Translation of a talk by editor of GegenStandpunkt on “99 zu EINS” (You Tube) on December 13, 2022. This continues from What is the Ukraine war all about?
The peaceful world order:
A system of imperialist domination
At first glance, the war in Ukraine is not about economics. It is an indirect war between the USA and Russia. And they say this themselves: Russia says it is opposing the West’s entire military power. And the West says it must punish Russia because Russia has broken the peace order, the Pax Americana, and is violating the United Nations Charter, even when they say they won’t negotiate with the Russians without the Ukrainians being at the table; or when they say they don’t want to tell the Ukrainians when the war should end and what the Ukrainians should settle for as an outcome – even when they say this, they are actually giving the opposite message under their breath: it is they, the USA, NATO and the EU who will decide how long Ukraine can fight and how much it can achieve. Ukraine’s ability to assert itself depends entirely on their weapons. It is a proxy war.
Russia has watched NATO advance into Eastern Europe, and does not want Ukraine to be the keystone of this progressive deterrence that NATO is pursuing there. Russia sees itself not just hindered in its ability to act as an autonomous world power in its own right, to engage in world politics with its weapons, but threatened with losing that status. And Russia is standing up to the final keystone of this encirclement, to Ukraine, saying: No more. First of all, I am fighting for the respect of the West, and if I don’t get it, then I want at least the barrier zone of Ukraine so that NATO’s deterrence can’t be so easily and so completely effective against Russia.
However, deterrence itself is nothing noble. If they talk about a peace order in the West and say that they are securing the world peace order through deterrence, then the NATO countries assume conflict between states; otherwise, they wouldn’t need to be deterred and they would get along. In this conflict, the West is trying to surround the other side with weapons and the ability to wage war so that if the other side takes up arms, it means defeat is certain even before war. That then will prevent war. This is the whole idea of deterrence, and this idea has failed: Russia has in fact not been deterred.
But the peculiar thing about this war, and the Russians really are denying this, is that this war is somehow being waged over the economic order or has to do with the economic order. The Russians, who have been converted to capitalism for thirty years, are themselves part of the economic order and haven’t criticized anything essential about it, at least before the war. They do what all capitalist states do: they rely on the dependability of contracts, they use foreign money, they put their own money in foreign hands, and they respect foreign property. Long into the war, they are still contractually honoring their supply contracts for energy and raw materials.
There’s only one thing they do not want: subordination to America. That is out of the question for Russia. Submission to the rules of the world economy: They have no problem with that. But submission to the power that sets and enforces the rules of the world economy, that ensures their validity, this is out of the question for the great Russia. There are statements like: Russia can only deal with others on an equal footing and can’t become a vassal of the Anglo-Saxons. That’s how they talk. So what is the stance? The stance is actually: Subordination to the rules of the world economy, to the principles of the capitalist world market, is not a problem for the Russians. However, subordination to the supremacy of the USA is out of the question. The Russians do not say this literally, but the idea is: It must be possible to separate the two: We are happy to obey the rules of the world market, but we will not submit to the dominance of the USA. That is a peculiar stance. What does “peculiar” mean? At least, it is a stance that must first be acknowledged: We bow to the world economy and its principles, ultimately in our own interests. We do not bow to the power that ensures all this.
The West is now confronting this and saying one thing above all: The Russians have broken the peace order and are thus not only a threat, but actually destroying what our rule-based world order is and needs. And that is what we survive on. The Western states basically have exactly the opposite point of view as the Russians. They say that the world economy and subordination to our ban on the use of force can’t be separated at all. The Russians are fighting to keep them separate, and the West insists that they can’t be separated, that they are one and the same: Peace order and subordination to our world economy are the same thing.
A short digression at this point: The eternal word peace order has the good ring: Yes, yes, here the states deal with each other civilly, they do not attack each other, there is no war. It’s no mystery, even to a humanity that has not been educated in Marxism, that peace is the same as enforced violence. All you have to do is attach a national attribute to peace and everyone knows that this is the same as world domination: e.g. if I say Pax Americana or, if you read history books, Pax Romana, then everyone knows: Pax Romana was the Roman Empire. Peace between sovereign states is the same as enforced domination by one state or one bloc of states over others. And they insist on this equation in the West, starting with the USA. The USA insists directly on two things: This world order and world economic order is our interest. And this equation – this is its attractiveness – can be read forwards and backwards, and the ambiguity of this order becomes somewhat recognizable.
On the one hand, you can interpret this ambiguity as: Our interest is this order. All our national interests are subsumed in this order, contained in it. But the reverse is also true: the whole system is only worth as much as it serves American interests, the egoism of the USA. So ambiguity means first of all: It is a set of rules that applies to everyone, in which US interests are nullified. But on the other hand, the entire set of rules is also constantly subject to scrutiny and is only worth as much as it serves American interests.
What does this world economic order look like now? The world economic order, in a very first, perhaps abstract step, coincides with the peace order, namely with the prohibition of violence which the USA and the NATO states impose on the rest of the world. There must be no autonomously effective violence alongside theirs. This means, conversely, that in their dealings with each other, in their use of each other as sources of their own wealth, that is, in their cross-border business dealings, the states must limit themselves to the use of economic means and levers. What they are not allowed to do is: make other states subservient to them by force. They are allowed to buy and sell, they are allowed to invest in a foreign country, they are also allowed to make the foreign country usable through credit, but they are not allowed to override its national ways. This is the nature of peace, and at the same time it is also an imperative: If you want to use other nations – of course, everyone wants to do that, every state makes the other a means of its enrichment, its growth – then you must do it through economic competition. You must use the others by making them attractive business offers. You can do that only through domestic activities. Nations enrich each other through the potent exploitation of their national labor power. And they are referred to this in the first instance when they make other nations serve them. They must offer them attractive commodities, they must offer them attractive, profitable investment opportunities on their territory. In this and no other way, states are allowed to enrich themselves from foreign states, but they should also do so.
First of all, a ban on the use of force means that every use of force by a state on this earth is subject to an American assessment. And it is an American judgment whether the result is that this is a contribution to stability on the globe, namely if it cuts rogue states down to size. Or whether the result is an attack on the world order, because its supporters have their rights curtailed. That’s why there’s a whole series of wars that the Americans just let run their course; let’s say the one that’s going on in Ethiopia right now. They don’t care about that one. But they don’t mind the Saudis waging war in Yemen against insurgents there who are supported by Iran. Then the Americans are ok with it because these Iranian-backed people who want to create their own state are being downgraded. And then there are the wars where it becomes borderline: America, for example, is critical of Turkish warfare in Iraq, and has been all along; in Syria, it is undecided, sometimes one way, sometimes another. and in general the Americans are no longer happy with the Turkish deployment. So there is also the question: How far do they go? Is it enough to prevent them from having access to modern weapons, is that disciplining enough? In any case, there is no war that is not subject to this American judgment. And, by and large, it can be said that since 1945 there have been no wars between the major capitalist states until now. Which, since 1990, includes Russia and China. So far, the ban on violence has worked.
All states are capitalist today. They participate in the world market in their own interest and do not have to be forced to do so at all. Perhaps it is worth remembering that this state of affairs is also the doing of the USA. After all, it took forty years for a third of the earth to be virtually converted to capitalism. And attempts at an alternative have been given up since defeat in the Cold War. So the condition in which all states want to operate capitalistically and use the world market is itself the doing of the USA. What produced this state of affairs? A hot world war was won against Hitler’s Germany and Japan, a cold world war was won against the Soviet Union and its block, and a whole series of smaller wars in Africa, South America, and Asia (Korea, Vietnam) above all produced this state of affairs. That’s one side.
The other side is the world order with open markets as we see it now. This world order is not simply capitalism in general, nor is it a world market in general. Because the world market can look very different: Before World War I, there was a world market that was different from today. Between the two world wars there was a world market that was also different from today. The current world market, which could be described as open markets and free competition, is what the Americans have brought into the world since 1945 and didn’t exist before. And that places special demands on countries, including impositions for their national egoism, which are not simply identical with what they want anyway.
Is this harmless compared to colonialism? It might seem harmless because – and this is true – this world order does not prohibit the egoism that is sacred to nations. But that is what colonialism does: something like a mother country slams other states shut and denies them a national self-interest. No, the national egoism of the countries is not forbidden, but only pointed toward a certain path. It is instrumentalized in that sense, and it is very important to see how national egoism is instrumentalized: Namely, with open markets. There is one thing that is ruled out: That trade is politicized by the countries that pursue it. “Politicized” means: one trades with friendly countries and privileges this in comparison with others with whom one does not exchange commodities or only exchanges certain commodities. One levies tariffs against one and not against the other. The political organization of cross-border trade is such that the nation secures its economic benefit. This political organization is excluded for the first time by the basic principle of the modern world economy. And the basic principle is: most favored nation treatment. Namely, customs and trade privileges that you grant to one country have to be granted to every other country. And that means: if you practice free trade somewhere, you have to do it with everyone. And that is what really unleashes competition, the economic power of competitors.
This brings us to the first point that characterizes this world economic order, namely the regulation of free trade. And here it is clear: If free trade prevails, i.e. borders are open and foreign business can compete with national business on the same terms or essentially the same terms, then it is clear that the nations in which capital has always been at home, which already have a lot of accumulation behind them, which therefore have concentrated technological progress with themselves, that these nations, which are capitalistically more productive, of course always have the competitive advantage over nations that still don’t have much capital, which are lagging behind, and are not so productive. The trade rules alone – and this is what we have to pay attention to now – are the special feature of the whole story. Rules that are the same for everyone, rules that, as rules, do not privilege anyone, ensure the reliable success of some and the reliable failure of others. Because of this, they put free competition, the free comparison of capital productivity, on the agenda, or demand it. For some, this means that they can appropriate the purchasing power in the less competitive countries and use it as a means of growth. Conversely, of course, they leave the other, less competitive countries little opportunity for capital growth and competitive success. Rather, these countries are by and large relegated to nothing more than means of exploitation that cost nothing. Because in it does not require huge technological investments to make labor more productive. For the entire Third World, this means exploitation. And the national wealth that the states there want is based quite openly and directly on paying the workers less and less, on more and more working days, on less and less free time, and increasingly unbearable working conditions. Or these countries find natural resources or metals on their own territory or produce agricultural products which grow there and only there. And then they use an accidental, natural monopoly to sell something that is worth money elsewhere. But these are the losing nations, thrown back on these means of wealth.
The organization of the world market is such that there are systematic losers and systematic winners in the competition. It is not simply losing and winning in a back-and-forth, but the whole set-up. It makes the countries with the lower competitiveness into instruments of the wealth of the others. And that’s something that’s permanent, not something that turns out one way and the other.
It’s also not quite true that the competition is always completely free. Of course, every country makes an effort, especially when it is dissatisfied with the results of the competition – and that’s basically everyone, even the successful countries can always imagine being much more successful – to make their own national business more competitive against the rest of the world or to protect it against the superior competition from outside by means of their political sovereignty, their power. This can be done with tariffs and subsidies, and this means all kinds of countries are constantly trying to correct the trade rules. Now, however, the situation is as follows – keyword: ban on the use of force: The states are referred to the civil way to change rules of competition which they think are disadvantaging them in relation to their business partners. Not their private business partners, but the nations that set the rules on the other side in order to negotiate better conditions for themselves. And when one state then tries to influence the other to agree to rule changes, the beautiful circle sets in that those who have always been ahead also reliably prevail in reforming the rules as well. Because they have already made the others dependent on their money, their credit, and their markets. And this then leads to the fact that the attempt to correct the terms of trade in favor of the losers actually leads more and more to the opposite: to ever greater dependence on these terms of trade. In this respect, the system also has its continuity and necessity.
The first point that we’ve discussed, the rules of trade and free trade, that’s just the basis. Yes, it’s about success on the world market through buying and selling. It’s about who collects the money and where it ends up. That’s important. But point two: credit, and point three: the national money, the currencies, these points make this system of domination really watertight.
Let’s start with credit. Here too we have something very general. All capitalist states and all private capitals operate with credit. No capitalist in the world waits for the money he has invested to flow back to a business with profit and only invests again when the money is there again. Everyone anticipates this: gets a loan and invests using other people’s money, that is, invests with the debts he takes on. With his debts, he anticipates, so to speak, the success he is striving for and immediately procures the means with which he is striving for it. The end effect is, of course, that he must be successful. If he isn’t successful, then the capitalist is broke. He has taken on debts, has to pay interest on them, and can’t service them. Then he is out of the game and expropriated.
This is where states now differ, and this brings us back to the previous point about trade successes and failures. In the countries that are generally competitively superior, that have the greater capitalist productivity, credit also proves its worth by and large. This means: the invested debts are then “healed” by the fact that success follows, the interest can be paid, and the principal sum can also be repaid. The rule is that such countries are then creditworthy and can borrow more and more. In states that underperform in the competition, loans fail more often; that also means: because accumulation there is not as advanced as in the advanced states. In these countries, the credit system is weaker. In other words: they can’t make as many new loans out of loans granted in the past.
It’s not just that the private capitalist does not wait for the money he invested to return. The bank doesn’t wait for that either. The bank that let him take out the loan doesn’t wait until the old ones are paid back before issuing new loans. You really have to see what an insane thing this is! For its part, the bank treats the issued debts, namely the claims that it has on its debtors, as existing assets and already takes on debts with this “existing” asset in order to issue loans. This is actually the enormous growth power of capitalism. It consists of the fact that success is always anticipated and the means by which success is brought about is debt. And this is a means that is available to some states. In the other states, which have not had so much accumulation behind them, that is, where the banks can’t yet concentrate so much of society’s money, the credit system is weak. And so companies are inhibited in their growth. With the effect: Either they are not growing or they are dependent on credit from abroad. They have to get credit from the countries that are big credit creators.
That brings us straight to the next department: Then they have to pay that back, too, and they have to pay it back to foreign countries. This sorts the world out very clearly, and everyone knows this, by the way: Go to any Third World country or any First World country. In the industrial zones of the cities, you always see the same big companies from the USA, from Europe, maybe from Japan, maybe now and then from China. But it’s always the same multinationals that organize exploitation around the world and make it useful for themselves. And it is always the same banks that are everywhere which use the credit needs of capitalism in all countries and harness it for increasing their money finance-capitalistically.
This sorts the world: firstly, into a manageable circle of so-called industrialized nations. These are countries like the European Union, the USA and Canada, Japan, and then it gets thin: Australia, New Zealand maybe, China of course. Capital is at home in these countries. They have a functioning, flourishing credit system from which new credit is always being created truly autonomously, which is used to take advantage of the world.
The second category of states are the so-called emerging countries. They are not unsuccessful at making themselves places of investment for foreign capital. These are mainly countries like Brazil, but China also comes from there in its entire development process. They make themselves into a place for foreigners to invest, for foreign capital. In this way, they certainly have a capitalist economic life at home, but essentially remain places of exploitation by foreign capital.
And then there is the third category, these are the poor countries, which there is little capitalist interest in. And this sorting of states is damn unshakable.
And this is because – I just mentioned the reasons – where capital is located, there is greater productivity, and therefore also superior competitive power, and that’s also where the credit is located which is used to open new businesses and make foreign businesses subservient to itself.
In order to change anything in this hierarchy of capitalist states, you need something like China: 1.4 billion people, more than four times the population of the USA, a huge country. A country that has secured political sovereignty over economic life for over fifty years: That, by the way, is what’s communist about the Communist Party. It meant that they didn’t allow the private capitalists who emerged in the country – who were also in the Communist Party – to regard the whole world as an investment location and to take the money to anywhere it could be used most favorably and safely. No, it was then a national duty: Invest here! And if you want to buy from abroad, then it’s only if the party thinks: buying this or that technology is useful, procuring this or that port is good because it serves Chinese exports. So you have to look not only at the size of the country, but also at what it was all about: making a nation of billions so productive that it really produces capitalist commodities that are competitive and at the same time keeping it so poor that the Chinese only collect a tenth of the wages that are paid in Europe. And so making world capitalism an unbeatable offer. The capitalists have also come to terms with the fact that, wherever they wanted to set up companies, they have had to enter into joint ventures with Chinese companies; they have had to accept technology transfers; they have complained about patent infringements for decades, but have not really fought them. That’s when you realize: It has to be this unbeatable offer for a country to be able to make profit like this.
That was a digression on the point: the hierarchy of capitalist states is not so unshakable, so unrevisable after all. True. But then you also need something like China. Not every state can do that.
All the states in this world issue money and force their society to use the legal tender. In other words, anyone who has a claim against someone else must be satisfied with the money of the state. You can’t demand to be paid in gold. You have to accept that the euro is the answer to all your claims. There is no question that any country can do that, because it is a question of the sovereignty to impose this on society. What this money is worth beyond the nation’s borders is a completely different question. Beyond the national borders, namely where it does not have to be accepted compulsorily, but where the buyer or the one paying can decide whether to accept the means of payment. And there, you notice again, there is a big difference between the moneys. One type of money is a local currency that is valid inside the country, but even very big transactions are no longer made in this currency, but in the currency of a nation with world money. In other countries, this money, which is also issued by the state bank there, is money that the whole world wants and needs and uses. It is not unknown that the whole world needs the dollar. This is also currently in the newspapers; when the US central bank, i.e. the Fed, raises interest rates, then there is a crisis in the entire Third World. Then currencies crash in droves. What does that mean? It means that these countries all have a relationship with the dollar based on the fact that they can buy dollars in the amounts they need with their domestic economic life and their domestic money. And when the dollar becomes more expensive because interest rates rise, then whole countries go broke.
In the case of the powerful nations that issue good moneys, the only ones to think about are the dollar and the euro. Even the English pound sterling is getting negative information about how far its credit goes. So the dollar and the euro become world money by being sent out into the world as credit and as an investment. And then they work as capital advances elsewhere and produce demand for more and more of it in the recipient countries, if only because they have to pay the dividends and the interest that these funds, these investments, naturally demand.
And this is now a totally important point: Because of the need of other countries for these world moneys, the power of these moneys actually emancipates itself from the internal capitalist capacity of the nations that issue them. To wit:
If these moneys or all the possible assets that are denominated in these moneys, i.e. bonds, shares, if these are bought all over the world, and rich people elsewhere want to hold these assets and say that they demand for euros for this, if, above all, central banks all over the world, in order to keep their local currency exchangeable with the world money, invest treasuries in dollars and euros, then they free the dollar or the euro from having to prove that the credit creation from which they originate is justified by the capitalist efficiency of the domestic economic life in the respective nation. It’s funny: Those who demand these moneys, i.e. who need this credit, give them this credit, i.e. give credit to the domestic economic life of the USA and the EU by keeping their papers and doing business with them. They give these papers credit by demanding them, by creating demand for them. The demand for this money arises independently of what the nations have to offer, either in terms of commodities or in terms of capital investments. By creating such demand, the ones demanding them relieve these countries of the burden of proving that there is something behind their money. This makes the creditworthiness of these nations limitless. The creditworthiness is equal to their ability to create capital, is equal to the ability of these nations to go into debt without limit. And that’s insane. By the way, if someone were to ask now: Is that really true? Yes, look at Germany. Hundreds of billions for bailing out the banks in 2012 and in the years following. Then Corona happens and the nation is kept afloat for three years with Corona aid. All on government credit. Then comes the Ukraine war. A hundred billion for the military, no problem. And less than three months later, 200 billion to cushion the energy price crisis. They rack up one pile of debt after another and don’t worry that their creditworthiness will reach its limits somewhere. And what Europe is doing – still aware, of course, that they still need proof – America is doing even more brazenly. This now shows something:
These states, which have this money, which enjoy unlimited credit because the whole world needs it, these states, whose credit power no longer really depends on it, or at least no longer depends exclusively on how much is yielded by domestic exploitation, these states are then of course also the ones that make every financed advance for capital productivity, for the advancement of science, for the provision of sophisticated infrastructure, for the provision of training so that there are still people who can invent and operate the sophisticated technologies.
These states whose creditworthiness no longer depends solely on their domestic performance are of course also the ones that are always able to provide the necessary advance payments in order to “sail” at the highest level of capital productivity and competitiveness.
Second point on the benefit of limitless creditworthiness:
States like these can then also step in with state loans when the economy goes into a crisis. With loans that are not an advance for new capital business, but actually just a substitute for failed business and to keep their economy afloat, to buy out the crisis, so to speak. And to burden other countries which can’t afford to do anything like this with the destruction of capital that is always due in a crisis. Here, too, everything is day-to-day politics: The fact that the Germans have now said they will launch this 200-billion-dollar program to cushion the increase in energy prices for the people and the economy has already aroused great resentment in the EU because Germany’s partner states are saying: We can’t afford that. This is an unfair way for the German economy to treat us partners, which then causes de-industrialization in our countries.
Third point: And last but not least, and this is the most important of these benefits connected with the limitless creditworthiness of world money: such states can also afford to invest in the military and in the development of the most modern weapons technology, and then precisely the weapons with which they impose the peace on other states that they must observe. The unlimited creditworthiness of such states is also the source of their military power and ability to control. You can look back at this again. This only makes clear how insane this boundless creditworthiness is: The ability to be able to afford all the necessary means of force in order to force other states to the peace that I just spoke about, the other states procure this for them by their dependence on and use of the world currency which these states issue, e.g. the USA with the dollar and the EU with the euro. Now we are getting to the point: this is a system of domination, an economic system of domination. The way it’s set up, the other states’ need for dollars and euros reproduces the power of the USA and its partners to keep the other states in the role of that dependency. A nice circularity there, too. The need of the other states for these currencies gives the USA and its partners the financial power to afford all sorts of military means to ensure this peace. Conversely, their money can only exert power over other states because there must be no states that are really capable of war outside of NATO.
So you can subjugate other states with money alone, and here you have to think of Germany again: How with its D-Mark and then the euro, how with its monetary power it forced self-denial on Greece to the point of national surrender, forced it to enforce impoverishment domestically, to sacrifice any amount of economy, just to measure up to the euro. Yes, this reveals everything, namely that this can only exist on the basis of the prohibition of violence and the renunciation of violence among states, in Europe now, otherwise there would be no such thing.
If there are limits to the creditworthiness of the USA, for example, then these limits consist in the fact there is a second or third world money. So even America might eventually reach the limits of its creditworthiness. That is, if the asset owners, the investors, the users of money in other nations are not necessarily and exclusively dependent on this one currency, e.g. the dollar or the euro. But it is then equally tricky for the USA and the EU if China also wants to make its renminbi the world currency. By the way, the euro is also tricky for the dollar.
Again a formula for the credit story: This boundless creditworthiness, where does it come from? It comes from the fact that the credit of these nations, the USA and the EU, which actually means their debts, their creation of debts, what they create in terms of ability to pay through debts, that is, ultimately their debts are the money that the other nations need and have to earn. And this trick – you can’t really say trick – this constellation makes things so unassailable for those who issue the money. The others need what are debts for the US and the EU. This might be simplified, but this is very much the way in which this system works.
Anyone who wants to understand how the banking system and the currencies work – although I have actually only offered results; I can’t do that any other way in a speech like this – has to read this book Finance Capital where it develops from the smallest commercial loan up to world money how the power of money capital functions.
Russia now says that it does not want to leave the world economy at all, but it does not want to put up with de-sovereignization, as President Putin calls it, i.e. the buying off of sovereignty, the taking away of sovereign freedom of action. But now he is being shown what an enormous contradiction Russia is allowing itself: On the one hand, it wants to establish itself as a normal participant in the capitalist world economy, as it exists today as the American world order, and on the other hand, it does not want to bow to the supremacy of the USA. Putin feels that he and his entire economy have long since submitted to the USA and its set of rules, in that the Americans and Europeans, especially the Europeans in the economic war, make it impossible for the Russians to participate in the world economy into which they have entered, which they depend on. This is done by expropriating the Russians’ foreign exchange reserves and excluding them from the Swift payment system. And, of course, it is done above all by canceling all the trade relations that the Europeans have with Russia. And this shows what it means to have and to be able to handle the world economy as a national asset: the Americans and the Europeans do not have to do much at all: They simply forbid their national businessmen and their national banks and stock exchanges from doing business with Russian business partners. Because the banks are all located on their territory, they are all subject to their sovereignty. And if the banks on American and European soil are no longer allowed to trade with Russia, then Russia will be largely cut off from the world economy. Then its natural resources are worth nothing and its state budget is in distress and its economy is in crisis. This shows very much what it means that the world economy, i.e. the economy of all states, is a national vested right of the USA and its privileged partners.
The economic war then also shows that not only the Russians, but also other states are subject to this system and can’t escape it. NATO and the countries assembled in NATO have realized that their sanctions regime against the Russians will not have its full effect, its full destructive power, if there are other countries on the globe that trade with the Russians, that buy Russian oil and other things, instead of them. And now there is a diplomatic and world political campaign, for example, to demand that the Indians join the sanctions and to enlist them to help in the destruction of the Russian economy. Now we know that the Chinese and the Indians and the other partners of the BRICS countries, that is, the big ones among the emerging countries, are politically refusing to support the sanctions. But even if they are refusing politically, just the threat of secondary sanctions has effects. In other words, sanctions that could also hit them if they do not participate in the exclusion of Russia. China and India are also so dependent on the markets in Europe and America and on the credit relationships between them and Europe and the US that they are becoming wary of the mere threat that they could be hit by secondary sanctions, too. And if these states protest like nobody else, their banks and companies have long been willing to be cautious in their dealings with Russia and careful not to irritate the West. After all, they could afford to do much worse to them than damaging their business relations with Russia. So that also shows that the BRICS states are also tied in, and to that extent not free, because they depend on business dealings with the Western centers. This also applies to China, by the way, despite China’s desire to assert itself.
Now it’s true that these countries are feeling the imposition of being recruited for the economic war against Russia. And they are also thinking about alternatives and ways to get out of being hamstrung in this bind. For example, they are thinking about payment systems that can bypass Swift. Of course, the system which has to bypass Swift is always disadvantaged because Swift is what all banks run on. And whoever opens something new now is alone for the time being and has to see who he can get to join. The kicker is that the countries that are trying out or trying to install such alternative payment systems are not at all enthusiastic about it themselves and don’t really get very far with it, so it is and remains a substitute solution for them, too.
And indeed for the following reason: Because the currencies they exchange with each other are just their currencies and not world money. What is a currency seen from abroad? A national money seen from abroad is a statement of what there is to buy in the country, that is, either commodities or factories, either created wealth or sources of wealth. But it is always only whatever is available to buy in the country. This limits the exchanges between nations. It limits the willingness to sell to the country to what is available to buy from it. And so what you can buy there and what you then acquire is not world money but limited to the potencies of this country. What one acquires there is precisely not the means to access everything that exists in the capitalist world. It does not allow comparison of the most profitable places of investment, but only the investment in this other country. And that contradicts the capitalist “more and more,” namely that you can sell as much as you can to everyone else. This contradicts that, if one wants to sell to it only as much as one can hope to buy from it. And it is precisely this unconditional “more and more” that has made this American globalization of the world economy with the few world moneys so normal and the standard.
What do the states that don’t like all this learn, and how do they learn it? They experience what we talked about earlier. They experience a system of economic domination, one which they have gotten themselves involved in and which they are thus subordinated to. So what are they complaining about? Not the system of domination at all, but the fact that America places itself above the system and violates its rules or changes the rules. Then you realize: these states that are protesting are also capitalist states. They have established themselves in the US world order. They want to succeed in it, and they do. They themselves need the binding nature of trade rules and respect for credit. And respect for credit is indeed something special, because it means that states must recognize that other nations have a right to their wealth, which must be ceded without anything being exchanged for it. They exchanged something before, at some point they had a loan. So they have to respect the fact that something may be taken away from them. The states want the rules because they need them, because only if these rules are binding can their own property deploy the coercive power over others that they are aiming for.
Now they are unhappy because they are being tasked by the West with an enmity that is not theirs. They are supposed to help, asked or not, in the destruction of the Russian economy. Yet they have no problem with that country. They have only useful relations with it. They mostly buy energy raw materials from there and sell some stuff there. They have no enmity with the Russians at all. Now they are being used for an enmity. And then it means that they have to give up picking the most useful trade partner for themselves and taking advantage of the most favorable investment opportunities. Why? Because America wants to exclude a country from the world that America objects to, but they do not. So they get told that their sovereignty doesn’t count for anything, that they are subordinate nations. And that’s what they’re protesting against. But how do they protest it? They protest against it with the idea that this is a violation of the order that they accept after all. If this idea were to be made into a policy, and it did not limit itself to diplomatic complaints or objections, then that would be an absolute challenge for the USA and the EU.
China and the BRICS countries are now complaining that the Americans with their economic war are breaking all the rules that they themselves made up. Now you can say that they are actually right about that. Yes, the economic war is a break with the rules of the world market. It really is the case that states are denied the free comparison of investment opportunities. That participation in the world market should suddenly no longer depend merely on states adhering to the rules of trade and the rules of credit, but that participation in the world market should be conditional on showing good behavior toward the US and on the Americans liking their state. This really is a break with the rules of the free world market. As a result, the holy of holies of capitalism, property, is no longer safe. Property in the hands of the enemy, i.e. Russia, is worth nothing. Property in the hands of the other states is no longer freely usable. So if you say that this would be a breach of the rules, then you can say: That’s right, this is a breach of the rules.
But at the same time, the opposite is also true: It is not a break with the American world economic system at all, but the USA and its partners are only putting on the agenda the premise that has always preceded the entire world order: Its supremacy in terms of violence is the condition for the validity of all rules, thus it is the condition for the reliability that the others need. The other states are only reminded that the order they want does not exist without US dominance over them as well. Now you realize what these BRICS states are doing with their protest: They want to divide the world order into, on the one hand, a necessary framework that also includes their interests as well; a framework that they want and support. And on the other hand, into a domination of the USA, which forces other nations to serve America and does not let them rise up. They want to separate these two sides, which cannot be separated at all, because one does not and cannot exist without the other. Then you realize that it is capitalist states that are now pursuing an idealism of their national interest. And if they do this seriously – and China is doing it in its own way – then this is an absolute challenge to the Americans and their order. You have to see that. These states can say for a long time: We just want to have a capitalist world economy. We just want to play by the rules. And the Chinese also say: We have always followed the rules. And Russia, too. But it doesn’t change anything. Wanting the rules and not wanting the supremacy, the superior power that guarantees the validity of the rules, this contradiction is not possible.
Let’s take a look at the USA. On its side, too, there is a contradiction: The USA has set up the world as an investment location for US credit. As such, it needs the egoism of foreign states, the national self-interest, the foreign states’ national desire for advancement and enrichment. The USA also wants their capitalist successes, because if the other states merely suffer defeats, then American credit will not benefit from it, nor American banks and American investors. The enrichment of the USA needs the success of foreign states, and their success is of course always included. With success on the money front, the nation becomes richer, the state has a bigger budget, which is always an advance on the power front. A state that has more money also has more weapons and also has more interests for which it can use the weapons.
Even this: The fact that states acquire not only wealth but also power through participation in the world economy is not necessarily directed against the USA and is not necessarily immediately registered by the US as an attack. The European Union is an example of this. Namely, how Germany and perhaps France, as the most important partners, have assigned the whole continent to themselves and made it suitable for them. This is a real surge in power, which the Americans, with the exception of Trump, have seen as a contribution to their world order and not as an attack on it. When they think it’s an attack, and for how long they think it’s a contribution, is entirely up to them. And then the next president comes along and sees things differently again. One of them is of the opinion that these are rivals that we have to keep down. And the other is of the opinion that we absolutely need them as allies in order to keep down the other rival.
The contradiction now is that America needs and wants the success of other states in terms of wealth and growth in power, but that on the other hand the enrichment and the increase in power must never go so far that the dominance of the USA is endangered. It’s the same: Other states must not become so rich that they limit the power of the dollar, and they must never become so powerful that they demand cuts in the deterrent capability of the USA. This is the contradiction: the competitive order creates rivals and at the same time does not tolerate rivals. That is the ultimate contradiction of this American competitive order. And that is the real reason why this competitive order is inherently warlike.
Question: What’s the role of the UN in this world order?
Answer: The United Nations is itself a product of the USA. It was its desire, after the 2nd World War, to form a world community above and beside the states in which the common dependence of the states on each other is organized. Beside and against their competition, which they pursue economically and in terms of power. In this respect, the UN – first of all, a bit like the League of Nations of an earlier time – has the character: It is the idealism of the world community alongside the real world order. This idealism should get more substance than the League of Nations before the World War 2. And that was the idea behind the founding of the UN back then. And for this purpose, in addition to the General Assembly in which each state has one vote but is not an executive body, a Security Council was set up alongside the UN – the word is of course very nice – in which the most powerful states at the time were united. The Security Council has the legitimacy to decide on war and peace. Actually, legitimacy means: to exercise just force in the interests of the international community, provided that the Security Council can agree on any matter of violence. That means: the most powerful rivals on earth, the greatest rivals in questions of power, must be in agreement for the UN to be able to act. In very specific cases, they have always been able to do so in subordinate wars by subordinate nations. But if the rivals do not agree, then the UN is merely a paper tiger. Then it practically becomes the legitimizing authority of the powers that are capable of acting on their own, but do not make themselves dependent on UN resolutions.
So the USA attaches great importance to the fact that when they wage a war, they wage it on behalf of the UN. But if the UN doesn’t give the mandate, then it just goes ahead and fights the war. That is the real role of the UN. It is the idealism that is added to the real conflict between states. And the UN has no chance of growing out of this role. It is the other way around: Everything it can do, it can only do if the really powerful states lend their power to the UN, i.e. provide soldiers for UN missions. And they do not provide them because the UN says so, but when it is in their interest to decide some conflict in their favor.
Question: Can we observe a shift of power in the direction of the BRICS states, which could only be stopped by a nuclear war? Does this mean that dollar imperialism can’t ever be broken?
Answer: First of all, about this kind of question: It’s always the story with forecasts, with the question: Yes, will it ever be possible to tell the Americans where to get off? What will the world look like in five or ten years? You have to see, not only that we can’t make forecasts and don’t want to make forecasts, but that this questioning attitude is one that I think is wrong. It is no longer the interest: What living conditions are imposed on us, what is this shit we are involved in, how does the shop work that we can’t avoid working for? What would it take to say “no” to that? Know your enemy, that’s more our logic.
It’s a completely different thing to say: What will the world look like in five years, what do you say as an expert? I have to say: This is an interest that wants to gain a forecasting quality in the sense of: Yes, I know what’s going to happen, I am well informed, I can see what’s coming. An interest that is connected to one’s own absolute powerlessness and criticizes nothing at all. Forecasts about economic growth or Corona, the weather report, these are all ways of thinking, positions on things you can’t influence, but that you want to cleverly adapt to. The attitude of this question is quite wrong when you look at capitalism, imperialism, and our states. That’s why I don't like it.
Second: on the BRICS countries: Is it possible to crack America’s dominance? Well, let’s look at the world. Everybody is trying. Everybody is working on it in their own way. The Europeans are trying to maintain strategic unity with the US for as long as possible, while at the same time achieving economic growth. By the way, in the meantime they are also trying to achieve an imperialistic growth that dominates Europe, which will relieve them of the necessary subordination to the American will. China in such a way that it copies the whole path of success of the West as well as it can. First, it became a successful export nation; then a successful capital investment nation; then a successful capital export nation: that is China’s Silk Road. The do everything the way the Germans did it in order to become a power that no longer has to obey America. Cracking American supremacy, that’s what they all want.
Question: How does it fit together that the central banks in the world should be independent of the respective governments? Aren’t the states giving up an enormous amount of power?
Answer: Yes, the states give up control to an institution that looks at the overall success of the community from a different perspective. This institution is not a hostile entity. It sometimes becomes hostile in crises, for example, when Erdogan wants interest rates to remain low because that is what the economy needs, and the Turkish central bank says that interest rates must be high because that is what the money needs. But the money is now also the interest of the nation, so the government outsources responsibility to the central bank, but it is just as much a state institution. It is part of the separation of powers in modern capitalist states. However, it does not necessarily have to be handled in this way. There are states where the central bank is not free vis-à-vis the finance minister. But it is organized in this way because they want a productive conflict between the interest in stable money, which is managed by the central bank, and the interest in the state benefiting from the use of this money, which is managed by the minister of finance. This conflict is organized institutionally so that attention is paid to it. Because one can also break something by investing too much if the money is cheap. Then there is the famous flash in the pan, a crisis, because investments have been made that are not profitable, and then the money is shipped off. They don’t want that, and that’s why they have this separation. This separation can be expressed like this: The government renounces a power of disposal, but it renounces it only in the interest of the monetary power that the nations have.