The Link Between Capitalism And War. By Kostas Rologas

Via: Socialist Alternative.

US National security advisor and former Boeing Corporation director James Jones

Wars are not simply the consequence of the policies of particular nation-states. Nor are they the result of sinister individuals getting into power. War is organically linked to capitalism – a result of the economic competition between business interests extending into military competition between states.

This link was analysed at the beginning of the last century by two Russian revolutionaries, Nikolai Bukharin and Vladimir Lenin. While both were attempting to understand the reasons for World War I, their insights are relevant to understanding the most recent wars in Iraq and Afghanistan.

Both Bukharin and Lenin attempted to understand the economic roots of war. They argued that the struggles among the great powers for global domination were a consequence of the increasing size of businesses and their centralisation into the hands of fewer owners.

The centralisation and growth of capital is a consequence of a system of competition and crisis. In the day-to-day struggle for profits, some firms either close or are bought out by larger rivals.

Historically, this has resulted in the monopolisation of entire industries. As Lenin observed:

“The remarkably rapid process of concentration of production in ever-larger enterprises is one of the characteristic features of capitalism….Competition becomes transformed into monopoly.”

In Lenin’s time, monopolies like Standard Oil and US steel dominated their respective industries. Today, the process continues. For example, by 2004 world media was controlled by five corporations as compared to fifty in 1984.

This monopolisation in industry was closely tied to the growth and importance of finance. As the corporations grew bigger, banks played an increasing role in organising the huge amounts of capital required for investment. The banks shifted from being small-scale lenders to managers of whole branches of industry.

With the fusion of the interests of the banking sector with those of industry, the form of competition changed. Previously, competition between businesses was based on price and quality of product (they still tell us this today).

But the formation of monopolies meant that competition was based on power, not simply innovation. The businesses that stayed afloat now were the ones that could bribe politicians, price-fix, engage in industrial espionage, utilise economies of scale to dominate the market, etc.

These monopolies became increasingly important to the nation-state, as they controlled vast amounts of capital and employed tens of thousands of workers; their revenues filled government coffers in the form of taxes.

The monopolies that had developed within a state now needed to expand internationally if they were to continue to grow. The state had a vital interest in ensuring that its companies won out in the international economic battle.

Imperialism – which is the competition between major states – is the inevitable extension of the capitalist system. It is characterised by two forms of competition – economic and geopolitical. As Lenin outlined, “An essential feature of imperialism is…the striving for hegemony, for the conquest of territory.”

The “striving for hegemony” that he refers to simply means that nations seek to dominate their region or the entire world in the same way that companies seek to dominate the market. But while companies put each other out of business, attack unionists and try to hold down workers’ wages, they rarely resort to the sort of violence that states do to maintain their position.

This link between capitalism and war manifests itself in a series of ways. One of the most obvious is the number of former employees of corporations that directly benefit from war who end up in positions of political power.

You only have to think of Bush administration figures like Donald Rumsfeld and Dick Cheney and their connections to the oil companies and military corporations that benefited hugely from the Iraq war. Thirty-two major appointees in the Bush administration were former executives, consultants or significant shareholders of weapons companies.

In the Obama administration, National Security Advisor James Jones was the director of Boeing Corp., one of the biggest Pentagon contractors (direct US military spending in financial year 2011 is to be more than $US708 billion), and of the giant oil company Chevron.

But link between war and capitalism is about more than just old boys’ networks and direct profit-making.

For example, the war in Iraq is not simply a consequence of America’s need for oil and the profits that oil companies and corporations like Halliburton would make from the “reconstruction” of the country. The US went into Iraq to gain greater control over the oil as a strategic resource.

The US imports most of its oil from Canada, Saudi Arabia, Mexico and Venezuela, as well as sourcing internally. Oil has a political as well as economic significance. US control over Middle Eastern oil undermines potential economic and military competitors like Russia, China, Germany and Japan.

The latter two countries in particular are dependent on oil imports. So while the US was bombing Baghdad, its targets were firmly set on Beijing, Moscow, Tokyo etc.

Iraq is also of strategic significance because of its geographic location, straddled between America’s other imperialist rivals (Europe, China and Russia). The US has built 14 of what it calls “enduring bases” in Iraq, alongside over 50 other bases in the country. As the name suggests, the bases are permanent.

While Iraq may be oil-rich, Afghanistan has little in terms of material resources of interest to the US. They have already spent at least $US300 billion on military operations there. This is money they will not get back. Like Iraq, Afghanistan is important to the US because of its geographical proximity to both China and Russia, as well as to resource-rich central Asian states.

The competition between capitalist nation-states that propels the US into these wars applies just as much to Australia. The $A1.2 billion spent on the Afghanistan war in 2009-10 will not be recouped in poppy seeds. As a mid-sized imperialist power, Australia’s intervention in Iraq and Afghanistan is part of its strategy to be the major power in the South Pacific.

The ruling class is explicit about this. The 2002 defence White Paper noted that one of Australia’s objectives was “to avoid the emergence in the Asia Pacific region of a security environment dominated by any powers whose strategic interests might be inimical to Australia’s.”

This is the real reason Australia maintains an alliance with the US and why it consistently intervenes in the region, from East Timor to Fiji and the Solomons.

So war, as Bukharin noted, is an “immanent law” of capitalism. What at first was competition between sections of capital becomes competition between capitalist nation-states for influence, markets and profits.

This is why, despite the kicking out of both Howard and Bush, the war in Iraq has continued and the war in Afghanistan has intensified. So long as the ruling class has a strategic interest in the Middle East, the wars there will continue – and the death toll will climb – regardless of which political party is in office.

Thus to oppose war it is necessary also to oppose capitalism. The link between capitalism and war means that as long as capitalism limps on as a system, wars will continue to occur. That is why our struggle is not simply against every single imperialist war, but also the rotten system that produces them.



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