The Structuralist
Perspective on
International Economics
Karl Marx is one of the most important
thinkers in the history of political economy,
With the end of the USSR it is easy, facile in
fact, to conclude that “Marx and Marxism is
dead”.
Marxism’s contribution to IPE continues
through the insights into IPE, provided by the
ideas which originated within the Marxist
tradition.
As a consequence Marxism remains very
much alive today.
The general heading “structuralism”
accounts for some of the more recent
theories and concepts which incorporate a
number of Marx and Lenin’s ideas today.
Underlying idea of structuralism is that
structure conditions outcome …namely both
the domestic and global economic structure
are the most significant determinants of
subsequent economic and political
developments.
For Marx capitalism was a welcome
movement forward in historical progress
allowing an abundance of productive wealth
impossible under feudalism…..but capitalism
too would reach its limits.
Vladimir Ilyich Lenin suggested that
capitalism could extend its life by entering the
phase in its development he termed
“imperialism” .
Structuralists view the global economy
differently from liberals.
Liberals make individuals and the state their
basic units of analysis, structuralists focus on
the nature of class relations across the globe
and examine the power relations across the
world derived from economic power.
“The history of all hitherto existing society is the
history of class struggle”
Karl Marx and Friedrich Engels
“Imperialism is capitalism in that stage of development in
which the domination of monopolies and finance capital
has established itself;in which the export of capital has
acquired pronounced importance;in which the partition of
all the territories of the globe among the great capitalist
power has been completed”
V I Lenin
“The third world countries of today were drawn into the
capitalist world market under regimes of formal and
informal colonialism, as appendages of the metropolitan
nations to supply raw materials and exotic commodities to
the industrial centre”
Joan Robinson
Karl Marx (1818-1883)…as a young man…
Karl Marx (1818-1883)…. Somewhat later
on….oh well it happens to us all…
Marx understood history to be a great
dynamic evolving process determined
fundamentally by economic and
technological forces. He believed that
historical materialism as a method of analysis
helped to explain the process of history.
The forces of production (ie the sum total of
knowledge and technology in society) set
the parameters for the kind of system of
political economy, or the mode of production.
As Marx put it ‘the hand mill gives you
society with the feudal lord, the steam mill
society with the industrial capitalist’
It is the contradictions between the forces of
production and the relations of production in a
society which heralds change,
Technical changes ushers in new forces of
production which eventually outgrow the
relations of production…
e.g. the emergence of the entrepreneurial class
and steam power and improved manufacturing
technologycapitalismstate is forced to
represent the interests of the new class which is
gaining ascendancyincreased democracy/
decline of aristocracy…also creates an entirely
new class the working class..whose only
saleable asset is its labour power.
“The feudal system of industry, in which
industrial production was monopolized by
closed guilds, now no longer suffices for the
growing wants of the new markets. The
manufacturing system took its place. The
guild-masters were pushed aside by the
manufacturing middle class; division of labour
between the different corporate guilds
vanished in the face of division of labour in
each single workshop.”
Karl Marx
“Meantime, the markets kept ever growing,
the demand ever rising. Even manufacturers
no longer sufficed. Thereupon, steam and
machinery revolutionized industrial
production. The place of manufacture was
taken by the giant, MODERN INDUSTRY; the
place of the industrial middle class by
industrial millionaires, the leaders of the whole
industrial armies, the modern bourgeois.”
Karl Marx
“Modern industry has established the world market, for which
the discovery of America paved the way. This market has given an
immense development to commerce, to navigation, to
communication by land. This development has, in turn, reacted on
the extension of industry; and in proportion as industry,
commerce, navigation, railways extended, in the same proportion
the bourgeoisie developed, increased its capital, and pushed into
the background every class handed down from the Middle Ages.”
“We see, therefore, how the modern bourgeoisie is itself the
product of a long course of development, of a series of revolutions
in the modes of production and of exchange. “
Karl Marx –The Communist Manifesto 1848

“Modern bourgeois society, with its relations of
production, of exchange and of property, a society
that has conjured up such gigantic means of
production and of exchange, is like the sorcerer who
is no longer able to control the powers of the nether
world whom he has called up by his spells. For
many a decade past, the history of industry and
commerce is but the history of the revolt of modern
productive forces against modern conditions of
production, against the property relations that are
the conditions for the existence of the bourgeois and
of its rule.” Karl Marx –The Communist Manifesto 1848
“The essential conditions for the existence and for the
sway of the bourgeois class is the formation and
augmentation of capital; the condition for capital is
wage-labour. Wage labour rests exclusively on
competition between the labourers. The advance of
industry, whose involuntary promoter is the
bourgeoisie, replaces the isolation of the labourers, due
to competition, by the revolutionary combination, due
to association. The development of Modern Industry,
therefore, cuts from under its feet the very foundation
on which the bourgeoisie produces and appropriates
products. What the bourgeoisie therefore produces,
above all, are its own grave-diggers. Its fall and the
victory of the proletariat are equally inevitable…”
Karl Marx- The Communist Manifesto 1848
Marx believed that history would eventually evolve
towards a situation whereby the new class-the
proletariat-would become dominant, and establish a
new political dominance . Just as capitalism saw a
political system of dominance by the forces of capital,
socialism would see the dominance of the working
class. Marx never placed a time scale on this process…
Lenin believed that capitalism had avoided this crisis
by expanding the pool of workers it
exploited…capitalism he argued “had escaped its three
laws of motion through overseas imperialism.the
acquisition of colonies had enabled the capitalist
economies to dispose of their unconsumed goods, to
acquire cheap resources,and to vent their surplus
capital”
Lenin aged 20
After the Russian
revolution in 1917
Oh dear its that aging process
again…Lenin in Summer 1923 shortly
before his death
The critical element fuelling imperialism
according to Lenin was the decline of
national economic competition and the
growth of monopolies.Based on Marx’s law of
concentration what emerged was an
aggregation of market power in the hands of
a “few cartels syndicates and trusts”
Because monopolies concentrated capital
they could not find sufficient investment
opportunities in the industrialized world..it
was therefore necessary to export capital
around the globe to earn sufficient profits.
This created a situation where the
working classes of the developed
world were in some respects
pacified by the benefits they derived
from the increased rate of
exploitation to be found in the
colonies and the third world…the
working class in many imperialist
nations Lenin’s term as a result
becomes “bourgeosified”…racism
and gung-ho nationalism are all part
of this process.
Monopolies, oligarchy, the striving for domination instead of
striving for liberty, the exploitation of an increasing number of
small or weak nations by a handful of the richest or most
powerful nations -- all these have given birth to those distinctive
characteristics of imperialism which compel us to define it as
parasitic or decaying capitalism. More and more prominently
there emerges, as one of the tendencies of imperialism, the
creation of the "rentier state," the usurer state, in which the
bourgeoisie to an ever increasing degree lives on the proceeds of
capital exports and by "clipping coupons."
It would be a mistake to believe that this tendency to decay
precludes the rapid growth of capitalism. It does not. In the epoch
of imperialism, certain branches of industry, certain strata of the
bourgeoisie and certain countries betray, to a greater or lesser
degree, now one and now another of these tendencies. On the
whole, capitalism is growing far more rapidly than before, but this
growth is not only becoming more and more uneven in general, its
unevenness also manifests itself, in particular, in the decay of the
countries which are richest in capital (England).
VI Lenin Imperialism –The Highest Stage of Capitalism-April 1917
The fundamental aspect of imperialism for Lenin was that
capitalist nations were able to delay their crisis by keeping the
poorer nations of the world underdeveloped and deep in debt,
dependent on them for manufactured goods, jobs and financial
resources.
Unsurprising therefore that Lenin’s theory of imperialism has
been very influential especially amongst intellectuals in lesser
developed countries.
Particularly the view that the relationship between capitalabundant nations and capital scarce nations should be one of
interdependence , since each needs the other for maximum
growth.
In practice what often evolves is a relationship of DEPENDENCE,
exploitation and uneven development.The same forces that drive
the bourgeoisie to exploit the workers, ultimately drives the
capitalist core nations to dominate and exploit the less develoepd
countries. ….see section in handout on DEPENDENCY THEORY.
Globalisation…..This new stage is supposed to have
been brought about by a growing internationalisation
of production and marketing. Companies, it is said,
are much more dependent than ever before on their
ability to sell abroad in the face of “global
competition”. They can only do this successfully
insofar as they become multinational corporations,
organising production itself on an international scale,
ignoring national borders. They are then able to
escape any control by national states or by workers’
movements that operate within national boundaries.
They are free to move their capital to wherever labour
is cheapest, thus thwarting workers’ attempts to
defend wages and conditions through trade union
action.
This view of the world today is usually articulated by “neoliberal” proponents of free market capitalism. They insist that
the new global order rules out any attempt to regulate the
system through Keynesianism let alone socialism. Any such
attempt, they claim, can only result in a backward siege
economy, indeed a horrific repeat of Cambodia’s year zero.
But it is not only far reaching change which is ruled out. So are
the mildest reforms – a minimum wage of more than about a
third of the median, any further reduction of the working week,
any attempt to protect jobs against the withering effects of
recession. If workers push their demands too hard, then
companies will simply pack up their bags and move elsewhere.
If governments implement meaningful reforms, then new
investment will simply flow to more profitable parts of the
world. All that can be done is to elaborate policies which will
make any particular group of workers more productive and cost
efficient than those elsewhere in the world, or which enable one
government to outbid others in guaranteeing profitability.
POSSIBLE FEATURES OF IMPERIALISM TODAY
first and most obvious consequence has been the
“third world”-isation of the ex-USSR bloc; countries
where the average mode and standard of living was
different to both the rich oppressor countries and the
poor oppressed nations are now surely being pushed
down into the Third World camp. There is no 'Second
World' any more.
There are qualitative changes within the technical
mode of production which have given capitalism an
apparent vitality, especially in the areas of
communications and IT which also require structural
changes within the working populations both as
producers and consumers of the new commodities.
The elevation of the power of finance capital as a
seemingly independent force. First, despite the
claims of the G7 at the Cologne Summit the
foreign debt is worse every year for the LDC’s .
Between 1987 and 1997 the indebted nations paid
$2,200 billion in repayments, and yet their debt
grew by $900 billion and now stands at $2,500
billion, most of this now to private banks. Secondly,
money capital is moved in and out of Third World
currencies and economies adding a degree of
volatility in the system never before known. The
potential for a local crisis becoming a global
financial crisis has never been more likely than it
is today.
A UNIPOLAR AND DANGEROUS WORLD? The end of Cold
War, imperialist triumph and "unipolarity" ?
USA now exercises un-paralleled military and
economic dominance in conditions where interimperialist rivalry has openly reasserted itself.
Imperialism's assertion of its supposedly unique
"civilised" values is contradicted by the devastation
and civilian casualties arising currently in Iraqsome estimate that as many as 40,000 Iraqis have
been killed since the invasion
On the basis of this self-proclaimed superiority, the
USA claims the right to intervene politically and
militarily in the internal affairs of any country in the
world.
THE WAR IN IRAQ…an OLD FASHIONED SUB-TEXT?
It is believed by many commentators that the immediate
reward for the USA is intended to be a securing of oil supply.
The reserves in the Caspian prospects pale in comparison with
Iraqi oil wealth. Iraq has the world’s second largest reserves (at
present 115 billion barrels, but long-delayed exploration may
take that figure to 220-250 billion barrels).
Moreover, its oil is, along with that of Saudi Arabia, Kuwait
and Iran, by far the cheapest to extract. The US is now quite
openly offering the French and Russians, who had giant
contracts with Saddams regime, which could not be realised
under sanctions, slices of the post-invasion cake in exchange for
a more conciliatory approach in the United Nations security
council .
Control of petroleum resources and pipeline routes is
obviously a central consideration in US strategy
worldwide—
note the long-term installation of US forces from
Afghanistan through Central Asia to the Balkans;
the entry of US troops in the Philippines and the
pressure on Indonesia to involve the US in a
campaign against Islamic fundamentalists in the
region;
the drive for US military intervention in Colombia
and the attempt to oust Chaves in Venezuela.
The US is particularly anxious to install a large
contingent of troops near Saudi Arabia, anticipating
the collapse of, or drastic change in, the regime
there.
Saudi Arabia has the world’s greatest stock of oil wealth.
Indeed the US is contemplating using the invasion of Iraq as the
springboard for a drastic political ‘cleansing’ of the entire
region, along the lines of the process long underway in the
Balkans and continuing in Afghanistan-Pakistan. Indeed it is
even willing to provoke, by its invasion of Iraq, uprisings in
other states of the region, in order to provide it with an
occasion to invade those states. This is not speculation, but has
been explicitly spelled out in various policy documents
authored by or commissioned by those now in charge of the US
military and foreign policy.
Linked to the above is a further, strategic, dimension to the US
designs. Not only is the US increasingly dependent on middle
east oil for its own consumption; Its capture of middle east oil is
also intended to secure its supremacy among imperialist
powers.
The Project for a New American Century made explicit its aims when it
was established in 1997-this conservative “think-tank” wields considerable
influence over the current White House administration…its aims are
explicit in its founding statement
“• we need to increase defence spending significantly if we are to carry out
our global responsibilities today and modernize our armed forces for the
future;
• we need to strengthen our ties to democratic allies and to challenge
regimes hostile to our interests and values;
• we need to promote the cause of political and economic freedom abroad;
• we need to accept responsibility for America's unique role in preserving
and extending an international order friendly to our security, our prosperity,
and our principles.”
Project for a New American Century 1997
But this trajectory of US policy has
created an unprecedented amount of
opposition to US foreign policy.