Sunday, December 30, 2012

International Realism: From Nation-States to Private Capital


"And every nation has its appointed term; when their term is reached, neither can they delay it nor can they advance it an hour (or a moment)." – The Quran (Al-Araf)

Introduction

                From the nation-state anarchy that emerged after the Treaty of Westphalia through the first decade of the twenty-first century, the international stage has been in constant transformation, through a series of historical events consisting of conflicts, treaties and the creation of international organizations, which have evolved world international relations into a new epoch.  From Westphalia onward, individual nation-states struggled and created alliances in order to pursue and protect national interests under the model of anarchy.  Through two major international conflicts, World War I and II, in which the victorious alliance of nation-states established a collective hegemon and inadvertently propelled a new nation-state power, the United States, to the international stage creating a world balance of power between capitalism and communism, termed the Cold War, under the influencing forces of created International Governmental Organizations such as the United Nations, the World Bank and the International Monetary Fund.  As anarchical nation-state power struggles consolidated under a single superpower nation-state after the Cold War and private sector capitalism pushed freely across the globe through mechanisms of established international governmental organizations, the world authority model of global governance which nation-state governments had evolved to became mere mechanisms utilized by a new model of anarchy that had emerged on the international stage in which private sector corporate actors ruthlessly competed for resources and interests as nation-states had once done at the time of Westphalia.  The events of the last century have brought an end of international anarchy between nation-states, consolidating and constraining nation-states under globalization, while unleashing the anarchy of private sector capitalism which has marked a new epoch in international relations.

Nation-State Anarchy and World War I

                As the young nation-state power, the United States, was on a quietly rising path of economic strength due to its vast natural resources, its ability to export to both sides of the European balance of power and the isolated geographic distance from Europe prior to World War I, the nation-states of Europe were entangled in thick political chains of anarchy and near the brink of continental conflict.  As a natural component of nation-state anarchy, alliances contributed heavily in the conditions that caused World War I as Britain, France and Russia created the Triple Entente and Germany, Austria and Italy created a Triple Alliance.  These alliances were the direct results of concerns by Britain, Russia and France toward the rapidly rising economic and military power conversion of unified Germany, as “Germany had pulled even with Great Britain, the preeminent power in Europe, and was three times wealthier than France or Russia. In 1913, one year before the war broke out; German wealth exceeded that of Great Britain by 40 percent”.  Germany, on the other hand, had their own security concerns about being geographically encircled by the nation-states of the Triple Entente, especially the arms embargo implemented by the Triple Entente in order to prevent neutral U.S arms sales from reaching Germany.

                Commonly in regional anarchic nation-state conflicts, vulnerable satellite or colonial territories belonging to or protected by larger nation-states can often create sparks that ignite regional conflagration.  This was the case leading into World War I when, in 1914, Austria-Hungary, backed by Germany, declared war on Serbia, which was backed by Russia, after the assassination of Archduke Franz Ferdinand.  The result was a Russian military mobilization and a German declaration of war which began what historians call the Great War, World War I.  The United States would join the side of Britain toward the end of the conflict claiming the issue of German submarine warfare and the provocative Zimmerman Telegram which offered Mexico the opportunity to become a German ally.

Nation-State Anarchy and First Attempt at Collective Security

                The defeat of Germany in World War I brought to the European surface several ramifications from the Treaty of Versailles which included German surrender of colonial possessions, heavy economic reparations on Germany and the loss of German control over the Ruhr Valley, Germany’s leading industrial area, to French occupation.  Even more important in the aftermath of World War I was the first attempt to establish a liberal model of collective security in the creation of the League of Nations.

                The liberal League of Nations was a failure in moving the world into a model of world authority in global governance mainly because it placed all nation-states, the victorious and the defeated of World War I, on equal footing as “all Council members, great and small, had a veto”.  Despite the intentions behind Wilson’s Fourteen Points plan and the League of Nations, the goal of collective security was not reached and the result was a formal meeting place for continued nation-state anarchy.   As a result, individual nation-states again came face to face with the same balance of power, along with the same fears and alliances that had originally caused World War I and Europe once again faced the rise of German economic and military power, which was erroneously left unified after World War I by the winning states of that conflict.

The Second War, Consolidated Balance of Power, and IGOs

                Several pertinent developments occurred after the conclusion of World War II, in which the winners of WWII repeated the victory of the First World War, and the United States propelled itself to the position of an international military power with nuclear capability.  Those developments were:  1) the previous mistake of nation-state equality within the failed League of Nations was corrected in the establishment of the United Nations Security Council.  2)  International Governmental Organizations aimed to promote private sector capitalism were created at Bretton Woods which would loosen private sector capitalism from the previous restraints of nation-state borders. 3)  A bipolarity balance of power developed between communism, led by the Soviet Union in the East, and Capitalism, led by the United States in the West which began a massive arms race, beneficial to private sector capitalism, which would stretch above the planet under the category of space exploration.

World Authority, UN Security Council, Bretton Woods & Cold Balance

                International anarchy on a nation-state level began degeneration with the establishment of the United Nations, and more specifically the establishment of the UN Security Council with five permanent members possessing veto power: the United States, Britain, France, Russia and China.  While the United Nations were successful in establishing a collective hegemony and world authority to prevent further international conflict, it did not prevent the international stage from dividing into bipolarity between the two major military superpowers after World War II: The communist nation-state of the Soviet Union, which developed nuclear weapons in 1949, and the United States, who following World War II would champion the banner of private sector capitalism by creating the Bretton Woods international organizations of the International Monetary Fund and the World Bank.  These International Governmental Organizations would eventually develop into powerful instruments that would allow private capital to manipulate, and eventually control at times, nation-states that had embraced or had been opened to capitalist markets.  It is the creation of the Bretton Woods international governmental organizations that mark the beginning phase of private sector anarchy on the international scene.  As the nation-states of the globe consolidated further into a world authority model under globalization, the more anarchical model of private sector competition branched out and grew more competitive.  In order to fully understand the beginning phases of capital anarchy, it is vital to understand the creations at Bretton Woods.

                The International Monetary Fund, with its current 188 nation-state members, “came into formal existence in December 1945, when its first 29 member countries signed its Articles of Agreement. It began operations on March 1, 1947.”   The International Monetary Fund is the organization that sets the international exchange rates between various nation-state currencies.  This international exchange rate is the vital human skeleton for international private sector capitalism and allows capital to cross national borders and assume various physical and monetary forms depending on final destination.  After World War II the International Monetary Fund “began to expand in the late 1950s and during the 1960s as many African countries became independent and applied for membership. But the Cold War limited the Fund's membership, with most countries in the sphere of influence not joining”.  The World Bank, on the other hand, is an International Governmental Organization, also with 188 nation-state members, that had earned its international reputation through nation-state reconstruction efforts, with conditional loans to open private sector investment into devastated post-war European nation-states after the Marshall Plan, and in aftermath of the Cold War, intensified efforts of ushering private sector capital into post-Soviet states in Eastern Europe and post-colonial nation-states in Africa.  Today, it is the reconstruction of post-colonial African nation-states by the World Bank and the infiltration of the private sector while in the period following the Cold War and the emergence of the U.S. international hegemony, Eastern Europe was the primary target.  In order to grasp the U.S. position within the World Bank, “The five largest shareholders are, France, Germany, Japan, the United Kingdom and the United States”, three of five permanent members of the United Nations Security Council.

Private Capital Utilization of World Authority

                Using war ravished Europe as a successful test bed for a global private sector market, “The original Bretton Woods plan was at first subsumed by the Cold War. The Marshall Plan announced in 1947 provided the USA with a more immediate bilateral way to ensure stabilization, investment and reconstruction in Western Europe.  Nevertheless, by the 1950s both the IMF and the World Bank were modestly assuming a place in the international economy.”

                The restricting boundaries of the Cold War prevented any further expansion of international capitalist markets into the Soviet sphere of influence, but after the collapse of the Soviet Union at the conclusion of the Cold War, the United States was instantly propelled to the level of unilateral superpower in the ashes of what was the most equally distributed international balance of power in history.   As a true champion of international private sector capitalism, the United States and her lesser nation-state allies instantly went to work through so-called United Nations Peace Keeping missions throughout Eastern Europe in order to spread the private market eastward into former Soviet satellite nation-states and bring them into the world market.  The United States was a founding member of the dual International organizations created at Bretton Woods, the International Monetary Fund and the World Bank, and these two organizations would be main instruments in spreading private sector capitalism as far as it would extend after the United States Cold War victory against Soviet Communism.  The utilization of the World Bank and International Monetary Fund, along with the economic and military might of the United States in the United Nations Security Council were pivotal in expanding capitalism eastward through so-called UN peacekeeping operations in territories left unstable, politically void or politically divided, such as Bosnia and Herzegovina.  While the private sector ushered in by the World Bank and International Monetary Fund had ridden the coattails of United Nations peacekeeping operations in many post-colonial African and post-Soviet nation-states in order to target natural resources, the example of the 1992 war in Bosnia-Herzegovina will clearly illustrate the methodology that is utilized by these organizations.

UN Peace Keeping Mission in Bosnia-Herzegovina

                The war in Bosnia between 1992 and 1995 was a direct result of the collapse of the Soviet Union.   Bosnian independence from Yugoslavia plunged the territory into civil war as “Bosnian Serbs did not want to break away from Yugoslavia, and so the Serbs left the Bosnian parliament to form their own parliament. The Bosnian Serb decision to split from the Bosnian parliament inspired the Bosnian Croats to also declare their autonomy”.  The early UN peacekeeping mission in Bosnia, a territory plunged into civil war, had difficulty in achieving, through proposed peace negotiations, the goal of stabilizing a unified Bosnian independence, and a government that could be brought into the world market, and eventually UN peacekeeping efforts were turned over to NATO military air strikes,  Operation Deliberate Force, and the champion of world capitalism, the United States, led the way by providing the most military and most economic contributions to operational missions.   This was the case until “U.S. troops marked the end of their nine-year peacekeeping role in Bosnia on Wednesday [December 24, 2004] as NATO prepared to hand over the task to the European Union in December [2004]” .

                As the region of Bosnia-Herzegovina began a stabilization process after the Dayton Peace Accords, the World Bank was eagerly present with lofty promises of reconstruction funding and the ushering in of foreign private sector capital investments which would target domestic natural resources in minerals, petroleum, hydropower, and other resources of commercial importance in Bosnia-Herzegovina.

Private Capital Anarchy and Nation-State World Authority

                From the example of the United Nations peacekeeping mission in Serbia, it becomes clear that nation-state governments under the world authority model burden the economic costs of military action and also burden the blood of lost national sons and daughters while private sector actors, using the instruments of the World Bank and International Monetary Fund in order to gain access to the natural resources inside nation-state borders while burdening nothing except capital spending to generate capital profit.

What began as the establishment of an international market spanning from the United States to war ravished Europe, gained acceleration with eastward expansion after the collapse of the Soviet Union and southward in post-colonial nation-states.  On the modern stage, nation-states, such as Iraq and Libya, that do not accept private sector ‘carrots’ are often removed by UN and NATO military ‘sticks’ and promptly rebuilt by the World Bank Group and private sector investors.  In extreme cases of military occupation, unsuspecting military members are placed on the ground to stabilize the region for private sector profiting.  The danger of these UN-NATO operations, often the results of brilliantly placed, inescapable economic sanctions, is that the most powerful military nation-states on the international scene today are representative democracies and representative democracies are the easiest governments on the international stage to be influenced or purchased into political or military action through the capital of domestic or international lobbyist forces.

With the massive increase of multi-national corporations battling for the opportunity to accumulate capital profits, the nation-states that have created the international organizations to promote capitalism and opened the international stage for private sector capitalism have become consolidated, and concreted, into a world authority model of global government that is easily manipulated, used and discarded by the anarchy of private sector capital actors.  The international stage is no longer the sole property of nation-states, for nation-states have become the indentured servants of the new international actor, private sector capital.

 

               

 

 

 

 

 

 

 

 

References

Ghoniem, Amira A.  United Nations Peacekeeping Operations: Improvements for Mission Success.  University of Stanford, 2003.  (Accessed on December 27, 2012 from http://www.stanford.edu/class/e297a/United%20Nations%20Peacekeeping%20Operations.pdf)

International Monetary Fund Website.  History of the IMF, Accessed on December 27, 2012 from http://www.imf.org/external/about/histcoop.htm)

Nau, Henry. Perspectives on International Relations. 3rd ed. (Washington, D.C.: CQ Press, 2012).

Treaty of Westphailia.  Yale Law School.  Lillian Goldman Law Library.  Avalon Project: Documents in Law, History and Diplomacy.  (Accessed on December 27, 2012 from http://avalon.law.yale.edu/17th_century/westphal.asp)

U.S. Troops Mark End of Mission in Bosnia.  Associated Press.  November 25, 2004, accessed December 27, 2012 from http://www.washingtonpost.com/wp-dyn/articles/A11164-2004Nov24.html)

Woods, Ngaire.  The International Monetary Fund and the World Bank, p. 955.  (Accessed on December 29, 2012 from http://www.globaleconomicgovernance.org/wp-content/uploads/Woods%20for%20Routledge.pdf)

World Bank Group Website.  About the World Bank, Leadership.  (Accessed December 27, 2012 from http://web.worldbank.org/WBSITE/EXTERNAL/EXTABOUTUS/0,,contentMDK:22428930~menuPK:1697011~pagePK:51123644~piPK:329829~theSitePK:29708,00.html)

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