World Views – Part 2 Structuralism and Marx and Lenin Linda Young POLS 400 International Political Economy Wilson Hall – Room 1122 Fall 2005

Linda Young, POLS 400, International Political Economy Structure Conditions Outcome  Examples –Chiapas – revolting against the state and the market  Foreign aid and trade – helping who? –John Perkins Chiapas Mexico

Linda Young, POLS 400, International Political Economy Marxism  Declined in importance as an ideology  Neo-liberal principles widely adopted (market orientation and also downsizing of the state) –North Korea and Castro’s Cuba  Important analytical perspective and criticism of capitalism –Boom-and-bust cycle of capitalism –Income inequality and great poverty alongside wealth North Korea Cuba Karl Marx

Linda Young, POLS 400, International Political Economy Historical Materialism Mode of production in society set the parameters for the political economy Economic structure then determines social and ethical relations of society -contradictions between the forces of production and the relations of production will cause change From primitive communism, slavery, feudalism, capitalism, socialism, pure communism Capitalism a necessary stage on the road to communism Structure dominates events

Linda Young, POLS 400, International Political Economy Not a conflict between the state and the market but… Concentration of wealth – competition forces down wages – technology leads to unemployment which in turn keeps down wages Conflict between the bourgeoisie and the workers or the proletariat

Linda Young, POLS 400, International Political Economy Laws of Capitalism Law of the falling rate of profitProblem of under consumption Accumulation of capital

Linda Young, POLS 400, International Political Economy Lenin: Imperialism Vladimir Lenin Capitalism escaped from crises due to imperialism With maturity, capital accumulates, profits fall, capitalist economies must seize colonies and create dependencies to create markets

Linda Young, POLS 400, International Political Economy Lenin: International Capitalism  Lenin also worried about concentration  Monopoly as the opposite of free competition but occurring  Inequality between classes and unequal development between nations – duality of wealth onto the international arena  Production and finance to create dependency and facilitate exploitation –Not interdependence but exploitation

Linda Young, POLS 400, International Political Economy World Systems Theory Economy organized world-wide Single division of labor Nation state dependent upon each other for exchange Core, periphery and semi-periphery – Nations categorized as such, and each nation has each group World-empires have a common political system- presently a world economy as no state has conquered the entire core

Linda Young, POLS 400, International Political Economy Core  Regions that benefited from the capitalist world economy  Much of north western Europe as the first core – state developed strong central governments, extensive bureaucracies and large armies to serve the purposes of the core  Permitted the local bourgeoisie to obtain control over international commerce  The core dominates to extract raw materials  Today the core is the United States and other developed countries  Core states use force when periphery states challenge the market rules that sustain the dominance of the core state  Can move between categories  Categories exist within countries and between countries

Linda Young, POLS 400, International Political Economy Semi-periphery is both an exploiter and the exploited – a political role More capital intensive industry than that of the periphery (but less than the core) and less dependent on the core Contributes to the stability of the system Both exploiters and exploited Semi-periphery prevents the unification of the periphery and stabilizes the world economy Mercantilism as the major tool of semi-periphery in seeking to become core states

Linda Young, POLS 400, International Political Economy Periphery  World systems very pessimistic about prospects for the perihery  Controlled by other states (first in colonialism and now through the market)  Lack strong central governments  Exported raw materials to the core and the core extracted much of the capital surplus generated in the periphery through unequal exchange  Eastern Europe (Poland) and Latin America Poland Latin America

Linda Young, POLS 400, International Political Economy Capitalism  Involves an appropriation of the surplus of the whole world – economy by core areas – in addition to the appropriation of the surplus value of labor by an owner  Capitalism: labor as a commodity –Appropriation of surplus value of the whole world economy by core areas –Appropriation of the surplus value of labor from a laborer  Capitalism never inhibited by national boundaries – mercantilism as a defensive mechanism by less power entities

Linda Young, POLS 400, International Political Economy History  Current system began in 1450  New phase since 1945 with the rise of the US as an economic and political power –US fostered and has since influenced/controlled the multilateral organizations used to control the world economy  Since late 17th century, Europe dominated by landless wage earners

Linda Young, POLS 400, International Political Economy Contradictions in the World Capitalist System Short run profit maximization requires the withdrawal of surplus from the majority, but over the long run, the economy needs the majority to consume the goods

Linda Young, POLS 400, International Political Economy Why the elite of developing countries don’t act in their self-interest Wallerstein’s Framework Answers Some of My Questions  Allied with the elite of the core  Explains why developing countries won’t follow the development path of the capitalists  Explains increasing income inequality  Decline Immanuel Wallerstein