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Progress and Poverty


Last year Kersplebedeb published Divided World Divided Class: Global Political Economy and the Stratification of Labour Under Capitalism by Zac Cope. The book stimulated a favorable review from Matthijs Krul, a reply from my old STO comrade Don Hamerquist, and a rejoinder from Krul. It also drew at least one unfavorable review, by Charlie Post. (References at end.) 

I enter into this discussion out of a sense of duty but also with hesitancy owing to my relative lack of knowledge about global investments, labor migration, transfer of values and other elements that some participants in the discussion seem familiar with and apparently consider essential. Refusing to be prejudiced by facts, and believing that the formulation of a question is its solution, I offer the following contribution.

Cope (like Don, I have not read him), Krul and Hamerquist share certain assumptions, although they differ among themselves on the political conclusions to be drawn from them. These assumptions are:

1) The comparatively high standard of living of workers in the West is to some degree the result of their sharing in the loot extracted from the Third World. (I am foregoing the ironic quotation marks, hoping that people will bear in mind that West, Third World and standard of living are all ideological, as are our, their, wealth, poverty, center, periphery, relative privilege and other terms employed in the discussion.) 

2) Workers in the West are in general less revolutionary than the masses of poor in the Third World.

3) There is a causal relation between 1) and 2), although – Don Hamerquist stresses this – it is not as determinant as some have claimed.

If either 1) or 2) is false, then 3) necessarily falls. In my opinion, both are false.

On 1): In 1890 a loaf of bread made from wheat grown in Minnesota cost less in Berlin than a loaf of bread made from wheat grown a hundred miles to the east. The difference was due to the mechanization of agriculture, storage and transport in the U.S., including trans-Atlantic shipping, compared to the techniques then used in Poland. The result was the ruination of agriculture in Poland (and much of Eastern Europe). Did the “shoals of roast beef and apple pie” in the U.S. (to which Werner Sombart in 1904 attributed the failure of Socialism there) depend on the destruction of Polish agriculture? Of course not. They depended on the accumulation of capital in the U.S. (at first based on the expropriation of the natives and the enslavement of Africans, and later on foreign investment in rails and canals) that made possible the cheap coal, timber, steel, tractors, railroads and steamships and ultimately the cheap food, houses, clothes, automobiles and appliances that constituted the famous American standard of living.

I remember reading an article around 1968 in Peking Review about how Chinese workers, using what the editors called the method of “ants nibbling at the bone,” that is, relying on hand tools, had built a stamping press. The editors, and apparently many Chinese, were proud of the accomplishment, as well they should have been. A few years later I worked in a medium-sized machine-tool factory in Chicago that had a couple of dozen presses equal in size to the one they had just built in China. There must have been five hundred factories like it in the U.S. (I make no pretense at numerical accuracy; what matters is the scale.) Didn’t the abundance of those presses in the U.S. explain more about the possession of refrigerators, washing machines, etc. by U.S. workers than the looting of China? Another example, again from China: at that time China, with six hundred million people on the land, was barely able, for the first time in modern history, to feed its population. The U.S., with three million people working in agriculture, was exporting food. Were the “shoals of roast beef and apple pie” consumed by U.S. workers taken out of the mouths of Chinese toilers? I don’t think so.

Cope, Krul and Hamerquist, following Emmanuel, point to unequal exchange as the mechanism underlying the transfer of value from Third to First World. (Emmanuel was the first to attempt to explain how the transfer took place. Lenin and others after him evidently regarded it as too obvious to require explanation. Charlie Post, who disagrees with them and with Emmanuel, gets it wrong: he has Emmanuel relying on transfers of value from industries with low organic composition to industries with high organic composition. Emmanuel actually adopted Marx’s formulation about transfers from low o.c to high o.c. industries and extended it to transfers from low-wage to high-wage regions.) A problem with Emmanuel’s argument and the arguments of his followers is that even if they are right about the process, until recently the output of the Third World was nowhere near great enough to account for the gap in living conditions. For most of the period the Third-Worldists are considering, the greatest portion – as high as eighty-five percent -- of U.S. investments were in a handful of developed countries, and the same is true for Britain, Germany, Japan, etc. If the Third-Worldists are right that U.S. relative privilege depended on low wages in the Third World, then wouldn’t it follow that as investment in the Third World increased the relative privilege would expand? Yet the opposite is true: nearly everything sold at Walmart is produced by low-wage (often prison) labor in China, yet the gap between U.S. and Chinese conditions has not grown but diminished.

I think I have shown that the poverty of the masses in the Third World cannot be the cause of the comparative wealth of workers in the First. But may not the reverse be true – that is, may not development in the First World account for its absence, and the misery that accompanies it, in the Third World? The reduction of the cost of producing wheat in North America and shipping it to Europe led to the ruination of Polish agriculture and the immiseration of the Polish peasants who, driven off the land, made their way to Chicago and Pennsylvania where they took up jobs in the industries that had destroyed their previous way of life. We are seeing similar phenomena today: the Rockefeller-sponsored Green Revolution has emptied the countryside of Asia, Africa and America, and sent millions of former peasants fleeing to swollen cities in those areas and to North America and Europe, but it has done nothing to elevate living standards in New York, London or Paris. On the contrary – it has increased competition for jobs in those places, with predictable results.

In chapter 13 of volume 3 of Capital, Marx introduces the law of the tendency of the rate of profit to fall, which he says is of great importance to capitalist production and which has been a mystery whose solution has been the goal of all political economy since Adam Smith. The law posits a relentless downward pressure on profits. The point of the law for this discussion is that it demands ever-increasing quantities of investment in constant capital in order simply to maintain profits, quantities that are beyond the reach of all but the largest capitalists and which therefore lead to the concentration of capital in ever-fewer hands and the elimination of the smaller and weaker among them. According to Wikipedia, “There were over 1,800 automobile manufacturers in the United States from 1896 to 1930. Very few survived and only a few new ones were started after that period.” If Studebaker, Nash and Kaiser, which were fairly big and employed many people, did not have sufficient capital to compete with General Motors in the world market, how could Nigeria and Mexico, let alone Haiti, develop an automobile industry, except through foreign investment? And if those countries could not develop an automobile industry and the steel, rubber, glass and other industries that go along with it, how could they expand their domestic markets and create the American way of life?

In sum, the relationship between conditions in the First and Third Worlds is the direct opposite of what the Third-Worldists argue. The Third-Worldist view is a perfect example of the mixing-up of appearance and essence that Marx attempted to counter through his concept of the fetish. That many workers in the developed countries mistake appearance for essence is a political problem; so is it when revolutionaries do the same. 

2) Are the masses of the poor in the Third World more revolutionary than workers in the U.S. and other countries of the center? The answer depends on what is meant by revolutionary. If by revolutionary one means engaging in armed struggle for explicitly political ends, then the Third World wins hands down: from Chiapas to Palestine to Naxalbari and in a hundred other places people in Third World countries have taken up guns in defense of land tenure, water rights, local autonomy and other causes great and small. I see no evidence that any of the struggles are motivated by a vision of communism (except maybe Chiapas, and it is significant that the EZLN has not fired a shot in anger in over ten years). By and large those movements are fighting to realize the promises of the bourgeois, French, Revolution of 1789. That does not make them any less worthy of support, but it does say something about how they should be measured against struggles elsewhere. Moreover, the widespread presence of bands of Kalashnikoff-bearing pre-adolescents pillaging and raping in the interest of one or another warlord ought to warn us against any easy identification of armed struggle and revolution, and give us cause to respect the reluctance of workers in Europe and North America, treasuring past victories in the reform struggle (often won through violence and sacrifice), to embark on a path from which it is difficult to turn back.

Or perhaps the criterion of revolution is the commitment to explicit anti-capitalist programs. By this criterion, too, the Third World is ahead: in contrast to the virtual collapse of Socialist and Communist Parties in Europe and the absence in the U.S. of a Socialist Party with a mass following (and the widespread tendency to denounce Obama’s healthcare plan as “socialist”), even the movement headed by Chavez declares its goal to be “twenty-first-century socialism.” Once again, a word of caution: “twenty-first-century socialism“ is not socialism, and the 80 million members of the Chinese Communist Party, whose leading role is written into the Constitution, bear no greater connection to communism (and perhaps less) than do the 60 million Americans who voted Democratic in 2012 to democracy.

Let me advance two criteria for measuring what is revolutionary. The first is the extent to which the preconditions for communism have been established, and especially the degree to which they are taken for granted by the general population. The communist society is characterized by, among other things, the elimination of the distinctions between urban and rural life and between intellectual and manual labor, by the rejection of class distinctions, and by the overcoming of patriarchy. I submit that in no other country have these conditions been fulfilled as in the U.S. and that in general they are more fully realized in the First than in the Third World. Automobiles, televisions, computers and cell towers have made sure that residents of the remotest village in the Ozarks are familiar with daily life in New York. The millions enrolled in post-secondary schools, including the various technical institutes advertised on late-night TV, testify to the overcoming of the distinction between intellectual and manual labor. (I recently had a conversation with a man who was shining shoes at the airport; he had a stack of books on his stand, and informed me that he was studying for the exam to get his realtor’s license; show me another country where that happens.). Even the naïve insistence by Americans that they are “middle-class” points to their refusal to accept class distinctions as permanent. As for the patriarchy, in no other country are the access of women to higher education, well-paying jobs and careers, political office, and the right to drive cars, rent apartments, control their own bodies and choose their associates as freely as men so well established and so widely accepted as in the U.S. Or consider race: The very bitterness of relations between blacks and whites is evidence of the mutual, if often grudging, respect that exists between them – no quarrel so bitter as a family quarrel -- and stands in contrast to prevailing attitudes in Latin America and Asia, where the upper classes do not hate the lower classes so much as look down on them as members of another species. John Bracey recounts the time CLR James was watching a football game on TV and called to him from the other room. “Look at this,” said James. “Black people beating up white people on TV. Capitalism is doomed.” Of course none of these tendencies can be fully realized so long as capitalist relations prevail, but the new society exists within the shell of the old. The U.S. is more ready for communism than any other country in the world.

My second criterion for judging who is revolutionary is the degree to which working-class activity has transformed the world. The Vietnamese people won what was arguably the greatest military victory in history over the world’s greatest power. And what changed as a result? On a world scale, not much. Global corporations are now reaping greater profits from Vietnam than they did before the fall of Saigon. Meanwhile, the massive resistance by U.S. workers to capitalist work discipline, which reached a peak in the 1970s, was an important factor compelling capital to introduce new methods of production that did away with workers, and shift industry from the First to the Third World (and contributed to the U.S. defeat in Vietnam). The struggles of the working class are the chief motor transforming society. Even before it overthrows capital, the working class compels it to new stages in its development. Looking back at U.S. history, the resistance of the craftsmen compelled capital to develop methods of mass production; the workers responded to mass production by organizing the CIO, an attempt to impose their control on the rhythms of production; capital retaliated by incorporating the union into its administrative apparatus; the workers answered with the wildcat strike and a whole set of shop-floor relations outside of the union; capital responded to this activity by moving the industries out of the country in search of a more pliant working class, and introducing computerized production to eliminate workers altogether. The working class has responded to the threat of permanent separation from the means of obtaining life with squatting, rebellion, and food riots. And so forth; this is a continuous process, and it moves the society forward ¾ ending, as Marx said, in the revolutionary reconstitution of society or the common ruin of the contending classes.

Over a century and a half ago Marx wrote:

It is not a question of what this or that proletarian, or even the whole proletariat, at the moment regards as its aim. It is a question of what the proletariat is, and what, in accordance with this being, it will historically be compelled to do. Its aim and historical action is visibly and irrevocably foreshadowed in its own life situation as well as in the whole organization of bourgeois society today. There is no need to explain here that a large part of the English and French proletariat is already conscious of its historic task and is constantly working to develop that consciousness into complete clarity.

Of course, Marx’s last sentence is not without interest.



Krul’s review:; Hamerquist’s reply:; Krul’s rejoinder:; Post’s review:




Response from Loren Goldner:

I haven't read Cope's book either but I'd like to add a few thoughts to this discussion. I quite agree with Noel's critique of the idea that "first world" living standards historically have been dependent on the super-exploitation of the Third World (and let me be clear: parts of the "Third World" ARE being super-exploited). I take exception to some of Noel's optimism about America but that's not the main issue here. The material conditions in Europe, the US and Japan until recently have been based on high productivity in Europe, the US and Japan- 80% of all investment from those three centers up to the 1970's was among themselves, not in the Third World, which declined as a share of world trade from 1900 to then. (Things began to change with the emergence of the "tigers", but that's another story, and it's not what Third Worldists think of when they perpetuate a dumbed-down version of Lenin's theory.)

Let's consider the history of this debate. Lenin wrote his pamphlet "Imperialism" during WW I to answer the question: what was the "material basis" of the failure of the European working class to overthrow capitalism to prevent the war, as its parties had promised for 15 years prior? Instead, the majority of workers supported their own bourgeois governments and marched off to be slaughtered and to slaughter workers from other countries. Lenin had no doubt that the Western working class was the "revolutionary subject"; he was inquiring about its failure to rise to that role. 

That was in 1914-1915. But despite that terrible setback, let's not forget that those same workers, three years later in 1917-1918, threw off those illusions and made the Russian Revolution, the (defeated) German Revolution, and achieved dual power (or near dual power) in Italy and in Great Britain, and launched mass strikes in France and the US .  But most Third Worldists since,and still today, don't remember that revolutionary surge, because they long ago wrote off Western workers as a radical force.

We should also remember that Lenin's wrong-headed economics in Imperialism were lifted from the bourgeois- Malthusian theoretician Hobson, who had argued a few years earlier (like MOST bourgeois economists trying to explain why imperialism was necessary in the late 19th century) that "insufficient demand" in countries such as Britain was the reason for the "export of capital". (Rosa Luxemburg's analysis was much superior, but that is another discussion.)

What was really going on, and what explained Lenin's wrongheaded analysis? From the 1870's onward, an agrarian revolution brought wheat (as Noel points out, briefly) from Argentina, Australia, Canada, the US, and Russia onto the world market, greatly cheapening the cost of food for workers, who had previously spent 50% of their wages on food. There was also a huge advance in productivity, above all in the US and Germany, cheapening other goods workers bought, and preparing the shift, before and above all after WW I, to consumer goods for workers which had previously been available only to the rich. THAT, not imperialism, is the "material basis" of worker reformism in the capitalist heartland. (And once again: imperialism exists, and continues to wreak destruction, but does not play the role in accumulation the Third Worldists give it.)

I've never understood how Lenin, who did serious research to write Imperialism, missed this, but he did. But then as Rosa Luxemburg pointed out on several occasions, Lenin didn't understand Marx's Capital- or he couldn't have come up with his equally wrong-headed theory of "monopoly capital" (which he also took from dubious sources).

With the rise of Stalinism, after Lenin's death, Lenin's analysis asking "what prevented the revolution in Europe in 1914?" gradually shifted to a increasingly moralistic view of the "aristocracy of labor" (presumed to be the majority of Western workers) living off the crumbs from the capitalist "superprofits" from exploitation of the colonial world. This was already present in Lenin's pamphlet but the focus increasingly became a dismissal of the revolutionary potential of the Western working class (again, forgetting or trivializing the revolutionary surge after WW I, or explaining it with Lenin's five-thumbed categories). Lenin had no doubt that Western workers were the "engine of revolution", but various "Marxist- Leninists" after his death increasingly discovered socialist revolutionary potential in peasant- bureaucratic movements in the colonies and, after de-colonization, in the nominally independent ex-colonies, still largely under US, British, French Belgian, Dutch, etc. control. 

What Noel points out in the case of Vietnam before and after 1975 can be generalized to many other cases. The "Marxist-Leninist", Stalinist, Maoist view had its heyday in the 1960's and 1970's, with (for example) the Lin Biao view of "peasant guerillas surrounding the cities" worldwide as the revolutionary dynamic. And this was during the biggest strike wave in post-1945 history, much of it wildcat, in Europe and the US, by the very workers who were supposedly "bought off" by imperialist "superprofits". 

Meanwhile, the peasant-bureaucratic revolutions in China, Algeria, Angola, Mozambique, Indochina etc. revealed their true nature after the 1970's (for those from whom their nature was hidden) and no one looks to such obviously capitalist countries today for inspiration. 

Consider then what has happened to this Marxist-Leninist geopolitics since. The Western working class, in response to the wildcat upsurge of the 60's and 70's, has been hammered by de-industrialization, outsourcing and capital intensive development. How anyone can look at contemporary Detroit, or more broadly the American rust belt, or comparable areas in Britain, France, Germany and Italy and call the diminished survivors a "labor aristocracy" living off imperialism is quite beyond me.

Meanwhile, east and southeast Asia, has moved from 5% of world production in 1960 to 35% today. South Korea and Taiwan, which in the 1960's were low tech exporters of textiles, ruled by tin pot dictators propped up by the US, now are "first world" countries and have quietly disappeared from the Third Worldist lexicon. As have the smaller cases of Hong Kong and Singapore. Malaysia is not far behind. Looking elsewhere, Brazil and more recently Mexico have moved up into some serious development. China, with the central committee of the Chinese CP made up of billionaires,  since 1978 has been developing at rates unprecedented in history. China, South Korea, Taiwan and Japan together now hold about $4 trillion of US government debt in their central banks, and the latter three have surpassed the US in total investment in China.  China , with its scramble for oil and natural resources, is now arguably on its way to exploiting Africa as much as any Western power did in the postwar era, as some African leaders have warned recently.

And the Middle East and North Africa? The old Third Worldist/ nationalist movements of the 60's and 70's have been swept aside by Islamic fundamentalism from Iran, Afghanistan and Pakistan to the recent upsurges in Egypt and Tunisia, now in danger of being hijacked by the Muslim Brotherhood and Saudi-backed Salafists.

(A fuller analysis of the world dynamic sketched here is in my article in the latest issue of Insurgent Notes, at http:// )

The supposed unity of the Third World of 40-50 years ago has been shattered into fragments by these developments.

There now exists, as a result of this process. a world wage-labor proletariat in both the former capitalist "metropolis" and in a dozen countries where it did not exist or barely existed 40 years ago. That's the revolutionary class. It's high time to move beyond the potted categories from some Marxist-Leninist time warp and start to pose strategic and tactical questions for the practical unity of that class, and be done with this moralistic hierarchy of oppression that, as Noel points out, assumes that the most oppressed are by definition the most potentially radical.



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