Global hegemony and the Structural Power of Capital_Stenphen R.Gill,David Law_International studies Quarterly Vo.33.No.4(Dec. 1989)475-499
Global Hegemony and the Structural Power of Capital
This essay seeks to clarify, develop, and apply concepts of power and hegemony which are often latent within the literature in the field of international political economy. Clarification is vital both for debate between rival perspectives and for attempts to go beyond them. We see power as having related material and normative. behavioral and structural dimensions. these distinctions are elaborated to help explain aspects of the changing nature of present day capitalism, with particular reference to aspects of transformation in the 1980's and beyond.
Partly building upon Robert Cox's anaysis of social forces and world otehrs. and Antonio Gramci's theory of hegemony, we seek to explain some of the conditions under which a more "transnational" regime of accumulation and an associated hegemony of transnational capital might develop. Such a hegemony could never be complete because of counter hegemonic forces and contradictionary elements in the internationalizaion of capital. Some requirements for an alternative counter hegemonic historical bloc are sketched. with suggestions for a research agenda.
In this essay we seek to advance the therization and interpretation of the dynamics and contrours of the emerging global political economy and to outline and agenda fo study in thie filed. Our perspective differs from and can be read as a critique of classical marxism, world systems theory, public choice and neo realist theory. Central to our arguments is the distinction between direct and structure forms of the power and their place within present day capitalism. Through developing this contrast. in combination with Gramscian concepts of hegemony historic bloc and the extended state we seek to meet two major challenges. the first is to better intergrate domestic and international levels of analysis. We think that a key to the resolution of this problem has been provided by Cox(1987). His analysis of social forces points to a more comprehensive and flexible approach to the question of structural change than the provided in various mechanistic’ modes of economies in the literature(Ashley, 1983)such economies is found recently, for example, in the writings of marxist and Public choice theorists(E.G.Ferguson. 1984; Frey 1984 respectively).the second challenge is related to the first : to theorize the complementary and contradictory relations between the power of states and the power of transnational capital. we aim, for example to reconsider ideas about cooperation and conflict in the world political economy and to sketch a new research agenda for the study of social forces at the global level. We begin by sketching aspects of Gramscian historic bloc and regime of accumulation to provide a basis for arguments concerning state, markets and the power of capital.
Gramscian Historical Materialism
In contrast to the instrumentalism and economy of the classical Marxists some contemporary Marxists take their inspiration form the ethical rationalism of the former leader of the Italian communist party, Antonio Gramsci, Gramsci's ideas are as yet, somewhat underdeveloped in the international relations literature, but they have gained increasing attention, even among influential non Marxists (See Keo Hane 1984, Russett 1984)
Gramsci's(1971)concept of hegemony differs from the orthodox realist usage. The latter refers to the dominance of one state over other states and is largely a case of what we call the direct exertion of "Power Over" in the sense used by Max Webber.
For Gramsci, hegemony was a concept used to analyze the relation of forces in a given society. A hegemonic order was one where consent. rather than coercion, primarily chracterized the relations between classes and between the state and civil society. Gramsci's concept of the state is an "extended" and intergral one. which reflects the fact that under certain conditions (For example, in Anglo Saxon Countries) there was often an organic fusion between state and civil society (Gramsci 1971:12). This concept of the state contrasts with the rather narrowly defined "nightwatchman" state of liberal economists and the "interventionist" state associated with Bismarck(Gramsci 1971 : 257-63)
For Gramsci the power of the Rulling class or class friction over others was partly exercised through the state. it was not simply a case of dominance through sanctions. punishments, or inducements, it also involved "intellectual and moral leadership"(Gramsci 1971 : 183, 269) Hegemony was excercised within a wider social and political constellation of forces or "historical bloc" this term refers to a historical congruence between material forces, institutions, and ideologies, or broadly to an alliance of different class forces. Thus historic bloc was the "organic" link between political and civil society(Gramsci 1971:366). A successful bloc was politically organized around a set of hegemonic ideas sometimes called the dominant ideology "for a new histroic bloc to emerge its key elements must engage in conscious planned struggle." this was not simply an issue of Capturing the state. Any new historic bloc must have not only power within the civil society and economy but also persuasive ideas and arguments (involving what Gramsci called the ethico-political"level) which build on and catalyze its political networks and organization. The catalyst is provided by "an appropriate political initiative which is always necessary to liberate the economic thrust from the dead weight of traditional policies to change the political direction of certain forces which have to be absorbed if a new. Homogeneous politico-economic histrocial bloc, wihtout internal contradictions. is to be successfully formed(Gramsci. 1971:168)
This aspect of Gramsci's thought provides inspiration for this essay because it has potentially far reaching implications for a new approach to the study of international relations as cox 1983 has demonstrated. it implies the necessity of considering global structual change and world orders in terms of the dynamics and dialectics of their normative (ethnical, deological, practical) as well as their material dimensions. However, Cox's pioneering work leaves much to be done. his recent book involves the elaborate categorization of historical forms of productive relations ,forms of state and world order(Cox 1987) in two concluding chapters he does reflect on mutations in the social structure of accumulation and the formation of historic blocs, since it is the first of the four volume work called Power and Production written in conjuction with Jefferey Harrol(1987)
Our contribution here mainly concenrs the theory of power. We assume that theories of power and hegemony must subsume both normative and material, structural and exitentaial(behavioral) dimenstions of social relations. part of the richness of Gramsci's concepts is that they combine these elements and thereby offer clues for overcoming the gulf between structure and agency. We believe a possible key to the resolution of structure action problem in social theory in general. and international relations theory in particular, may be in the development of mediating concepts such as structural power and historic bloc.
Historic Blocs and Regimes of Accumulation
Some recent writers suggested that capitalism is entering into a transnational stage. which differs in significant respects from the imperialist (national capitalism) stage analyzed by classical marxist (see Brewer, 1980-79-130) Applying Gramci's ideas internationally and to this particular stage, Cox(1987:355-98) has demonstrated that it is possible to conceive of hegemony and the formation of historic blocs on a world scale. it can then be theorized what role such bloc might play in promiting broad changes in the process of capitalist development. This includes shifts from one type of social structure of accumulation to another within the broader confines of a particular mode of production. cox's concept of social structure of accumulation is paralled by that of a regime of accumulation used by the French regulationist school.We assume that such a regime involves class and intra class relations including the mode of life and composition of the labor force. its political organization. the labor process in its technical, organizational and human aspects)and legal regulation of work. It also involves "forms of regulation" concerning the scope of markets and the freedom of enterprise at both national and global level. A regime. therefore. broadly ecompasses the forms of socio-economic reproduction which together constitute the conditions of existences of economic development n a particular historical period or epoch. As such there may be different regimes of accumulation(e.g., Capitalist or existing socialism) coexisting at any point in time.
De vroey(1984) sketches out two dominant regimes of accumulation which have characterized modern capitalism. the first extensive regime(roughly encompassing the first three quarters of the nineteenth century)was associated with relatively competitive industrial l structures and less capitla intensive forms of production that in the later."intensive regime"which more fully emerged in the twentieth century, the first regime was associated with a ratehr narrow domain of stae intervention and to a certain extent. a doctrine of economic liberalism. Moreover political democarcy and workers. organizations were very under developed. the second and some what more democratic regime was characterized by more capital intensive mass production systems and a gradual rise in real wages. it was accompanied by wide ragning state intervention especially in monetary and macroeconomic management and by the promotion of education training research and development. it was also associated with the widespread growth of trade unionism life wing political parties. Coporations planning and the consolidation of the welfare . Charles Marier(1988)has called this complex of policies and class compromises the politics of productivity at the international level thes two regimes of accumulation coincided respectively with a period of British hegemony and the Gold standard and after 1945 with America globalism and the Bretton Woods system.
What were the key international elements in the post 1945 regime of accumulation which generated uniquely rapid economic grwoth throughout the industrialized capitalism world?we would suggest at least four. the first was the construction of a U.S centered economic, security, and political structure for the non communist world. ensuring peaceful condtions at the capitalist core in sharpt. mixed economy which along with the rise of the cold war. was important in the reconstituion of the legitimacy of the liberal democratic forms of rule the west and in Japan A fourth element was the cheap and plentiful supply of raw materials especially oil.
this order was what we term a new international historical bloc of social forces centered in the United States. This bloc originated in the outward expansion of the social forces associated with what Tom Ferguson has called an American multinational block the leading elements in this constellation sought to internationalize New Deal Principles and associated forms of forms of capital intensive. mass consumption accumulation and to extend opportunities notably in oil. the multinational bloc also encompassed financial interest on the Wall street which sought wider investment opportunities oversear and a more comprehensive international role for the dollar(Ferguson. 1984).However this bloc brought together not only fractions of productive and financial capital but also elements in the state appratuses, centrist political parties. and non communist organized labor in the major capitalist nations. Forces associated with the multinational bloc in the U.S were able to forge links consciously with counterparts in Europe to form a concept of a trans altlantic political community. this became the political core of the international historic bloc(Van der Piji. 1984. Gill 1989).
What needs to be emphasized here. therefore. is that the concept of an international historic bloc means much more than an alliance of capitalist interests across national boundaries. it implies that elements of more than on class were involved. and its basis was more organic and rooted in material and normative structure of society. that is in the governmental and social instituions and civil societies of a number of countries, including weak states. hence the alliance of social forces is comprise is seen as natural and legitimate by most of its members
Viewed from this perspective the post war mix of social democracy and the mixed economy incorporated a range of class interests which sustained the emerging liberal international economic order. this maintained its coherence and continuity for approximately twenty five years after 1945 although the appearance of continuity in at work which would in the long term erode the basis of the regime of accumulation and the intergral natrue of the associatied international historic bloc. Eamples of such forces were the growing knowledge intensity of production and organizational systems and the related gradual rise in the importance of transnational capital. Especially fianacial capital highlighted in the growth of the Euromarkets since the 1960s at the same time the scale and scope of welfare expenditures was also growing as were state expenditures as a proportion of GNP.
in a structual sense what was occuring in the post war period was the emergence of a globally intergrated economy while political regulation at the domestic level was becoming ever more comprehensive. We discuss this transformation below in terms of the simultaneous and in some ways contradictory growth in the power of both state and markets.
States. Markets and the Power of Capital
Both markets and states long preceded industrial capitalism. but the latter was historically associated with the growth of intergrated capitalism market. While Marxist writers have typically stressed the emergence of wage labor market as a defining feature of capitalism we suggest that the emergence of elaborated capital markets is at least as important. Markets historically have required some form of political organization and protections require finance, which rates an added interest in both facilitating and regulating markets. for example to obtain taxes. However extensive regulations and restrictions often lower profits and breed forms of evasion(such as smuggling black market and financial innovation) the incentive for capital to in transport and communications are reduced that is as capital becomes more mobile. the growth in the Euro markets since the 1960s in an important example of this .one which we relate below to the structural power of capital. Just as capital seeks the most propritious conditions for investment. states compete to attract capital and direct investment. Under the recessionary conditions of the 1980s this gave rise to competitive deregulation of different national capital markets. Competitive deregulation is a misnormer. however. since it accompanied attempts to redefine market historically have required some form of political organization and and protection normally provided by the state. By the same token, governmental instituions require finance, which creates an added interest in both facilitating and regulating markets for example, to obtain taxes. However extensive regulations and restrictions often lower profits and breed forms of evation(such as smuggling black markets. and financial innovation). the incentive for capital to evade controls is greater if national regulations vary, especially if technical obstables in transport and communications are reduced that is as capital become more mobile. the growth in the Europe Markets since the 1960s in an important example of this one which we relate below to the structural power of capital. Just as capital and directs investment. Under the recessionary conditions of the 1980s this gave rise to competitive deregulation of different national capital markets. Competitive deregulation is a minomer. however since it accompanied attmeps to redefine market rules under new conditions most important however the process progressively reduced the barries to the international mobility of financial creating a more intergrated and global capital market.
In this sense there is an evolving dialectrical relationship between the nature and scope of markets and the forms of state regulation, especailly as knowledge, technology and transportation change. which seek to reconcile the potentially international dimensions of state activity. which seek to reconcile the potentially political rule. political rule is circumscribed by the problems of legitimation, mobilization and communication in political time and space. thus capital as a social relation depends on the power of the state to define. shape, and participate in a regime of accumulation. by capital as a social relation we mean the contrast between those with a substantial or even privileged ownership, control, or access to both financial and physical assets, in contrast to the bulk of the remainder of society(most of the labor and their dependents).
The form of different regimes of accumulation provides the wider context for our discussion of contemporary state capital relations and the question of the structual power of markets. We will argue that the widening of the scope of the market in the 1980s and probably during the 1990s along with certain changes in technology and communications contributes to the rising structural power of internationally mobile capital. By contrast the state as an instituional and social entity also create the possibility for the limitation of such structural power, partly because of the political goods and services which it supplies to capitalists and the instituional autonomy it possesses. The stance of the state towards freedom of enterprise in a given regime of accumulation is at the hear of this issue.
At the domestic level, the distinction between direct and structural forms of the power of capital or of "Business" has already been well developed. Direct aspects of business power and influence relative to labor. include its financial resource expertise, contract with government, for example through lobbying, moreover in oblipolistics industries large firms possess some market power over prices and perhaps wages in contrast to highly competitive market where both buyers and sellers are subject to the power of the market as in highly competitive financial market (in which governments borrow reguraly) political system. By contrast Marxist associate business with capital as a class. As such. anaysis of its power implies a deeper, socio structural dimension inherent in the capitalist system. Nonetheless the power of capital in general needs to be distinguished from the power and influence of particular fractions of capital.
Here our chief concerns is to analyzed the power of those factions of capital which are the both larger in scale and internationally mobile. this category both some firactions of productive capital in manufacutring and extraction and financial capital such as in banking insurance and stockbroking. the power of capital in general partly rests upon the degree of division between different fractions of capital. or what Lindblom would call different sections of business. At the same time of course competitive pressure may mean that cooperation between capitalists within different fractions is difficult or even impossible to achieve. nonthless in anaysis of the conflicts and divisions which divide capitalist.
the form of different regimes of accumulation providers the wider context for our discussion of contemporary state capital relations and the question of the structural power of markets. We will argue that the widening of the scope of the market in the 1980s and probably during the 1990s along with certain changes in technology and communications. contributes to the rising structural power of internationally mobile capital. By contrast, the state as an instituional and social entity also crates the possibility for the limitation of such structural power. because of the political processes. the stance of the state towards freedom of enterprise in a given regime of accumulation is at the heart of this issue.
at the domestic level the distintion between direct and structural forms of the power of capital or of "business" has already been well developed. Direct aspects of business power and influence relative to labor. include its financial resources expertise. contacts with government and control over much of the media.
Business has a privileged ability to influence relative to labor. include its financial resources expertise. contracts with government and control over much of the media. Business has a privileged ability to influence relative to labor. include its financial resources, expertise, contracts with government and control over much of the media. Business has a privileged ability to influence relative to labor include its financial resources, expertise, contracts with government and control over much of the media. lobbying. More over in oligopolistic industries large firms possess some market power over prices and perhaps wages in contrast to highly competitive markets where both buyers sand sellers are subject to the power of the market. as in highly competitive trualizatiin much of it inspired by Lindblom(1977) business is viewed as a type of previlliged vested interest in a more ore less pulralist (polyarchiscal) Political system.By contrast Marxists associate business with capital as class. as such, analsysi of its power implies a deeper,socio structural dimension inherent in the guished
at the domestic level. the distrition between direct and structural forms of the power of capital or of business has already been well developed. Direct aspects of business power and influence relative to labor. include its financial resources. expertise, contacts with government. and control over much of the media. Business has a privileged ability to influence government. for exmaple through lobbying moreover in industries large firms possess some market power over prices and perhaps wages in contrast to highly competitive markets where both buyers and as such analysis of its power implies a deeper socio structural dimension inherent in the capitalist system. nontheless the power of capital in general needs to be distinguished from the power and influence of particular fractions of capital.
Here our chief concerns is to analyze the power of those fractions of capital which are both large in scale and internationally mobile. this category includes capital in general partly rest upon the degree of division between different fraction of capital or what linblom would call different sections of business. at the same time capital or what lindblom would call different sections of business. at the same time. of course competitive prressure may mean that cooperation between capitalists within different fractions is difficult or even impossible to achieve. nonethless in analysis of the conflicts and divisions which divide capitalists the concept of power is a behavioral one. thus the focus over others or the state appratus. While this dimension is essential it need to be combined with an investigation of structural power. in deed the more striking the divisions within its ranks the more crucial the structural aspect of capital's power becomes.
this structural aspect of power is associated with both material and normative demetions of society such as market structures and the role of ideology which may or may not be mutually reinforcing. the tenacity of normative structures is economic growth relative to other goals .such as conservation. another illustriation concenrs the assumptions and cliams made about the conditions for the achievement of growth. with repect to capitalist economies. Lindblom(1977:170: 88( suggests that business people are able to claim an expertise of public value. partlybecause there is widespread accpetance of the view that economic growth is fundmenlly dependent on invemstment and innovation by private enterprise.
Acceptance of these assumptions and claims by politician and the public means that governments have to be concerned with the cultivaiton of an appropriate business climate or else investment might be postponed and a recession might be precipitated.an elected socialist party with a radicap program would therefore be constsrained in its policy choices by the nature of the business climate not least because it would need tax revenue and or loans to finance its ambitious spending planes an assumption behind these arguments is that there is a market for capital enterprise and inventiness and the supply of these will be reduced by higher taxation. indeed sucha arguments are the essence of the so-called supply side economics which became influential in the U.S in the 1980s.
there is striking contrast between the ability of capital and of labor to shape policy in the long tern under capitalist conditions. whereas an Investment strike. by business may occure spontaneously if the business climate deteriorates. labor.in order to exercising corresponding influence. would have e to directly orgnaize a wide ranging or even general strike.
thus capital and particularly whears a reduced williness to invest for productive purposes usually comes about gradually the supply of finance to government through the purchase of government bonds and bills may decline very rapidly this might result in the government being unable to finance its current activity without resorting the investment climate to deteriorate further prolonging the investment strike. the such as lobbying and gentle manly arm twisting. however such a twisting is secondery to the markets notably the financial markets .this power constrians the participats in the market. notably the financial markets. this power constrains the participants market.
some of the points made above fit in with the notion of a hegemonic ideology which serves the class interests of capital relative to those of labor. at the heart of this notion are the ideas that private property and accumulation are across act and that of such ideas is the way in which monetarists ideas about the need to control inflation countries during the late 1970s and 1980s. this commitment was refected for summits. the late 1970s was of course before conservative goverments were in power in most of the summit nations Nonthless, monetray targets rapidly became common place madating discpline in goods and labor markets Either wages had to be restrianed or according to the logic of these policies. workers would price themselves out of jobs./ 8page 후략.