III.2 The fifth (stateless) SCA

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III.2 The fifth (stateless) SCA

The main characteristics of the new systemic cycle of accumulation are summarised in Table II. We will now describe them briefly.

The world that was ‘discovered’ by Imperial Iberia and ‘conquered’ by Imperial UK is now being ‘permeated’. This is the third dramatic widening of the capitalist world system. This widening, however, is not geographic in the strict sense of the word, indeed, practically the whole world has been incorporated into the capitalist world system during the US SCA. This means that traditional geographic widening a la Arrighi is no longer possible[2]. It is a widening in the sense that the many interstices ignored or repressed by the US-led world system are being filled. From a complementary point of view, we can say that (almost) the whole economic space is being made marginal. Well-defined loci of production and trade are abandoned and replaced by delocalised, diffuse ones. Large corporations are subdivided into networks of small units (at the extreme, individuals). Out‑sourcing means that core units where most added value is generated are fewer and smaller, while the bulk of the production units have to compete in the massively inflated marginal spaces between them[3].

So, enterprises in the US SCA were geared towards mass production of one same product (or a different few models) that had to cater for the needs of large segments of the population. This left much demand either unmet or met only partially. Enterprises in the new SCA are geared towards customised production for satisfaction of individually expressed needs.

The main innovation of the new SCA is related to these developments, and is externalisation of state costs allied to internalisation of the benefits of the core-periphery system. Personal retirement plans, private health care, private security systems are some of the functions of the Keynesian welfare state that are being externalised by the capitalist agencies, that is, no longer paid for with taxation of enterprises or of rich individuals. This goes hand in hand with the reintroduction of the Third World within the First, that is, the exclusion from the benefits of the core of large segments of its population. That is, the periphery is being brought back into the core, creating a non-geographic core-periphery network structure, superimposed to the old geographic one.

All these developments are made possible by information and communications technology (ICT), which is the strategic commodity of the new SCA. Not only does it enable and enhance the potential of many other technologies (besides generating itself immense profits), it is ICT that weakens geographically based processes, and makes possible the rise of delocalised and decentralised ones. That is, ICT is the foundation stone on which the reorganisation of the economic space is proceeding, and the cells of the network structure of the new SCA are connected to each other through computers and telecommunications.

Ceaseless accumulation of capital is ensured through the world-wide financial market, whereby the surplus capital accumulated during the US SCA can be allocated to enterprises anywhere in the world. Another mechanism is that vertically integrated TNCs are re-engineering themselves towards the new flexible forms of organisation, directly guaranteeing investment of capital in the new processes of accumulation.

In the US SCA, the political system was geared towards formation of large groups (the USA, the EU, the ‘Free World’, or even the nation-state) in which one same political ‘product’ catered for the whole population. Now it accommodates much more easily small-country nationalisms, regionalisms and even non governmental organisations. One of the reasons for that is the political stabilising framework of the new SCA, which is based on institutions of international (world) government such as the UN and the International Court of Justice[4]. With human rights becoming a justification for intervention in a country’s internal affairs, the new fragmented political units can be closely controlled. Further, international relations have been partially integrated within the scope of TNCs as some TNCs are economically larger than some nation-states and are able to negotiate (or even dictate) conditions of interaction with states.

The liberal freedom of the new SCA is the freedom to move instantly. This movement is concrete – of people, or at least the elite of e.g. international managers, artists, sportspeople; virtual – of ideas and information through the world wide web (www); and both virtual and concrete – e.g. of speculative floating capital, that has no material support but has very real consequences.

The ‘universal’ idea associated to this is the www itself, ‘the information superhighway’, that is presented as as important (or more) an event as the Industrial Revolution, that will revolutionise the way each individual lives. Individualism, and even personal ‘rebel’ attitudes, are not only tolerated (where before they were feared), they are positively encouraged[5]. In the new universalism, diversity is central. The defining ‘ordinary’ art of the new SCA can then be taken to be television commercials, with their appeal to individualism and with the very short attention span they require. It is important to note that the www is not, nor could it be, associated with any given state, and personal participation in it is relatively easy (certainly if compared with direct participation in the ‘universal’ idea of the US SCA, the ‘Space Age’).

The fundamental difference between this SCA and the previous ones is that no single hegemonic capitalist agency can be identified. The new hegemonic structure is hegemonless. Capital accumulation based on ICT is fundamentally stateless, because it cannot be controlled or contained within artificially constructed geographic borders. To be sure, the new capitalist agencies occupy places, however they are not defined by the places they occupy[6]. They are still concentrated in the old core regions, but they are not attached to them. What is good for General Motors is now good, not for America, but for its management and shareholders, who can be located anywhere in the world.

The structures of the new SCA can be seen as being of imperial character, and we will refer to the new SCA as Empire without Emperor (EwE)[7]. This imperial character manifests itself in the coexistence of overlapping institutional structures and jurisdictions that complement each other and compete with each other[8], with frontiers that do not separate spaces and sovereignties but constitute fuzzy margins. This multitude of jurisdictions is reflected in a multitude of memberships and loyalties, of which each individual holds a unique set. The new universal constructs cannot thus be based on a formal universal polity or economic system. Instead, they are based on harmonised standards and regulations that define the interactions between different components. This allows, and indeed encourages, diversity, as long as it conforms to the framework of rules agreed upon.

Previous imperial hegemonies, the Iberian and the British, had their imperial character defined by direct control over the sources and routes of wealth. This also meant a direct control of the periphery[9]. We argue that the same is valid for the new imperial hegemony, the EwE. Firstly, it should be noted that traditional (imperial) territorial control ceases to be crucial in the age of networks and delocalised production. Instead, each high-value added production or trade unit (for instance, a local business unit of a TNC) controls, through out-sourcing and sub-contracting, a whole network of other business units which carry out lower-value added processes, thus skimming a large part of the surplus generated. There is normally no direct control over any single company in the network, the control is instead over the network as a whole[10], which is the relevant structure. Finally, many of the workers of (often small, occasionally self-owned) units in the network belong to the new non-geographic periphery, and are directly or indirectly dependent on the (non-geographic core) high-value added unit. We can then finally say that the organisational mode of the new SCA is cosmopolitan capitalism allied to non-territorial imperialism.

 

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[2] Which, incidentally, makes attempts to search for a new geographically defined region or group of capitalists as candidate to lead the world system into a new material expansion based on geographical enlargement of the system by and large hopeless.

[3] Notice that the networks under consideration are not uniform nor static; the core cells will have denser connections, and these are not symmetrical, since they can cut links with any given non-core cell (i.e. a unit involved in low-added value activities) without suffering, but the inverse does not hold. On the other hand, the non-core cells, or rather the totality of their connections, define the configuration, that is the ‘shape’, of the main features, i.e. the core cells. We can now take as “margin of any given entity … any part of it which may plausibly be thought capable of being part of it or not” (Parker 1998: 5). In this sense, the units involved in low-added value activities are the margins of the complex geometry under study (networks) because, as non-essential cells of a network, they can be discarded at any moment by the core cells. Their activity is potentially ephemeral. This is even more true of individuals (who can also voluntarily delink from the system).

[4] Although it should remain clear that no such thing as a world government exists or is likely to exist in the foreseeable future.

[5] “[A] good consumer is a fun-loving adventurer. For good consumers it is not the satisfaction of the needs one is tormented by, but the torment of desires never yet sensed or suspected that make the promise so tempting” (Bauman 1998: 82).

[6] This last point is also true of the long sixteenth century Genoese, which however still had to meet at their regularly held fairs. Further, belonging to one of the ‘nations’ in which merchant bankers were organised was required to generate confidence and reduce risks. The Italian merchant that arrived empty-handed to Lyon needed only a table and a sheet of paper to do business (Arrighi 1994: 129, 148). Nowadays, however, even direct meetings are unnecessary and the ‘fairs without place’ can be held permanently (even controlled by computers). The modern banker does not actually need to go anywhere most of the time, as all they need is a computer and a modem to do business anywhere in the world. Further, standard financial instruments (derivatives etc), credit ratings, and watchdogs eliminate or reduce the need to know personally with whom you are trading, let alone coming from the same city or state.

[7] This phrase is taken from Jean-Marie Guéhenno’s The End of the Nation State (Guéhenno 1995). Although making no allusion to SCAs, the structures and processes he describes can be seen as part of the new SCA.

[8] Which is typical of the old multinational empires, with local lords, local religious leaders, overlords, high priests, emperors, tax collectors, armed groups (including bands of brigands, which often did not differ much from tax collectors), provinces, the capital, etc.

[9] This could be opposed to the indirect control practised by the Dutch and American trading hegemonies.

[10] At the extreme, the consequences for a region of the closure of a single large core enterprise can be dramatic, with the collapse of direct and indirect suppliers, services, real estate, etc.