Crisis in the West, Opportunity for the Rest?

IN FOCUS, 22 Jul 2024

Walden Bello | CounterPunch – TRANSCEND Media Service

Photograph by Nathaniel St. Clair

17 Jul 2024 – Whether we call it “polycrisis,” like Columbia University Professor Adam Tooze, or “the age of catastrophe,” like the distinguished Marxist Alex Callinicos, there is no doubt that we are living in a period where the very foundations of the contemporary world order are cracking. There is that enigmatic line Gramsci used to describe his era that is also appropriate for ours: “The old world is dying, and the new world struggles to be born: now is the time of monsters.”

This short essay will focus on a key dimension of the polycrisis: the unravelling of the global hegemony of the United States.

The downspin of the U.S. empire has had a number of causes, but key among them are military overextension, neoliberal globalization, and the crisis of the liberal political and ideological order. Let us discuss each in turn.

Overextension and Osama

Overextension refers to the gap between the ambitions of a hegemon and its capacity to achieve those ambitions. It is almost synonymous with the concept of overreach as used by the historian Paul Kennedy, the slight difference being that overextension as I use it is principally a military phenomenon. The struggling empire the United States is today is a far cry from the unipolar power it was a quarter of a century ago, in 2000. If we ask ourselves what led to this situation, it inevitably comes down to one individual: Osama bin Laden.

The aim of bin Laden’s attack on the Twin Towers on September 11, 2001 was precisely to provoke the overextension of the empire by forcing it to fight on several fronts in the Muslim world that would be inspired to revolt by his dramatic action. But instead of igniting revolt, Osama’s act ignited revulsion and disapproval among most Muslims. September 11 would have been a big failure had not George W. Bush seen it as an opportunity to use American power to reshape the world to reflect the Washington’s unipolar status. He took Osama’s bait and launched the United States into two unwinnable wars in Afghanistan and Iraq. The results have been devastating for America’s power and prestige.

During the June 7, 2024, debate between Donald Trump and Joe Biden, Trump referred to the defeat in Afghanistan as the worst humiliation ever inflicted on the United States. Now Trump, as we all know, is prone to exaggeration, but there was strong element of truth in his statement.

According to CIA analyst Nelly Lahoud, “Though the 9/11 attacks turned out to be a Pyrrhic victory for a-Qaeda, bin Laden still changed the world and continued to influence global politics of nearly a decade after.” If the United States is the confused and groping global power it is today—one that has been, moreover, reduced to a dog being wagged by the Zionist tail—that is to a not-insignificant degree due to bin Laden.

To acknowledge the significance of 9/11 is not, of course, to endorse it. Indeed, for most of us, the attack on civilians was morally repelling. But one must give the devil his due, as they say, that is, point out the objective, world-historic impact of the deed of an individual, be this person a saint or a villain.

Trading Places

Let us turn to the second major cause of the unravelling of the hegemonic U.S. status: neoliberal globalization. Thirty years ago, U.S. corporate capital, along with the Clinton administration, envisioned globalization, achieved through trade, investment, and financial liberalization, as the spearhead of its greater domination of the global economy. Wall Street and Washington were wrong. It was China that was the biggest beneficiary of globalization and the United States one of its main victims.

Investment liberalization meant billions of dollars worth of U.S. corporate capital flowed to China to take advantage of labor that could be paid at fraction of the wages paid labor in the United States in exchange for technology transfer, voluntary or forced, that helped China comprehensively develop its economy. Trade liberalization made China the manufacturer of the world supplying mainly the U.S. market with cheap products. Both investment and trade liberalization contributed to the deindustrialization of the US and the loss of millions of manufacturing jobs, which declined from 17.3 million jobs in 2000 to around 13 million today. Compounding the deleterious effects of deindustrialization have been the financialization of the U.S. economy, that is, making the super-profitable financial sector the leading edge of the economy, and regressive taxation, which led to an extremely inequitable distribution of income and wealth.

China has traded places with the United States in the global economy. China is now the center of global capital accumulation or, in the popular image, the “locomotive of the world economy.” According to IMF calculations, China accounted for 28 percent of all growth worldwide from 2013 to 2018, which is more than twice the share of the United States. What must be underlined is that while the United States followed neoliberal policies of giving full play to market forces, China selectively liberalized, with the powerful Chinese state guiding the process, protecting strategic sectors from foreign control, and aggressively demanding advanced technology from Western corporations in exchange for cheap labor.

Although in dollar terms, the United States is still the biggest economy, by some other measures, like the World Bank’s Purchasing Power Parity (PPP), China is now the world’s largest.  In the United States, 11.5 percent of people now live in poverty, whereas, according to the World Bank, only 2 percent of China’s population is poor.

Of course, China has faced challenges in its rise to the world’s economic summit, but development, as the economist Albert Hirschman point out, is a necessarily unbalanced process. China’s crises are crises of growth, compared to the U.S. crises, which are crises of decline.

From De Facto to Armed Civil War?

Military overextension and the effects of neoliberal economics have contributed not simply to political disaffection but to political turmoil in the United States, with one of the two major parties, the Republican Party, becoming the spearhead of far-right or fascist politics fueled by racism, anti-immigrant sentiment, fear, and decline in economic status among white people. Politics has become severely polarized, and some warn that there is now a state of de facto civil war. In short, the political and ideological regime of liberal democracy is now in grave danger, with many liberals and progressives warning that Trump’s Plan 2025 will amount to the establishment of a fascist dictatorship. They are not wrong.

Here is what Steve Bannon, the ideological chief of the U.S. far right, says,

The historical left is in full meltdown. They always focus on noise, never on signal. They don’t understand that the MAGA movement, as it gets momentum and builds, is moving much farther to the right than President Trump… We’re not reasonable. We’re unreasonable because we’re fighting for a republic. And we’re never going to be reasonable until we get what we achieve. We’re not looking to compromise. We’re looking to win.

A second Trump presidency is now a certainty, with the strong possibility that the de facto civil war could turn into an armed civil war. Indeed, the assassination attempt on Trump on July 13, whoever carried it out, may well be a major step towards the unrestrained violence depicted in Alex Garland’s “Civil War.”

Crisis of the Liberal International Order

Washington has been the guardian of the international order, and with the economic and political crisis of the United States, that order has also entered into a deep crisis. What are the key aspects of what has been characterized as the liberal international order? First, of all, global leadership of the United States and the West underpinned by U.S. military power. Second, a multilateral order that serves as a political canopy for Western capital, whose mainstays are the World Bank, the International Monetary Fund, and the World Trade Organization. Third, an ideology that promotes Western-style democracy as the only legitimate political regime.

This liberal order is now in trouble on two fronts: on the international front, it has lost legitimacy among the global South, which sees the multilateral system as designed mainly to keep it down; internally, the liberal democracy that is its guiding ideology is under assault from the far right. If the far right comes to power in the United States and in key states in Europe—and it may come to power soon in France and soon after that, in Germany—the international order they would favor would probably continue to assert Western economic supremacy but adopt a much more unilateralist approach, more protectionist approach of securing it instead of using the IMF-World Bank-WTO complex. Certainly, the far right will abandon the hypocritical appeal to liberal democracy as a model for the rest of the world.

Headed for War?

China says it is not out to displace the United States as global hegemon. To the U.S. elite, however, China is a revisionist power determined to dislodge it as the global hegemon. Especially in the Biden years, the United States has become more and more determined to use that dimension of hegemony where it enjoys absolute superiority over China, military power, to protect its status as number one.

This is why the danger of war between the United States and China is not to be underestimated, and this is the reason the Western Pacific is such a powder keg, far more than Ukraine. In Ukraine, the United States and China confront each other through proxies, Russia and NATO, while in the Pacific they confront each other directly.

The United States has scores of bases surrounding China from Japan to the Philippines, including the massive floating base that is the Seventh Fleet. The South China Sea is now filled with rival warships performing naval “exercises.” Among the latest visitors are vessels from France and Germany, U.S. allies that have been dragooned far from NATO’s traditional area of coverage to contain China. U.S. and Chinese warships have been known to play games of chicken—heading at each other and then swerving at the last minute. A miscalculation of a few feet could result in a collision, with unpredictable consequences. Fears that the South China Sea will be the next site of armed conflict are not alarmist.

In the absence of any rules of conflict resolution, the only thing preventing conflict is the balance of power. But balance-of-power regimes are prone to breakdown, often with catastrophic results—as was the case in 1914, when the collapse of the European balance of power led to World War I. With Washington aggressively marshaling Japan, South Korea, the Philippines, five carrier task forces of the U.S. Navy, NATO, and the newly created AUKUS (Australia, United Kingdom, United States) alliance into a confrontational stance against China, the chances of a rupture in the East Asian balance of power are becoming more and more likely—perhaps just a collision or away.

Hegemonic Transition or Hegemonic Stalemate?

So what does the future hold?  Some say a hegemonic transition, whether peaceful or not is inevitable.

But let us pose another possibility. Perhaps, we should be looking not so much at a hegemonic transition but at the emergence of a hegemonic vacuum akin to but not exactly the same as that which followed the First World War, when the weakened Western European states had ceased to have the capacity of restore their pre-war global hegemony while the United States did not follow through on Woodrow Wilson’s push for Washington to assert hegemonic political and ideological leadership.

Within such a vacuum or stalemate, the U.S.-China relationship would continue to be critical,  but with neither actor able to decisively manage trends, such as extreme weather events, growing protectionism, the decay of the multilateral system that the United States put in place during its apogee, the resurgence of progressive movements in Latin America, the rise of authoritarian states, the likely emergence of an alliance among them to displace a faltering liberal international order, and increasingly uncontrolled tensions between radical Islamist regimes in the Middle East and Israel.

Both conservative and liberal policymakers paint this scenario to underline why the world needs a hegemon, with the former advocating a unilateral Goliath who does not hesitate to use threat and force to enforce order and the latter preferring a liberal Goliath who, to slightly revise Teddy Roosevelt’s famous saying, speaks sweetly but carries a big stick.

There are, however, those, and I am one of them, who view the current crisis of U.S. hegemony as offering not so much anarchy but opportunity. Although there are risks and great dangers involved, a hegemonic stalemate or a hegemonic vacuum, opens up the path to a world where power could more decentralized, where there could be greater freedom of political and economic maneuver for smaller, traditionally less privileged actors from the global South playing off the two superpowers against one another, where a truly multilateral order could be constructed through cooperation rather than be imposed through either unilateral or liberal hegemony.

Yes, the crisis of U.S. hegemony may lead to an even deeper crisis, but it may also lead to opportunity for us. To use Gramsci’s image that I began this essay with, we may be entering an age of monsters, but like Ulysses, we cannot avoid going through the dangerous passage between Scylla and Charybdis if we are to get to the promised safe harbor.

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Walden Bello is the co-founder of and current senior analyst at the Bangkok-based Focus on the Global South, the International Adjunct Professor of Sociology at the State University of New York at Binghamton, and National Chairperson of Laban ng Masa, a progressive coalition of organizations and individuals in the Philippines. He received the Right Livelihood Award, also known as the Alternative Nobel Prize, in 2003, and was named Outstanding Public Scholar of the International Studies Association in 2008. Bello did his doctoral dissertation on the counterrevolution in Chile in 1970-73. He is currently senior research fellow at the Center for Southeast Asian Studies of Kyoto University. The author or co-author of 25 books, he served as a member of the House of Representatives of the Philippines from 2009 to 2015.

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