Empire’s Contradictions, Our Weaknesses: The Empire Stumbles On

Today’s two most conspicuous global flashpoints – the Middle East and Latin America – have widely exposed the fact of U.S. imperialism and highlighted some of its limitations. Adding the apparent cracks in U.S. economic hegemony seems to indicate an empire in decline. Yet a more cautious assessment would recall that the earlier defeat in Vietnam did not derail U.S. global expansion, while the new Vietnam has become a model member of the WTO. It is equally sobering to note that the four largest Latin America economies – Brazil, Mexico, Argentina and Columbia which collectively account for some 80 percent of the continent’s GDP – are, in spite of significant jolts along the way, hardly considering any radical break with capitalism but in fact deepening their integration into global capitalism. As for the U.S. trade deficit and falling dollar this is simply too economistic a measure of imperial strength.

A New Kind of Empire

To assess the status of the U.S. empire, it is useful to first clarify its distinctiveness. Its uniqueness lies in the extent to which particular U.S. interests and capacities merged with the making of a global capitalism – a process that has been deeply uneven and remains incomplete process. Though capitalism has a natural tendency to ‘nestle everywhere, settle everywhere, establish connections everywhere’, this came with a most significant contradiction: the same nation states that developed alongside capitalism and contributed to universalizing the rule of law and markets domestically, tended to act parochially internationally. The result was that even as capitalism became more internationalized in scope, it remained divided by tariffs and spheres of influence into national imperialisms.

The competition within this fragmented capitalism contributed to its international collapse through two world wars and the Great Depression. It was the U.S. state which, in the aftermath of WWII, not only revived the possibility of an internationalized capitalism but – by undermining the material foundations of the old rivalries – also set the stage for the possibility of a truly global capitalism.

In the rich and very influential work of William Appleman Williams it was the crisis at the end of the 19th century, and the exhaustion of opportunities at home, that launched the U.S. abroad and led it to demand of other powers an opening up of their empires. From this perspective, the post-WWII U.S. state was merely continuing its long-standing emphasis on an ‘open door’ for itself. This however misreads the impetus of U.S. expansionism. U.S. corporations looked outward independent of crises and alongside their extension and intensification of inward accumulation. U.S. capital went abroad for the same reason that it moved across the North American continent – the expansive dynamism of U.S. industry and finance saw opportunities, responded to competitive pressures, and made the most of its emerging technological, spatial and administrative capabilities.

Moreover, insisting on open doors was not the same as achieving them. Even though the U.S. was already the world’s dominant industrial power on the eve of WWI, and the world’s largest creditor in the years following that war, it was unable to definitively project its priorities and sense of manifest destiny onto the other capitalist powers. It was only after WWII that the U.S. state was able to effectively penetrate the former imperial states. And it was at that time that the U.S. state also went beyond the particularism of the open door and came to act on behalf of capital everywhere – that is, as the central agent in the making of global capitalism.

That role required a radical shift in the nature of imperial relations. While the earlier era was characterized by the density of north-south linkages, after WWII the densest relationships were dramatically reoriented to ties among the developed capitalist countries themselves. If we think of ‘imperialism’ as the extension of political influence and authority onto other social formations, the U.S. state became a specifically capitalist imperial state by virtue of a particular kind of intervention: encouraging the restructuring of other states to take responsibility, within their territories, for supporting global accumulation. Amongst the developed capitalist countries, the economic success of this internationalization of their states was spectacular.

Latin America

The outcome was however quite different for the vast majority of what came to be called the ‘third world’. A degree of geographic dispersal of foreign direct investment somewhat offset the previous rigid division of global labour, and brought a growing share of third-world manufacturing to selected countries. But the restructuring of third world states was in the main unsuccessful and capitalism provided no general solution to third world development. The failures of the most recent attempts at such restructuring, that associated with neoliberalism, resulted in an
explosion of opposition throughout Latin America, the most dramatic and radical challenge coming from that led by Chavez.

It was, however, not only neoliberalism that couldn’t deliver equitable economic and social development; neither could moderate reforms. Given the extent of Latin America’s integration into and dependence on global capitalism, only radical transformations at home and in international economic relationships had any possibility of achieving sustained social development. But as noted earlier, it is the retreat from these kinds of options that remains the dominant trend amongst Latin America’s largest countries.

Even in Venezuela, where the Chavistas have the special advantages of oil wealth and army support, profound barriers remain to any decisive break from global capitalism. Corruption and clientalism continue to characterize the Venezuelan state; the impressive mobilizations within the barrios have not yet led to the kind of horizontal links across them that promise new kinds of democratic control from below; the informal sector remains pervasive; unions remain divided not only organizationally but also in their visions of ‘worker-control’; the formation of a genuinely democratic political party to address these and other questions of revolution remains problematic; and the power of the Venezuelan bourgeoisie is far from overcome. Chavez’s victory, with the inspiration it brings and crucial spaces it opens throughout Latin America, is certainly an irritating thorn in the U.S. imperial body. But that imperial discomfort does not yet amount to a threat to the empire itself.

The Middle East

In the Middle East, the making of global capitalism has focussed on creating a degree of stability sufficient to ensure capitalism its steady transfusions of oil. The central issue in the invasion of Iraq wasn’t access to oil since all these regimes were anxious to sell their oil. Nor was it the geopolitics of privileged access for the U.S., since the U.S. state saw itself precisely as guaranteeing general access. Rather, as Tom O’Donnell has convincingly argued, the concern was that future oil demands necessitated massive foreign investments in Iraq and this risked an enormous increase in the regional power of Saddam Hussein and a potential challenge to Western hegemony (‘The political economy of the U.S.-Iran crisis: Oil hegemony, not nukes, is the real
issue’ Z-Net, June, 2006). Though this particular outcome was in fact blocked, Iraq nevertheless came to represent a greater defeat than Vietnam.

As the editors of Socialist Register have pointed out, while Vietnam was ‘an exercise in mopping up after an old imperial power, and containing the spread of Communism…Iraq was to be the first installment of the Project for a New American Century…the goal being to remake the country and incorporate it into the American empire’ (preface to Socialist Register 2008: Global Flashpoints). The reality of how difficult it is to restructure other states and societies so they ‘fit’, especially through armed intervention, has led to a striking decline in U.S. imperial legitimacy and military credibility – one which will no doubt reinforce those allies and internal U.S. forces counselling prudence in other potential interventions. Yet there is no reason to assume it will spur further adventurism on the part of other countries such as Iran (which has its own reasons for moderation and seeking some accommodation), or that it will precipitously interrupt U.S. access to oil, or (as the run-up to the U.S. election makes clear) lead to any fundamental reconsideration of U.S. global policy and interventions. The empire has stumbled, but the making of global capitalism moves on.


What then of the constant aura of imminent crisis and the alleged economic decline of the most basic foundation of the U.S. empire: its economic strength? Recurring crises within the U.S. empire are systemic because a) the empire of necessity operates through other states, each of which reflects a specific balance of class forces; and b) in the present phase of capitalist development discipline and integration is heavily reliant on financial markets which, as we repeatedly witness, are inherently extremely volatile. But though the U.S. state cannot prevent crises, it has developed an impressive capacity to contain the depth, duration and reach of these crises.

That capacity includes: administrative capacities developed over time (including those which, as Greg Grandin has shown, were built up through interventions in Latin America); formal and informal coordination through international bodies; links across central banks; and the reach provided by the embeddedness in the state of U.S. productive and financial capital (Empire’s Workshop: Latin America, the United States, and the Rise of the New Imperialism, New York: Metropolitan Books, 2006). As well, the fading of the old inter-imperial rivalries has further eased barriers to the crisis-containment capacities of the U.S. state – the very process by which Europe and Japan narrowed their economic gap with the U.S. included their endorsation and de facto reproduction of U.S. leadership. Above all, that capacity is reinforced by the consolidation of class power within the U.S.. The defeat of the left over the past three decades, especially the crushing of the U.S. labour movement, provides U.S. capital and the U.S. imperial state with critical degrees of political space and flexibility in containing the economic crises that inexorably occur.

In this context, trade deficits, a falling dollar, and periodic financial turbulence – even those which cause a great deal of nervousness on Wall Street – are relevant economic facts. But they say little about the continuing resiliency of the U.S. as an empire. It might in fact be said that the U.S. empire is more powerful today than it was at the end of WWII. In contrast to the limited opportunities immediately after the war, the accumulation potentials of U.S. capital now extend not only into a prosperous Europe, but also into the former Soviet Union, Eastern Europe, SE Asia, India and of course China. As well, while the U.S. earlier bore the burden of sharing its surplus with Europe through the Marshall Plan, today it is the U.S. which has access to what seems like a bottomless pool of global savings. And, again, the general weakness of oppositional forces today contrasts to the depth of radical movements that posed a challenge to capitalism at the end of World War Two. Add to this the continuing U.S. leadership in the highest tech sectors; the remarkable expansion of U.S. FDI which overwhelms trade imbalances; and the dominant U.S. international role in finance, accounting, law and consulting – and it is clear that the material foundations for U.S. imperial leadership remain gloomily solid.

The politics that looks to projections of imminent economic collapse of the U.S. as overcoming the prevalent fatalism is ultimately self-defeating. It not only undermines left credibility as the forecasts prove false, but a deep economic crisis is as likely to lead to an even further loss of working-class confidence and, in the absence of an effective left, a vulnerability to the siren call of a return to the ‘better’ capitalism of yesterday. The critical narrative of our times is therefore not the coming decline of empire but the de facto weakness of the left.


Neoliberalism’s downgrading of the structures of legitimation within the developed countries might suggest optimism of a new opposition that could also create greater space for, and support of, third world struggles. Yet, while neoliberalism has certainly led to multiple bases for potential resistance, it has also contributed to limiting those openings. Growing inequalities amongst workers fragment the working class; accelerated restructuring destroys not only specific jobs but the social communities that sustained resistance; forced immigration from devastated economies may bring radical ideas but also includes a desire for family mobility within the system; the individualization of the channels for accessing consumption – longer hours, greater debt and tax cuts – further atrophy collective capacities for struggle. The challenge, therefore, is not to find false hope in economic declinism and crises. Rather, it is to use the myriad of openings to win people over to the realization that even when it is functioning ‘well’, global capitalism has become the pivotal barrier to human development and, perhaps, even the survival of the planet. •

Sam Gindin was research director of the Canadian Auto Workers from 1974–2000. He is co-author (with Leo Panitch) of The Making of Global Capitalism (Verso), and co-author with Leo Panitch and Steve Maher of The Socialist Challenge Today, the expanded and updated American edition (Haymarket).