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Transcript
RADHIKA DESAI: Hi everyone, and welcome to this Geopolitical Economy Hour. I’m Radhika Desai.
MICHAEL HUDSON: And I’m Michael Hudson.
RADHIKA DESAI: Every fortnight we are going to meet for an hour to discuss major development in the fast-changing geopolitical economy of our 21st-century world.
We’ll discuss international developments. We’ll discuss their roots in individual countries and regions. We will try to uncover the reality beneath the usually distorting representation of these developments in the dominant Western media.
We plan to discuss many subjects: inflation, oil prices, de-dollarization, the outcome of the war over Ukraine which is going to determine so many things, the threats the U.S. is making against China about Taiwan, China’s increasingly prominent role in the world, how China’s Belt and Road Initiative is going to reshape it, how Western alliances and the Western-dominated world that was built over the past couple of centuries is so rapidly fracturing.
We’ll discuss financialization, the West’s productive decline. Many important things. Michael, am I leaving any important things out?
MICHAEL HUDSON: Well we have been talking about this for many decades. Already in 1978 I wrote a book, Global Fracture, about how the world is dividing into two parts. But that time, other countries were trying to break free so they could follow their own developments.
And today it’s the United States that is isolating other countries – not only China, Russia, Iran, Venezuela, but now the Global South – so the United States has ended up isolating itself from the rest.
What we’re going to talk about is how this is not only a geographic split, but a split of economic systems and economic philosophies. We’re going to talk about what the characteristics and the policies [are] that are shaping this new global fracture.
RADHIKA DESAI: Indeed, Michael and my collaboration goes back a couple of decades. In fact, even before we met I had read books like Global Fracture and Super Imperialism, which were quite prescient, and with which I agreed.
[Unlike] all those people talking about globalization and U.S. hegemony, Michael could see, and I also could see, the fractures underlying the system. My own approach has been characterized by such skepticism about enduring Western dominance, U.S. hegemony, dollar dominance, etc.
And after thinking and writing about small bits of it for a couple of decades I eventually came up with this book, Geopolitical Economy, from which Ben [Norton] has also taken the title of Geopolitical Economy Report, with which of course we are collaborating.
In Geopolitical Economy, I question the dominant cosmopolitan understandings of the world. In ‘globalization discourse’ the world is seamlessly united by markets. In ‘American hegemony discourse’, or ‘hegemony-stability discourse’, the world is united by a single leading power.
None of these narratives are really true, and the advance of multipolarity, which I’ve argued goes back at least to the 1870s, continues apace. Of course today multipolarity is in a very rapidly advancing phase, and we are looking at some major changes in the world order.
We are going to be discussing all these things, but today, for our opening show, what Michael and I thought we might do is to introduce the big idea that frames our thinking, which is the advance of multipolarity – that is, the difficulty of retaining Western dominance.
The difficulty is so great that not only are the West’s attempts to preserve this dominance futile, but they are even counter-productive, like the conflict over Ukraine or many other things that are actually boomeranging back on the West, like financial sanctions against Russia.
So we basically want to talk about this big idea, the emergence of the multipolar — or some might even say a bipolar — world order. Michael, do you want to start off with some reflections on that?
MICHAEL HUDSON: I think the most obvious driving force that’s splitting the world is the U.S. attempt to create a unipolar world under its control, [particularly] its national security diplomats and financial interests. They insist on monopolizing the international finance system so that if countries try to follow a policy that supports their own development, the United States can simply pull the plug and block their financial transactions.
The U.S. tries to control the oil trade. Oil has always been, for the last century, a centerpiece of American diplomacy, because if the American oil companies (along with British Petroleum and Dutch Shell) can control the oil, then they can turn off the power, and the lights, and the transportation, of any country that is not following the U.S. plans for a world order.
And also food. The United States, from the time that the World Bank was formed, has blocked other countries from developing their own food production, and has steered them into producing export crops (non-food crops, tropical crops) remaining dependent on the United States for its grain, so the United States can starve them out if they try to go their own way.
So the United States approach to leading the world order is to lead by being the aggressor — to threaten, to hurt other countries — not by providing mutual gains [or] by helping them [develop], but by saying, “If you don’t do what we want, we will overthrow you. We’ll have a coup d’état. We’ll do to you what we did with Pinochet in Chile. We’ll do to you what w did with Boris Yeltsin in Russia. We’ll interfere.”
This has been easiest of all in probably the most corrupt region of the world, Western Europe, where the United States Treasury officials have told me that all they need to do is give little white envelopes filled with dollar bills and they’ve been able to control European politics.
The United States is essentially trying to use its threats and its sanctions, and it believes that it can hurt another country.
Behind it all, of course, is the military threat, as you were saying, in Ukraine. But it turns out there isn’t really any military threat by the United States. Not only have the U.S. and NATO run out of normal military arms, but America really can’t mount a land war anymore.
There will never be another Vietnam. There will never be the United States invading another country, or Europe invading any other country, because you’ll never get a population willing to be drafted, since the anti-war movement.
And without that, America has only one military leader against other countries: the hydrogen bomb. There is nothing in between a targeted assassination attempt and an atom bomb.
That basically is what has enabled other countries, for the first time, to break away. They couldn’t do this back in the 1970s, when Radhika and I were first noticing it, because at that point, Indonesia and the Caribbean and Latin America didn’t have the critical mass to go it alone.
Now they do have the critical mass to go it alone, thanks to Russia, China, Iran, India. They are able to go it alone.
There is only one part of the world that is not able to go it alone, and that’s the United States and Western Europe. They de-industrialized.
In their class war against labor, looking for lower-priced labor abroad, they have cut their own industrial labor force, but they’ve also shifted the center of manufacturing, technology, agriculture — everything has shifted to Eurasia and the southern hemisphere.
The United States turns out to have left itself alone [i.e. isolated itself]. The problem that is frustrating American diplomats is: How are they going to dominate the world without industrial leadership, with debt deflation, with a debt that is much higher than other countries. How on earth can they lead, in a weakening position, without any military?
RADHIKA DESAI: Absolutely. I think this whole point you’re making — that the United States’ attempt to dominate the world is increasingly failing — the United States turns out to be essentially a giant with clay feet.
From the point of view of today, it becomes much more credible to say so. But I’ve been saying, and I think also with a lot of help from Michael’s writings, that in reality, when people talk about ‘American hegemony’, ‘American dominance’, ‘American imperialism’ — what we have to realize is that what we are looking at, what the United States has attempted to do for more than a century, is attempt to dominate the world. But this attempt has actually never been successful.
The story that I tell in my [book] Geopolitical Economy is actually a rather different story, which does not try to deny the huge extent of the harm the United States has done by its wars, by its economic coercion, by its suppression of attempts of countries to develop.
[The book] acknowledges that all these things have happened, but the key point is that the United States has never actually succeeded in exerting its dominance. What we are looking at today, what we are calling multipolarity, in fact shows the failure of America to dominate.
What I argue in Geopolitical Economy is that, in the early 20th century, it was very clear to many observers that British dominance over the world economy was weakening, and the United States felt that it was going to take over the torch from Great Britain and be the dominant power in the world.
But they knew, of course, even then, it was very clear that they would never be able to match the scale of British dominance; they could never acquire an empire, a formal empire, of the size that Britain had. Remember, Britain had an empire on which the sun never set.
So what [the U.S. ruling elites] decided to do was, instead, lower their sights and say, “We can’t have an empire of this size, but we are going to try to make the dollar the world’s money.”
The way they tried to do so after the First World War, and the financial mayhem they caused is a really interesting story that I’ve written about, Michael has also written about, and so on.
But, after the Second World War, we are told that the dollar became the world’s currency, but the fact of the matter was, that the first attempt to try to make the dollar the world’s currency fell afoul of the very famous Triffin dilemma – which is to say that, since the United States could not export capital, since it had no capacity to do so – Britain could export capital because it had an empire, it had an empire from which it drew surpluses – the United States had no such empire, no such surpluses, so it created dollar liquidity by running deficits.
And Robert Triffin pointed out, the bigger the deficits, the lower will be the value of the dollar, and the lower will be the attractions of the dollar.
This logic finally worked itself out, and the United States was forced to break the dollar’s link with gold, because people were ditching the dollar in favor of gold. Countries were ditching dollars in favor of gold, including famous Western allies, European allies.
And since then – what Michael and I argued in a recent paper we did called “Beyond the Dollar Creditocracy” – and by the way, this is also my argument in Geopolitical Economy – [since 1971], the dollar has become reliant on a series of financializations, or a series of expansions of purely financial activity, so that the unattractiveness of the dollar for normal economic use, for trade use, and so on, is counteracted by vastly expanding the financial demand for the dollar.
And that is why this (post-1971) age of alleged dollar dominance has in fact rested on a series of financializations, one after another. It has also been an age of recurring financial crises.
To emphasize: What we are looking at are American attempts to dominate the world, but they are all attempts that have failed. And this is another story that we will tell.
MICHAEL HUDSON: It’s interesting that when President Biden and the State Department and the media talk about what’s happening in the world, and [when] they describe policy, they don’t talk about anything that Radhika has just said.
And they don’t even talk about the fight between unipolar and multipolar world. President Putin talks about that, and [Russian Foreign Minister] Lavrov talks about that, but not the U.S.
If you listen to what President Biden and the State Department say, this global fracture is “between democracy and autocracy“. That is how they characterize it. This is Orwellian Doublespeak.
[To them,] ‘democracy’ means a financial oligarchy. Aristotle, 2500 years ago, wrote a book on constitutions of Greece. He wrote, “All these constitutions call themselves democracies, but they are really oligarchies.”
Democracy tends to turn into oligarchy. So by ‘democracy’, what President Biden means, is a financial oligarchy in control of policy.
And what Biden means by ‘autocracy’ is a mixed public-private economy with strong government support for industry, for technological research and development, for rising living standards, and most of all for providing basic needs: public health, public education, retirement income, transportation – all subsidized to minimize the cost of living for labor, so that the economic surplus can go to upgrade education, improve the productivity of the labor force, and do essentially what China has done and what other countries are doing, and what everyone expected industrial capitalism to do in the United States and Europe, but which finance capitalism is not doing.
So you have to go beyond this rhetoric to ask what is really happening. To the Americans, public spending, anti-monopoly regulation, and protection of consumer rights is ‘socialism’.
Well, it is socialism, and that’s why in the United States, they’ve done polls, and find that most people prefer the world ‘socialism’ to ‘capitalism’. Many people in the United States claim to be socialist, but finance capitalism is not socialism.
This distinction, which Rosa Luxembourg called the fight between barbarism and civilization, that’s really the fight between democracy and autocracy, with a different vocabulary.
RADHIKA DESAI: Let me take one or two of those points. First, the United States’ claim to lead the ‘democratic world’, to stand for humans rights and democracy, sounds increasingly hollow.
And this is also really interesting to reflect on why, because the policies that the United States has had to follow in order to exert dollar dominance, in order to create the financializations on which dollar dominance rests, have tended to undermine the United States’ productive economy.
They have tended to divide society because they have created astronomical levels of inequality in the United States, and other countries that follow that kind of policy paradigm.
And as a consequence they have essentially created the present political breakdown that we witness in the United States, where a character like Trump can get elected president. And then when Biden is elected, he must more or less continue Trump’s policies.
So you’re looking at a serious breakdown of democracy in Western countries themselves.
[Second], this is going to be a show about world affairs, and it’s interesting to explain to you how our approach to world affairs differs from the ones that you normally see.
So in the study of international relations, some people take a liberal point of view, which is essentially what I was earlier criticizing, [characterized by] globalization, U.S. hegemony, cosmopolitan views of the world economy, with the world economy seamlessly united.
[In the liberal view,] nations don’t matter, nation-states have become irrelevant, etc. etc. You can take that point of view. Or, you can take a so-called ‘realist’ point of view in which all nations are out to ‘do down’ other nations.
But in reality, the point of view that we take comes from a very strong tradition of critical thinking that goes back to Marx and Engels, but has continued to develop in a big way since then, which is to understand world affairs as the contest between imperialism and anti-imperialism.
Trotsky used to call this uneven and combined development, which is to say that the countries that are already developed, the imperialist countries, want to retain the uneven configuration of development in the world, with some countries being developed and other countries less so.
But the ones who are less developed, the ones who are left behind, contest this by promoting their own development through policies that are designed to improve their productive capacities and so on.
So what Michael is trying to say when he says that the United States is always trying to prevent development, is basically, for all the talk of Western countries trying to help the development of Third World countries, in reality when Third World countries develop in the only way they can, which is by focusing on productive activity, controlling trade and financial flows and so on, as all successful developers have done, including the United States in its own time, when they try to do this, the United States tries to force them open.
They talk a lot about ‘free markets’, ‘free trade’, ‘openness’ – what does this ‘openness’ really mean? It means that countries should lay themselves open to being dominated by, penetrated by, Western capital, Western corporations, and be open to supplying, cheaply, what the West needs – namely, commodities, labor, low-cost goods, etc.
So this is really a contest of anti-imperialism and imperialism in which, today, the cracks of multipolarity is that the forces of anti-imperialism are winning.
MICHAEL HUDSON: What Radhika said that is most radical is America really is trying to stop the development of other countries.
This may seem surprising to some people – not to listeners of this show – but those very words were set into stone in America’s national security report, saying that “any other country’s development, to the point where it is independent of the United States, is a threat to the United States.”
And the reason that China is the number-one opponent and “systemic” rival, as they put it, to the United States is that it is developing, and the United States really is against any development except that which American financial interests control and receive the rental earnings and the profits from turning this development into a U.S. monopoly.
So, I guess what is going to be really unfolding, in this show and the future, is, we know the aim of other countries is to develop, we know what they want to do, but how are they going to actually implement this in policies?
Radhika mentioned my book Global Fracture, back in the 1970s, and that was right after the Vietnam War had forced the United States off gold and Saudi Arabia had taken ownership of its oil reserves.
And U.S. diplomats already at that time were [concerned to] make sure all the development was U.S.-centered, not foreign-centered. They were in the dark as to how to navigate, because, as ironic as it might seem, I was hired by Herman Kahn at the Hudson Institute [of no relation] to go to the State Department, and the White House, and the Defense Department, to explain how super imperialism worked.
The largest purchase of my book [Super Imperialism], 2,000 copies, was by the CIA, [where it was] an operations manual.
The United States thought that, well, if we can continue to make other countries keep their savings in the United States by buying U.S. Treasury bills, if we can tell Saudi Arabia and the oil countries that they can charge whatever they want for their oil, [they could] quadruple the price of oil, but they have to keep all of their earnings in the United States, in the U.S. stock market.
They cannot buy a major U.S. corporation – but the U.S. can buy control of other economies, but no other countries’ investors can buy control of critical U.S. industries. Saudi Arabia can buy minority stock holdings, can buy Treasury bills; the Japanese were allowed to buy golf courses, that they lost a billion dollars on; they were able to buy the land under Rockefeller Center, that they lost a billion dollars on. But they couldn’t really buy American industry.
So you had the whole plan for what seemed to be making other countries dependent on the United States and U.S. satellites, and getting very little for their dollars.
But the fact is, the United States found that it had developed a new kind of imperialism. It wasn’t the old kind of colonial imperialism.
They looked at what happened to Haiti. When it bought itself independence from France in 1804, France said, “Yes, we will give you the independence, but you have to reimburse our military invaders for having conquered you. You have to pay them the current value of what they took for free when they took you over.”
Haiti for the last 200 years has been a debt peon of France and the international financial community.
The United States said, “We can do the same with other countries. We can make them borrow, base their monetary systems on creating their own credit by U.S. banks, creating their own credit in dollars, and all the interest payments and the capital gains on all of this will be remitted to the United States. We don’t need military colonialism anymore. We know that we can’t have another Vietnam. What we can have is dollar dependency.”
That is a system that they put in place, and that is the focus of talks between China, Russia, Iran, and the Global South, has been de-dollarization. And that is what both Radhika and I have been writing about and focusing on for the last few years.
RADHIKA DESAI: Absolutely. And one of the things I was also reminded [of] by what you were saying: the United States has changed its economic structures very radically over the post-Second World War period, because if you – I remember when I was researching my book Geopolitical Economy, I came across this quote from a major American official [George Kennan] at the end of the Second World War, where he says, ‘Today we account for half of the world’s production, and our aim should be to retain that position of relative dominance’ – that is to say, that the United States must continue to account for half of the world’s production.
So the rest of the world can only grow insofar as its growth does not outpace that of the United States. But of course that is exactly what happened. It was impossible.
One of the things people forget, you know, even major historians such as Eric Hobsbawm, for example, when you read the books The Age of Extremes, in which he writes about the history of the 20th century, he talks as though the United States started growing from the late 19th century onward.
By the eve of the First World War, it was a really major producer, and so when [the US] came to become such a dominant producer, when it came to account for half the world’s economy at the end of the Second World War, this was [portrayed as] some kind of a completely natural process.
What people entirely forget is that the United States acquired this position of dominance not through some secular process of growth, but because of the war.
During the war, the United States essentially grew, as the so-called ‘arsenal of democracy, its economy boomed. Between 1939 and 1945, U.S. GDP doubled.
It would not double again for another 22 years, even though these were the years of the so-called ‘golden age of capitalism,’ and growth was relatively high.
So you can imagine the sort of boost that the war gave the U.S. economy.
Plus, of course, if you’re talking in relative terms, the war is boosting the U.S. economy while it is destroying productive capacity in the rest of the world, where the war is actually occurring, where the fighting is actually happening.
So it was the complex result of this. So there was nothing natural about the U.S. position of dominance.
There are a couple of things one can add to this.
[The first thing is that] you know, today, when people are once again celebrating the United States’ role as ‘the arsenal of democracy,’ it’s really ironic because the United States, both in the First World War and the Second World War, profited in this manner.
Many countries have only recently finished paying off the war debt, etc. So the United States essentially has been indebting other countries simply by posing as an ally, when in fact it was not an ally.
The second thing is that, of course this also should tell us, give some background to how the U.S. economy has become so reliant on military production [and] armaments production, why the military-industrial complex is such a large part of the U.S. economy.
MICHAEL HUDSON: Well you pointed, quite rightly, to the role of debt in all of this. During WWII, the United States used its position of supplying arms to the Allies to force the creation of two institutions, the World Bank and the International Monetary Fund (IMF) – along lines that were opposed by Europe – designed to, number one, break up the British Empire.
Under Lend-Lease of WWII, and under the terms of the IMF, they make Britain [overvalue] the pound at 5 pounds-per-dollar, and promise not to devalue it until 1949.
They also insisted that Britain could not maintain its sterling area. Britain had a sterling area that was much like the dollar area today.
During the war, India and other former colonies had exported raw materials and built up huge government savings in exchange for these raw materials. And, as [part of] the sterling area, they were obliged to spend all of these savings on British manufactures.
But America said, “We want free markets! Free markets means you can spend your money anywhere.” They broke open the British sterling area and said, “You can buy goods anywhere”, meaning, from the United States.
Because with Britain being committed to an [overvalued] pound sterling, and the United States having the industrial capacity, the United States ended up with all of these savings that the British Empire had accumulated.
And the United States, under Franklin Roosevelt, signaled that Britain was America’s number-one rival. Britain was in the position that China is in today.
So the [British] empire was broken up, and basically forced into debt in the balance of payments, because Britain could no longer earn its way to dominate the sterling area by exporting. It was on the road to deindustrialization.
Meanwhile, the second thing that was important, is that the United States emerged from the war with almost no domestic debt at all.
The [Great] Depression had wiped out domestic personal lending and corporate lending. There was nothing to buy in WWII, in the civilian economy, because it was war production. So there was hardly any debt.
So, since WWII, [for] every recovery there has been a business cycle in America, Europe, all over the world. Every business cycle recovery has started from a larger and larger proportion of debt-to-GDP, a larger proportion of personal debt to personal income, and corporate debt to corporate income.
This is what has essentially made America spend so much money on domestic debt service, that neither its labor compete with other countries – if you have to pay mortgage debt, and personal debt, credit card debt – but American industry is debt-ridden.
Suppose, now, you’re China, Russia, and the Global South. How can they develop their economies in a way that does not simply replicate the American debt overhead?
How can China develop its real estate without following the American real estate [model], that, what people thought was increasing middle-class wealth by the price of housing going up and up, all of a sudden, you’re house poor – you’re spending so much money on your mortgage that you don’t have enough money to buy goods and services.
How are China, Russia, and the Global South going to create an alternative economic system that doesn’t simply replicate what the United States has done since WWII?
And how are they going to create, to help this, an alternative to the World Bank and the IMF, that is quite different, and with different principles?
RADHIKA DESAI: And that brings us to another theme that Michael and I have both collaborated on and written independently about, which is really: What should the structures of finance ideally be?
And when Michael poses all these questions – how China can organize its financial sector and its economy in such a way as to promote production without creating these debt overheads?
In one sense, of course, these are always new questions, because economic circumstances change. But in another way, we have models going back at least a century, century and a half.
That is to say, that in their own industrialization, major industrial countries, including the United States, Germany, Japan, China today, they have all had financial sectors in the period of their most rapid development.
For the United States, we are talking about the 19th and early 20th centuries. In this period they had a very different model of finance. It was, the financial sector was structured in such a way as to aid production.
Finance was the handmaiden of production. Finance facilitated long-term investment in productive capacity. Finance did not focus on consumer lending and so on. In fact there was hardly any consumer lending.
So in all of these ways, finance has actually powered the development of these countries, and finance was subordinated to production.
By contrast, Britain has always had a very different financial model which — ironically, for the home of the first industrial revolution — actually was not geared to promoting production. It was rather geared to short-term credit for commercial purposes, eventually for speculative purposes, and so on.
So this short-term financial model, which was originally British but has been adopted by the United States through a creeping process of financial deregulation that began in the 1970s and 1980s, and reached a peak in the repeal of the Glass-Steagall Act in 1999, under the supervision of none other than the so-called “Maestro,” Alan Greenspan.
I’m sure we will have an episode discussing the role of central banking as well.
So anyway, this model of finance, which the United States has adopted over the last many decades, is actually the opposite of the sort of financial structures that you need.
You need financial structures that are going to aid production, whereas these financial structures actually strangle production. These financial structures actually create the economic inequality which we have seen scaling new heights.
And the opposition of the interest of finance and production is so great that we saw, for example, during the pandemic over the last two or three years, while the economy was tanking, stock markets were doing nothing but scaling new heights, and increased the wealth of those with the greatest number of financial assets.
These contrasting models of finance, historically and today, will be another theme that Michael and I will be addressing.
MICHAEL HUDSON: Well, what’s so remarkable, is that the point that Radhika has just made was well understood in 1914.
After WWI broke out, the British press began to write articles about how they thought that they were probably going to lose WWI because of British banking.
They said, “Germany has a great advantage over the United States. In Germany, the banking is for long-term. There is a three-way [relationship] between the German government, the banks, and the large corporations — especially the steel-making and heavy industry for the militaries.”
And there was a belief that German industrial banking, that they had been able to industrialize, and that the banking in England was post-feudal; it was short-term banking, the financial time frame was only short-term, and the British stock market especially was hit-and-run.
It was like a brokerage in the United States today. They’d put clients into a stock [and] pump-and-dump. That was the British way of making money.
But when the British were creating the industrial corporations, they were run by financial managers, just like has happened in the United States with General Electric and other financialized firms.
They didn’t take their profits and reinvest in new industrial capital formation; they paid them out in dividends. Instead of industrial engineering, they had financial engineering.
And the result was that finance in Britain was predatory.
All of this was understood. And it was believed that, in the aftermath of WWI, you were going to have what Marx had described in volume three of Capital, that finance was going to be industrialized.
And Marx said the revolutionary role of industrial capitalism was to get rid of the landlord class and make land rent and natural resource rent part of the public domain, and not for private absentee owners, and to get rid of predatory finance, English style, and replace it with productive finance.
And he [Marx] believed that this would lead naturally into socialism, with the banks being, if anything, the model of socialist planning and government planning for the economy.
And that was actually what was happening in Germany under the Reichsbank. I described this in my book Killing the Host.
And instead, what happened was, with America’s victory [in World War One], you had the Anglo-American financialization policy that, as you know, brought on the 1929 stock market crash and the 1931 debt cancellation of inter-Allied debts and German reparations.
So there were two opposing financial systems. And what Radhika is saying is that the Global South and China and Russia are doing today is finally a recognition, a replay, of this same debate between finance capitalism and industrial socialism that you had a century ago.
RADHIKA DESAI: Yes, and there’s another point worth making in connection with the history you were recalling, Michael.
So in the United States, like I said, in the late 19th and into the early 20th century you had very different banking structures.
And then, yes, as Michael said, in the 1920s, the financial structure sort of began to evolve towards this British-style predatory short term.
Of course, you also had this enormous boom in consumer lending in the United States in the 1920s. These were the “roaring twenties” as we remember them. And a large part of what made them “roar” was debt-fueled consumption in the United States.
So anyway, so there was a brief period, but then you got the 1929 crash, you got the Great Depression, and you got the depression-era banking legislation — Glass-Steagall chief among them — which really made American banking, U.S. banking, among the most regulated banking sectors in the world.
Because you had a system of essentially state regulation of banks, and a sharp distinction between banks that were commercial banks that took the deposits of ordinary customers like you and me, and enjoyed federal deposit insurance, which was the new institution that was created by this depression-era banking legislation.
So if you enjoyed federal deposit insurance, which basically allowed ordinary depositors like you and me, trust that if we put a few thousand dollars in the bank, that it would not disappear if the bank went bust.
But, banks that enjoyed this deposit insurance were heavily regulated in terms of how much they could lend, at what interest rate they could lend, what purposes they could lend for, and they were forbidden from speculating in financial markets; whereas, banks that did so – banks that speculated in financial markets – the so-called investment banks – were not given federal deposit insurance.
And this structure of US banking, which allowed US banks to play a positive role in the economy, continued into the 1970s.
And it was then, particularly after the dollar’s gold link was broken, and it became gradually clear that expanding dollar-denominated financial activity would be able to counteract the Triffin dilemma to a considerable extent.
That’s when the financialization really took off, so you saw vast increases in financial activity in terms of government borrowing, in terms of lending to Third World countries – eventually the stock market bubble, the dot-com bubble, the East Asian financial bubble, and finally the mother of all bubbles, which broke in 2008: the housing and credit bubbles.
And of course now, nothing has been done in all of these decades, despite repeated financial crises, to regulate American banking structures, or very little has been done.
And as a consequence, we today have an even bigger so-called “everything bubble.” Anything that even remotely smacks of any lucrativeness is an asset to be acquired.
So the United States has undergone quite a transition. And this is important to remember as well.
MICHAEL HUDSON: Well, what the implication of what you’re saying is: What are other countries going to do to avoid this same problem? Because many other countries followed the US [banking] philosophy.
What we’ve been discussing is not at the center of economic discussion, either here or abroad.
Well, what has made China so successful, and what is so unique about Chinese socialism, is they have treated money creation, banking, and credit as a public utility.
That means that, if the United States cannot really cure the debt bubble it’s built up really since the 1980s, because if it writes down the debt there will be huge defaults, and in 2008 the head of the FDIC, [Sheila Bair] said that Citibank was the most corrupt bank, and incompetent bank, in the country; it was in negative equity, it had wiped out the entire stockholder wealth.
But fortunately, President Obama had appointed a treasury secretary, Robert Rubin, who worked for Obama’s sponsor, Goldman Sachs.
And Obama was the political lobby of Citibank. They bailed out Citibank, instead of letting it go under – instead of letting it go under and turning it into a government bank, to actually loan money for productive reasons.
Obama sponsored the super-financialization of the United States, and, since 2008, has traded $9 trillion in subsidies to the financial sector, that is used – this $9 trillion – to buy control of the industrial sector, to financialize corporations, to [deindustrialize] them, and essentially the financial sector has helped destroy industry in the United States.
Well, China is not in this position. It doesn’t have a powerful financial interest to take over the government; just the opposite.
China has a very large corporate debt, now, and especially a real estate debt. But when its corporations get insolvent, China does not say, “Well we’re going to break you up and you’ll have to be sold to foreign buyers and anyone who can buy them.” China essentially writes down the debt.
And it’s easy for it to write down the debt, because it’s writing down debt that is owed to itself. There is no private bank to fight it and to lobby against it.
The same situation occurs in Chinese real estate right now. There are a lot of complaints in China that families have to go into long-term debt in order to borrow the money to buy their housing, because their housing has been bid up – like the United States – on credit.
How can China lower the price of housing to keep its labor force with low housing overhead, so that it can remain competitive, and so that it can use labor’s income to buy the goods and services that labor produces instead of paying the banks?
RADHIKA DESAI: These contrasts that you’re drawing, Michael, between Chinese financial structures and what American financial structures have become over the last several decades, this is very pertinent for talking about de-dollarization, on the one hand, and the rise of the renminbi, or the yuan – the Chinese currency has two different names – as a major world currency.
Now, there are a couple of things one should say about this. First of all, as far as the de-dollarization is concerned, the fact of the matter is that this is happening because the rest of the world is increasingly becoming aware that participating in the dollar financial system has many disadvantages, including the tendency of the dollar system to incur increasing financial crises and so on.
But in addition, there is another point one must make, which is that the dollar system, which rests on the structures of financialization, have been strangling the American economy.
They have been making the American economy less productive. They have been increasing social inequality in the United States. And of course, all of this has also had repercussions for politics.
But of course, the way American politics works, you know, it’s “the best democracy money can buy.” So essentially the extremely wealthy interests, which are also those interests which have an interest in financialization, are keeping the system going – even though it is having these bad effects on the American population, and even though the dollar system is actually decreasingly attractive to the rest of the world. And therefore we are going to see its demise very soon. So, these interests are keeping it going.
By contrast, in China what you have — people say that the Chinese yuan must be internationalized in the same way as the dollar — and this is where they are making a mistake.
Yes, there will be increasing use of the Chinese yuan in international trade, but also you are seeing that the new structures that are emerging are not just about yuan domination.
On the contrary, China is signing more and more agreements to trade with other countries’ currencies. So it will also enable the currencies of, say, Iran or India, to become used in a limited, regulated way, nevertheless, but nevertheless used in international trade.
But this will be about trade. As long as you don’t have a vast investment in the financial bubbles regularly blown up by the American financial system, you don’t need the dollar system, basically.
So the yuan will be internationalized in an extremely different way. It will not look the same as dollar internationalization has looked over the last many decades, reliant on financialization.
So China, we will see that, but it will look very different. That’s a clarification that must be made.
MICHAEL HUDSON: Well the question is, how are they going to create an international bank to oversee international reserves that do not really contain the dollar, except some dollars for foreign-exchange stabilization.
Certainly the first step is going to be bilateral and multilateral currency swaps. China will hold Saudi Arabian riyal, and Saudi Arabia will hold Chinese yuan, and the result will be the petroyuan that people have talked about.
The members of the SCO (Shanghai Cooperation Organization) and the allies of China, Russia, Iran, are going to develop mutual currency swaps. And at some point they will join together and create an international bank that will be able to create credit to finance the huge investment in infrastructure, port development, transportation, that we’re so far seeing China take the lead in developing along the old Silk Road and the Belt and Road Initiative.
This is going to be coordinated by an international bank, so that they can essentially have their economy without much contact with the dollar and the euro.
Because the dollar and euro have very little to offer – not raw materials, not much technology. They can make specialized machinery for producing computer chips, but basically it requires a whole institutional development.
And I’m sure that’s what they are discussing right now. And this is going to be unfolding in future programs that we’ll be discussing.
RADHIKA DESAI: Exactly. We’re nearly at one hour, Michael, so let’s wind down this conversation. Maybe I’ll wind it down by underlining something that you and I argued in our article “Beyond the Dollar Creditocracy.”
The dollar system has operated with a carrot and a stick. The carrot has of course been the vast financialization bubbles that the United States has blown up regularly in order to invite the rest of the world to buy dollar-denominated assets, and thereby increase demand for dollars.
And that also has of course been running into increasing contradictions, to such an extent that today, Michael mentioned earlier the Federal Reserve’s expanded balance sheet.
It went from about $1 trillion in the early years of this century to about $2 trillion, then $4 trillion after the 2008 Financial Crisis, and now it is over $9 trillion dollars.
The bulk of this money is there because essentially foreigners are not crowding into American asset markets to buy dollar-denominated assets. So those asset markets have to be supported by the Federal Reserve.
Of course, eventually it can become a sort of self-contained system, in which the Federal Reserve continues to inflate the wealth of some Americans, but the rest of the world is decreasingly interested in it.
The other – the stick – has of course been control over commodities. Michael mentioned control over oil.
Of course today many other commodities are becoming important – food of course is becoming important.
Various resources connected with the production of various ‘green’ technologies, like lithium is becoming important, so there will be a big attempt to control this.
But American attempts to try to keep control over oil has also been slipping over the last many decades. Oil prices take a turn of their own.
And of course as commodity prices go up, the value of the dollar falls. And so this is another – essentially the reason why commodity prices are going up is because the rest of the world is demanding more, because the rest of the world is also developing.
And so the development of the rest of the world itself is going to have a negative effect on American attempts to retain purchase.
So the sooner the United States realizes the folly of trying to dominate the world, and focuses on being a productive national economy, the better it will be for Americans themselves.
Because Americans have also paid a big price. The world has paid a big price, but so in a lesser way Americans have paid a price for the U.S.’s vain attempts to retain dominance over the world, even if it is only by keeping the dollar as the world’s money.
MICHAEL HUDSON: Radhika, we could have gotten a million dollars from the State Department by keeping this to ourselves and just telling them how the world works.
RADHIKA DESAI: Well I hope instead we get a million viewers. This would be far more rewarding for us.
So please watch out for our next show, which we will record in two weeks time, and you will see in two weeks time.
Meanwhile, please also give us your reactions, your suggestions, for topics we might cover. We’ll try to do that as much as we can, and we look forward to talking with you every fortnight from here on.
Thanks very much, and see you next time.
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For the NATO war on Serbia to come, see Camp Bond Steel and the Albanian-Mecedonian-Bulgarian Oil Pipeline Corporation (AMBO).
Source: Europe at Bay: In the Shadow of US Hegemony by Cafruny and Ryner c. 2007
However,
also
and finally,
Source: Europe at Bay: In the Shadow of US Hegemony by Cafruny & Ryner c.2007
from Wikipedia, since 2022:
“AMBO-Pipeline LTD is attempting to utilize blockchain technology and NFT smart-contracts as kick starters to secure funds necessary for legal, due diligence and administrative costs to activate pending loans.”
sounds legit…
Anent little white envelopes filled with dollar bills:
Bribery (or blackmail) of satellite states is one pillar of US coercion. The US regime’s real problem has always been forums in the transnational space. The US approach to that problem has been to end-run independent organizations.
They try to end-run the UNSC with NATO. End-run ECOSOC with Bretton Woods bank diktat. End-run UNCTAD with the WTO. Now they want to end-run the institutions and authorities of international criminal law with S.4240.
This crock of reeking shit sets up star chambers immune to judicial review and illegally undermines the Rome Statute, to which the US has signatory obligations. This is what happens when you have CIA-trained cookie pushers playing monkey-see-monkey-do with the forms of international law. This puerile edict would codify arbitrary foreign intervention by the US. In municipal law, anyway.
Good luck imposing that with a missile gap (a real one, this time,) an atrophied defense industrial base, and an armed force of malnourished mental defectives against allied nuclear-armed great powers, the G77 (now really G134 and counting,) CELAC, and the NAM.
As Iranian officials publicly state, the CIA impunity regime is a laughingstock, a pariah state reduced to sneaky little ratfucks. Their grand plans for show trials are about as impressive as John Bolton’s videotaped three-ways at Plato’s Retreat. The shaved apes in the NHB are digging themselves in deeper with legal exposure to UNTOC, the BWTC, CAT Article 20, and the customary international law of state responsibility. US extradition requests can be voided as persecution by a torture state. “Rendition” disappearance will not fly – if the knuckle-draggers try to snatch some enemy abroad, they are liable to end up inside the glass booth themselves.
An economy that is reduced to survive on military industrial complexes leads to unstable international transition period. The USA international behavior has one focus and that is to provide support for everything that enhance healthy growth of their military industry. Everything else was lost to others competing participants and therefore new policies are oriented for survival of that crucial industry. Especially after Soviet Union collapse new enemies and conflicts must be created. Prolonging Ukraine conflict provided new optimism for the industry, but unfortunately that conflict may break the hegemon back forever.
It has never been the play of a free market .US stopped the growth of Japanese economy in 80 at a time when capitalism was worshipped as if it were God without rival. US imposes sanctions on trades over violations of its policies that have military objectives . It allows certain behaviors and doesnt allow certain that can compete with its growth and profits . The modus operandi involves forces,coups, and sanctions. It doesnt allow market takes its course in the defense or financial- banking sectors. These are bolstered and rescued and maintained by printing money ,zero inflation, tax subsidies and by forcing other countries to spend their earnings or theur loans on defense purchases or on finanical service purchase . It forces opening of foreign nation’s vital sectors and closes the Amerucan vital sectors to foreigners. It invokes issues of threat to security for Chinese tech so that China cant penetrate or spread . It allows myriad corruptions expressed in jargon and neologism to help off shore looting and off shore parking of profits .
It always hedges and treats its own priniples in contrasting fashions depending on the countries involved: allowing India to trade,buy and manufacture products but wont make same decisions in relation to powerless other countries . It openly works with corporations in two way revolving door manners and still conjures up existences of State owned enterprises only in relation to China,Russia,Iran ,in order to rail against them and inflame negative attitudes domestically. Then it sanctions them on the basis that theese are state entitities .
“During the war, India and other former colonies had exported raw materials and built up huge government savings in exchange for these raw materials. And, as [part of] the sterling area, they were obliged to spend all of these savings on British manufactures.”
That gave a lot of room to the British to meet its deficts in relation to new world and Europe.
Now those savings earned by the 3 rd world return to US to fianance Amercian welfare at home and warfare abroad.
Often these dollar savings cant be used to establish commercial relation between any two of the 3 rd world countries without going through NY bank. 3 rd world doesnt own its own labors nor its resources . Unlimited capacity and control over the production and possession of dollars have avoided any possibility or pitfalls of managing trade defictis in respect to any country . Dollar is needed like gold or silver or fossil fuel is needed by other countries . Its a system that the figures forcing this arrangemnt divested of any underlying value coudldn’t even imagine in 1973.
Swap and accecpatnce of any currency for bilateral trade will revert the system to the pre industrial era establishing a level playing field for the weak and underdeveloped . It will also stop lootimg and parking and fleeing of capital .Two way open system will not favor that . Europe managed this by allowing only one way system by arbitrary regualion ,deceptive laws,and punituve forces .Europe kept the industries, finances and bankings of the colonies separate from its domestic markets and from the domestic competition at the same time controlling the banking ,finance and industries of the colonies . Though the ownerships belonged to the local in later years . But it was like owning dollars of today – no real power. Ameriac digitalized the conccepts through the revolving door of the dollars but its flow ,direction ,and uses still stayed within the purview of American needs and whims .
Its interesting that the menace of sovereign currency was not appreciated before by the general public until now .
Also the slow relentless atatck on dollars are not being met with new ideas and tools by US .Because it has none that will work and sametime protect its hegemony,lifestyle of the elite ,and the prerogative of arbitrary application of the plastic standard to the rest . When it goes down,it will bring S Korea,Japan, Austarlai and western Europe with it . It will try its best to mainatin stranglehold on these countries .
May be Japan and S Korea can see this and want to acquire the nuclear capabilities though sold as deterrnat against China or NK.
https://www.dawn.com/news/1731420/debt-a-longer-view
Good to see someone in even Pakistan of all places, is articulating a view and the rightwing proreligious media is allowing that aligns with that of Desai and Hudson .
“Its interesting that the menace of sovereign currency was not appreciated before by the general public until now .”
The intricacies of US international financial dealings are beyond the ability of the average American to understand. The glitches in our domestic economy, however, have made more than a few people curious including myself.
love you two.
Dr. Michael Hudson is such a great scholar of how US Financial Hegemon conducts business, it’s only fitting that his cohort be nearly as brilliant as he is.
Sadly, the gal there rambles on and on, with no directionality and purpose in what she is *trying* to say.
Benjamin Norton and team: please find someone else who is able to start with a central point, and uses a variety of details that reinforces the central point of his/her argument.
I strongly disagree. It was a good interview, very informative and thorough. I’m surprised there have been so few responses. But maybe bots found the topic too complex.
Also, Hudson there seems to be a loyal Biden fan. Gotta be something wrong with his thinking. I’d suggest finding still other proponents of the US economic-chains thesis because Democrats have had so much to do with our foreign policy ventures, they are clearly more problem than solution.
As a former Naval Officer, I think PhD Hudson has glossed over and oversimplified the Hegemony’s Military Scenario.
Murica+NATO just spent 20+Years in a fresh round of FalseFlag_9/11 initiated Long War in MENA and provocations around the World.
PNAC7 – Kristol, Khagan, and Friends
*Did Murica invade AFG? Yes. 9/11 Lies. bin Laden denied his involvement.
*Did Murica go into IRQ again? Yes. WMD Lies. Crude Drilling Rights and Executing Saddam Hussein.
*Did Murica attack LBY? Yes. Human Rights/Civil War AgitProp. Petro-GoldDinar was too much for NATO.
*Did Murica try to destroy SYR? Yes. Chemical False Flags.
*Did Murica prop up ISIL? Yes.
*Did Murica try to start a Hot War with the PRK? Yes. Bannon saved Murica+KOR from themselves and BoneShards.
The “Long War” has been “played out”. Outside of Warring Factions in Africa which may preside over Industrial Ore – there aren’t many Countries planning on threatening Murica or Murica’s Trade Routes.
I concur in a certain degree – WashingtonDC probably won’t be able to convince the Murican Public to engage in a major War of
Conscription/National_Mobilization and Invasion against RUS or CHN – probably not even in the Defense of KOR nor for an Invasion of IRN. MICC-Paid Talking Heads and Netan-Yahu may try to Drum Up IRN and PRK; but IRN and PRK now have CHN and RUS positioned to back them up through the SCO/SilkRoad and Military Advisories.
IRN have CHN – AND – PRK Military Advisors OnBoard. Did I mention that there appear to be some sort of Arms Licensing + Import/Export Transactions btwn RUS and IRN? I “Shahed” just did…🥁 IRN have too large a Land Mass and too many means to fend off Amphibious Assaults or Overland Assaults through their Neighbors.
IRN aren’t “No-Fly-Zoned” IRQ, AFG or LBY; and RUS can intervene very – easily.
PRK have CHN backing them up, with RUS standing by.
Murica can’t “justify” another False Flag War for quite some time.
On the Other Hand – ISR – might have several Campaigns brewing because they’re on pace to Double their Population several times over the next 100 Years… Territorial Real Estate will become their Topic of Interest soon.
The Murican Military can fell many Nation-States without deploying 100K Troops – their Navy and Army Air Corps(my dig – Army+Navy were set up by Acts of Congress, rest are tag alongs 😄) are up to the Task. It’s just that the Sanction Antagonists are too powerful to attempt to take down – even with a Major Unpopular War; and the more vulnerable amongst them have CHN and RUS Standing By to Aid them.
UKR may be the Final Proxy-War Opportunity the Hegemony may have for years.
A MICC funded Face Off at best.
Michael Hudson has made invaluable contributions to our understanding of economics, and this discussion is great as far as it goes, within the boundaries of what he feels safe to say. I invite consideration of one other major factor – corruption.
When he (and virtually all other analysts) refer to “American” emperialistic policies, financial and military, we understand these policies are dictated by a tiny number of ruling financiers. John Hobson explained this root of emperialist policies in Emperialism: A Study. In essence, these financiers use the militaries of their home countries to plunder the resources of other countries.
So America’s emperialist policies do not originate in the general population and rise up through their elected representatives. They are imposed by these ruling financiers without the knowledge of the general public, and often override the actual will of the general public. This is why the current policies of the Western “democracies” are sacrificing the well-being of their populations for the benefit of these few financiers.
Consequently, an opportunity to speed up the end of the Western Empire lies in the public becoming informed of this situation, and demanding their elected governments root out this devastating corruption. The internet makes this much more possible today than would have been possible in the 1800’s.
If Western citizens could take down the corrupt financiers that are bribing, blackmailing, and assassinating their way to power, this could end these financiers’ current attack on Russia before it escalates into World War Three. We would not need to wait for a ruinous economic collapse of the West.
It seems that most economic analyses and models do not include massive corruption at the center of the system. That is understandable, but hopefully will change soon.
Hobson’s main points and selected passages are in the section titled “The Nature of Empire” in War Profiteers and Israel’s Bank
https://warprofiteerstory.blogspot.com/p/war-profiteers-and-israels-bank.html
US hegemony has only increased with US intel and weapons winning the Ukraine war and dominating the semiconducter industry, a major blow the Russia-China regime’s image.
Me too, but what is not too hard to understand is all those stacks of cash, and treasury bonds out there in the world are like IOU’s that one day are going to be cashed out and called upon, and some mother fuckers are going to be holding the turkey. If you have any holdings in U.S. dollars get out now!
must say…
Again with the “multipolarity” delusion. See Ian Davis for a detailed dissection of the multipolar hogwash:
https://www.ukcolumn.org/article/who-wants-a-multipolar-world-order-part-ii
Well, it is socialism, and that’s why in the United States, they’ve done polls, and find that most people prefer the world ‘socialism’ to ‘capitalism’. Many people in the United States claim to be socialist, but finance capitalism is not socialism.
We keep forgetting that the commune had two versions: Russian-Jewish or Soviet and German-anti-Jewish or Nazi. In principle, the actions did not differ much. And both, in mutated form, still exist.
This distinction, which Rosa Luxembourg called the fight between barbarism and civilization,…
Who are more dangerous them or Klaus Martin Schwab’s puppets?
…thousands of communists – on the 104th anniversary of the deaths of Rosa Luxemburg and Karl Liebknecht – gather for the annual demonstration commemorating the murder of revolutionaries.
US hegemony is in decline, following the fate of all great powers in history. History also shows: every empire eventually gets the war it is trying to avoid – convinced it won’t. But will there be anything to inherit except rubble?
https://patternofhistory.wordpress.com/
With the current cultural development it is ridiculous to try to justify the ideas of racial superiority that caused the genocide of hundreds of millions of human beings to rob them that resulted in the failed world we have today. Humanity deserves a better fate than living by stealing the right to life of others.
And the ideas of preserving nature have human beings in the first place or everything turns out to be a farce.
So socialism CAN’T work — try saying that in Chinese.
What it really is that Jewish capitalism (financialization) can’t work. Capitalism worked when guys like industrialist Henry Ford loved seeing thousands of workers coming into their plants at every change of shift. Jewish capitalism loves to lay off the worker and watch their bank accounts grow instead.
Send your jobs to China and watch your country follow. And boy are the Jews in for a “revolting development” when they try to move their butts to China and repeat the “sell-out”. The Chinese will simply say – “Shalom, dudes- you aren’t moving here.”
It doesn’t seem such a big deal. China pays for its oil imports from Saudi Arabia in Chinese Yuan.
Saudi Arabia holds a reserve of Chinese Yuan. They use the money directly to pay for local Chinese run development projects. China is their principal source of imports.
The dollar really doesn’t come into it. This part of world trade and international development is denominated in Chinese Yuan.
Unipolar world = Zionist-controlled US Empire
That’s coming to an end.
http://biblicisminstitute.wordpress.com/2014/08/05/israel-the-scourge-of-empires/
“It is well that the people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.” —
Henry Ford
“The few who can understand the system (check money and credits), will either be so interested in it’s profits, or so dependent on its favors, that there will be no oppositions from that class, while on the other hand, the great body of the people mentally incapable of comprehending the tremendous advantage that capital derives from the system, will bear its burdens without complaint, and perhaps without even suspecting that the system is inimical to their interests.” — Rothschild Brothers of London
What is interesting to note is how all of this ‘Multipolarity’ is inevitable. The US as a World Hegemon is in decline and there is nothing the Financial Pirates of the US Global Banking System can do about it! If the ‘Exceptional Nation’ accepts Reality and acts like the Bankrupt Nation the World Hates, the USA and their Owners: the Neo Cons, the Israel Lobby and the War Industry, will yield a Crash of Epic proportions. US Rulers–elites if you want to call them that–will be shown for ALL the World to be the sleazy, corrupt, warmongering FAILURES they are. The USA’s descent into 3rd World status will accelerate at breakneck speed. Then, there will be many Nations of the World who will take revenge on their USA Oppressors. This is what the Rulers are afraid of.
Except that they have lost the war in Ukraine (and all other wars since the Philippines) and China controls the world’s semi-conductor manufacture.
Whilst Taiwan and S Korea are nominally the world manufacturers of SCs, the truth is that both have their components manufactured by ‘sister’ companies in China.
Intel has some 29 manufacturing plants, but only one plant that makes the machines (and spares) to actually manufacture SCs.
China cannot at this stage manufacture or develop the 5n chips but has endless capacity for 11n. Like a Rolls Royce, you don’t really need one or a 5n chip. A good old Ford, Volkswagen or 11n will still get you there.
US AND JAPAN PREPARE FOR CONFLICT WITH CHINA
Video Link
The Jewnighted Stasis has morphed into a parasitic empire, not an even exchange or mercantile set of arrangements. Long controlled by the Talmudic Parasites, it became the same when it grew up.
Interesting isn’t it, that Russia and China are offering reciprocal arrangements. Neither had a colonial history of subjugating other peoples for profit and fun.
… National Socialism had done ?
So close to the truth and so prissy to speak it out, Dr. Hudson. China is a counterfeit of the original, although not a bad one.
An interesting and intelligent post. I would complain that they ignore the role of the rich forcing population growth, but still, well said.
However:
“There will never be another Vietnam. There will never be the United States invading another country.”
Possibly correct, but also not relevant.
1. To paraphrase the late science-fiction author Jerry Pournelle, conquest is expensive, but destruction is cheap. The western elites might not be able to invade and conquer a nation, but we can sure as hell wreck it. Look at what we did to Libya, and almost did to Syria (although we did cripple it). Again if I can draw from science fiction, from Frank Herbert “The power to destroy a thing is the absolute control over it.” Russia and China seem to be holding firm, for now, but how many other nations can withstand these sorts of attacks?
The western invasions of Afghanistan and Iraq ‘failed’ – or did they? Both countries have been devastated and made largely powerless. And the western elites made piles of profits. Perhaps this was as intended?
2. The west can indeed conquer other counties, but through subversion: as in the 2014 coup in Ukraine. The west tried similar tactics recently in Belorussia and I think Kazakstan, and failed, but they can keep trying and they only need to be successful once. Effectively unlimited money can be more powerful than fleets of tanks.
Bottom line: the western elites no longer have need of a future Vietnam, they have moved to more efficient models of conquest and control. Their empire may still collapse, mind you, but they are very far from toothless.
hope so…
“A character like Trump” brought us general prosperity.
Hey Pablo, stop jerking off to the demise of your hated America.
Great comment. I’ll wager that conscription in the US would lead to mass resistance greater than that against the vietnam War. Now even the majority of traditionally minded, “conservative” / rural / suburban white Americans won’t fight for this scumbag regime ruling us — and rightly so.
As for our family, we’ll help our sons leave this country and not return rather than be drafted. They have multiple citizenships and we’ll be working to help them acquire another. Better to renounce US citizenship than “serve” aggression and evil.
They will not murder men, women and children thousands of miles from our borders who pose no threat to us here. Nor will they risk being justifiably killed, maimed, or paralyzed by the people defending their own lands against US invasion and bombardment.
Never thought i’d quote the hippies, but:
WHAT IF THEY HELD A WAR AND NOBODY SHOWED UP?
To the contrary, both ” Russia ” and ” China ” are imperialist constructs. They have invaded and annexed plenty of their neighbors. That’s how they grew to the size they are today. And both Moscow and Beijing seek to retain if not expand their regional hegemony. Ask Vietnam. Ask Ukraine.
Seems you skipped history class.
Hudson’s been banging this drum for a while. Sorry, but he’s not Phil Rudd. And whereas economists howl and wail and shout ” America is doomed! ” (as they have done for decades) some Wall Street hedge fund manager just quietly gets on with making billions.
You Ess Aye!
What is the ratio now? Last I heard it was something like $.52 on the dollar of the US federal budget went to “defense”.
You’re on your way out, a**hole. 90 percent of the world will trade with China before Israel and its puppet. It’s over. Maybe not today, maybe not this year, possibly not this decade. But you’ll live to see its end.
Not more Marxist theory. No! How could anybody by 2023 take Marxist theory and prescriptions seriously enough to attempt reasoning within Marxist framework?
Look, the ultra-financialized economy (24% interest rates on credit cards, corporations legally able to spend their capital on “stock buybacks”, comparatively immense government borrowing) is Marxism in action. The “vanguard” class makes all the decisions, and it makes them wrong for society, but right for the vanguard. In the Soviet Union, the vanguard attempted to run the USSR’s economy under Krushchev, but gave up after his disasterous failures and contented itself with minding its own interests. Sic semper marxists.
Consider this:
OK, so Obama controlled enough money to save Citibank. What Obama did made Citibank into a government bank. Did that bank “loan money for productive reasons”? Of course not. Government can’t tell “productive reasons” from ripe watermelons. The old Soviet economy found that it had no control over the actual economy, that several layers of local bosses redirected funds and falsified reports. The industrial economy had learned this under Stalin, when reports of success were life and death matters. What Obama did was make Citibank a more reliable source of graft and preserve the entire system of elected officials becoming millionaires while in office. It’s what’s known in politics as “clean graft”.
The USSR was able to produce military goods, but only at great expense (rather like the US).
So, what is https://www.unz.com/mhudson/explaining-multipolarity-decline-of-us-hegemony about? Simple. The US is failing, and the US government wants more control, probably so they can steal more before the failure becomes terminal.
As for the “imperial” interest opposing development in the “rest of the world”, it was the US initiative to the People’s Republic of China that started China’s rise. (Note that China ended a command economy to enable the rise.)
In the broadest terms, the US won the Cold War by making Globalization both possible and so profitable for the 3rd World that the 3rd World came over to the US side, this despite a deeply held grudge against the West for the West’s actions from Columbus to WW II. However, globalization has destroyed the West, or at least almost finished the destruction of the World War era.
So the sooner the United States realizes the folly of trying to dominate the world, and focuses on being a productive national economy, the better it will be for Americans themselves.
Easier said than done. I just wonder how the 1% will agree to bring back production which will eat away at their income, to make way for more equality.
I just in the past few days read a synopsis of who the US dismantled the Japanese semiconductor industry as it was passing the US in the 1980’s. Japan deserves to lose it’s military because of what it did in the past… But stifling it’s industry just to keep the US the hegemon is unjust.
Never read such a nonsense.
St. Domingue was (with Cuba and Argentina) the most prosperous Latin American country, when it was run by the French, some 200 years ago. An immense tropical garden with plenty of French infrastructure and know-how.
The 70 000 French had the bad idea to import 400 000 slaves and when the French Revolution told them they were as equal and capable as Whitey, they cut the throats of the French (and of each other), ruined the infrastructure and created the shithole now known as Haiti.
The blacks never paid for the infrastructure left by the French, nor for the victims of the genocided French and are still asking for money because they are unable to export anything but their human surplus – visible south of the Rio Grande.
You make good points…. Specifically with Saudi Arabia it Hasn’t happened yet – but is happening. That meeting was to announce to the world that’s what is going to begin. Venezuela gets debt write down in exchange for oil… Iran barters goods to sell its oil to China (which Iran announced in 2022 it is their highest since the US sanctions over JCPOA) – while Russia is now selling almost half to China with yuan and rubles. So yeah it’s happening more and more. If I’m not mistaken India is buying from Russia using rupee and rubles…
Elsewhere Argentina and China just announced a further currency swap. Aside from what you noted – Argentina is doing it to hedge US dollar exported inflation and to leverage being able to use Chinese funds to build up it’s own industry
I am very keen to learn more about Plaza accord . Also eager to know what else was embarked ( by US) to stifle Japan’s growth .
Any source or name of a ( thin ) book would be appreciated .
Lol. The semiconductor does not have components made in China, it gets raw materials from Cbina. The actually important technology is made in Europe (Dutch ASML).
The USA controls the industry that’s why TSMC cannot sell to Huawei and is building more and more fabs in the USA.
USA lost all wars since Phillippines? I guess that’s why the USA is the world hegemon huh
Sucks to live in lala land
The hegemon is not really the United States. The JUSA is just an appendage, a limb controlled and directed by the ZIO Oligarchs International, Inc. No West leader decides anything; they are all sock puppets, told what to say, when to say it, and which hand to wipe their ass. All of them. “Joe Biden decided, said……..etc”. He, like so many read the script and follow orders. One must constantly remind oneself.
Annexing is not the same as colonization. Annexation that is permanent involves common interests, culture, and mutual benefit.
Vietnam is not a colony of China. You are confused, as usual. See, it’s like primary colors of red, green, and blue. From blending them, you get other colors, varieties. That’s the difference between a superficial glance and a longer, deeper look and knowledge.
“Imperial constructs”?
“On the Other Hand – ISR – might have several Campaigns brewing because they’re on pace to Double their Population several times over the next 100 Years… Territorial Real Estate will become their Topic of Interest soon.”
Soon? I think you mean, Right now. The Jewish-Russian war in Ukraine –which is what it really is, carte sur table– is of course a well-planned war to devastate Ukraine in order to turn it into New Israel: fertile, just-recently-ruined, dirt-cheap land just waiting to be “reconstructed” by Jewish “investors” for pennies on the shekel (how do you think they began grabbing Palestine?!), complete with pre-installed demoralized serfs and widowed and orphaned shiksa sex-slaves. Plus, no pesky Moslems around to bother them about “waqf”.
Michael Hudson’s “Secret Life”….enjoy!
https://www.larouchepac.com/the_british_using_george_h_w_bush_destroyed_the_first_church_committee_s_achievements_a_true_crime_story_and_lesson_for_our_times
from the article!
“A man by the name of Michael Hudson entered a New York bar one night in 1983 for a meeting. An economist by trade, he had worked at Chase (he says for David Rockefeller personally) and Arthur Andersen, and then went to the Hudson Institute under Dr. Strangelove himself, namely Herman Kahn. Under Kahn at Hudson, he advised the White House, the State Department, the Defense Department, and other governments about developing sector debt before joining UNITAR at the UN. He then became an economic advisor to the Canadian government. All the time, he was a devout disciple of Leon Trotsky and Karl Marx. He says he is Trotsky’s godson, and that he holds or held the copyrights to both Trotsky’s works and the works of the Hungarian neo-Marxist George Lukacs. Lukacs is considered by most to be the founding philosopher of the Frankfurt School and the modern European Marxist theory practiced in the United States and Western Europe.
Hudson had approached Lyndon LaRouche’s associates in early 1980, bringing with him his collection of works on the Meiji Revolution in Japan, the American System of political economy, and a claimed devotion to the works of Heinrich Schenker in classical music theory. He also claimed to center his economics on the substance of human economic productivity—also an essential topic in the works of Lyndon LaRouche. ….
In 1981, Hudson undertook to lend the financially strapped book publisher associated with LaRouche $75,000 at usurious interest rates. Some of us argued that the loan was a setup, given Hudson’s sketchy background and the loan’s egregious terms. Other New Yorkers, our investigation showed, had accused Hudson of various financial scams and fraud. But, expediency won out. When payment didn’t occur on the precise terms of the note, Hudson sued, not in state court where suits on promissory notes are quickly won or settled, but under RICO, in federal court, with all sorts of false allegations against leaders of the LaRouche movement. LaRouche and friends concluded the obvious: they had been set up.”
You are talking nonsense. Placement of the US military base in any country means losing sovereignty of that country. Now count the number of US military bases around the world and counts Russians or Chinese. Ironically, Taiwan is essentially US territory…at least the sinister boys in Washington think so.
Not only defense spending but multipliers effect of military industry is enormous. For instance a company making buttons for general public is considered non-military, even if it sales buttons for military uniforms.
You don’t seem to realize that there’s an economic dimension to the ability of any nation to execute its “will”. “Willpower” is necessary but insufficient.
Congratulations! A post with every sentence being incorrect or completely false. Obviously your knowledge of semiconductors would fit on a 5nm process node (or less).
Well yeah the Plaza Accord forced Japan to stifle it’s economy – such as put it’s currency where the US wanted it. But the semiconductor industry was separate. They crushed Japan’s NAND memory and Toshiba directly for example. They stifled Nikon and Canon in lithography in favor of ASML… I wish I had time right now – but try typing those things into a search engine and see what you can come up with…
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Important reminder on the meaning of words:
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Very important : the real meaning of the words “thread” or “menace” for Washington :
Key part of your post:
Not more Marxist theory. No! How could anybody by 2023 take Marxist theory and prescriptions seriously enough to attempt reasoning within Marxist framework?
Look, the ultra-financialized economy (24% interest rates on credit cards, corporations legally able to spend their capital on “stock buybacks”, comparatively immense government borrowing) is Marxism in action. The “vanguard” class makes all the decisions, and it makes them wrong for society, but right for the vanguard. In the Soviet Union, the vanguard attempted to run the USSR’s economy under Krushchev, but gave up after his disasterous failures and contented itself with minding its own interests. Sic semper marxists.
Consider this:
OK, so Obama controlled enough money to save Citibank. What Obama did made Citibank into a government bank. Did that bank “loan money for productive reasons”? Of course not. Government can’t tell “productive reasons” from ripe watermelons. The old Soviet economy found that it had no control over the actual economy, that several layers of local bosses redirected funds and falsified reports. The industrial economy had learned this under Stalin, when reports of success were life and death matters. What Obama did was make Citibank a more reliable souce of graft and preserve the entire system of elected officials becoming millionaires while in office. It’s what’s known in politics as “clean graft”.
The USSR was able to produce military goods, but only at great expense (rather like the US).
So, what is https://www.unz.com/mhudson/explaining-multipolarity-decline-of-us-hegemony about? Simple. The US is failing, and the US government wants more control, probably so they can steal more before the failure becomes terminal.
As for the “imperial” interest opposing development in the “rest of the world”, it was the US initiative to the People’s Republic of China that started China’s rise. (Note that China ended a command economy to enable the rise.)
In the broadest terms, the US won the Cold War by making Globalization both possible and so profitable for the 3rd World that the 3rd World came over to the US side, this despite a deeply held grudge against the West for the West’s actions from Columbus to WW II. However, globalization has destroyed the West, or at least finished the destruction of the world war era.
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I will here assume that RF/Ukraine conflict does not end with widespread use of nuclear weapons. Such use would result in a “broken back” world that would see regard itself as immediately and fundamentally different from the pre- UR/Ukraine conflict world.
US grand strategy after WW II was essentially to destroy all strategic rivals: UK, Europe, Japan, USSR. The US destroyed the UK’s Empire during the Suez crisis, destroyed Germany with the EU, did not destroy Japan because Japan withdrew from competition in the 1990s, and of course destroyed the USSR (which could not enter the US trading network, and could not have competed within that network if the USSR had entered it).
The US tried to incorporate the semi-independent Middle East (Iran, Iraq, Syria) and Central Asia (Afghanistan) in its global trading network, but failed to do so. The US favored Israel in these conflicts, largely because Israel was an area specialist and was already an element of the US trading network (AKA “Globalization”), but also because of the Jewish coalition’s political dominance within US Federal Government (USFG).
US grand strategy is now failing. If the Russian Federation (RF) wins the RF/Ukraine conflict, the US will almost certainly be ejected from its present suzerainty over Europe. The US Federal Government (USFG) will be unable to sell T-bills (to borrow money) from Europe, RF, China.
Why is this important?
It is important because after WW II the USFG found itself an Imperial power (strictly speaking, a suzerain). The USFG was an Imperial power because its income no longer depended on US tax receipts. USFG could (before Nixon) simply deplete its gold stocks, and (after Nixon) simply borrow more money from the “Free World”. US popular opinion no longer mattered to USFG basic policy.
USFG used its freedom of action to establish the US trading network referenced above, and to give free access to the American market to any nation that cared to ally itself with the US. Even Maoist China found this to be irresistible, as the entire Third World was having trouble feeding its population. Further, USFG under Eisenhower delegitimized the European Empires during the Suez crisis.
The net result of US actions was to destroy Western legitimacy and to “hollow out” the US, destroying its industrial base and its ability to innovate in science and engineering (“innovation” is now called “earth murder”), preventing any further expansion of the ethnic base that had fought and won WW II, and reducing its descendants to perhaps half the US population; this was coupled to a program of cultural genocide starting in the 1960s. Such a strategy and domestic program would have been impossible had the USFG been dependent on domestic tax base. The “hollowing out” made the US incapable of maintaining the “Pax Americana” that legitimized its suzerainty. (See: Martin van Creveld, “The Fate of the State”, Parameters, 1997. Consider the rise of a hostile China, which is currently inciting a war with India by diverting the headwaters of the Ganges and Indus rivers ( https://www.lowyinstitute.org/the-interpreter/india-china-relations-geopolitics-water ). India sits astride China’s primary trade routes, and will interdict them should a hot India/China war start.
So What? Why is this important to US domestic politics?
It is important because a loss in RF/Ukraine conflict ends the decades of US suzerainty (as described above), and therefore end the decades of USFG’s independence from the US tax base.
This is a fundamental change in the US political system. USFG intervention will greatly lessen as enforcement funds are reduced to a bare minimum or possibly zero.
Regions such as Texas or Kansas that are economically viable will become much more influential, able to act independently and deny income to USFG. You can expect E. Musk’s actions at Twitter to become a template for CEOs/Boards should USFG’s client Ukraine lose the RF/Ukraine conflict.
Regions such as the Northeast and the West Coast will find that they lack money to feed, clothe, and house their populace. The West Coast may find that it lacks the money to supply Los Angeles and San Diego with water.
The large urban areas, economically obsolete since ~1970 and currently being deserted, will cease to be politically important. The city government of New York City (NYC) is already giving out abortion inducing drugs and trying to refuse immigrants, a strong sign that it cannot support its present inhabitants on its present income. Since much of NYC’s income is from USFG, the support offered to NYC’s inhabitants will lessen should USFG become dependent solely on the US tax base. The ensuing disorganization and disorder (already in process) will destroy NYC and other large cities as political powers.
This fits a pattern of most Empires: they are founded by a government dependent on popular support, their Empire destroys that dependence, and their government becomes incompetent because it is unconstrained by popular support. Historically, most such Empires are conquered by barbarians, but there are no similarly powerful barbarians now. More likely, the world will simply devolve back into spheres of interest, much smaller spheres than the current US suzerainty. World population will decline sharply.
Comments? Non AI commenters are favored (search for “dead internet” on Youtube.com to see what I mean).
Could someone help me out? What happens to the money supply when a central bank purchases government bonds from the government? I am very unclear about this; would this all be an accounting entry that had no effect on the money? The government could simply spend unlimited amounts of money?
This whole dialogue is framed in false statist logic when it comes down to economy.
What has made China successful, is simply that by moving towards controlled capitalism, they unleashed the energy of society which they had been formerly repressing. They did this in a controlled manner, but the power of capitalism and free markets is so huge that it can can give an enormous boom to the economy. Statist countries (big government, and control over the economy) can produce a boom when unleashing the power of free markets and capitalism, but on the long run, after the boom, the control by government wil start to be a hindrance. Moreover, China has been lifting on Western capitalism, free markets and it products.
Simply, the people of China, were getting a cigar out of their own box, their disastrous communist slave system being opened up, releasing energy, so that the economy could improve.
This is the typical caricatural propaganda which statists spread, based on mere belief and pretence. The real situation is that it is capitalism and free markets, in despite of their minor evils, which have lifted the whole world out of poverty the last three centuries or so, and statist government, whether Western type of statism, or communism and socialism. have brought nothing but poverty, sabotaging of the economy, and proletarian dictatorship.
One must realize that UNZ is the home of statists, lot’s of articles consist of statist propaganda, and the world and economy according to statists. Statists are always out to assign to themselves and their ideological models the successes which are the product of capitalism and free markets.
Great comment, Johan!
Yes, it is remarkable how the role of the state in causing poverty is so often overlooked. They have always realized that the power they wield over the people is inversely related to the level of capitalism they allowed. The implicit threat to the state of capitalism is that they would lose this power. One can have a remarkable level of power over the people when they live in absolute poverty; yet, once affluence emerges government’s actual level of power on main street largely evaporates.
The miracle really is not so much that capitalism works (This has been known for centuries), but that the state has finally gotten out of its way and allowed prosperity to flourish. It is then so hugely ironic, that when they finally stopped obstructing a better life, they begin congratulating themselves for their “achievement”.
Statists are those whom imagine that economies can be controlled by government; or at least governments whose main activity is to disguise the real power behind the rituals they promulgate.
Statists are believers in the pretence governments are agents of democracy; as though they are people like you and I — i.e. ordinary people representing you and I.
At any one time governments are larded with the same people, presenting as novel, each time after a suitable refresh, the revolving door ejects them once again into the public domain. These people are professionals — professional liars! The state cares not a fig for those whom are believers, or in the paid liars either. The state is the iron fist — its promulgators are merely embroidered gloves — the people are wide eyed gullibles — fascinated by the entertainment.
This is a good documentary for Japan if you haven’t watched it:…”Princess of the Yen” by economist Richard Werner::
And a short video of how the USA dominates Tech using underhanded methods:
Video Link
Repeating propaganda does not make it true. I’m too lazy to explain but it wasn’t US initiative. Why would the US help Communist China in 1971 when it could have helped “democratic” India? In short, China’s rise begun when Mao Tse Tung kicked out all the foreigners that had invaded and looted China for over 100 years. Mao rebuilt the foundations for a successful society starting with health, life expectancy, literacy (education) etc…..
Typical western MO: take all the credit, never any blame.
Opium war: China’s fault.
Treaty ports: China’s fault.
Japanese Invasion: China’s fault.
One of the greatest of nineteenth century [western] philosophers said: “they are the slime of the earth and the masters of lying”.
The entire “history” of the twentieth century, as written by westerners, is almost completely a lie.
Will this century be different? It will be different to the degree that economic independence from the west is attained by Russia and China.
Yeah the only purpose of US engagement of the PRC was to exploit the rift between the Soviet Union and PRC. The US couldn’t care less about China. It just wanted another nuclear power “on its side”. Chinese economic reform came about 8 years after through consultation with Singapore – not the U.S.
in many ways China regrets helping the U.S. now. Chinese and Russian leaders formed the SCO to not repeat that mistake again. Joe Biden once boasted that Russia couldn’t do anything about NATO expansion and that Russia could either bow or look toward China and Iran (mocking). Well 20+ years later Biden’s own words are coming against him
https://www.theguardian.com/world/2023/jan/19/france-hit-by-nationwide-strikes-over-macron-pension-plans
In France, the people have spine. In America, on the other hand, they kiss the asses of the people who oppress them.
thanks
really appreciate your comment; I am attempting to re-read it a few times to fully understand the strands you’ve pulled together and your synthesis, which is ringing all kinds of bells in my brain.
While we all have our noses in the global news hog trough, the Congressional electors and also busy camouflaging the national news. Hourly, it seems, the public hears of ‘defunding police’ and ‘cancelling the IRS hires” and so often, and so changeable, that we really have no idea.
Well, here’s some news.
https://waysandmeans.house.gov/brady-democrats-force-taxpayers-to-cover-irresponsible-promises-with-largest-private-pension-bailout-in-history/
PENSIONS GOING BUST!
And this is only the beginning of what the public will be shocked to discover. The massive glut of police hires prompted by the propaganda scares of crime, daily murders, and the coverage of once-finalized issues brought back to life as scenery extras is breaking the national bank.
Community Justice Centers with 100 staff all receiving state benefits. And this in communities that normally had 2 dozen neighborhood police. Where is the money coming from?
This is more true than anyone can imagine. The beginning and end of the Covid scam-demic should have awakened many “non-geo-political” citizens but didn’t. So, as a gesture of erasing some lies of the 20th Century, I take a page from Mao and start with health.
Take 20 minutes to go through the first 2 chapters….best 20 minutes of you and loved ones lives.
https://archive.org/details/virus-mania-how-the-medical-industry-continually-invents-epidemics
Short video if you prefer a primer:
https://odysee.com/@drsambailey:c/the-truth-about-viruses:a
The correct term for the average American: lumpenproletariat.
You wouldn’t know Marxism from the Marx Brothers. Yeah, Marx argued for the “financialized economy”.
His call for “Workers of the World, unite!” was just his way to propose AAa-rated collateralized mortgage obligations LOL.
“Prolonging the Ukraine conflict provided new optimism for the industry (MIC), but unfortunately that conflict may break the hegemony back forever.”
I think you might have meant to say “fortunately” . The world will certainly benefit when our current sole superpower status is relinquished and it’s only a question of time when that will occur. The results of the war in Ukraine are not going to change the end result, only the timing. Washington D.C. however seems convinced that winning the war will enable the United States to maintain hegemony and USD supremacy forever. Given the numerous instances of escalation, the latest being more tanks, more tanks, more tanks, the likelihood of the D.C. crowd convincing NATO to directly engage Russia is increasing by the day. Sholtz gave into pressure on the tanks and Stoltenberg is more likely than not to give in to US pressure as well. What a mess started be the clueless Biden Administration. An unnecessary and really dumb war gets more so by the day while also upping the risk of a worldwide conflagration.
Even more: it cannot be said that ‘they (governments) finally stopped obstructing’, even in the US the government obstructs and corrupts through various forms of protectionism and interventionism, let alone the statist/socialist governments in Europe and China. Capitalism and free markets (combined with science) is so powerful that when governments milk this cow continually, even when they abuse it in all kind of ways, it still produces an abundance of ‘milk’.
It is their still existing interventionism which makes governments look like beneficial participants, and which makes fools believe they are required. They sometimes even manage to blame capitalism and free markets for the disruptions government themselves have caused. Apparently many people today are still that primitive and superstitious that they believe that authority from above is needed to make such things work.
It is a desperate ponzi scheme that is overtaking taxation income.
Obviously. Then there was that international secret police pact…
In this case, a facade make trivial things non-transparent. Asserting “USA” does all this is like swapping “Vatican” for “Italy”. Or in this case, «financial oligarchy» of Italy.
Which is, of course, nonsense. In the matters of dominance, the question is simple: could CNN bully Facebook (demand it to do something Facebook didn’t on its own, without compensation), or could Facebook bully CNN? And the answer is obvious.
And does Guardian push for something else entirely, irrelevant to (or at odds with) interests of CNN, after all it’s not in “USA”?
So without smoke and mirrors, what’s left is a theocratic oligarchy.
Any theocracy capable of unchecked expansion is going to have similar basic properties due to its nature. Whether bells and whistles are Catholic, Protestant with catholic (small “c”) style doctrine or Marxist (which are each other’s descendants in this order, of course)… if the Aztec priests somehow got lucky enough to reach other continents before being bogged down in their own blood bath, they would do much the same (details may vary, though they did kill people for good weather).
Thus the new theocracy is also international, as are most important affiliated organizations, even if UN was crippled early on. As such, it has ability to pool forces (in whatever form) and maneuver with them across all those quaint secular borders. Its obvious interest is increase of this advantage.
Someone has to actually rule the yokels in the real world. When the goal is setting up a puppet regime, the local supporters are poor choice of forces for occupation and oppression: they have all those pesky human attachments and/or tend to work toward their own dominance, rather than their owner’s. Thus, foreigners. As long as they are pious. Even if the nu-Rome itself burns in a riot, the nu-Vatican can simply call on support of loyalists from further away.
Thus, dependent.
The error, however, is fundamental.
Generally, to determine whether something failed, or not… you need to know the actual objectives. Obviously. The problem is, usually those are not known. How? Everything meaningful is decided behind the closed doors. Every POTUS after Roosevelt is a figurehead, US Congress could as well be replaced with Professional Wrestling, international Lamestream press preaches such half-assed nonsense that it’s quite worthless beyond designating targets for the zealots and insulting the public’s intelligence.
In a few cases we can be quite confident about the goals, however. For one, Saddam was obviously whacked for trying to sell oil not for dollars. So the ultimate objective: defend the petrodollar. Intermediate objectives: crush Saddam, deter others with the show of force. Was the goal achieved? Duh.