By WAHU KAARA
Kenya Debt Relief Network (KENDREN)
To fight for alternative solutions and for structural reforms (that is to say, for intermediate objectives) is not to fight for improvements in the capitalist system; it is rather to break it up, to restrict it, to create counter powers which, instead of creating a new equilibrium, undermines its very foundation.
Andre Gorz, Strategy for Labor
Long before a young first time senator from Illinois, of Kenyan descent and with a funny sounding name like Barrack Obama, transfixed the world on his march towards the highest political office in the United States, former President Bill Clinton, billed as the most “black” President of the US, had this to say on his last sojourn to Africa;
“Africa with a population of over seven hundred million people, boast abundant natural resources that can power its growth as global power. It is certainly the last frontier of American business and interests…”
As Clinton waxed lyrical of the ‘last frontier’, the ‘Economist’ primed as Britain’s lead financial lens in the global realm referred to Africa as the ‘Hopeless Continent’ (May 2000). Contrasting definitions and forays into AfricaAfrica continues to experience in its relationship with the imperial West. has marked the varied interactions that
Away from the Huntington assertion of a “clash of civilization” or Fukuyama’s “end of history” and the neo-conservative “Plan for A New American Century” that amplifies the ideological bankruptcy of the petro-military-industrial-big pharma complex that continues to hold global sway (albeit a resurgent and resilient global justice movement) through the a White House, Bretton Woods revolving door, I contend that We are witnessing a political-economic passage: from global stagnation to amplified uneven development to worsening primitive accumulation (‘looting’) to socio-economic conflict. This trajectory highlights Africa’s problems in particular, and in turn also suggests ways forward. After three decades of neoliberalism, a policy approach meant in theory to establish market relations above all else, authorities on global political economy have returned to themes of imperialism grounded in extra-market power relations. For Africa’s popular struggles, the objective of transforming power relations as the basis for ending conflict and underdevelopment requires engaging this theoretical approach to the critique of capitalism.
Introduction: Cultural or materialist explanation?
Consider two divergent ways to approach the concept of looting in political economy: cultural and material. To take, first the question of how this word is used and abused in popular cultural discourse, consider that on August 30, 2005, yahoo.com displayed to web surfers a metaphor for the common-sense inversion of Africa’s relationship to the West. Two photographs were momentarily on display at yahoo’s news site, in the immediate aftermath of Hurricane Katrina. In one, Agence France Press had snapped two New Orleans residents triumphantly wading ‘through chest-deep water after finding bread and soda from a local grocery store’, as the caption explained. In the other, the Associated Press circulated a picture of a man walking ‘through chest deep flood water after looting a grocery store’. The couple ‘finding’ were white, the man ‘looting’ was black (http://www.flickr.com/photos/firewall/38725768/).
Slavoj Žižek (2005) considered stereotypes of this sort in discussing what he termed ‘the subject supposed to loot and rape’ in New Orleans:
We all remember the reports on the disintegration of public order, the explosion of black violence, rape and looting. However, later inquiries demonstrated that, in the large majority of cases, these alleged orgies of violence did not occur: Non-verified rumours were simply reported as facts by the media. For example, on September 3, the Superintendent of the New Orleans Police Department told the New York Times about conditions at the Convention Canter: ‘The tourists are walking around there, and as soon as these individuals see them, they’re being preyed upon. They are beating; they are raping them in the streets.’ In an interview just weeks later, he conceded that some of his most shocking statements turned out to be untrue: ‘We have no official reports to document any murder. Not one official report of rape or sexual assault.’
When white tourists formerly lodged at New Orleans hotels sought to escape the city, they were hustled to the front of emergency bus queues, ahead of the mainly African-American, low-income ghetto residents stuck at the wretched Convention Centre. Some such residents had indeed raided shops for water, milk and perishables primarily as a survival mechanism, to the opprobrium of Fox News anchors and like-minded neoconservative commentators.
So who, in reality, benefited from the catastrophe? Another critical analyst, Mike Davis (2005), observed how the Bush regime rapidly swung open the doors of New Orleans to corporate looters such as Halliburton, the Shaw Group and Blackwater Security, already fat from the spoils of the Tigris, [which] contrasted obscenely with the Federal Emergency Management Agency’s deadly procrastination over sending water, food and buses to the multitudes trapped in the stinking hell of the Louisiana Superdome.
Hence when it comes to explaining the world’s growing social divides, revelations from the main port city of the world’s richest country are telling. They boil down to the idea of ‘looting’: not as the logical lifestyle of imperialism’s black victims, but instead as the basis for capital accumulation under conditions of extreme inequality.
In the mid-19th century, Marx developed this idea – which in relationship to early capitalism he called primitive accumulation – based upon his observations of the transition from feudalism. The British ‘Game Laws’ provided an exemplary case of separating pre-capitalist livelihoods from the means of production (Perelman 2007). Hence the original use of the idea was of ‘once-off’ accumulation which centralized wealth claimed by the bourgeoisie. But by 1913, Rosa Luxemburg (1968) established the first full-fledged theory of imperialism from the argument that primitive accumulation continues well past the point of capitalism’s origins, and indeed is key to the ongoing accumulation of capital:
Force, fraud, oppression, looting are openly displayed without any attempt at concealment, and it requires an effort to discover within this tangle of political violence and contests of power the stern laws of the economic process. Bourgeois liberal theory takes into account only the former aspect: ‘the realm of peaceful competition’, the marvels of technology and pure commodity exchange; it separates it strictly from the other aspect: the realm of capital’s blustering violence which is regarded as more or less incidental to foreign policy and quite independent of the economic sphere of capital. In reality, political power is nothing but a vehicle for the economic process. The conditions for the reproduction of capital provide the organic link between these two aspects of the accumulation of capital. The historical career of capitalism can only be appreciated by taking them together. ‘Sweating blood and filth with every pore from head to toe’ characterizes not only the birth of capital but also its progress in the world at every step, arid thus capitalism prepares its own downfall under ever more violent contortions and convulsions.
The sources of capitalist wealth – based in no small measure upon looting Africa – is regularly revealed by critical scholars, of whom Walter Rodney (1972) looms large for his book How Europe Underdeveloped Africa, followed by Paul Zeleza’s (1993) formidable Modern Economic History of Africa. But the process continues nearly unhindered (except for popular resistance), contributing to conditions of ‘resource curse’ conflict and systemic underdevelopment.
To illustrate, consider all the attention Africa received during 2005, through efforts to ‘make poverty history’, to provide relief from crushing debt loads, to double aid and to establish a ‘development round’ of trade. At best, partial critiques of imperial power emerged amidst the cacophony of all-white rock concerts and political grandstanding. At worst, polite public discourse tactfully avoided capital’s blustering violence, from Nigeria’s oil-soaked Delta to northeastern Congo’s gold mines to Botswana’s diamond finds to Sudan’s killing fields. Most of the London charity NGO strategies ensured that core issue areas – debt, aid, trade and investment – would be addressed in only the most superficial ways. By 2007, one of the G8’s court jesters, Bob Geldof, finally became so frustrated that he called those attending the Heiligendamm summit ‘creeps’ and their work a ‘total farce’ (Blair 2007).
Perhaps this was not surprising. Mass media’s images of Africans themselves were nearly uniformly negative during the recent period, which plays nicely into the hands of elites. Reminiscent of New Orleans ghettoes, Giles Mohan and Tunde Zack-Williams (2005:214) observed, ‘Africa’s underdevelopment has for long been blamed on local culture and the lack of “proper” values. Such discourses designed to let imperialism off the hook have reared their ugly head again in various guises.’ It was from West Africa that the neoconservative US writer Robert Kaplan (1994:46) described a future defined in terms of ‘disease, overpopulation, unprovoked crime, scarcity of resources, refugee migrations, the increasing erosion of nation-states and international borders, and the empowerment of private armies, security firms, and international drug cartels’.
It was not a distant leap for then-prime minister Tony Blair’s advisor Robert Cooper (2002:16-17) to declare that ‘when dealing with more old-fashioned kinds of states… we need to revert to rougher methods of an earlier age: force, pre-emptive attack, deception, whatever is necessary to deal with those who still live in the 19th century world of “every state for itself”‘, hence generating ‘a new kind of imperialism… to bring order and organization’. Tim Jacoby (2005:228) concludes of such sentiments, ‘In order to obscure western complicity in, or in some cases responsibility for, the defects of states in the South, policy makers have been influenced by, and contributed to, a rise to prominence of cultural explanations for social phenomena.’
2. Uneven development
Material not cultural reasons for conflict and underdevelopment begin at the highest scales. Most importantly, pressure has increased because the world capitalist system has exhibited slower growth in Gross Domestic Product (GDP) – and absolute decline in broader signifiers of eco-social welfare, as well as more intense financial volatility since the early 1970s. The average rate of growth of GDP fell from 3.6% during the 1960s, to 2.1% during the 1970s, to 1.3% during the 1980s to 1.1% during the 1990s and 1% during the first half of the 2000s (Harvey 2005). Of course, GDP measures are notorious overestimates, especially since environmental degradation became more extreme from the mid-1970s. At that point, a typical ‘genuine progress indicator’ – which incorporates much more than the GDP’s annual output of goods and services – went into deficit. How would we transcend the biased, patriarchal GDP and construct an indicator of genuine progress? At the San Francisco group Redefining Progress, statisticians subtract from GDP the cost of crime and family breakdown; add household and volunteer work; correct for income distribution (rewarding equality); subtract resource depletion; subtract pollution; subtract long-term environmental damage (climate change, nuclear waste generation); add opportunities for increased leisure time; factor in lifespan of consumer durables and public infrastructure; and subtract vulnerability upon foreign assets. The resulting indicator, a more accurate reflection of genuine progress, peaks in the mid-1970s and in spite of subsequent absolute GDP growth, hovers in a static mode.
Capital’s standard responses to accumulation problems are, as Marx pointed out in Das Kapital, intensified ‘absolute and relative surplus value extraction’. This entails, respectively, working the labour force harder and longer, and replacing less efficient workers with machines in search of temporary advantage over competitors. As David Harvey (1999) has pointed out, though, the 20th century capitalist crisis-displacement toolbox added two new geographic and temporal displacement mechanisms. In the first, the problems are moved around as one or another group of territorially-organized capitalists either push away the devaluation of their capital stocks, or resist, resulting in more extreme uneven spatial development and intensified exploitation of weaker geographical sites. In the second, the problems are put off through time, insofar as a rising credit system allows today’s problems to be mitigated through borrowing against the hope of future economic growth.
In both cases, the displacement strategy becomes increasingly ineffectual (especially when financial system crises adversely affect confidence in debt), so the system turns to more extreme forms of exploitation that occur beyond purely market production and exchange: what Harvey (2003) calls ‘accumulation by dispossession’, or a permanent mode of primitive accumulation. In this process, the phrase ‘uneven and combined development’ suggests that growth (accumulation) and decline (underdevelopment via super exploitation) happen in a systematic manner, but not one which follows either the modernization path – directly along a line of underdevelopment, ‘take-off’ and development – or permanent dependency. Instead, accumulation at one pole and poverty at another happen systematically, according to systems of exploitation that we must carefully analyze and document, but that can change, depending upon political processes (Bond 1999).
Uneven development is most obvious in regional terms. According to Mark Weisbrot of the Center for Economic Policy Research, “In Latin America and the Caribbean, gross domestic product grew by 75% per person from 1960 to 1980, but only 7% per person from 1980 to 2000. The collapse of the African economies is well known, although still ignored: GDP in Sub-Saharan Africa grew by about 34% per person from 1960-1980; in the past two decades, per capita income actually fell by about 15 percent’ Alan Freeman (2004) has documented worsening unevenness evident between regions of the world, especially since the mid-1970s.
One analytical problem should be flagged, especially as it relates to Africa. In geographical terms, unevenness has been associated with dependency-inspired theories of unequal exchange and related forms of core-periphery dominance. This is in part because of their appropriation by progressive (and sometimes regressive) Third World nationalists. However, while allowing us to invoke a moral condemnation of Northern power over Southern states, such analysis has had the unfortunate effect of over-emphasizing interstate relations and under-emphasizing the flows of capital and social struggles that have more decisively shaped local underdevelopment. It is in this respect that the theory of uneven development is far superior to dependency theory, in part because it is applicable in Africa in intrasocietal ways, just as readily as between North and South.
Scholars, who have taken such analysis furthest since Ernest Mandel’s 1960s revival of the theory of uneven development, emerged in the field of geography. Harvey, Neil Smith (1990), Michael Webber and David Rigby (1996), and others have shown how systematic combinations of space, time and the accumulation process generate thorny political-economic problems. In particular, the condition of overaccumulation crisis – i.e., a period of glutted markets and idle plant, equipment, finances and workers due to economic stagnation – amplifies the process of uneven development. This is because, as Smith (1989:151) explains, of the ‘continual, if never permanent, resolution of opposing tendencies toward the geographical equalization and differentiation of the conditions and levels of production. The search for a spatial fix is continually frustrated, never realized, creating distinct patterns of geographical unevenness through the continued seesaw of capital.’ The seesaw metaphor suggests that instead of balancing accumulation in an equilibrium (as neoclassical economists insist markets do), capitalism promotes growth in some areas and decline in others, but in a dynamic manner that does not permit convergent and balanced growth.
It is not just a matter of capital roving the landscape – like locusts, according to Smith – in search of sites of accumulation when profitability falls at home. In addition, capital seeks relief through time, in a ‘temporal fix’. The idea is that overaccumulation can be mitigated by credit, since large infusions of loans permit the temporary consumption of the vast gluts of goods created by capitalism. But likewise, this process is continually frustrated, because it simply puts off the overaccumulation problem until payment is due at some future date, when more surplus value must again be extracted. This is one of the key reasons for capitalism’s uneven development over time.
Thus the spatial fix and the temporal fix are not genuine solutions to stagnation and falling profits. While they may lead to increasing power by capital, dividing workers in some parts of a country or the world from each other, the geographical restructuring of capitalism (the spatial fix) and its use of credit to put off the problems until later (the temporal fix), are only ‘displacement’ techniques. They don’t really address the fundamental causes of overaccumulation. Hence when capitalism suffers sustained problems and when geographical and temporal techniques begin to reach their limits, then powerful economic agents must turn – in search of profits – to extra-market modes of exploitation, which we can consider as ‘combined’ development, utilizing both advanced and backward systems of exploitation. This is where socio-political conflict associated especially with the ‘resource curse’ or alternatively resource shortages, is a logical outcome of uneven and combined development.
The phrase ‘uneven and combined’ comes originally from the analysis of Leon Trotsky (1977:26-27), who remarked in the immediate wake of the failed 1905 Russian revolution, ‘The development of historically backward nations leads necessarily to a peculiar combination of different stages in the historic process. Their development as a whole acquires a planless, complex, combined character.’ The ‘combined’ component of uneven and combined development is, ultimately, contingent upon the power of a dominant economic bloc to extract surpluses from weaker blocs, themselves locked into non-capitalist social relations.
Combined development in specific (peripheral or semi-peripheral) settings was hence often explained – as in the South African case – as a process of ‘articulation of modes of production’: the capitalist mode of production relied upon earlier modes of production for an additional, superexploitative subsidy. This happened during apartheid and colonialism via a reduction in the cost of labour power’s reproduction: i.e., workers came to the labour market very inexpensively because of the multiple oppressions involved across the society. Colonial-era arrangements for compulsory work included slavery and other forms of forced labour, taxes and fees, indebtedness, and wholesale expropriation of land. One of the most advanced of these systems was South Africa’s apartheid, where superexploitation was based upon simultaneous class/race/gender/ecological power, and led to an initial ‘cheap’ labour inflow from Bantustan reserve areas to the cities, mines and plantations where workers earned a pittance – certainly not enough to support the reproduction of an urban family. Women were compelled to subsidize the migrant labour pool by engaging in childcare, healthcare and eldercare without the benefit of the state and capital’s ordinary labour reproduction processes. Much Southern African labour was based upon this approach, supplying cheap male workers to mines, plantations and factories, and it remains, today, a substantial component of the labour market.
An amplification of this sort of extra-economic exploitation occurs especially in times of insufficient profits from surplus value extraction, and when the spatial and temporal fixes associated with crisis displacement (not resolution) also reach their limits, as had happened by the end of the 19th century. The next reaction by capital is a return to primitive accumulation. In this respect, Rosa Luxemburg’s analytical contribution is often undervalued (in part because of errors in sections of her work, as shown by Howard and King 1989). In contrast to early studies of globalization (e.g. by Lenin, Hilferding and Bukharin) which stressed interimperial rivalries, Luxemburg drew our attention much more to the relationship between capitalism and non-market activity. She considered polarization between what were later termed the First and Third Worlds to be functional, not irrational, just as the apartheid polarization between white-controlled cities and black rural areas was functional to South African capitalism, and similar labour reserves functioned under colonialism. Luxemburg (1968:452) wrote how, under imperialism, ‘The relations between capitalism and non-capitalist modes of production start making their appearance on the international stage. Its predominant methods are colonial policy, an international loan system, a policy of spheres of interest and war.’
This analysis is not a century old, it is current even if neocolonial policy, the African debt and proxy wars are the updated phrases. It is in part because of this legacy that combined development becomes more important in Africa, the more that mineral resources are in demand. In the period since 2002 when demand for raw materials resumed thanks to Chinese growth, prices have increased, hence so too have superexploitative tendencies to take advantage of Africa’s resource curse, and an intensification of conflict over those resources.
Gillian Hart (2005:7) has shown the crucial distinction ‘between primitive accumulation construed as an event that can be relegated to a precapitalist past, as opposed to an ongoing process.’ In the latter, she suggests, we must also uncover ‘gendered relations and conditions of unwaged work through which the labour force is produced and renewed on a daily basis.’ So too have Dodzi Tsikata and Joanna Kerr (2002) and Isabella Bakker and Steven Gill (2003), respectively, demonstrated that neoliberal policies associated with contemporary imperialism exacerbate gendered inequalities associated with African patriarchy and the overall reproduction of Third World labour.
Likewise, given the racially constituted character of global and local relations in most settings, dimensions of racial and ethnic power also contribute to ongoing primitive accumulation as combined development, whereby the market superexploits non-market conditions. Adebayo Olukoshi (2007:19) has observed how race is central to Malawian political economist Guy Mhone’s notion of ‘enclavity’, especially as the articulation of modes of production draws labour migrants from a regional catchment:
In the post-colonial era, enclavity has also played itself out as a result of anomalies and contradictions in ways that have fueled xenophobia and ethnicity. Consider the post-apartheid immigration policy, which attempts to maintain rigid boundaries in the context that was preceded by the sucking of labour from other parts of Southern Africa without regard to boundary and without regard to the kinds of rules that were supposed to be concerned about loss of jobs to immigrants’ populations, particularly in South Africa. This policy flows out of the unemployment-underemployment nexus that characterizes primary discrimination, in Mhone’s analysis of the centrality of race to enclavity in Southern Africa. The notion of primary discrimination is basically the discrimination built into the political economy of the enclave in a way that permanently dampens wages for the working class. It is one which is shared across the board in all the enclave economies.
The dampening of wages through regional superexploitative relationships helps to explain (though not of course justify) not only the ferocious bursts of anti-immigrant sentiment by the South African working class but so many other sources of border conflict.
Moreover, human control over ecological processes also presents an opportunity for capital to superexploit the environment in search of profits. This hardly needs elaboration, but it is in the final frontier for capital – the ‘privatization of the air’ – that we can discern the extent of this tendency. Africans even as sophisticated as Wangari Maathai are being persuaded to endorse the Kyoto Protocol’s Clean Development Mechanism, which establishes a market in carbon emissions. Given disproportionate CO2 emissions from the North, the new carbon trade represents a technique for market forces (large energy firms and the World Bank) to transfer costs to the South by buying the right to pollute, while maintaining emission levels which threaten climate change especially harmful to Africa. This is just one new component of a vast ecological debt that the North owes the South (Bond, Dada and Erion 2007).
In sum, there is an organic relationship between exploitation via market mechanisms at the point of production, and other extraeconomic mechanisms – superexploitation, gendered violence, racial/ethnic discrimination and environmental destruction – that, at least at surface level, conflict with a market ideology in which meritocracy and ‘sustainable development’ are allegedly incorporated. It is here where Luxemburg (1968:453) observes correctly that although ‘force, fraud, oppression, looting are openly displayed without any attempt at concealment’, nevertheless ‘it requires an effort to discover within this tangle of political violence and contests of power the stern laws of the economic process.’
That process – capitalist crisis tendencies, partial spatial and temporal fixes, unevenness as intrinsic to capital accumulation, ‘combined’ development in the form of accumulation by dispossession, in a variety of racial, gendered and environmental manifestations – are all vital tools for our understanding of violence in the contemporary world, especially in relation to worsening North-South inequality, especially as applied to Africa, where conventional wisdom (and rock-star campaigning) suggests that the continent is not sufficiently subject to the laws of the market.
Before moving to a contemporary review of these relationships, consider the apt summary of combined development made by Luxemburg (1968:450) in 1913:
Capital is faced with difficulties because vast tracts of the globe’s surface are in the possession of social organizations that have no desire for commodity exchange or cannot, because of the entire social structure and the forms of ownership, offer for sale the productive forces in which capital is primarily interested. The most important of these productive forces is of course the land, its hidden mineral treasure, and its meadows, woods and water, and further the flocks of the primitive shepherd tribes. If capital were here to rely on the process of slow internal disintegration, it might take centuries. To wait patiently until the most important means of production could be alienated by trading in consequence of this process were tantamount to renouncing the productive forces of those territories altogether.
Hence derives the vital necessity for capitalism in its relations with colonial countries to appropriate the most important means of production. Since the primitive associations of the natives are the strongest protection for their social organizations and for their material bases of existence, capital must begin by planning for the systematic destruction and annihilation of all the non-capitalist social units which obstruct its development. With that we have passed beyond the stage of primitive accumulation; this process is still going on. Each new colonial expansion is accompanied, as a matter of course, by a relentless battle of capital against the social and economic ties of the natives, who are also forcibly robbed of their means of production and labour power.
Any hope to restrict the accumulation of capital exclusively to ‘peaceful competition’, i.e. to regular commodity exchange such as takes place between capitalist producer-countries, rests on the pious belief that capital can accumulate without mediation of the productive forces and without the demand of more primitive organizations, and that it can rely upon the slow internal process of a disintegrating natural economy. Accumulation, with its spasmodic expansion, can no more wait for, and be content with, a natural internal disintegration of non-capitalist formations and their transition to commodity economy, than it can wait for, and be content with, the natural increase of the working population.
Force is the only solution open to capital; the accumulation of capital, seen as an historical process, employs force as a permanent weapon, not only at its genesis, but further on down to the present day. From the point of view of the primitive societies involved, it is a matter of life or death; for them there can be no other attitude than opposition and fight to the finish-complete exhaustion and extinction. Hence permanent occupation of the colonies by the military, native risings and punitive expeditions are the order of the day for any colonial regime. The method of violence, then, is the immediate consequence of the clash between capitalism and the organizations of a natural economy which would restrict accumulation.
How might we make closer links to adverse African conditions that regularly spawn conflict? The central routes by which wealth flows from Africa to the North are exploitative debt and finance, phantom aid, capital flight, unfair trade, and distorted investment. Although the resource drain from Africa dates back many centuries, beginning with unfair terms of trade and then mediated through slavery, colonialism and neo-colonialism, today, neoliberal policies are the most direct causes of inequality and poverty. They tend to amplify uneven and combined development, especially pre-existing gender, race and regional disparities, as we have seen above.
To illustrate, given the decline in inflowing Foreign Direct Investment, where does the US get its required capital fixes, especially financial inflows to permit the payment of more than $2 billion each work day required for imports and debt repayments? This vacuuming of available finance into the US is important to Africa because since 2004 it has come at the expense of rising global interest rates (17 rate increases over three years). There is no shortage of liquid capital in the global markets, only a question of what rate of return will be required to maintain foreign interest in the US position. This is particularly important as one of the crucial ‘pull’ factors, drawing resources away from Africa and other developing countries. One result is the need to maintain much higher interest rates in Third World settings than under normal conditions. To take 30 July 2004 as a snapshot point, emerging market bonds funded internationally required the highest premium in Nigeria (6.1% premium). As for local bonds, the interest rate spreads have been stratospheric in high-risk sites like the Ivory Coast, at 33.3% in mid-2004 (IMF 2005:Appendix, Table 13).
Amplified uneven development is reflected in highly divergent patterns of financial stability and volatility in these emerging markets. One figure that signals perhaps the greatest danger for the Third World is capital outflow via unofficial routes. Capital flight has been an especially severe problem since the mid-1990s in AsiaMiddle East ($50 billion in 1999). Africa has seen an even greater share of its resources – more than $20 billion in 1997 alone – drained out by its own citizens (IMF 2005:126). James Boyce and Léonce Ndikumana (2000) estimate that over a quarter century, $285 billion was drained from a core group of Sub-Saharan African countries whose foreign debt was $178 billion in 1996. (peaking at $100 billion in 1998) and the
Other net outflows of finance occur through debt repayment. In absolute terms, Third World debt rose from $580 billion in 1980 to $2.4 trillion in 2002, and much of it is now simply unrepayable, a factor recognized by the G8 finance ministers in June 2005 when they agreed to a partial write-off of $40 billion of debt owed by the 18 poorest countries. The debt relief was conditioned by standard neoliberal policy requirements, and represented an outlay of merely $1.5 billion each year for the wealthy countries, in comparison to those states’ military spending in excess of $700 billion a year. In 2002, there was a net outflow of $340 billion in servicing this debt. Overall, during the 1980s and 90s, Africa repaid $255 billion, or 4.2 times the original 1980 debt. For 21 African countries, the debt reached at least 300% of exports by 2002, and for countries such as Sudan, Burundi, Sierra Leone and Guinea-Bissau, it was 15 times greater than annual export earnings. In at least 16 countries, according to Eric Toussaint (2004:3), debt inherited from dictators could be defined as legally ‘Odious’ and therefore eligible for cancellation since citizens were victimized both in the debt’s original accumulation (and use of monies against the society) and in subsequent demands that it be repaid. These amounts easily exceed 50% of Africa’s outstanding debt. As Toussaint (2004:3) remarks, ‘since 1980, over 50 Marshall Plans (over $4.6 trillion) have been sent by the peoples of the Periphery to their creditors in the Centre’.
The Highly Indebted Poor Countries initiative demonstrably failed to change the debt servicing ratios noticeably, and the small debt relief concessions – including the June 2005 G7 finance ministers’ offer – came at the expense of deepened neoliberal conditionality. Even the largest slice of debt relief that year, for Nigeria, required a vast downpayment. According to the leader of Nigeria’s Jubilee network, Rev. David Ugolor, ‘The Paris Club cannot expect Nigeria, freed from over 30 years of military rule, to muster $12.4 billion to pay off interest and penalties incurred by the military. Since the debt, by President Obasanjo’s own admission, is of dubious origin, the issues of the responsibilities of the creditors must be put on the table at the Paris Club’ (Jubilee USA 2005).
In addition, trade liberalization has exacted a heavy toll on sub-Saharan Africa – $272 billion over the past 20 years, according to Christian Aid (2005) and Kraev (2005). Dependence on primary commodities, worsening terms of trade, northern subsidies and long-term falling prices for most exports together grip African producers in a price trap, as they increase production levels but generate decreasing revenues (Burnett and Manji 2007). Across Africa, four or fewer products make up three quarters of export revenues. Natural resources accounted for nearly 80% of African exports in 2000, compared to 31% of all developing countries and 16% of the advanced capitalist economies. Meanwhile, agricultural subsidies to Northern farmers (mainly corporate producers) have risen steeply – 15% between the late 1980s and 2004, according to the United Nations Development Programme (2005:94), to $360 billion per year – which has greatly intensified North-South trade inequalities. Developing countries lose $35 billion annually as a result of industrialized countries’ protectionist tariffs, $24 billion of this as a result of the Multifibre Agreement.
Non-financial investment flows are driven less by policy – although liberalization has also been important – and more by accumulation opportunities. During the 1970s, according to the Commission on Africa, roughly one third of FDI to the ‘Third World’ went to Africa; by the 1990s, this had declined to 5%. Thereafter, what seems like significantly rising Foreign Direct Investment (FDI) in the late 1990s and 2001 can be accounted for by the relocation of South African companies’ financial headquarters to London, and by resurgent oil investments in Angola and military-ruled Nigeria. Tax fraud, transfer pricing and other multinational corporate techniques also reduce Africa’s income. In 1994, for example, an estimated 14% of the total value of exported oil went unaccounted for (Cockroft 2001:4). Privatization-related FDI (14% of total recent FDI) has proved disappointing or worse throughout the continent, including in South Africa where foreign investors have made exceptionally high returns on privatized assets – 108%, for example, on shares in Airports Company of South Africa. The repurchase of shares by state agencies (including Telkom) negates any ‘expertise’ rationale behind such privatization (Bond 2005).
A final example of the processes by which the North drains the South comes from African minerals and petroleum, the source of enormous political and civil conflict. The World Bank has addressed the issue of natural capital depletion in a 2005 document, Where is the Wealth of Nations? The Bank methodology for correcting bias in GDP wealth accounting is nowhere near as expansive as it should be, but at least represents a step forward in recognizing that extractive investments may not contribute to net GDP growth if resource depletion and pollution are factored in. The Bank’s first-cut method subtracts from the existing rate of savings factors such as fixed capital depreciation, depletion of natural resources and pollution, but adds savings investments in education (defined as annual expenditure). The result, in most African countries dependent upon primary products, is a net negative savings/GNI rate. For every percentage point increase in a country’s extractive-resource dependency, that country’s potential GDP falls by 9% (as against the real GDP recorded), according to the Bank (2005:54). (To be sure, in making estimates about the decline in a country’s wealth due to energy, mineral or forest-related depletion, the World Bank has a minimalist definition based upon international pricing, not potential future values when scarcity becomes a more crucial factor, especially in the oil industry. The Bank does not calculate the damage done to the local environment, to workers’ health/safety, and especially to women in communities around mines. Moreover, the Bank’s use of average – not marginal – cost resource rents also probably leads to underestimations of the depletion costs.)
The African countries most affected – i.e., with high resource dependence and low capital accumulation – include Nigeria, Zambia, Mauritania, Gabon, Congo, Algeria and South Africa, as well as two – Angola and the DRC – where data are not available. In comparing the potential for capital accumulation – i.e., were resource rents not simply extracted (and exported) and resources depleted – on the one hand and, on the other, the actual measure of capital accumulation, the Bank (2005:55) remarks, ‘In many cases the differences are huge. Nigeria, a major oil exporter, could have had a year 2000 stock of produced capital five times higher than the actual stock. Moreover, if these investments had taken place, oil would play a much smaller role in the Nigerian economy today, with likely beneficial impacts on policies affecting other sectors of the economy.’ In what may be the worst case, Gabon’s people lost $2,241 each in 2000, as oil companies deplete the country’s tangible wealth. The Republic of the Congo (-$727), Nigeria (-$210), Cameroon (-$152), Mauritania (-$147) and Cote d’Ivoire (-$100) are the other African countries whose people lost more than $100 in tangible national wealth each in 2000 alone (World Bank 2005:66).
In sum, the role of extractive FDI in oil and resource rich countries must take into account the net negative impact on national wealth, including natural capital. Ironically, given the recent source of leadership at the World Bank (with Project for a New American Century providing presidents Paul Wolfowitz and Robert Zoellick to represent the US petro-military complex), the Bank’s new accounting of genuine savings is a helpful innovation. Taking the methodology forward and rigorously estimating an Africa-wide extraction measure, in order to account for the way extractive FDI generates net negative welfare/savings, still remain as important exercises.
On the other side of the ledger, overseas development aid to Africa dropped 40% during the 1990s. Contributions from almost all developed countries fall well below the UN-agreed target of 0.7% of GDP, with 0.12% of US GDP and 0.23% of Japanese GDP as extreme examples. In a study by Action Aid (2005:1), the NGO estimates that the 2003 total official aid of $69 billion is reduced to just $27 billion in ‘real’ aid to poor people because of a variety of ‘phantom’ aid mechanisms. ‘Untied’ aid rose from $2.3 billion in 1999 to $4.3 billion in 2003, but declined as a proportion of total ‘aid’.
It is too early in the analytical work to say whether which of Africa’s extraordinary social, civil and regional conflicts (ranging from genocide to attempted coups) during the last quarter century can be explained by the factors noted above: Angola, Benin, Burkina Faso, Burundi, Cameroon, Chad, Congo, Cote d’Ivoire, the Democratic Republic of Congo, Ethiopia, Gabon, Ghana, Guinea-Bissau, Kenya, Lesotho, Liberia, Malawi, Mali, Mozambique, Namibia, Niger, Nigeria, Rwanda, Senegal, Sierra Leone, Somalia, South Africa, Sudan, Togo, Uganda, Western Sahara, Zambia and Zimbabwe. The continent’s civil wars and adverse climatic conditions (droughts and floods) are increasingly identified with structural political-economic power relations of the sort we have examined, ranging from post-Cold War geopolitical fragility to global warming. The rapid rise of Chinese investment in Africa appears not as an anti-imperialist bulwark but rather an intra-imperial competition which will exacerbate the looting process (Marks and Manji, 2007).
We are left with a sense that the world economy is amplifying features of uneven and combined development that are not accidental, but are structured into economic interrelationships within the advanced capitalist world, and between the North and South. The greatest African political economist, Samir Amin (2003), describes this process as theft: ‘The US programme is certainly imperialist in the most brutal sense of that word, but its not “imperial” in the sense that Antonio Negri has given the term, since it does not aim to manage the societies of the planet in order better to integrate them into a coherent capitalist system. Instead, it aims only at looting their resources.’
The recourse taken in recent years to increased superexploitation of petro-mineral resources in sites like wretched African countries is only an illustrative example of ways that capitalism ‘loots’ the world in search of profits during a persistent overaccumulation crisis. If this seems an excessively crude way of considering the process of accumulation under stress, it is nevertheless a term apparently acceptable now in the mainstream.
For Africa, in suffering such intense, unrelenting looting, perhaps theories such as uneven and combined development can assist with accurate diagnoses and potentially guide us to a broader politics of genuine, durable conflict resolution. With such tools we would quickly realize that recent elite reform proposals will not reverse the outflow of African wealth. Instead, campaigns to reverse resource flows are emerging from grassroots struggles and progressive social movements, such as:
‘decommodification’ movements to establish basic needs as human rights, rather than as privatized commodities that must be paid for;
campaigns to ‘deglobalise’ capital, such as defunding the World Bank and securing the right to produce generic (not patented) anti-retroviral medicines;
demands for civil society oversight of national budgets; and
activism to ensure equitable redistribution of resources in ways that benefit low-income households, grassroots communities and shop-floor workers.
Were there even a single genuinely left government in Africa (Zimbabwe does not qualify due to its brutality against poor/working people, by the crony-corrupt elite), a variety of national policies could be applied to reverse socio-economic collapse:
systematic default on foreign debt repayments;
strategies to enforce domestic reinvestment of pensions and other funds;
reintroduction of currency exchange controls and prohibition of tax-haven transfers;
refusal of tied and phantom aid, along with naming and shaming fraudulent ‘aid’;
inward-oriented import-substitution development strategies;
refusal of foreign investments that prove unfavorable when realistic projections factor in costs such as natural resource depletion, transfer pricing and profit/dividend outflows; and
reversal of macroeconomic policies that increase inequality.
But since any moves in this direction require bottom-up social movements to intensify their work, it is most crucial in the short run to recognize anti-capitalist efforts to bridge intraAfrican, global-local and Northern-African divides. They include (but are not limited to) the mid-2007 general strikes by revitalized labour movements in countries ranging from Swaziland to South Africa and Nigeria; campaigning for reparations and the closure of the World Bank and IMF by Jubilee and Debt Movements in Africa; AIDS treatment advocates breaking the hold of pharmaceutical corporations on monopoly antiretroviral patents; activists fighting Monsanto’s GM drive from the US to South Africa to several African countries; blood-diamonds victims from Sierra Leone and Angola generating a partially-successful global deal at Kimberley; Kalahari Basarwa-San Bushmen raising publicity against forced removals, as the Botswana government clears the way for DeBeers and World Bank investments; Lesotho peasants objecting to displacement during construction of the continent’s largest dam system (solely to quench Johannesburg’s irrational and hedonistic thirst), along with Ugandans similarly threatened at the overly expensive, corruption-ridden Bujagali Dam; a growing network questioning Liberia’s long exploitation by Firestone Rubber; Chadian and Cameroonian activists pressuring the World Bank not to continue funding their repression and environmental degradation; Oil Watch linkages of Nigerian Delta and many other Gulf of Guinea communities; and Ghanaian, Kenyan, South African and Dutch activists opposing water privatization.
How far they go in part depends upon how far valued allies operating in/against the world’s financial and corporate centres recognize the merits of their analysis, strategy and tactics -– and offer the solidarity that African and other Third World activists can repay many times over, once the Northern boot is lifted from their countries’ necks and they gain the space to win lasting, emancipatory objectives. But setting out campaigns for reparations, Bretton Woods decommissioning, corporate malfeasance and an end to many specific other forms of looting is only part of an even bigger challenge for bottom-up construction: establishing a durable programmatic approach that the world’s progressive movements can unite behind. A strong analysis that captures the multiple new modes of superexploitation is a necessary foundation and far more work is required to develop and critique this approach.
That is the only way that we can strengthen and energize the peoples struggle to unite to build a new world order that is against imperialist aggression, state terrorism, plunder and social destruction. On peoples movements’ and struggles can chart the course of the new life worlds, new realities.
In the words of Che Guevara; “Hasta la Victoria Siempre.”…….Onwards to Victory!!!!
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