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Hardt and Negri in Empire argue that ”Imperialism is over.” On the contrary, others argue that not only is imperialism not dead, but its machinations have amplified during the phase of globalisation (Patnaik’s The Value of Money, Patnaik and Patnaik’s A Theory of Imperialism, John Smith’s Imperialism in the Twenty-First Century, among others). The reason for this sharp division among progressives is because of the current world scenario. On the one hand, some countries in the periphery (emerging economies) are growing faster than those in the core. On the other hand, the terms of trade has started moving in favour of the primary commodities over the last two decades. This paper argues that imperialism exists not in spite of but because of the globalisation of capital.
Mature capitalism in the core needs to deal with three instabilities: accumulation, price and political (Patnaik), the first because of expectations in investment decisions (Luxemburg), the second because of the wage-price spiral (Rowthorn) and the third because of the social unacceptability of high rates of unemployment. We argue that globalisation solves the first two problems but, in the process, aggravates the third instability.
The world is no longer divided into two camps of a capitalist core and non-capitalist periphery. Today, we have a tripartite division of the world with a capitalist core (G-8), predominantly capitalist periphery (China, Taiwan among others) and a pre-capitalist periphery (the African subcontinent and the rest). The capitalist periphery, through its low wage costs, keeps the wage shares in the capitalist core under check, thereby providing price, and hence, financial stability to the US dollar. The same low wage costs induce a shift in the site of accumulation to the capitalist periphery even as the capitalist core retains the surplus generated through the IPRs. Due to increased accumulation, the raw material requirements create debilitating conditions for the pre-capitalist periphery in effect forming a pyramidal structure of imperialism.
However, a significant contradiction develops in this process. While globalisation provides the core with price and output stability, it comes at the cost of political instability because a declining wage share and outsourcing creates unemployment or declining income for the workers in the US resulting in a rightward shift (election of Trump and others) in the polity in the core.
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