Daniel Lacalle reports that in the Eurozone 30 % of all SMEs are zombified, and the numbers for SMEs are at 20 % for the US and 25 % for the UK (Lacalle 2017). In China, the amount of zombie companies went down from a peak of 15 % in 1999 to only 5 % in 2016, but their share of total corporate debt has been rising disproportionately since 2011. State-owned enterprises play a crucial role here, contributing 60 % of the rise in total corporate debt between 2008 and 2016 (Lam et al. 2017). The BIS defines zombie companies as businesses unable to cover interest expense with earnings before interest and taxes. All of this is happening in the context of exceptionally low interest rates, and this is one of the reasons why upticks in interest rates are such a sensitive issue.

The other side of this tendency are the enormous job losses through automatization and robotization since the late 1970s – and more job losses are yet to come. The nationalist blame game is thus very obviously serving to move attention away from the paradoxes of technological improvement in capitalist societies: The overabundance of wealth made possible with technological improvements leads to immiseration and longer working hours. Within the capitalist class, it leads to increased contradictions and tensions between large companies and the SMEs, and to a growing number of indebted zombie companies that block profit-making. But robotization was used mainly in specific industries, namely in manufacturing, so that rather than having too much automatization, researchers of the IMF and of McKinsey underlined a lack of capital investment in most advanced economies over the last ten years (Adler et al. 2017; McKinsey 2017). The IMF paper highlights that apart from stagnant labour productivity the total factor productivity is also not increasing. This basically means that large sections of the economy in richer countries lack investment, but that these sections could see even larger job losses in the future (namely in the job-rich service industry) if capital investment catches up. For now, there is rather a problem of a lack of profitability. Thus, we have a small section of highly capitalised global companies, and a large section of companies with lack of increases in output per capital investment, lack of increases in labour productivity and lack of technological advances.

This leads us to a second aspect of the economic background: The financial sector. It tried to move out of the stock markets and evade some of the real estate markets that failed in the late 2000s – partly in order to move into new real estate markets, e.g. in Germany. On the other hand, the banks continued to feed the zombie companies with credit, and a huge amount of the non-performing loans goes back to these companies. While the small and medium companies feel increasingly strangled by the banks, some banks might be prone to fail if the number of those companies not able to pay the loans continues to rise. The enormous problems of Italian banks go back to this issue. Thus, the middle classes are trapped in between. While they continue to profit from rising real estate prices, and are able to get higher rents from small real estate property or higher private credit due to the rising value of property the middle classes live in, they face more difficulties to service loans for their companies and encounter more difficulties to expand their salaries by playing on the stock market which was one of the main pillars of integration of the middle classes into financialization (Mau 2015). On the larger plane, it has been convincingly argued that financialization served to reinforce the dominance of the main imperialist countries since they do not only have the largest and more powerful banking sectors, but the large corporate and private capital holders also use the financial sector as a relay to force whole countries to adapt to shareholder value expectations (Norfield 2016). The financial sector as such is looking for new fields of investment and due to an overabundance of capital that is crowding the few profitable investment opportunities it discovered recently “infrastructure as the new asset class” (Black Rock 2015; Hildyard 2016).

Infrastructure investment is the third element for our economic background and it is not by chance that it forms the central axis for both the economic rationale of the Trump administration and Xi Jinping´s showcase project of One Belt, One Road. While profit rates in the real economy are decreasing, and real estate markets still do not provide enough investment opportunities, there is an enormous liquidity of capital that is not being invested, above all in China, but also in the other main imperialist states. This hyperliquidity stems on the one hand from the dysfunctional domestic markets, witnessing the decreasing spending power of the general population. In addition, in China saving rates are high due to a largely incomplete social security system. Another reason for the hyperliquidity are dollars held by emerging economies in sovereign wealth funds, and the enormous redistribution of wealth to the top in the years after 2008. In any case, the new strategy to absorb this hyperliquidity is focused on state-led infrastructure projects that do not only procure private companies for construction, maintenance and operation, but also include multiple forms of financial investment and/or public-private partnerships that regularly benefit financial investors to the detriment of public budgets and citizens that face higher fees for toll roads, health service and education, or simply higher prices for railway and air transport. Black Rock (2015) reported a record high of 48.3 billion Us-dollar infrastructure investment globally for 2014, and cites a McKinsey estimate of 57 trillion US dollar of necessary infrastructure investment until 2030.

Although the last number should be dealt with cautiously, it illustrates where the hopes of investors lie. Nick Hildyard has demonstrated in detail how the different ways of extraction of public wealth for private interests work via infrastructure investments (2016) – basically, private capital demands a certain return on investment over a period of 5 or 10 or 20 years. If the infrastructure in question does not deliver the return defined in the contract, then state budgets will serve this gap. In this way, a growing (and uncertain) amount of the public budgets is already claimed by private capital, and this for decades in many cases.

So, it is on these types of investment that the hopes of many corporate actors today rest. The German government tries to privatize its famous highway system, under high pressure by insurance companies that enter shaky ground due to the low interest rates, and the long-running life insurances they sold with a much higher interest rate (Bock et al. 2015). The Juncker Plan in Europe and the EU capital market union are designed to encourage large infrastructure projects across Europe (Müller 2015). Donald Trump promised a large scale infrastructure investment that would create jobs for US citizens. The People´s Republic of China intends to invest in more than 60 countries in order to enhance infrastructure, get access to natural resources and to boost trade. The investment in the context of One Belt, One Road is estimated to be around 100 billion US dollars. Fitch Ratings issued a report in early 2017 that the Chinese financial system could be in danger due to potential risk defaults, since construction and manufacturing companies in China are currently the main sources for non-performing loans domestically, and Fitch sees an export of the same model with the One Belt, One Road infrastructure program (Wells/Weinland 2017). These infrastructure investments will in some cases also reinforce the domination of other countries by main imperialist powers, such as the inroads of Chinese companies into Brazil´s energy sector. In the context of the One Belt, One Road initiative, “Laos, for example, has provided assets in the form of potash mines as collateral for a loan that will push up its public debt to gross domestic product ratio by almost 60 percentage points.” (John 2017).

Achilles heel of the renewed national imperialist state: redistribution of wealth

Thus, we see three large tendencies: a slump in overall labour productivity focused on a growing portion of the all companies, financialization as the relay for enforcing high rates on return that are increasingly hard to get, and public infrastructure spending as both the promise to generate employment, an instrument of domination and influence, and an investment opportunity for the hyperliquidity of capital. The decisive question if of course, how all these tendencies will play out in the future – will it be feasible to integrate a considerable part of the zombie companies into infrastructure investment? Will it be possible to generate enough employment in order to compensate past and future job losses due to automation without a radical transformation of economic, social and political relations? It seems pretty unlikely that the infrastructure drive will serve to solve any problems of profitability or legitimacy of capitalism, but the challenge for the national imperialist governments will consist in raising the hopes as long as possible, while they will seek to generate new dynamics (wars, political campaigns) in order to distract from the paradoxes of high-tech capitalism.[iii]

While the question of economic performance and distribution of wealth will be the Achilles heel of these countries, it is not the only obstacle. While almost all governments worldwide follow the same economic model, the tensions between the imperialist countries and between the imperialist and the subimperialist countries will be a substantial characteristic of the coming period. Politically, this is much more resembling a pre-World War 1 situation than a pre-World War 2 situation. We are not facing consolidated fascist regimes with a more or less stable mass support, but rather shaky oligarchies that try to gather a mass support that remains very volatile. But for sure we are facing a kind of neo-Leviathan strategy that tries to rule with fear. Given the situation of the ruling classes, a socialist revolution might have some good chance of success, but we (still) do not have a revolutionary situation due to the lack of such sentiment in the broad masses and the lack of properly organised revolutionary political forces. Suffice to say that these were also seeming to lack in the end of World War 1.

We identified the competition between the main imperialist states as the form in which they unfold their logic of development. This competition is characterised by an overlapping of geopolitics and economic relations, as in every imperialist epoch. The most pronounced and influential variant is for sure the Trump administration in the US. Two driving forces have been commonly identified behind it: a crisis of representation of established presidential candidates, and a ‘realist’ reorientation of a part of the US elite towards confrontation with China. Mike Macnair has convincingly argued that this reorientation might be based on the fact that Russia is rather a second-class power today, and that the EU has run out of steam to be a potential competitor with the US, and thus does not have to be controlled via the UK anymore after Germany wrecked any political perspectives within the EU with its own imperialist oppression of other EU countries via the common currency and the 4-plus-2 compact established in a parallel law system in January 2012 (Macnair 2017). Brexit gave the death knell to the stumbling EU project.

The UK will try to strike a balance between trade with the EU and China, and a close relationship with the US, but there will be a strong push to strengthen strategic ties with the US, and the special relationship that Britain maintained with the US for a long time. This is enhanced by the fact that the US has the largest share of foreign-owned non-financial businesses in the UK with three times more gross value added than German-owned-companies (Office for National Statistics 2017). China seems to go onto the offensive with its parallel outreach of infrastructure investment outside and the project to prop up its poorer provinces. But apart from the huge liquidity that Chinese companies hold, and the ability to oppress any dissidents with ruthless oppression, the Chinese leadership is facing tough challenges. This mood could be read psychologically with the desperate embrace by Xi Jinping of free trade at the Davos meeting in 2017. Harder and colder facts are the sheer impossibility of coherent reform of the governance apparatus in China, with which Xi Jinping aims to combat corruption and regional and intra-party factionalism, and to improve product quality and the massive environmental problems. In regular patterns, all those problems are interwoven, as exemplified in the regular food scandals. As long as these problems persist, China will also be faced with them in any outside venture and remain unattractive as a role model to follow. In these aspects, the areas of superiority of the US as a superpower become quite clear, which might expand to the military aspects.

Japan, like Germany, is caught between China and the US. Both countries want to improve economic relations with China, but at the same time protect their own national champions against any Chinese takeovers. While this balancing act might be manageable, Japan´s geopolitical ambitions go along with an increasing tension with China, partly caused by Japan´s installment of a new missile defence system. Not unlike Germany, Japan’s government is quite good at ruining relations with allied countries, as can be witnessed with the ongoing and escalating fight about the comfort women with South Korea´s government. At the same time, both countries face allegations by the Trump administration to manipulate currencies. Other than China, Britain and the US, the national leaderships in Germany and Japan are not challenged by protest and widespread dissatisfaction, so they might rather be able to muddle through. The intention to both trade and compete with China finds its expression in recent reports and research papers from Europe that project the Chinese state and economy as a threat to free trade and to European companies (European Chamber 2017) or see China’s impact on the global economy as the central cause for ‘economic nationalism’ in Europe (Colantone/Stanig 2017). Colantone and Stanig contend that regions affected by Chinese imports would have voted stronger for the radical right – in implicit denial of the fact that German imperialism is likely to have a much bigger impact on European countries than Chinese imports. Why speak about the elephant in the room if you can blame the mosquito? These ideological repercussions of imperialist competition in academic research will not remain isolated incidents.

Shift in variables: towards a new encounter of “the Left” with the conjuncture

We have seen how the competition between the main imperialist states plays out. The decisive test for these projects will be whether one of those governments will be able to kickstart a new cycle of growth within a few years. All the predictions by the IMF and the World Bank do not indicate such a growth in foreseeable time. The political variables are an escalation of xenophobic and authoritarian movements beyond the control of governments and a growth of progressive movements or electoral victories of left-leaning governments. At least the UK could see the latter, and possibly also the US. On the other hand, the relative triumph of far right populism in the German elections in September 2017 and the following “low-intensity” political turmoil has confirmed the former part of that equation, the consolidation and relative electoral success of a Corbyn-led Labour Party in the UK the latter part. China seems to be static in political terms, but could face significant tensions in the future when more rural migrant workers retire without sufficient pension insurance and more workers are laid off due to high-speed robotization.[iv] More likely are in the present conjuncture in all five main imperialist countries more conservative, nationalist and protectionist movements in the population. At this point, ideological struggles will become one of the decisive crossroads in order to make inroads into this scenario.

A serious weakness of many left analyses consists in giving in to the liberal rhetoric of “populism” that is subsuming the state projects of the national imperialist states and recent renewals of social democratic or socialist political projects under the same heading. This lumping together under the name of populism (Mouffe 2016) suggests that these would be essentially similar approaches. In the light of the analysis above the whole notion of calling “populism” every political current that pretends to divert from the different brands of neoliberalism becomes visible as being an ideological manoeuver in itself, and a largely successful one. This manoeuver gives credibility to the national imperialist state projects by granting them some “popular” legitimation, and it collapses any progressive move towards a more equal society (even if it comes from largely failed social democratic revamps like Syriza or Podemos) with deeply authoritarian and corporate politics.

Such form of an inverted theory of totalitarianism (= right wing and left wing populism wanting essentially the same, i.e. put an end to free trade neoliberalism) signals the lack of a serious internationalist vision on the side of the remaining and hitherto weak left-wing political forces, accompanied by the “inability to intervene at the global scale in which markets operate” (Gonzalez Vicente/Carroll 2017). Both the expected and ongoing surge of imperialist and subimperialist nationalisms (and the ensuing types of competition and economic nationalism) as well as the increasing relevance of migrant labour and migration hint at the necessity of a radical internationalist orientation for any progressive politics in the future with a redefined terminology and vision to entrench itself against the reconstruction of the dynamics of national imperialisms.

This requires a clear view of the economic problems and constellations beyond the surge of the nationalist wave. It is an ideological move to the extent that the colluding political and economic elites in all major imperialist projects have strong transnational links through investments, company mergers, financial connections etc. But this ideological move represents the sentiment and hopes for more national focused economic projects by the big mass of small and medium enterprises, since the contradictions between large global companies and the majority of all other companies that do not see capital investment and increases in labour productivity is one of the driving forces of the current dynamic. This split within the capitalist class accounts also for the frictions within state apparatuses and state projects. At the same time, much of the political horizon of the middle classes is too narrow in order to conceive a political project of a Fordist-type class compromise on a level beyond the national state. It is in this arena that the weight of ideology is making itself felt. Thus, the national imperialist projects are fraught with the paradox that renationalization is no viable option on the economic plane, but part of the elites feel they need national rhetoric in order to tie the middle classes to the existing economic order. The move to engage in large infrastructure projects seems to represent a rather desperate attempt to relieve some of the political and economic deadlocks than a viable long-term project of accumulation and political rule.

It is clear that a social-democratic solution will not offer another way out of those impasses. On the other hand, it is obvious that political tensions and economic bottlenecks are rather increasing.

Towards the conclusion, we would like to draw attention to a relative new phenomenon which may very well evolve into a sub-conjuncture within the greater context of the rebirth of the national imperialist state: the re-emergence of separatist movements within the advanced economies.

Albeit it has a renowned and complex historical background, the Spain – Catalonia crisis points towards a new and escalated phase of internal contradictions in the developed economies. Carving “new micro-states” out of existing and centralized ones has been largely occurring in more peripheral states, but this phenomenon currently signals a serious tendency of crisis of the nation-state in Europe. However, the idea behind that relatively new form of “separatism” is not an anti-capitalist one. It is rather related to the fact of “distribution and redistribution of wealth” given the specific situation of the region of Catalonia within the Spanish state. In any case, with all its economic, socio-cultural, and more importantly, legal dynamics, the Catalonia crisis could be the harbinger of a significant overturn of the state formation in Western world. The fierce reaction of the central Spanish state to the independence referendum in early October 2017 also provides hints for the near future regarding the shape of things to come in the political scene of Europe.

What makes the “Catalonian dilemma” important is that this particular crisis demonstrates the fact that intra-capitalist contradictions have arrived at an irreconcilable stage even in the global North or in the Western world if you will. These developments should be read in the context of a concrete analysis of the concrete situation. Today, many purportedly progressive analyses and responses to such developments are rather based on a vague recourse to democracy. For instance, the Catalonian dilemma may be perceived in the framework of the “right to self-determination of oppressed nations”, instead of handling the issue in the context of the political-economic reality. The same argumentative logic of national self-determination and popular democracy is employed by nationalist right-wing parties like Front National in France and AFD in Germany. This does not legitimise equating the Catalan independence movement with the extreme right, but reveals the emptiness of a politicist recourse to democracy without any explicit basis in contemporary political economy and the economic interests at stake – taking into account that these are never ‚purely’ economic: they always take a political form. Similar examples of the ineptness of approaches of the ‚populist’ left can also be seen in the instances of the Syrian crisis or the Arab Spring. That ineptness has led and continues to lead to devastating ideological and practical-political errors.

In the light of all this, the most pressing issue remains to be the reconstruction of a renewed revolutionary response – not “alternative” – to rising neo-authoritarianisms on the one hand, and to a weakened and deformed mainstream cultural “left”. This situation is connected to a rather subterranean malaise: the avoidance of the idea of socialism centred around the issue of the ownership of the means of production – that is, the abolishment of private ownership of the means of production. To be more specific, the new phase of global capitalism and the re-emergence of the national imperialist state necessitate a corresponding, multi-dimensional and multi-layered communist thinking and program.

References

Acharya, Viral V., Tim Eisert, Christian Eufinger, Christian Hirsch, 2016: Whatever it takes: The Real Effects of Unconventional Monetary Policy, (December 15, 2016). SAFE Working Paper No. 152. Available at SSRN: https://ssrn.com/abstract=2858147

Adler, Gustavo, Romain Duval, Davide Furceri, Sinem Kilic Celik, Ksenia Koloskova, Marcos Poplawski-Ribeiro, 2017: Gone with the Headwinds: Global Productivity, IMF Staff Discussion Note SDN/17/04

Bellamy Foster, John, 2015: “The New Imperialism of Globalized Monopoly Finance Capital. An Intrduction”, in: Monthly Review, Vol. 67, No. 3,  https://monthlyreview.org/2015/07/01/the-new-imperialism-of-globalized-monopoly-finance-capital/

BIS (Bank for International Settlements), 2017: BIS Quarterly Review, September 2017. International banking and financial market development, https://www.bis.org/publ/qtrpdf/r_qt1709.pdf

Black Rock, 2015: Infrastructure Rising. An Asset Class Takes Shape, https://www.blackrock.com/investing/literature/whitepaper/infrastructure-rising-an-asset-class-takes-shape.pdf, accessed April 5, 2017

Bock, Reinout de, Andrea Maechler, Nobuyasu Sugimoto, 2015: “European Life Insurers: Unsustainable Business Model”, 5 May, https://blog-imfdirect.imf.org/2015/05/05/european-life-insurers-unsustainable-business-model/

Colantone, Italo, Piero Stanig, 2017: “The Trade Origins of Economic Nationalism: Import Competition and Voting Behavior in Western Europe”, BAFFI CAREFIN Centre Research Paper Series No. 2017-49

European Chamber (=European Union Chamber of Commerce in China), 2017: China Manufacturing 2025. Putting Industrial Policy Ahead of Market Forces, http://www.europeanchamber.com.cn/en/publications-archive/473/China_Manufacturing_2025_Putting_Industrial_Policy_Ahead_of_Market_Force

Gonzalez-Vicente, Ruben, Toby Carroll, 2017: “Politics after national development: Explaining the rise of populism under late capitalism”, in: Globalizations, forthcoming, http://dx.doi.org/10.1080/14747731.2017.1316542

Hardt, Michael, Antonio Negri, 2000: Empire, Havard University Press

Hildyard, Nicholas, 2016: Licensed larceny. Infrastructure, financial extraction and the Global South, Manchester University Press

Hirsch, Joachim, Jens Wissel, 2011: “The Transformation of Contemporary Capitalism and the Concept of a Transnational Class: A Critical View in Neo-Poulantzian Perspective”, in: Studies in Political Economy 88, Fall 2011, 8-33.

Huang, Yu, Naubahar Sharif, 2017. “From ‘Labor Dividend’ to ‘Robot Dividend’: Technological Change and Workers’ Power in South China”, in: Agrarian South: Journal of Political Economy 6 (1), 53-78.

John, Alun, 2017: “Belt and Road Project may hurt China banks”, in: South China

Morning Post, February 1, B2

Lam, W. Raphael, Alfred Schipke, Yuyan Tan, Zhibo Tan, 2017: Resolving China’s Zombies: Tackling Debt and Raising Productivity. IMF Working Paper 17/266.  http://www.imf.org/en/Publications/WP/Issues/2017/11/27/Resolving-China-Zombies-Tackling-Debt-and-Raising-Productivity-45432

Lacalle, Daniel, 2017: “The Rise of Zombie Companies – and Why it matters”, August 8, https://mises.org/library/rise-zombie-companies-—-and-why-it-matters-0

Macnair, Mike, 2017: “The new president and the new global order. What if Trumpism was made to serve the aims of US capital?”, in: Weekly Worker, Issue 1139, 26 January,

http://weeklyworker.co.uk/worker/1139/the-new-president-and-the-new-global-order/

Mau, Steffen, 2015: Inequality, Marketization and the Majority Class. Why did the European Middle Classes accept Neo-Liberalism?, Palgrave Macmillan

McGowan, Muge Adalet, Dan Andrews, Valentine Millot, 2017: The Walking Dead? Zombie Firms and Productivity Performance in OECD Countries, Economics Department Working Papers No. 1372

McKinsey Global Institute, 2017: The Productivity Puzzle: A Closer Look at the United States, Discussion Paper, March 2017, https://www.mckinsey.com/global-themes/employment-and-growth/new-insights-into-the-slowdown-in-us-productivity-growth

Mouffe, Chantal, 2016: “In defence of left-wing populism”, in: The Conversation, April 30, http://theconversation.com/in-defence-of-left-wing-populism-55869, accessed April 6, 2017

Müller, Julian, 2015: European Capital Markets Union. False promises of growth and its risks to financial stability?, SOMO paper, https://www.somo.nl/wp-content/uploads/2015/09/European-Capital-Markets-Union.pdf

Office for National Statistics, 2017: Annual Business Survey: UK non-financial business economy foreign owned business, 2014 and 2015, https://www.ons.gov.uk/businessindustryandtrade/business/businessservices/articles/annualbusinesssurvey/uknonfinancialbusinesseconomyforeignownedbusiness2014and2015

Norfield, Tony, 2016: The City: London and the Global Power of Finance, London: Verso

Roberts, Michael, 2016: The long depression. How it happened, why it happened, and what happens next, Chicago: Haymarket Books

Panitch, Leo and Sam Gindin, 2010: The Making of Global Capitalism. The Political Economy of American Empire, Verso: London.

Roberts, Michael, 2017: Beware the zombies, January 23, https://thenextrecession.wordpress.com/2017/01/23/beware-the-zombies/

Theurl, Simon, 2017: “Die Rolle von Klein- und Mittelunternehmen im politischen Kampf um TTIP. Eine hegemonietheoretische Betrachtung”, in: Momentum Quarterly, 6 (1), 3-16

Wells, Peter, Don Weinland, 2017, “Fitch warns on expected returns from One Belt, One Road”, in: Financial Times, January 26, https://www.ft.com/content/c67b0c05-8f3f-3ba5-8219-e957a90646d1

[i] Many thanks to Toby Carroll for useful hints and debates on robotization, and to Brad Williams for background information on Japan.

[ii] A recent study found that the European resistance against the TTIP trade deal was also supported by small and medium enterprises, see Theurl 2017 for the case of Austria. European SMEs set up a website in which they declare opposition to TTIP: http://faireconomyalliance.eu/

[iii] As we finalise this text, the Trump administration launches a military attack against military bases of the Syrian government on 6 April 2017 – during the first day of Xi Jinping’s first meeting with the US president. It is yet unclear if this was rather a ‘drive-by-bombing’ as suggested by the Financial Times as one possible option, or if this announces a lasting direct engagement of the US military in Syria. For sure, Trump succeeded with this attack to line up formal allies like the German government and important politicians in his own party behind him. It is important to note that Xi Jinping did not leave the meeting with Trump after being informed about the attack. This points to a situation in which the Chinese leadership is so much afraid of a trade war with the US that it tolerated this maneouver.

[iv] Huang Yu conducted a very recent study in Dongguan province based on data from the year 2016 and found out that robotization led to a 60-70% decline of the workforce in different factories. If these robotization programs are rolled out on a massive scale in the framework of China’s Manufacturing 2025 program, backed with financial support of various levels of the state (as it is planned), there will be an enormous increase of underemployed surplus population all over China (Huang 2017).