by Dan Jakopovich
In The Long Twentieth Century: Money, Power, and the Origins of Our Times (1994), Arrighi centres his attention on the examination of systemic capitalist cycles of accumulation: their immanent logic, the interplay between the emerging and old powers (elements of systemic continuity and discontinuity), and the factors of hegemonic consolidation.
Arrighi identifies the birth of the modern inter-state system in the Italian late medieval sub-system of states, which prefigured the four main features of the modern, capitalist world: the impulse for profitability or capital accumulation, the operation of the “balance of power”, “protection-producing industry” (war-making and state-making, self-perpetuating system of military “Keynesianism” or commercialized violence), and the extensive networks of diplomacy (initially mostly employed for trade-related information-gathering and the management of the balance of power, backed by “gunship diplomacy”).
Throughout the book, Arrighi interweaves the analysis of two major forms of power extension – “territorialism” (which perceives territorial expansion as central) and capitalism (which considers territorial expansion primarily as a possible instrument for capital accumulation). The Italian city-states were the first to illustrate this new capitalist logic, basing their power on the dominance of trade circuits, or, more specifically, their European monopoly over commercial exchanges with India and China (with the Islamic world as a mediator). The Dutch United Provinces, with their focus on strengthening their trading position rather than expanding their colonial territories, are another clear example of this non-territorialist capitalist logic (early modern mercantilism).
Arrighi is also quick to clarify these differences do not have any a priori bearing on the intensity of coercion, as the history of capitalist violence all too clearly illustrates. Furthermore, “the capitalist and the territorialist logics of power have not operated in isolation from one another but in relation to one another (…) As a result, actual outcomes have departed significantly, even diametrically, from what is implicit in each logic conceived abstractly.” He goes on to confirm this by pointing out that the most expansionist society proved to be capitalist Europe, rather than territorialist China for instance. However, it is important to note how the new territorial discoveries and colonial conquests of West-European powers developed in pursuit of trade circuits and in accordance with the newly unfolding profit logic. In turn, these conquests strengthened and generalized the very logic that created them in the first place. From its inception, capitalism threaded over the bones and souls of millions of “lesser” (i.e. weaker) humans. Modern slavery itself was the product of the same capitalist logic which later universally codified wage labor. While slavery existed long before classical antiquity, it was further extended and intensified under capitalism, which fully integrated it in its processes of capital accumulation (eg. the triangular trade), primarily as a method of compensating for the scarcity of adequate colonial labor force. Arrighi points out that “the earliest beginnings of the nineteenth-century free trade movement can be traced to the Atlantic slave trade” (p.244).
He argues that the Habsburg failure to embrace the new post-medieval modernity led to Spain’s relatively swift demise as the dominant power. The second half of the 16th and first half of the 17th century were marked by a sharp increase in militarization and violent power balancing. This systemic chaos led to popular class revolt, as well as religious (ideological) strife, a series of religious innovations and restorations. The 1648 Treaty of Westphalia finally inaugurated the beginning of “ordered international anarchy” based on inter-state “law”, state sovereignty, and the balance of powers. Considerable freedoms for commerce across political borders were also established. It is this “reorganization of political space in the interest of capital accumulation” which, for Arrighi, signifies the birth of capitalism as a world system. In contrast to the Italian city-state system which functioned well as a regional subsystem within a larger medieval system, the systemic struggle of the 16th and 17th century (especially the Thirty Years War) forced European powers to rationalize their relationships in order to preserve their common class interests.
As the colonialist “latecomers had radically to restructure the political geography of world commerce” (p.49), they adopted a new strategic synthesis of “territorialist” and “capitalist” approaches. Britain, geographically protected from the self-destructive continental conflicts, channeled its resources towards overseas colonial conquest, relatively quickly attaining global supremacy and establishing a new inter-state system which came to be known as “free-trade imperialism”. One major consequence of the new system was that “(u)nder free trade and equal exchange Indians perished by the millions”, Arighi notes in passing (quoting Polany).
A major violation of the established Westphalian inter-state principles occurred during the rise of expansionist Napoleonic France, both through its direct attack on state sovereignty and its limitations of commercial and property rights. Arrighi describes how the British leadership of the victorious anti-Napoleonic alliance, and the subsequent restoration and supersession of the Westphalia System (formalized in the Settlement of Vienna of 1815 and the Congress of Aix-la-Chapelle of 1818), reaffirmed and deepened British hegemony after the destabilizing American secession, as well as the French Revolution.
Echoing the concepts of Machiavelli and Gramsci, Arrighi points to the “coalitional” nature of international hegemony, which is based both on coercion and consent, and a system of states. In addition to leading the world in its direction, a power’s dominance can be manifested in its ability to draw “other states into its own path of development” (p.29). This is precisely what he sees as something that had largely characterized the British strategy (eg. with its unilateral and self-serving introduction of non-restricted, “free” trade).
Particularly after the demise of the overtly reactionary Holy Alliance (the “age of Metternich”), the British-directed Concert of Europe came to the forefront as a new “system” of international governance. Arrighi claims that the British dominance over the new transcontinental economic markets supported the development and exporting of a liberal capitalist ideology in which the “wealth of nations” concept served to legitimate an emerging global system that eroded old national boundaries through “invisible instruments of rule over other sovereign states” (p.56). The revolutionary upheavals brought forward a renewed interest in the preservation of common ruling class interests (furthermore, it could be argued, the rebellions led to the rise of the bourgeoisie, which was more interested in business activities than commercially unproductive forms of nationalist power struggles). Still, “the creation in the nineteenth century of a part-capitalist and part-territorialist imperial structure (…) shows that the formation and expansion of the capitalist world-economy has not involved so much a supersession as a continuation by other, more effective means of the imperial pursuits of pre-modern times.” (p.58)
Combined with the German maturation as a major force, beginning in the 1870s, the emergence of the United States – superior in size and resources – further destabilized the existing “Pax Britannica”. It was largely these two counter-hegemonic challenges which pushed the world system into a new stage of systemic chaos. In particular, the new externally expansionist nature of German imperialism led to bloody outcomes in the 20th century. Germany was a latecomer to the expansionist colonial agenda, which was already brutally initiated in earlier epochs both by Britain (mostly) overseas and the US continentally. In fact, the birth of the United States as a new hegemon cannot be separated from the horrific genocide against the Native American population.
The US kept the doors of its domestic market closed to foreign products for a long time, focusing on an endogenous, auto-centric developmental strategy. It fully engaged in international affairs only in the Second World War, ”leading the inter-state system towards the restoration of principles, norms and rules of the Westphalia System, and then went on to govern and remake the system it had restored” (p.65), and accumulating huge war credits in the process. Again, similarly to post-Napoleonic Britain, the hegemonic power came to embody a perceived general interest. This unified vision led to the construction of the Bretton Woods institutions, the General Agreement on Trade and Tariffs, as well as the international dollar system. In addition to these innovations (along with the remarkable rise and spread of large scale, vertically integrated transnational corporations), the principle of absolute state sovereignty was informally limited in the course of the Cold War, which was a major source of US political legitimacy in the post-war period (especially since it was the only force capable of defeating the Soviet Union), but often also a rationale for forceful integration into the capitalist world, which led to major conflicts and a crisis of US legitimacy (1960s and 70s). Furthermore, the US initiated regulatory thrust (largely a response to the British deregulatory period) and the Marshall Plan created another opportunity for broadening the global markets and remaking the developed world according to its own image, while the creation of a military-industrial complex represented a new means for sustaining and internalizing demand. The military-industrial complex, in turn, has provided a major incentive for an aggressive US foreign policy.
In the latter part of the book, Arrighi also deals with a new global development – the rise of neoliberalism, though he perhaps does not give it quite the attention it deserves. The specificity of the US system of global governance is that it had presided both over the regulatory thrust after the Second World War, and the neoliberal transformation which emerged out of the systemic crisis of the 1970s. Furthermore, it could be theorised (as David Harvey’s famous argument about ”accumulation by dispossession” in The New Imperialism seems to corroborate) that we’re witnessing a return to a more territorialist policy of the world’s leading power, a partial ”reversal” as a result of resource wars and the rise of non-cooperative regimes.
Arrighi concludes his overview of systemic cycles of accumulation and world governance, their tendencies and counter-tendencies, with an analysis and speculative narrative of the rise of Japan and the “Asian tigers” (but not China). He contemplates the possibility of Japan’s development into a hegemonic power (a popular notion in the early 1990s), which has not materialized. However, Japan’s “membership” in the dominant Triad (along with the US and EU) does point to some important facts, namely Japan’s continued economic strenth, as well as its deep integration in the main global political and cultural trends (as “an honorary member of the West” – p.353), which puts it at a distinct advantage in front of politically and socially less-integrated China, which has so far been unable to construct a strong and comprehensive system of international alliances (and therefore seemingly “disinterested” in relation to this).
Arrighi’s account of capitalist development is striking not just for its apt portrayal of vast and rapid systemic innovations and alterations; it also depicts the underlying continuity of its basic profit-making agenda and basic modes or rules of operation. However, Arrighi repeatedly questions the limits of its growth, seemingly evoking Marx’s belief in change and the potential for systemic supersession. He warns: “there is no reason to suppose that in the present just as in past hegemonic transitions, what at one point appears unlikely or even unthinkable, should not become likely and eminently reasonable at a later point, under the impact of escalating systemic chaos” (p.76). It is, at least, a call for openness and reflection, if not action.