Plundering and profits: Moving beyond Dependency Theory
By Esteban Mora
October 13, 2018 — Links International Journal of Socialist Renewal reposted from Review of African Political Economy — In the on-going debate on imperialism on roape.net, Walter Daum distorts arguments
that I have made in a response to this debate. In this blogpost I am
going to try to expand on the subject, and at the same time, answer
Daum’s critique. First off, I did not deny in the original blogpost
that there is a draining from South to North, nor that there is any
draining at all between strong and weak countries. I said my view was complementary.
Why complementary? Because in the possible inversion between East Asia
and Triad countries, we should not expect the inversion of draining, but
a mutual profiting with a relatively new positioning between strong and
weak countries in the world market. So, if we understand the market
only by such terms and processes of ‘draining’ where one is a strong
‘draining state’, and the other a weak dependent state, how are we going
to understand this inversion of roles between countries who are both
strong or becoming so, and who also drain others (and even each
other, such as the automobile industry, where East Asia and the Triad
both share production sites and markets with each other)? In addition,
how do we avoid making the mistake of thinking the Triad is going to
become a Third World dependent-republic, as a radical inversion of roles
between North-South? Instead, could it be concluded that there are more
universal and global mechanisms which permit a smoother transition from
one position to the other, and which do not imply a simple reversal of
the Triad’s hegemony, due to the fact that it now shares much of its
characteristics with East Asia?Now, to the three strategies discussed by Daum:1) There is no mention of a hegemon in
any theory of imperialism by Lenin or Bukharin or anybody, nor of any
‘three worlds theory.’ Obviously, I do not reject inequalities and
unevenness in the world market, nor that there are big, strong
nation-states and weaker nation-states (metropolitan and peripheral, if
you want), but this is not based on countries or regions, nor geography
or ethnicity, but on relations of production. This implies ‘sharing’ not
only mechanisms of draining, but also mechanisms of mutual profiting
which forces us to go beyond chauvinism, nationalism, and regionalism,
and see the world market as class divided, between an
international bourgeoise and international proletariat; as an
international system of states where every single state is an agent of
financial capital. Or as Lenin wrote: ‘Relations of this kind have
always existed between big and little states, but in the epoch of
capitalist imperialism they become a general system, they form part of
the sum total of “divide the world” relations and become links in the
chain of operations of world finance capital’ (Lenin, Imperialism, Highest Stage, Chapter Six).2) By ‘relative’ I do not mean the
‘rate’ only, I mean the fact that two absolute amounts of profit can be
the same (as in China and the US, as I cited), or can even be bigger
than the other (as in the examples Daum uses from the same report), and
this does not imply the same purchasing power, the same exchange rate,
nor the same control over the means of production; essentially the same
amount of mass of profits in the US is not worth nor functions in the
same way in East Asia, nor do the absolute amounts of profit equal the
same purchasing power or relationship with constant capital, since raw
materials can be cheaper, jobs low-priced, and capital goods as well,
etc. So, Daum can find in East Asia a smaller mass of profit
than the Triad, but this is not a measure of the rate of profit, nor a
measure of the relationships between this mass and purchasing power, raw
materials, capital goods, etc. It is not only a matter of the
relationship with constant capital, but appropriation of value. In other
words, there could be a bigger appropriation of value in Marxist
terms, where there is a smaller mass of profit (the only way profit
numbers between West and East can be equivalent with each other, is if
any other factor of production involved – constant capital specially –
is also equivalent according to the exchange rate between the two
monetary systems, commonly dollars and any other currency. This is
highly unlikely and forces us to be cautious on the use of absolute
quantities as markers of profit or value, as Smith and Daum argue. This
notion helps us to understand the working of value across different
exchange rates, currencies and the world market, etc. (There is a short
explanation of this process here).Using two amounts of profits plain and
simple, and looking for the biggest one as a mark of profit rates or
purchasing power or the relationship with constant capital, etc, is not
even Ricardian economics. All the defenders of the orthodox view on
economics simply show data where profits are bigger, as if the whole
discussion was the matter of a single amount or a single quantity or
magnitude deciding everything, when it’s a matter of a relationship.3) I do not mean South and North
countries are equivalently profitable, nor that there are no differences
between small and big countries. Rather I argue that besides these
differences in ‘draining’ which permit large countries to exploit small
countries, there is a mechanism (a ‘neo-colonial’ and also
‘dependency-like’ mechanism) which allows for the maintenance of the
international imperialist system, not a radical break or absolute
heterogeneity between ‘draining and drained countries’ that both Smith
expects, and Harvey claims is already occurring.I also said something else that Daum
ignores: why do high-tech industries, industrial production, gross
capital formation and capital goods exports all now come from East Asia
and not the Triad? For this reason, we must move beyond a number or
figure and ask about the relationships at the level of the
world market. Are we going to reduce the whole imperialist debate to who
has higher profits, and do this without understanding profits
relatively but as an absolute mass?Industrial production, gross capital
formation and capital goods exports were characteristics of the Triad
when they were called imperialists. All twentieth century Marxism is
based on this assumption. What are we to say about franchises and all
sorts of export of capitals which occur right now thanks to the
internationalization of the division of labour and the
multinationalization of capitals? Even countries like Costa Rica, in
Central America, has started to ‘drain’ other countries through
franchises, and Guatemala already has its own multinational.Multinationals from the South have all
been developing rapidly in the last 20 years, which ‘drain’ Triad
countries. Is Costa Rica ‘imperialist’ because it drains flows of money
from South America and the rest of Central America? What are we going to
do with these phenomena? Do we instead need to understand every
nation-state as part of imperialism, whether metropolitan or peripheral,
or are we going have to keep dividing up regions (like Three Worlds
Theory) and insist on outdated notions? Also what has happened to the
‘industrial countries’ and ‘agricultural countries’ divide that was so
important for Bukharin and Lenin, yet which does not exist anymore? Are
we going to cling to the past, or look into the rich and real phenomena
occurring in the world market in front of our eyes?This is where I once again insist that
instead of looking for a radical inversion of the world market where
superpowers become dependent countries and vice versa, like some
spectacle in science fiction, we have to start to analyze more complex
processes beyond dividing the world into imperialists and
non-imperialists, or into region 1 and region 2, even when they are
clearly bigger than the others – this is exactly what takes place in
distorted universe of Three World Theory-dependency theory, and other
theories which share this outlook.Draining is more complex, to the point
that it is not only the Triad which is responsible for it. Since, if
‘draining’ is the only characteristic that makes a country imperialist,
then you have a methodological problem of enormous dimensions with every
country from the Caribbean to the Pacific enjoying inflows of value
(‘draining’, in a word). Rather there seems to be an uneven development
in the market, but also a synchronicity – maybe like the one asserted by
Wallerstein, which goes beyond nations and regions, while at the same
time making some bigger than others. Plundering does not always involve
an absolute deterioration for the smaller partner, rather a relative
plundering and mutual profiting moving in multiple directions.
Is this so hard to come to terms with in the actual workings of the
modern world market? In this important debate on imperialism on
roape.net, this is what I propose.Esteban Mora is a researcher in
Communications Science at the Universidad de Costa Rica, he has written
three books on capitalism and Marxism, and writes a Marxist economics blog. He has recently reviewed The History of Business in Africa
by Grietjie Verhoef. Verhoef makes an important historical argument
about the role and agency of African capitalists from the early colonial
period. Mora argues that Verhoef forces us to rethink more orthodox
accounts of the development of capitalism in Africa.
