Social Change The Nature of Capitalism Marx: From “simple commodity production” C-M-C "merchant capitalism" to “capitalist production” M-C-M’ "industrial capitalism"

Social Change Max Weber’s six basic characteristics: p. 140 private ownership of means of production free market – absence of constraints development of technology/mechanization calculable law (rational, not arbitrary) free labor (not slavery/serfdom/etc.) commercialization of economic life

Social Change Back to Marx – at the center of capitalism Class relations – owners and workers and Exploitation – the extraction of surplus value The “Labor Theory of Value” Slaves, Peasants, and Wageworkers

Social Change So, what is capitalism? A new mode of production A new mode of social organization A new culture (way of life) A new set of class relations A new mode of exploitation

Social Change EVOLUTION OF THE MODERN WORLD The modern world system is a capitalist world system (WSYS), which has developed along two lines:

Social Change 1. a system of political/economic relations between societies (nation-states). (3 sectors + others) 2. a system of relations within each society - modern (capitalist) social institutions. (Marx and Weber)

Social Change This section is about WSYS between nations. The next section will examine modern institutions. There are two “symbiotic” parts of the WSYS structure - (1) the world economy (2) the interstate system

Social Change (1) THE WORLD ECONOMY consists of three basic “zones” - the core, semi-periphery, & periphery. CORE (“developed”) nations are industrialized, modernized, prosperous, and dominant. US/Canada, Europe, Japan, Australia

Social Change SEMI-PERIPHERY (“developing”) nations are moving toward the core by industrializing, modernizing, etc. (Mexico, S America, etc.) Will they ever get there? LATER PERIPHERY (“under-developed”) nations are areas exploited for natural resources and cheap labor. (India, Asia. Africa, etc.)

Social Change (There are also areas of the world that are outside the world economy - these are called “external arenas.”) China (still external???, Soviet bloc (now gone – SP??), Various parts of Asia and Africa

Social Change In the world economy, the CORE nations intensely exploit both the S-P and P nations while the S-P nations exploit the P nations to a lesser extent. (mirrors cap class systems in Core countries? - caps, workers, poor

Social Change There are intense rivalries among the CORE nations (this is where most major wars have come from), (over last 500 years!) and mobility in the system is very limited (S-P to CORE, P to S-P, etc.). how limited??? theories later

Social Change There are three long-term dynamic processes in the world economy. 1. The world economy has continually expanded over the last 500 years and now is nearly 100% global. (mostly by force – coercion – “opening up markets” and “free trade”)

Social Change The world economy has continually “deepened” over the last 500 years, extending the main forms of capitalist culture into institutions. This is an increasingly global process. (Aspects: commodification - mechanization – contract model - proletarianization - polarization)

Social Change Two cyclical dynamics -- Kondratieff Waves and Hegemony cycles. Kondratieff Waves - 50 year cycles involving a boom cycle that crests after about 25 years, followed by a bust cycle that bottoms out after about 25 years, then a boom cycle starts again

Social Change Hegemony cycles - three “hegemons” (sort of a modern version of empires) have risen and fallen over the last 400 years – Holland in the 1600’s, England in the 1800’s, U.S. in the 1900’s.

Social Change (2) THE INTERSTATE SYSTEM is dominated by CORE nations which collude and compete - jointly trying to extend capitalism ("open markets“ “democracy”) while competing for dominance. (Noam Chomsky explan of Iraq war) Over the last 500 years, boom-and-bust cycles, wars, and hegemons have come and gone while the interstate system has continuously expanded.

Social Change FOUR STAGES IN DEVELOPMENT OF WSYS WSYS began to emerge from the collapse of feudalism. (England & Northern Europe)

Social Change Consolidation of the WSYS (growing trade networks) WWIGlobal expansion of the WSYS (colonization, etc.). WWI - cont.Global deepening of the WSYS (“modernization” etc.).

Social Change SOME QUESTIONS AND EXAMPLES BASED ON WSYS MODEL 1. Why do hegemons rise and fall? e.g., why did the emerging “Asian hegemony” fizzle out? Japan China as future/next hegemon?

Social Change 2. Why is the gap growing between the CORE and PERIPHERY? This is a disastrous development! 3. Will Kondratieff waves continue (WSYS near end of down cycle – boom cycle should start in the next few years).

Social Change Development and Underdevelopment in the WSYS (most important issue of our time and probably of the future)

Social Change Capitalist deepening is spreading the Core culture of consumption while economic underdevelopment continues to make the means unavailable to SP and P countries. The rich countries are getting richer and aspirations are increasing rapidly in the poorest countries. “want but can’t have” This is a result of “market” forces – the less constrained the market, the more inequality.

Social Change PCGDP ratios – richest to poorest countries (Sanderson p. 203) to to to to to to1 (CIA World Factbook, 2002)

Social Change Modernization Theory “One path” from traditional to modern – all countries will follow sooner or later Focuses on non-material culture – ignores material/economic (an anti-Marxist theory) Their deficiencies, they need to change customs, attitudes, etc. Rich countries can and will help them change (strangely, this never seems to work!) Reality – this is a “blaming the victim” approach

Social Change Dependency Theory Marxist, originated outside the Core, rejects Modernization Theory Specific dominance/exploitation creates and maintains under- development Core countries dominate/exploit weaker “trading partners” Direct exploitation + elite complicity (“puppet governments”) “Structural distortion” – e.g., one-crop economies Weak market position in global market (e.g., coffee/sugar in S and C America) Dependent development – e.g. partial uneven development like Mexico

Social Change World System Theory Similar to Dependency Theory but “structural” rather than specific Position in WSYS determined early, few opportunities for change Several different strategies when opportunities do arise Oil, specific markets (India and tech), etc.

Social Change American Marxist Theories Szymanski and Warren – key is time period of their studies – 1970s Post WW2 Core reconstruction shared some wealth downward for a while Also, decline of postwar US hegemony in the 1970s was encouraging If these trends had continued S&W might have been right But re-asserting of market forces (globalization) led to return to old trends

Social Change Evaluating the Theories Modernization theory still dominant in most of the Core countries, but nowhere else (We’re the good guys and try to help, their problems are their own fault) The balance of historical factors and dependency in causing under- development is still being debated and is still inconclusive (to what extent is it structural, to what extent specific?) The basic issue is short term benefit vs. long term dependency from Core investment

Social Change Sanderson – “Soft Dependency Theory” WSYS is capitalist (market driven) and has developed “unevenly” – once positioned in the system it is hard for a country to “break out” but there are occasional opportunities for some countries to partially break out Some development continues in most countries but it continues to be uneven and the poor countries will never catch up – resources stress reinforces this (global resources cannot support broad development) So the poor countries are structurally (historically) disadvantaged and dependency and global ecology reinforces the disadvantages

Social Change So, where are we today?? Core countries – hard to sustain economy polluting, exhausting resources, wars SP – issues of dependency, rich/poor gap, growing socialist push for “democracy” P – growing disaster – no way out

Social Change Next: Development of Modern Institutions

Social Change