Tagged: Third World

Selected Readings from José Carlos Mariátegui

In this pdf, you will find the readings Prologue to Tempest in the Andes, The Indigenous Question in Latin America, The Latin American Socialist Revolution, and The Anti-Imperialist Point of View by José Carlos Mariátegui. They were retrieved from an anthology titled Marxism in Latin America 1909 to the Present edited by Michael Lowy. Click here to download the pdf file

José Carlos Mariátegui La Chira (14 June 1894 – 16 April 1930) was a Peruvian journalist, political philosopher, and activist. A prolific writer before his early death at age 35, he is considered one of the most influential Latin American socialists of the 20th century. Mariátegui’s most famous work, Seven Interpretive Essays on Peruvian Reality (1928), is still widely read in South America. An avowed, self-taught Marxist, he insisted that a socialist revolution should evolve organically in Latin America on the basis of local conditions and practices, not the result of mechanically applying a European formula.” (Wikipedia)

Read a full biographical note on Mariátegui here. 

The World Seen from the South By Samir Amin and Irene León

I would like to focus this interview on three distinct but related questions: your vision of the world and the possibilities of changing it; your conceptual and political proposal on the implosion of capitalism and delinking from it; your analysis of the global context, seen especially from Africa and the Middle East. What is your vision of the world, seen from the South and from the perspective of the South?

To respond to this question, which isn’t a simple one at all, it is necessary to divide the theme in three parts. First of all, let’s examine: What are the important, decisive characteristics of contemporary capitalism — not of capitalism in general, but of contemporary capitalism? What’s really new about it? What characterizes it? Secondly, let’s focus on the nature of the current crisis, which is more than just a crisis — I define it as an implosion of the contemporary capitalist system. Thirdly, in this very framework, let’s analyze: What are the strategies of the dominant reactionary forces, that is, of dominant capital, of the imperialist triad of the United States-Europe-Japan and their reactionary allies in the entire world?  Only having understood this can we size up the challenge that the peoples of the South, in the emerging countries as well as the rest of the South, confront.

My thesis on the nature of the contemporary capitalist system — which more modestly I will call “hypothesis” for it’s open to discussion — is that we have entered in a new phase of monopoly capitalism. It’s a qualitatively new stage, given the degree of concentration of capital, now condensed to the point that today monopoly capital controls everything.

To be sure, the concept of “monopoly capital” is not new. It was minted at the end of the 19th century and developed as such, through successive distinct phases, during the 20th century; but, beginning in the 1970s-80s, a qualitatively new stage emerged. Before that, it existed but did not control everything. In reality, there is now no capitalist economic activity that is autonomous or independent of monopoly capitalism — it controls each and every one of the capitalist economic activities, even those that preserve an appearance of autonomy. An example, one among many, is agriculture in developed capitalist countries, where it is controlled by monopolies that provide inputs, selected seeds, pesticides, credits, and marketing chains.

This is decisive — it is a qualitative change which I call “generalized monopoly,” that is, monopoly that is extended over all spheres. This characteristic entails substantive and significant consequences. In the first place, bourgeois democracy has been completely nullified: if it was once based on a left-right opposition — which corresponded to social alliances, more or less proletarian, more or less bourgeois, but differentiated by their conceptions of political economy — now, for example, Republicans and Democrats in the United States, or the Hollande current of socialists and the Sarkozy current of rightists in France, are the same, or just about the same. In other words, all of them are united on a consensus commanded by monopoly capital.

This first consequence constitutes a change in political life. Democracy, thus nullified, has turned into a farce, as is seen in electoral primaries in the United States. Generalized monopoly capital has very serious consequences.  It has turned the United States into a nation of “fools.”  It’s serious because democracy has no way of expressing itself any longer.

The second consequence is that “generalized capitalism” is the objective basis of the emergence of what I call “collective imperialism” of the US-Europe-Japan triad. It is a point that I strongly emphasize, since, though it is still a hypothesis, I can defend it: there are no major contradictions among the United States, Europe, and Japan. There is a little competition on the economic level, but on the political level the alignment with the policies defined by the United States as what the world’s policy should be is immediate. What we call the “international community” copies the discourse of the United States: in three minutes there appear European ambassadors with some extras, great democrats such as the Emir of Qatar and the King of Saudi Arabia. The United Nations doesn’t exist — its representation of states is a caricature.

It is this fundamental transformation, the transition of monopoly capitalism to “generalized monopoly capitalism,” which explains financialization, for these generalized monopolies are capable — owing to the control that they exercise over all economic activities — of suck up a bigger and bigger part of surplus value produced in the entire world and converting it into the monopolist launching pad, the imperialist launching pad, which is the cause of inequality and growth stagnation in the countries of the North, including the US-Europe-Japan triad.

That leads me to the second point: it is this system that is in crisis. Or rather it is not just a crisis — it is an implosion, in the sense that this system is incapable of reproducing itself from its own foundations, in other words, it is a victim of its own internal contradictions.

This system is imploding, not because it is being attacked by people, but because of its own success. Its success, having managed to impose itself on people, has led it to cause a vertiginous growth of inequalities, which is not only socially scandalous but unacceptable and yet ends up being accepted, accepted without objection. However, that’s not the cause of the implosion, but the fact that it cannot reproduce itself from its own foundations.

That leads me to the third dimension, which has to do with the strategy of the dominant reactionary forces. When I say the dominant reactionary forces, I refer to generalized monopoly capital of the historical imperialist triad of the United States-Europe-Japan, joined by all the reactionaries forces around the world, which are grouped, in one form or another, in local hegemonic blocs that sustain and are part of this reactionary global domination. These reactionary local forces are extremely numerous and enormously different from one country to another.

The political strategy of the dominant forces — that is, generalized, financialized monopoly capital of the historical, traditional collective imperialist triad, the United States-Europe-Japan — is defined by its identification of enemies. For them, the enemies are emerging countries — in other words, China. The rest, like India, Brazil, and others, are for them semi-emerging.

Why China?  Because the Chinese ruling class has a project. I am not going to get into details about whether this project is socialist or capitalist. What is important is that it has a project. Its project consists of not accepting the diktats of generalized, financialized monopoly capital of the triad, which imposes itself through its advantages: control of technology; control of access to natural resources of the planet; control of mass media, propaganda, etc.; control of the integrated global monetary and financial system; control of weapons of mass destruction. China has come to challenge this order, without making any noise.

China is no mere subcontractor. There are sectors in China that function as subcontractors, as makers and sellers of cheap toys of poor quality, only because the Chinese need to get their hands on foreign exchange, and subcontracting is an easy means to do so. But that is not what China is all about. What characterizes China is its development and rapid absorption of high technology, its own development and reproduction. China is no mere workshop of the world as is claimed by some. It is not “Made in China” but “Made by China.”  This is now possible only because they made a revolution: socialism paradoxically built the path that made it possible to practice a certain kind of capitalism.

I would say that, next to China, the rest of the emerging countries are secondary. If I had to grade them, I’d say that China is 100% emerging, Brazil is 30%, and the rest are 20%. The other emerging countries, in comparison to China, are subcontractors: they do major subcontracting business because there is a margin of negotiation, due to conformity between generalized, financialized monopoly capital of the triad and emerging countries like India, Brazil, and so on. Not so with China.

That is why a war against China has come to be part of the strategy of the triad. 20 years ago there were already crazy Americans who advocated the idea of declaring war on China before it would be too late.

The Chinese have been successful, which is why their foreign policy is so peaceful. Now, here comes Russia to join the Chinese in the category of truly emerging countries. We see Putin proposing the modernization of the Russian armed forces, planning to remake the Soviet-era navy, which once constituted real counterweight to the military power of the United States. This is important. Here I’m not talking about whether or not Putin is a democrat, or whether or not his perspective is socialist; it’s not about that, but about the possibility of countering the power of the triad.

The rest of the world, the rest of the South, all of us — you the Ecuadorans, we the Egyptians, and many others — do not count. Our countries interest collective monopoly capitalism for the one and only one reason, access to our natural resources, because this monopoly capital cannot reproduce itself without controlling, wasting, the natural resources of the entire planet. This is the only thing that interests monopoly capital.

To guarantee exclusive access to natural resources, imperialists must ensure that our countries will not develop. Hence “lumpen-development,” as was defined by Andre Gunder Frank. Frank discussed it in much different circumstances, but I borrow the term here to apply it in new circumstances, to describe how the only project that imperialism has for us is non-development. Development of anomaly — oil-rich pauperization, fake growth fuelled by gas, timber, or whatever, in order to obtain access to natural resources — that is what is about to implode because it has become morally intolerable. People no longer accept it.

Hence the implosions. The first waves of implosions originated in Latin America, and it’s no accident that they happened in marginal countries like Bolivia, Ecuador, and Venezuela. It’s no accident. Then, the Arab Spring. We’ll see other waves in Nepal and other countries for it’s not something that would happen only in a particular region.

For the people who are the protagonists of this, the challenge is enormous. That is to say, the challenge cannot be contained within the framework of this system, within an attempt to transcend neoliberalism to achieve capitalism with a human face, to enter into the logic of good governance, poverty reduction, democratization of political life, etc., because all those are modes of managing pauperization which is the result of this very logic.

My conclusion — from the position mainly focused on the Arab world — is that this is not just a conjuncture but rather a historic moment, a great moment for people. I’m talking about revolution. Though I don’t want to abuse this term, there are objective conditions for building broad alternative, anti-capitalist social blocs. There is a context for audacity, to propose a radical path.

The false promise of capitalist development: Singapore’s inequality battle

A more recent article with more information on inequality in Singapore. Sustaining the argument that most Third world countries who intend to achieve development through the market system will eventually hit a wall.The optimal alternative to underdevelopment is socialist development.

Singapore’s inequality battle
New Mandala/Australian National University
December 23rd, 2011 by Elvin Ong

There have been growing concerns over rising income inequality in Singapore in the last decade. Based solely on income from work per household member, Singapore’s Gini coefficient has increased from 0.433 in 2000 to 0.465 in 2010. After accounting for government transfers and taxes, it has increased from 0.425 in 2000 to 0.446 in 2010. If returns from investment assets are taken into account, the Gini coefficient is likely to be much higher, as the rich are more likely to have surplus assets that they can invest for returns.

In contrast, the rest of Southeast Asia has similar or less inequality (as measured by the Gini coefficient) as compared to Singapore. According to the CIA World Factbook, Indonesia’s Gini coefficient is at 0.368, Philippines is at 0.458, Malaysia is at 0.462, and Vietnam is at 0.376. Only Thailand has a remarkably higher Gini coefficient at 0.536.

Recent academic work has suggested that high inequality within countries is highly correlated with a whole host of social ills. In the book “The Spirit Level: Why More Equal Societies Almost Always Do Better”, Richard Wilkinson and Kate Pickett argue that high income inequality, rather than low average per capita income, is correlated with social ills such as crime, obesity, teen pregnancy, mental health, and drug addiction.

In Singapore’s case, although social ills are an increasing concern, they are less of a concern than the prospect of a permanent stratification of broader classes in society. Between 2001 and 2011, real incomes for the 20th percentile of the population saw no increase at all, whilst real median incomes only saw an increase of 11%. When placed alongside the statistic of increasing gini coefficient, this means that the rich are getting richer at a much faster pace than the rest of society. In addition, there are also concerns that social mobility has declined, with the less well off trapped in a cycle of poverty.

How should the Singapore government respond to this increasing income inequality?

On the one hand, government rhetoric has been clear and unambiguous. They acknowledge the problem and recognize that there needs to be increased social welfare provision, but abhor the creation of a welfare state such as in the Scandinavian, Japanese, or Australian models. For these government purists, Singapore, as a small country with no natural resources, needs to maintain financial prudence. The nightmare scenario is that increased social welfare provision, coupled with higher taxes to pay for these benefits, will kill the competitive work ethic of the population, make people lazy, and result in a downward spiral of the free-market competitiveness of the Singaporean economy in a globalized world. They point to the debt-ridden countries of Southern Europe and America as examples of this scenario. Most recently, Sim Ann (President’s Scholar, former career senior civil servant and the ruling People’s Action Party (PAP) Member of Parliament) reiterated such a view in a newspaper commentary.[1]

On the other hand, some current and former senior civil servants have been quick to point out the crisis of inequality in Singapore, and strongly urge the government to chart a different course with respect to social welfare provision. Donald Low (former Director at the Ministry of Finance and Civil Service College) and Yeoh Lam Keong (currently Managing Director at the Government Investment Corporation of Singapore) co-wrote a commentary that was also published in the local papers, arguing that a much broader and inclusive social welfare provision strategy should be adopted, rather than targeted benefits for the poor.[2] They point to the success of generous government subsidies in the early years of Singapore’s industrial development, such as mass public housing and almost-free mass primary and secondary education.

These ongoing public debates about the level, type and form of social welfare policy should definitely be encouraged and are unlikely to die down any time soon. Yet one wonders whether these debates miss the point. Rather than debate about policy, the real debate could be about politics instead.

There is a significant agreement amongst political economists who study inequality, most notably the late Michael Wallerstein, that two key factors affect cross-country income inequality – first, the institutionalization and level of collective wage bargaining unions; and second, the role and presence of Left parties in competitive democratic governance. On these two issues, the Singapore story is simple: our unions are crippled due to their inability to strike and their close (some say subordinate) relationship with the ruling PAP; and, Left parties have little ideological traction and salience amongst the population, and are uncompetitive in elections organized under biased electoral rules.

The primacy of politics means that politics often has far-ranging social and economic consequences. At the risk of sounding overly pessimistic, the outlook for the still-authoritarian Singapore on the inequality front strongly suggests business-as-usual continuity rather than hopeful change.

[1] https://www.facebook.com/notes/sim-ann-沈颖/tackling-inequality-charting-our-own-path/285475898170435

[2] https://www.facebook.com/note.php?note_id=305534386147209

The false promise of capitalist development: Singapore’s economic boom widens income gap

This article is a few years old, but it illustrates in a nut shell the false promise of capitalist development. Most Third world countries who intend to achieve development through the market system will eventually hit a wall.The optimal alternative to underdevelopment is socialist development.

Singapore’s economic boom widens income gap
By Melanie Lee

(Reuters) – Carol John, 27, doesn’t own a bed. Every night she sleeps on thin mattresses which she shares with her three young children. Outside her one-room flat, a smell of sewage lingers in the common corridor.

Just a few kilometers away, on Singapore’s Sentosa island, Madhupati Singhania relaxes on his $435,000 yacht berthed at the city-state’s swanky One 15 Marina Club.

Income inequality is nothing new in free-market Singapore, but two years of blistering economic growth and a government policy of attracting wealthy expatriates have created a new class of super-rich, while a string of price increases for everything from bread to bus fares have made life harder for the poor.

“I can’t save anything, it’s so difficult for me,” John told Reuters. John, who is unemployed, relies on her husband’s S$600 (US$420) monthly salary and a S$100 government handout.

“We don’t benefit at all from the economy. As far as I know, my husband’s pay hasn’t gone up,” she said.

Singapore’s economy is firing on all cylinders, with a booming construction sector, record tourist arrivals and a fast-growing financial sector all contributing to a gross domestic product set to grow nearly 8 percent in 2007.

But the rising tide is not lifting every boat.

The proportion of Singapore residents earning less than S$1,000 ($690) a month rose to 18 percent last year, from 16 percent in 2002, central bank data released late last month show.

At the same time, the proportion of those earning S$8,000 and above rose from 4.7 percent to 6 percent in the same period.

“When a country becomes richer, you tend to see a widening of income inequality. Over the last few years it has been worse,” said econometrics professor Anthony Tay at SMU university.

Despite sporting a first-world GDP per capita of $29,000 — second only to Japan in Asia — Singapore has an income inequality profile more in line with third-world countries.

Singapore’s Gini coefficient, a measure of income inequality, has worsened from 42.5 in 1998 to 47.2 in 2006, and is now in league with the Philippines (46.1) and Guatemala (48.3), and worse than China (44.7), data from Singapore’s Household Survey and the World Bank show.

Other wealthy Asian nations such as Japan, Korea and Taiwan have more European-style Ginis of 24.9, 31.6 and 32.6.


CIMB-GK Research economist Song Seng Wun believes that growth itself partly explains the widening income gap.

“In an environment where growth is huge, there are lots of opportunities for risk takers, and inevitably, you will get this widening (of the income gap),” he said, adding that those in stable jobs will also benefit, but to a lesser extent.

Opportunity is what attracted Singhania to Singapore. He intends to buy a new 47-foot yacht for $1.3 million.

“You’ve got everything you want in Singapore. You want to buy a fast car, you want to buy a big boat, you want to buy an aeroplane, whatever you need, you can get in this country.”

Singhania, who runs a business consultancy firm, was originally from Mumbai but decided to move to Singapore and become a Singapore citizen, citing its first-world comforts.

The Asian Development Bank blames the widening income gap in Singapore and many other Asia countries partly on globalization, which it said favors the well-educated, and recommended policies to create more equal opportunities and wealth.

Singapore’s government has made the reduction of the income gap a priority, but argues welfare should not be a crutch, and rules out unemployment benefits or a minimum wage.

While the ruling People’s Action Party is in no danger of losing its stranglehold on parliament, the growing income disparity has hurt its credibility.

“There is definitely envy, but this is not enough for civil disturbance,” said sociologist Ho Kong Chong at NUS university.

“These emotions of despair and desperation are missing in Singapore because of the government’s housing policy and transfer payments,” Ho said.

Singapore’s extensive housing program provides owner-financed flats in government-built blocks and the state also provides modest income supplements to those in low-income jobs, although there are no unemployment benefits.

Carol John, who left school when she was 15, does not know much about support schemes. “In the years to come, I’ll just leave it in God’s hands, whatever he gives me, I’ll take it.”

($1=1.448 Singapore Dollar), ($1=.6894 Euro)