Author: Oliver Eagleton

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Sound Money?

On 6 September Liz Truss was appointed Prime Minister of the United Kingdom, after a Conservative leadership contest notable for its near-total lack of reference to the social calamity known as the cost-of-living crisis. While the ruling party spent the summer decrying ‘woke culture’ and praising the trickle-down theory, Keir Starmer’s Labour found a new spring in its step, calling for a windfall tax on energy firms and opening up a poll lead that could point towards the steps of Downing Street. Meanwhile, a wave of strikes and protests – centred on consumer prices and real wages – has given a shot in the arm to a radical left still emerging from the post-Corbyn doldrums. Don’t Pay UK, canvassing support for the mass non-payment of energy bills in the wake of a 56% April increase and an 80% hike scheduled for October, has amassed a pledge list of almost 200,000 refuseniks.

During this period, the cap on maximum domestic energy changes by Ofgem – toothless regulator of the privatized energy system – became the object of increasing discontent. This was not the intention of Theresa May’s government when it introduced the energy cap in 2018, in an attempt to allay pressure from Jeremy Corbyn’s Labour (the proposal for a cap itself dating as far back as Ed Miliband’s leadership). Yet as wholesale natural gas prices spiked across Eurasia over 2021, then skyrocketed following Russia’s invasion of Ukraine, Ofgem continued to raise its price ceiling to unprecedented heights, bound by legislation to guarantee a 1.9% profit to retailers. This brought with it the prospect of nationwide strikes plus mass civil disobedience. So, on the second day of Truss’s tenure, the government pledged a not-quite freeze on bills (the typical bill will go up £600 rather than £1,600) for the politically significant period of two years, up until the last possible date of the next general election. This was the largest single economic intervention in Britain’s peacetime history, dwarfing the eventual cost of the Covid furlough scheme.

There is an obvious precedent for Truss’s handout. When Thatcher became PM in May 1979 she immediately accepted the recommendation of the Clegg Commission, established by Callaghan after the Winter of Discontent, for an average public-sector pay rise of 25% – approximately double the rate of inflation. This elicited a backlash from the new breed of hardline monetarists, but Thatcher recognized that securing industrial peace was more important than appeasing them. As The Economist reported at the time, she entered office with a clear intention to buy off stronger sections of organized labour while confronting and defeating weaker ones. The 1977 Ridley Plan described this as the ‘salami’ approach – ‘one thin slice at a time but by the end the lot is gone.’ In the short term, wrote Ridley, the government would have no choice but to ‘pay up’ to those unions ‘that have the nation by the jugular vein.’

It seems that today’s Tories – even (or perhaps especially) their most committed ideologues – are once again prepared to ‘pay up’ if it allows them to win a class fight. And let’s not delude ourselves: Chancellor Kwasi Kwarteng’s mini-Budget, announced this morning, shows that a class fight is underway. His so-called ‘fiscal event’ was the most dramatically regressive announcement by any government for some time – giving a £4,500 tax cut to the richest 500,000 people in the country while further tightening Britain’s miserly benefits system. This smash-and-grab raid on behalf of the very wealthiest must be set in the context of recent global upsets: the shifting international balance of power, trade wars, Covid-19, the Russian invasion of Ukraine and worsening ecological crises. With growth rendered uncertain by such turbulence, but profits still demanded, working-class and middle-class living standards are on the line. We are entering an era of zero-sum capitalism, even more cut-throat than that of the early eighties.  

In this conjuncture, the old rules of Ukanian state management – according to which the Treasury’s books should be balanced and the free market should come first – appear to have been rewritten. The Tories of the Cameron-Osborne era are gone; in their place, we have austerity-sceptic Johnson followed by deficit-sceptic Truss. The former Chancellor Rishi Sunak has seen his drab bean-counting rejected by the Tory membership, while Truss is set to embark on a £150bn-plus borrowing bonanza. Reversing the NICs rise, cutting green levies on domestic energy bills and reversing Sunak’s planned Corporation Tax hike were the priorities she enumerated during the leadership campaign, the total cost of which could easily reach £30bn. These aren’t the Tories of old: neither Thatcher’s homilies on household budgets nor their repetition by Cameron and Osborne get a look in.

With that in mind, it is worth considering the Spectator’s fascinating survey of ‘Trussonomics’, based on interviews with her three leading economist supporters, for hints as to where the Tory right are headed. In it, Truss’s backers – who prefer to be known as ‘Trusketeers’, alas – outline a programme that deviates significantly from the traditional Conservative prospectus. Julian Jessop, former chief economist at the Institute of Economic Affairs, now asserts that the austerity of the 2010s was a mistake: ‘When the facts change, I change my mind…Ten years ago, I would have been much more conventional in my thinking that you need to get the budget deficit down as quickly as possible. But it’s clear that isn’t working.’ Patrick Minford, an early supporter of Thatcher, is currently reprising that role but flipped 180 degrees as he lays into the Treasury’s obsession with book-balancing: ‘We have policies in place which are raising taxation, that damaged growth in order to satisfy short-run borrowing constraints put forward by the Treasury.’

As for the monetarism Minford once expounded, with its insistence on a strict separation between the monetary authorities and the government as well as mechanical targets for monetary growth, Gerard Lyons, tipped as a member of Truss’s as-yet-unveiled Council of Economic Advisors, says he wants to ‘re-examine’ the Bank of England’s remit ‘to make sure it is fit for purpose’. Elsewhere, Kwarteng pays lip-service to the idea of central bank independence whilst simultaneously pledging that ‘fiscal and monetary policy must be coordinated’ – the passive voice happily disguising who, exactly, should be making the coordination happen. Put all this together, and the family resemblance is not so much to Thatcherism, with its rhetorical commitments to ‘sound money’ and balanced books, but to Reagonomics, with the US deficit under President Reagan ballooning to unprecedented levels thanks to tax cuts for the rich and vast increases in military spending. (Truss has promised to increase UK military spending to 3% of GDP by 2030, at an estimated cost of £157bn.)

Of course, these solutions are presented as short-term ones: a necessary yet temporary detour from the true path of deregulation and ‘sound money’. Minford has suggested that a 7% interest rate might ultimately be more appropriate for the British economy, while Jessop has suggested relaxing restrictions on financial services, ‘gene editing’ and data protection. But all this is for somewhere down the line. For now, the Trusketeers anticipate significant state intervention and large deficits, in part to provide a political cover for their long-term plans.

Will any of this work? Most economists would say no. The FT’s Martin Wolf claims it is a ‘fantasy’ to believe corporate tax cuts and deregulation will deliver improved growth, while Jonathan Portes asserts that deficit spending will stoke inflation. But here we might pause. With inflation largely driven by external factors – Putin’s invasion, environmental collapse, supply issues linked to the pandemic – conventional economic models of why prices rise, focusing on excessive demand, are falling short. Those still using them to talk up the inflationary risks of increased government deficits are likely to be proved quite wrong. It is therefore worth attempting a level-headed assessment of Truss’s economic prospectus – identifying its strengths and weaknesses, in the terms it has set itself – beyond the standard neoclassical framework.

The most pressing challenge for the British economy is currently the soaring price of essentials goods, causing households to spend less on desirable things like pubs, restaurants and local shops and more on undesirable things like fossil fuel companies – which means that government support, of the kind promised by Truss, will be necessary to sustain demand. Contra her detractors, this is unlikely to have much meaningful inflationary effect. If the government borrows money to cut domestic energy bills, the Institute of Public Policy Research estimates that 3.9% would be taken off the ONS’s calculation for the headline rate of inflation – a win-win, making life easier for households and reducing pressure on the Bank of England to further increase interest rates.

Other things being equal – the economist’s get-out clause – Truss’s plan to massively increase government borrowing will also have some impact on growth, if only because it’s hard to borrow and spend over £150bn without making something happen. Whether this is useful in the long-term is a different question: handing £30bn more to corporations, already squatting on a £950bn hoard in their bank accounts and showing no great inclination to invest, is hardly an effective use of the tax system. Then again, if corporations don’t actually spend their unexpected windfall in Britain, it is less likely to feed into inflationary pressures here.

So, when it comes to propping up demand, limiting inflation and stimulating immediate growth, Trussonomics won’t be as abortive as orthodox economists predict. And she needs only two years, at most, to prove something like competence before facing a general election. Yet there may be other fronts on which her domestic plan could falter. For one thing, the international situation today is more uncertain than in the 1970s, and Britain’s global position is far weaker. The UK retains immense privileges as a developed economy with deep, liquid capital markets and venerable institutions. But it is also undergoing a radical shift, via Brexit, in its relations with the rest of the world at a time of acute social stress. This will inevitably unsettle the Conservative’s traditional support base in big capital and finance, while the decrease in the value of the pound, presently hitting an almost forty-year nadir against the dollar, indicates the possibility of funding problems ahead.

This is compounded by Britain’s reliance on imported energy and food supplies. In the last true currency crisis face by a Conservative government – Black Wednesday in 1992 – Britain ran a small deficit on its energy consumption, soon to disappear as gas production peaked in 2000, and was 70% self-sufficient in food. Today, it imports roughly half its natural gas, and 45% of its food. The Black Wednesday crisis erupted because the government was unable to defend the value of the pound against the deutschmark inside the Exchange Rate Mechanism, a precursor to the euro. Today, Britain is out of the EU and the pound floats freely, but the currency crisis could be even more fundamental, if we are forced to pay higher sums for basic goods in a declining currency. Even if Truss – borrowing from the playbook of Anthony Barber, Chancellor under Heath in 1970 – manages to engineer a short-lived growth spurt at the beginning of her tenure, this will prove difficult to sustain. Indeed, it may have already evaporated by the time she is forced to face Starmer at the polls.

Truss also harbours unrealistic hopes of unlocking growth through a post-EU shake-up of employment laws, threatening the removal of rights on working time and, in a familiar trope, invoking the spectre of trade union militancy. But while the recent uptick in union membership and activity is to be welcomed, strikes in Britain remain rare, with the number of annual walkouts still close to the all-time lows of the last decade. Further restrictions on union organizing will not miraculously translate into improved productivity. Nor are there many remaining costs in Britain’s perilously neoliberal labour markets that could be removed without pushing further and deeper into living standards. If Truss wants to press ahead with such reforms, she will likely have to sweeten the pill or buy off discontent with further temporary handouts – which may draw opposition from the backbenches.  

But where Trussonomics is perhaps most likely to fall apart due to domestic factors is in failing to overcome the resistance of the Treasury. Rumours that the new energy plan would involve forcing ten-year loans onto households indicate the lingering presence of Treasury Brain (harking back to the equally daft forced loan scheme which Sunak cooked up for domestic energy bills last spring). That this misstep was avoided suggests someone, somewhere in government is prepared to put political strategy over Sunak-style bean-counting. Yet the fact that this supposed ‘price freeze’ doesn’t entirely freeze prices, seemingly in deference to vestigial accountancy concerns, also evinces the zombie-like persistence of the latter.

As a result, the policy’s political efficacy has been blunted, opening up a gap which Labour could easily exploit. And this is to say nothing of the evident hypocrisy of making £40bn of liquidity support available to energy companies whilst promising only six months of support to every other business, large or small. Kwarteng’s peremptory sacking of Tom Scholar, Permanent Secretary at the Treasury, having been Second Permanent Treasury as austerity was implemented in the early 2010s, was greeted with howls of outrage from the liberal end of the media. But it reveals the new administration’s determination to press ahead with its programme against concerted opposition. The new Chancellor knows that realizing major deficits and mighty tax cuts means overriding Treasury recalcitrance.

It was always a mistake to think of austerity as a programme that swivel-eyed true-believers were determined to force upon the rest of us. This may have applied to a small number of Thatcherite diehards baying for shrunken states and flat taxes. But, by and large, austerity was promoted, designed and delivered by a cadre of ideologically adaptable Sensible People like Scholar, poring over spreadsheets at the Treasury and the Institute for Fiscal Studies. They were the ones who inflicted a miserable lost decade on the country. Now, the current crop of Tories may have few compunctions about cutting spending when the time comes; but they know better than to insist on it as a strategic priority. The class battles ahead demand a more considered approach. And should Truss’s plan fall short, as prices spiral upwards, growth disintegrates and the capital markets turn sour, there are many forces waiting to move: from the Don’t Payers to the striking workers, to those in her own party sharpening their knives for the next leadership contest.

Read on: Tom Hazeldine, ‘Transformatrix’, NLR 131.

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Privatized Universe

There is no limit to human megalomania. One recent example – which went largely unnoticed during this torrid and neurotic summer – was a bizarre exchange between NASA Administrator Bill Nelson and the Chinese authorities. ‘We must be very concerned that China is landing on the Moon and saying: “It’s ours now and you stay out”’, Nelson cautioned in an interview with Die Bild. A spokesman for the Chinese Foreign Ministry immediately hit back: ‘This is not the first time for the chief of NASA to lie through his teeth and smear China’.

Nelson’s accusation was strange, given that this December will mark fifty years since anyone has set foot on our natural satellite. Since then, moon exploration has been delegated to small, tracked vehicles which scuttle over its rocky outcrops. China has only deployed one such robot, which travelled to the moon’s ‘dark side’ in 2019. So the idea that it could establish sole dominion over an area the size of Asia, suspended in a vacuum at temperatures ranging from 120 degrees Celsius during the day to minus 130 degrees at night, exposed to cosmic radiation and more than 384,000 km from the closest supply base, was somewhat of a stretch.

The accusation was all the more outlandish given that it was the US, not China, that planned to launch a gargantuan rocket into space on 29 August, completing a few lunar orbits before returning to earth, all for the modest sum of $29bn. This would be the first leg of the Artemis mission – so-called after the Greek goddess of the moon and sister of the Sun-god Apollo – which eventually aims to establish a base worth $93bn on the moon by 2025. In theory, this lunar settlement will one day serve as a launch pad for a human expedition to Mars.

The question is: why are we interested in further trips to the moon? On their successful voyage in 1969, American astronauts collected a few curious stones but nothing else – so it is hard to find a scientific rationale for future missions. There may be a military objective: it was not for nothing that in late 2019 the US established the sixth branch of its armed forces, the Space Force, to manage all space-related military activities. But why the moon? Perhaps to install a military base from which to threaten an enemy on earth? Surely it would be sufficient to use the satellites already in orbit, which are much closer, cheaper and more precise.

Cynical onlookers such as the Financial Times and Economist insinuate that these missions are merely a ploy to bankroll the defence industry and distribute funds to strategic electoral constituencies. The latter publication reported that the Space Launch System (SLS) used in the Artemis project was nicknamed the ‘Senate Launch System’, and its technology, derived from the now defunct Shuttle programme, was intended to safeguard jobs in Alabama, where the bulk of the Shuttle’s components were manufactured.

Another hypothesis is that US wants to replay the game that eventually caused the USSR to collapse. The Strategic Defense Initiative, or ‘Star Wars’ programme, was a cosmic defence system whose pursuit brought the Russians to their knees, despite the fact that it was never realized. To keep pace with the American conquest of the moon, China would similarly have to divert a quantity of resources that would plunge its economy into crisis. Hence the US calling upon its vassals – Canada, Japan, the UK and EU – to participate in the Artemis mission.

Lest this New Cold War expenditure should strike the public as somewhat pointless, the government can always pull a rabbit out of its hat. In recent years we have seen countless economic gurus extolling the potential of resource mining, not only from the moon but also from asteroids. Names of great prestige from the world of finance have begun to sponsor this nascent industry. In 2009, Google’s Larry Page and Eric Schmidt joined with the director James Cameron and the aerospace entrepreneurs Eric Anderson and Peter Diamandis, among others, to found Planetary Resources, a company whose ultimate mission is to mine high-value minerals from asteroids and refine them into metal foams. Meanwhile, iSpace, a similar venture launched in Japan in 2010, claimed that

by taking advantage of lunar water resources, we can develop the space infrastructure needed to enrich our daily life on earth, as well as expand our living sphere into space. Also, by making the earth and Moon one system, a new economy with space infrastructure at its core will support human life, making sustainability a reality.

Fantastical enterprises of this ilk have since proliferated. In 2013, Deep Space Industries Inc. drew up an ambitious blueprint for identifying asteroids suitable for mining by 2015, returning samples to earth the following year, and commencing full-scale operations in 2023. Shortly after, a Californian company called OffWorld announced a grand plan to ‘develop a new generation of universal industrial robots to do the heavy lifting on the Moon, asteroids and Mars.’ It envisioned ‘millions of smart robots working under human supervision on and offworld, turning the inner solar system into a better, gentler, greener place for life and civilization’.

In a 98-page report to its clients in 2017, Goldman Sachs asserted that the prospect of mining platinum in space with ‘asteroid-grabbing spacecraft’ was becoming increasingly affordable, and forecast ever-increasing profits in the sector. Morgan Stanley followed suit. When such banks are encouraging their clients to invest in space mining industries, it is worth remembering that it was Goldman Sachs who managed Greece’s national debt, practically doubling it in the process. That is to say, large financial institutions are endlessly capable of squeezing their clients like lemons. In the end, despite the banks’ predictions, Deep Space was sold to Bradford Space, a comparatively modest trader of orbital flight systems and aircraft components, while Planetary Resources was liquidated and its assets auctioned off. Illusions, however, die hard: January 2022 saw the founding of AstroForge, another Californian firm which claims to have developed new lab-tested technology for processing asteroid material.

Bloomberg has warned us in no uncertain terms about these sci-fi-esque enterprises:

Where would science fiction be without space mining? From Ellen Ripley in Alien and Dave Lister in Red Dwarf, to Sam Bell in Moon and The Expanse’s Naomi Nagata, the grittier end of interstellar drama would be bereft if it weren’t for overalled engineers and their mineral-processing operations…It’s wonderful that people are shooting for the stars – but those who declined to fund the expansive plans of the nascent space mining industry were right about the fundamentals. Space mining won’t get off the ground in any foreseeable future – and you only have to look at the history of civilization to see why. One factor rules out most space mining at the outset: gravity. On one hand, it guarantees that most of the solar system’s best mineral resources are to be found under our feet. earth is the largest rocky planet orbiting the sun. As a result, the cornucopia of minerals the globe attracted as it coalesced is as rich as will be found this side of Alpha Centauri. Gravity poses a more technical problem, too. Escaping earth’s gravitational field makes transporting the volumes of material needed in a mining operation hugely expensive.

Indeed, if we exchange illusion for reality for a moment, we realize there are good reasons why very few people over the last fifty years have poked their heads out of the immediate vicinity of our planet. The International Space Station orbits the earth at only 400km from the earth’s surface – if one were to represent the earth as a sphere a meter in diameter, it would hover just 3cm above it. The moon, on the other hand, is almost a thousand times further, and the shortest distance between the earth and Mars is 55 million kilometres. This doesn’t mean that humans will never exit the solar system, but doing so would require a scientific paradigm shift beyond Einsteinian physics, plus staggering technological advances which would revolutionize transportation in a manner as unthinkable as the reaction engine would have been in the age of the horse-drawn carriage.

The mirage of space exploration obeys the same iron law which Horkheimer and Adorno identified in the culture industry. Namely, it works by indefinitely postponing satisfaction: ‘The culture industry perpetually cheats its consumers of what it perpetually promises. The promissory note which, with its plots and staging, it draws on pleasure is endlessly prolonged.’ We are constantly told that in two, five, ten years’ time, a new mission will land on the moon – or better still, build a base there. Likewise, we will always be twenty, thirty or forty years away from establishing colonies on Mars. Deadlines for space flights are infinitely delayed, as demonstrated by Artemis, whose launch was first scheduled for 2020, then for the end of 2021, then 29 August 2022, then 3 September and now, ‘probably’, for later this month, or maybe next…

There’s a stark difference, though, between the ‘normal’ culture industry and the space mirage; the former is produced for the masses, the latter for the capitalist class. It is the Larry Pages, the Elon Musks and the Jeff Bezoses that tell themselves such fairytales – believing, with frenzied hubris, that they can turn fiction into science. From this point of view, the exploration (or exploitation) of space takes a form that is closer to religious postulate than plebeian superstition. For the concrete fact which continues to vex capitalists is that the earth is round (and therefore limited, finite). Capitalism is an intrinsically expansionist system; without unrestricted growth, the profit mechanism jams. We’ve frequently witness this phenomenon as capitalists are forced to open new frontiers of industrialization and accumulation; after Britain and the US it was France, then Germany, then Japan and Italy; now it is China and Vietnam, and one day it will be Africa. Yet the earth remains stubbornly spherical – and this poses an insurmountable problem unless the market can expand beyond its frontiers; or maybe even further, beyond those of the solar system. The capitalists’ dream is of an infinite, universal market, where you can buy shares of the Andromeda Galaxy and futures on the commodities produced on the three planets which orbit the pulsar PSR B1257+1 in the Virgo constellation, 980 lightyears away from our solar system. Imagine: an entire cosmos to exploit! 

Yet capitalism is not simply an expansionist economy; it also involves a proprietary relation to the external world. It is enough to recall the paeans which accompanied last year’s flea-jumps out of the earth’s atmosphere by three billionaires (Branson, Bezos, Musk), heralding the private conquest of space (obviously far more efficient than any public equivalent). Here we must reckon with the notion of the privatized universe: entire star systems recast as private property. Our billionaires have no trouble thinking on this scale. Nor, for that matter, are they reluctant to embrace the ridiculous.

The history of space conquest stretches back to the middle of the last century. The moment humankind peeped out of the earth’s atmosphere (Laika the dog in 1957; Yuri Gagarin in 1961), governments immediately began using international fora to stake their claims on the cosmos. To prevent future galactic incursions and imperialisms, they solemnly signed the Outer Space Treaty in 1967, which recommended that the ‘exploration and use of outer space should be carried out for the benefit and in the interests of all countries and shall be the province of all mankind’. But this peacemaking was merely a facade. In 1979, when the Moon Treaty declared the moon and its natural resources ‘CHM’ (Common Heritage of Mankind) and called for ‘an equitable sharing by all countries in the benefits derived from these resources’, many states including the US refused to ratify it. Nine years later, the US government’s Department of Commerce established the Office of Space Commerce, whose mission was ‘to foster the conditions for the economic growth and technological advancement of the US commercial space industry’.

Now, over the last decade, Washington has intensified its efforts to create a legal framework that would enable the exploitation of resources in space:

The Obama administration signed the US Commercial Space Launch Competitiveness Act of 2015, allowing US citizens to ‘engage in the commercial exploration and exploitation of space resoources’. In April 2020, the Trump administration issued an executive order supporting US mining on the Moon and asteroids. In May 2020 NASA unveiled the Artemis Accords, which included the development of safety zones around lunar mining sites.

At this rate, it won’t be long until law firms begin to handle space-related controversies, hiring lawyers who specialize in the intricacies of interplanetary commerce. And all this before anyone has even returned to the moon itself! The problem is that, while we pursue such extravagant schemes, we are simultaneously condemning this small, singular, fabulous planet of ours to destruction. 

Translated by Francesco Anselmetti.

Read on: Eva Díaz, ‘Art and the New Space Age’, NLR 112.

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Chile’s Rejection

Pinochet and his legacy have proven hard to kill. The 2022 draft constitution – the most progressive constitution ever written in terms of socio-economic rights, gender equality, indigenous rights and the protection of nature – was rejected by almost 62% of voters in a national plebiscite on 4 September. How could Chileans, after rising up in October 2019 to demand a new constitution, then voting by an overwhelming majority to initiate the constituent process, reject the proposed draft? Why would they align with right-wing forces seeking to preserve the Pinochet constitution? This astonishing result surely demands a multi-causal explanation. Here I will focus on two of the most prominent ones: the right-wing disinformation campaign across traditional and social media, and the exclusion of the popular sectors from the constituent process, which I have highlighted in previous analyses.

Support for Rechazo (‘Reject’) was strongest in low-income municipalities, where turnout was also higher than in upper-class neighbourhoods. While in the 2020 plebiscite the opposition to the constituent process was led by the three wealthiest municipalities, this time around the poorest neighbourhoods turned out en masse to vote against the proposed draft. Also in contrast to 2020, voting was mandatory – with fines for non-compliance – which forced the popular sectors to cast a vote for fear of the pecuniary costs of abstention. Turnout increased substantially from 50% to 86%; and of the 5.4 million new votes cast, 96% opted to reject. In total, the draft constitution received only 4.8 million votes – one million less than voted in favour of redrafting two years earlier. This was not only a vote against the new constitutional text, however. It was also a rejection of Gabriel Boric’s administration and its parties: the ‘new left’ coalition including Frente Amplio, the Communist Party and the parties of the old Concertación. Apruebo (‘Approve’) was supported by roughly the same number of people that voted for Boric in the runoff against the far-right candidate José Antonio Kast in December 2021 – suggesting that he has been unable to expand his constituency since taking office.

At least a million dollars were poured into the month-long campaign to raise awareness about the draft constitution. About 90% of these funds were spent by the Rechazo camp, comprising the right-wing parties, parts of the Christian Democrats and the new centrist coalition ‘Amarillos por Chile’. They repeatedly denounced the document as ‘extremist’ and ‘poorly written’ on morning talk shows and evening news programmes, while conservative thinktanks bombarded audiences with opinion polls of doubtful accuracy showing that most people would vote down the new draft. Such efforts were bolstered by the spread of disinformation on social media, as well as the distribution of fake copies of the draft constitution with doctored articles. In one illustrative episode, the far-right Convention representative Constanza Hube was caught giving out fake copies of the constitution during a Rechazo meeting.

Exit polls and vox pops revealed that many people were confused about what the plebiscite was actually about; some even thought that by voting to reject they were abolishing the Pinochet constitution. This is not surprising given that the only official information on the constitutional draft amounted to thirty minutes of television broadcasting a day, divided equally between Rechazo and Apruebo, over a 28-day period. Since the broadcasting space was allocated to an array of political parties and civil society groups, the messaging was fragmented. For the Apruebo campaign, ten organizations participated in the broadcasts; even after various deals were struck between them, some ended up having less than five seconds to say their piece. There were no official campaign adverts, nor leaflets sent to people’s homes, nor in-person information sessions; all the outreach was done by political parties, NGOs, or volunteers. It remains unclear why the Boric administration did such a poor job informing the electorate on such a crucial matter.

While the daily information broadcasts for and against the new constitution had little impact on voters – only about 720,000 people tuned in each day – the endless stream of TV shows featuring politicians and self-styled intellectuals spreading disinformation about the content of the draft surely did. Among the most pervasive falsehoods were that the new constitution would abolish homeownership for the working classes, allow on-demand late-term abortions, and open the door for the secession of indigenous territories.

A testing ground for disinformation was the Araucanía region, a militarized zone – placed under a state of exception due to the Mapuche conflict – where 74% of voters chose to reject the constitutional draft: the second highest level of support for Rechazo nationwide. A traditional right-wing stronghold, Araucanía was one of only two regions that voted to keep Pinochet in power in 1988, although it subsequently voted to initiate the constituent process in 2020. In late June Francisco Orrego, a young lawyer and Rechazo spokesperson, went all-out to convince the working-class community of Angol that the draft constitution’s right to housing – one of the few articles proposed by grassroots organizations that eventually made it to the final text – would abolish people’s right to own their homes if they had bought them with social subsidies (a situation that applied to about 40% of the population). Although this was immediately denounced as fake news, Orrego nonetheless continued to appear as a regular pundit on political talk shows, where he could disseminate such lies to larger audiences.

Meanwhile, the evangelical churches, which recently entered into an alliance with the far-right Republican Party, have a strong presence in Araucanía, with their membership constituting about 27% of the population. In late February, before the article on gender rights was even approved by the Convention, representatives from more than 2,700 churches in the region called on their communities to reject the draft, citing abortion as their main concern. Although the draft constitution codified the right to abortion in general terms by mandating the state to guarantee the ‘voluntary interruption of pregnancy’, the public had a warped perception of this provision. Felipe Kast, the right-wing Senator for Araucanía, used conservative radio stations to broadcast an advert claiming that the draft constitution ‘allowed for abortion until the ninth month of pregnancy’, decrying this as a ‘violation of the human rights of unborn children.’ Although Apruebo advocates tried to push back against these falsehoods, they became impossible to dislodge from the popular imaginary.

Perhaps the most controversial and weaponized topic, however, was that of indigenous rights. Although the text merely followed the commitments established in the ILO Convention No. 169 on indigenous rights, which Chile had ratified in 2008 but never implemented, right-wing politicians and pundits wove a narrative in which indigenous peoples would gain the ability to dismember the country. Ximena Rincón, Senator for the Christian Democrats, claimed in early July that she was supporting Rechazo because it would give indigenous peoples (who constitute less than 10% of the national population) veto power over constitutional reforms. Even though she was told on live television that this was untrue, she refused to change her line – and such distortions continued to influence the national discourse.

At the same time, the voting results coming out of the prison system, where the inmates’ only information came from television broadcasts, revealed the powerful effects of conservative media in shaping public opinion. For the first time in history inmates were allowed to vote, and it was expected that they would swing behind Apruebo, since the draft constitution gave new rights to incarcerated people such as free legal defence, the prohibition of double jeopardy, and a People’s Ombudsman to prevent against abuses. Yet, in the end, just one of the fourteen prison complexes voted to approve it. This was, by no coincidence, the only one where physical copies of the draft constitution were actually distributed to prisoners and information sessions were held with legal aid volunteers. Those who actually learned about the text approved of its reforms; those who relied solely on the media coverage were implacably hostile to it.

According to a recent report, at least 36 organizations not subject to electoral controls, and therefore not mandated to disclose their funding, spent $130,000 advertising on Facebook and Instagram during the months before the plebiscite; 97.4% of these adverts pushed to reject the draft constitution. Ultimately, it seems that bias in traditional media, plus the millions spent to influence opinion via social media, helped to consolidate the narrative that the Convention was a political circus that had drafted a sloppy and unprofessional document.

In addition to this disinformation campaign, those on the extra-parliamentary left were sceptical of a Convention that had betrayed the mass mobilizations of 2019. Many of them voted to reject rather than legitimize the process. They rightly pointed out that the Pact of 15 November 2019, which was agreed in a backroom deal between Boric and a hard-right Senator, and which set out the framework for the Constitutional Convention, was intended to constrain rather than channel popular energies. It instituted an antidemocratic two-thirds supermajority rule for passing new constitutional articles and gave establishment parties outsize influence over the drafting process. From the beginning, the constituent process was captured by elites, who intensified their attempts to preserve the status quo as the plebiscite approached.

On 14 May, the Convention delivered a lengthy first draft that incorporated progressive constitutional innovations such as plurinationality and ecological rights. Two special committees were formed to ‘harmonize’ and edit the final document, which included a total of 388 articles, and to decide on transitional arrangements. However, the Convention’s autonomy was soon violated by negotiations over how to transition from one constitutional framework to another. On 16 May, the government sent a document to the Convention recommending that the current regulations on natural resources, water and indigenous lands be preserved until new legislation is approved – so as to assure an ‘orderly and gradual transition’. This meant, for instance, that water would remain private until right-wing Senators who control half of the Senate – and who voted in 2020 against making water a human right – agreed to nationalize it. The government also recommended that Boric, whose approval rating stood at just above 30%, as well as members of Congress, see out their original terms and stay in post for three and a half more years. The Convention bowed to these self-serving demands. For many activists, this was seen as unacceptable collusion between the constituent body and the executive, which served to discredit the drafting process as a whole.

Three weeks before the plebiscite, the parties of the governing coalition began to set out the changes they intended to pursue if the draft constitution was approved. Attempting to placate the parties on the right as well as those of the former Concertación (which now control 38% of the government ministries), Boric pledged to strictly delimit the rights of indigenous people, stressing that their input on national policy issues would be non-binding. He also reassured the establishment that the current neoliberal framework – in which basic services such as healthcare, education and pensions are largely provided by private companies – would remain in place. Indeed, while the draft constitution mandated the creation of a public education system, national health system and a public social security system, it did not explicitly dismantle the current voucher system in education, nor the insurance model in healthcare, nor the individual savings scheme that forces the Chilean working class to subsist on poverty pensions. Instead of pushing to reform these dictatorship-era systems, as protesters have been demanding since 2009, Boric agreed to preserve them.

These intended reforms not only demonstrated the government’s intention to preserve the core features of Chilean neoliberalism; they also signalled the contempt in which Boric’s coalition held both the draft document and the popular will. His announcement that he would seek to reform the constitution – even before it was put to a popular vote – compounded the impression that it was not fit for purpose. This played into the hands of the Rechazo campaign. It also conveyed to the electorate that they would merely be voting on a provisional text, rather than having a meaningful say in the country’s future. 

Chile now finds itself in an awkward position, without a clear path to resolve its impending socio-political crisis. By voting in favour of initiating a constituent process, Chileans indirectly rejected the current 1980 Constitution. Yet by rejecting the new proposed constitutional text, the process set in motion by the November Pact has officially been terminated, leaving no standing provision for a new drafting process. The constitutional reform resulting from the Pact merely stipulated that if the draft constitution were to be rejected, the old one would remain in force. So, what will happen next?

Before the plebiscite, President Boric vowed to call a new constituent process if the proposed draft was rejected. However, the only way to start such a process is through a new constitutional process, which requires a supermajority in Congress. This will be difficult enough to secure due to the right-wing opposition. But given that conservative forces control the Senate, convening a constituent assembly with adequate mechanisms of popular participation seems like an impossibility. It is therefore likely that Boric will try to establish another Convention based on rules negotiated from a position of weakness, which will be even more accommodating to the demands of the political class. This will be a party-led process – dominated by ‘experts’ and insulated from popular pressures. Pundits are already blaming the few independents in the Convention for the draft’s defeat, setting the stage for an eclipse of whatever radical potential the process previously had. Yet, at the same time, Chileans are already taking to the streets again to demand their own constituent process – one in which there are no backroom negotiations, and the people themselves have the power to make binding decisions.

Read on: Camila Vergara, ‘The Battle for Chile’s Constitution’, NLR 135.

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The Great Unfettering

In a recent contribution to Sidecar, Matthew Huber claims to present a ‘Marxist alternative’ to the ‘mish-mash ecologism’ and dead-end ‘utopianism’ that he says afflicts parts of the climate left. Finding evidence of these maladies in two recently published books – The Future is Degrowth by Aaron Vansintjan, Andrea Vetter, and Matthias Schmelzer, and Half-Earth Socialism by Drew Pendergrass and Troy Vettese – Huber makes an impassioned plea for the left to walk away from utopian arcadias and embrace the more realistic option of a ‘socialist eco-modernist . . . transformation of production’.

Huber’s essay rehearses a line of criticism that he has elaborated on several occasions and that finds its most systematic form in his recently published book, Climate Change as Class War. In part an argument for appealing to working-class interests to win a Green New Deal, in part a polemic against degrowth, which Huber associates with the environmentalism of the ‘professional managerial class’, the book aims to further the cause of so-called ‘eco-modernism’.

Briefly put, advocates of degrowth call for an end to the fetishization of growth in contemporary society, a reduction in energy use and material throughputs in the Global North, and a globally just distribution of wealth and resources. This is necessary, they claim, to phase out fossil fuels, regenerate the planet’s damaged ecosystems and attain a decent quality of life for all. Such a programme would require reductions in resource and energy use for many in the Global North, yet this need not lead to asceticism. Rather, its supporters argue it would enable communal luxury within ecological limits. Though disagreements exist within the degrowth movement, most of its adherents envision a future where food production is localized, people have democratic control over issues that affect them, renewable energy infrastructure is decentralized and collectively owned, and public transportation is commonplace.

For left eco-modernists such as Huber and Leigh Phillips, this is a decidedly middle-class agenda – a ‘politics of less’ which, by calling on workers to reduce their energy and resource use, is destined to be unpopular and unattainable. For Huber, the problem is not the consumption habits of the Global North’s proletarianized groups; it is rather the activities of a capitalist class that consumes too much and profits from planet-destroying fossil fuels. As such, the antidote is class struggle, stronger unions and a parliamentary path to a Green New Deal.

From this perspective, degrowth’s inclination towards the local and the particular, and its relative silence on class struggle, create insurmountable barriers to socialist emancipation. In contrast, eco-modernists propose largescale nuclear energy projects, hydroelectric dams and industrialized agriculture, arguing that this is what it means to think and act in the Marxist tradition. Capital’s large-scale industry and exploitation of the world’s producers sets the stage for its abolition through a working-class seizure of the means of production. In Huber’s words, ‘industrial capitalism makes emancipation and freedom possible for all of society. This vision of freedom through social control over industrial abundance is key to mobilizing the masses to the socialist fight.’

In his Sidecar contribution, Huber adds that social control of industry will remove the primary impediment to a green transition: capital’s pursuit of profit. ‘All known technological pathways to halting environmental breakdown’ – Huber gives the examples of renewable energy, ‘green nitrogen production’ and lab meat – ‘are “fettered” by the social relations of production’. He goes on to explain that ‘while the utopian eco-socialists would likely scoff at these “techno-fixes” – technological solutions which don’t challenge capitalist social relations – an eco-modern socialist perspective would insist these technologies will not be developed unless we challenge capitalist social relations.’

Huber’s Climate Change as Class War has so far been the apogee of the eco-modernist position in a debate that has done much to further the discussion of desirable post-capitalist futures. The book’s emphasis on class struggle, thinking at scale, the state as a terrain of struggle, and the dynamics of transition are valuable contributions. Huber’s Sidecar essay reiterates many of these themes, stressing the need to imagine a green transition rooted in a Marxist study of the ‘historical economic conditions’, rather than abstract utopian speculation.

There is no question that there are important critiques of degrowth to be made from a Marxist perspective. Whereas Marxism’s critique of capitalism flows from a study of the historically determinate way it realizes value – through the exploitation of labour and the natural world – degrowth instead opts for an abstract critique of ‘growth’ as such. This is more than just a difference of terminology. Degrowth’s simplified conceptual apparatus has obscured the political stakes of a green transition to such a extent that it has been adopted by various irreconcilable traditions: from anti-capitalists to those pursuing a reformist politics of redistribution and reduced consumption. However, by unreflexively aligning Marxism with eco-modernism, Huber obscures Marxist alternatives to degrowth that are not eco-modernist in orientation but that nevertheless strive for the revolutionary overthrow of capitalism in the pursuit of a liveable planet for all human and non-human life.

At the heart of Climate Change as Class War is the claim that a successful climate politics must win over the majority of the world’s population. As Huber rightly claims, that majority is the ‘global proletariat’ in its myriad of forms: manufacturing labour, service workers, informal workers, agricultural work, unwaged work, reproductive work and more. The issue of how the world’s exploited and oppressed can unite in struggle is of course a crucial one for any left politics. It is all the more striking, then, that Huber does not try to answer it. In a footnote to Climate Change as Class War, Huber explicitly narrows the scope of his study:

My analysis of class in this book will focus mostly on the US context . . . While there is no justifiable basis for analyzing class in territorial terms – as if particular classes are only contained within national boundaries – a reason for this analytical focus is the simple fact that US political culture is the largest barrier to climate action globally . . . I will also admit my own scholarly (and personal) expertise is based in American Studies and US politics.

This amounts to an admission of methodological nationalism. If the goal is to appeal to the majority of the world’s population, this should lead to an analysis of the global working class in all its complexity – not the minority of that class living in the US. Moreover, if ‘US political culture’ is indeed one of the greatest stumbling blocks to climate action, this should involve an interrogation of not just the US’s internal political economy but its external role as the world’s leading imperialist power and orchestrator of wars, coups, sanctions, ‘development programmes’, ‘human rights interventions’, assassinations and arms sales that have devastated the world’s working classes and the ecological systems their lives depend on.

A thorough analysis of US class politics should also involve a consideration of how imperial predation in the periphery shapes class interests and struggles in the US. Yet in his critique of climate justice politics, Huber categorically rules out this line of inquiry: ‘climate justice politics often positions the struggle in territorial terms, as a struggle between Global North and Global South, and not as a global class struggle between capital and an international working class.’ He goes on to cite Jason Hickel’s work on value transfers and uneven ecological exchange as an example of a degrowth paradigm that fails to ‘differentiate “income” based on wages versus capital ownership’, writing that such scholars falsely ‘assume all income – whether it flows to capital or labour – is a form of ecological imperialism.’

This approach leads Huber into a false choice between a politics that attends to imperialist domination and one focussed on class struggle. As anti-colonial Marxists such as Walter Rodney, Samir Amin and Sam Moyo have long argued, this is to ignore one of the fundamental issues of working-class politics today: the national self-determination of oppressed peoples. As Enrique Dussel explains, Marx repeatedly intimated in his writings that an analysis of global capitalism must investigate both competitive relations between ‘capitalist nations’, which are defined by ‘dependency’ and the ‘extraction of surplus-value by the stronger capital’, and relations of class struggle, or ‘the exploitation of one class by another, of labor by capital.’

Huber’s criticism of Hickel also ignores a wealth of scholarship on how value transfers and uneven ecological exchange are used to reduce labour unrest in the core. Utsa and Prabhat Patnaik, for instance, describe how the imperialist world-system rests on the devaluation of currencies in the periphery to strengthen the currencies and increase the living standards of both capitalists and workers in the Global North, while Gurminder Bhambra traces the genealogy of Euro-American welfare systems back to their origins in colonial plunder and exploitation. None of this is to say that workers in the core are not exploited; it is merely to point out that they benefit from a capitalist system that pits them against their peripheral counterparts. If you drink coffee in the United States or Europe, eat chocolate, own a phone or wear clothes, you are in all likelihood a participant in the super-exploitation of the periphery’s lands and labour. To recognize this is a precondition for meaningful internationalism. Since the Global North’s energy and resource use cannot be extended to the rest of the world without exceeding the planet’s biophysical limits, anti-imperialist politics requires that those in the core – including many workers – reduce their overall consumption.

In 1848 Marx and Engels wrote that ‘the proletariat of each country must, of course, first of all settle matters with its own bourgeoisie’. This, I would hazard, is what animates Huber’s approach to Marxist politics. But by 1869 Marx had come to realize that for workers in colonial countries, this would be impossible without first tackling the colonial question that divided the world’s working classes into ‘hostile camps’. As Marx argued, and as history verified, workers often have conflicting interests that pose a challenge to the kind of mass mobilization that Huber envisions. His image of the ‘planetary proletariat’ is not attuned to how conflicting interests, misogyny, racism and chauvinism drive a wedge between workers. It refuses to acknowledge that shared interests, far from being an objective reality, must be composed in and through struggle. Indeed, it is particularly concerning that Huber’s proposal to implement a Green New Deal in the imperialist heartland overlooks such messy realities. As critics of the GND have argued, a green transition that does not take heed of such divisions will merely entrench neo-colonial and ecologically unsustainable relations of labour, land and resource exploitation.

Huber’s belief in the necessity of climate ‘megaprojects’ – involving large-scale, state-led ecological planning – leads him to rebuke those on the left with a ‘penchant for a retreat to small-scale agriculture’, which he says ‘implies hunger, if not starvation, for the world’s mega-slums’. In a telling aside, he remarks that ‘as Russia’s invasion of Ukraine demonstrates, urban gardens are no substitute for industrial agriculture’. This reveals a major problem with the eco-modernist mentality. Far from discrediting urban gardens, the Ukraine conflict makes the case for localized, resilient and diverse food systems. The global dependence on a few select crops, produced by industrialized monocultural systems that are vulnerable to geopolitical antagonisms – and unpredictable weather events like floods, droughts and wildfires – now looks entirely unsustainable in light of the war. What matters here is that, like all eco-modernists, Huber assumes capitalist industrialization is the pinnacle of technological advancement. Technology progresses, they suppose, in a linear fashion from inefficient and labour-intensive systems to efficient, energy-intensive, labour-saving ones. Hence, for Huber as for Phillips, the aim should be ‘to take over the machine, not turn it off!’

But things are not as simple as this stageist, almost Whiggish, theory of history would suggest. David Noble and Langdon Winner have argued that technologies do not exist independently from the social relations that produced them (and which they help to reproduce). Andreas Malm’s Fossil Capital recounts how the introduction of fossil fuels in the early nineteenth century was an effect of class struggle rather than linear progression. Mill owners transitioned from using water energy in the countryside to coal – a more expensive energy source – because it enabled them to access a more disciplined and dependable labour supply in industrializing cities. In Carbon Democracy, Timothy Mitchell explains how the eventual shift from coal to oil similarly empowered capitalists to discipline labour by limiting the ability for workers to conspire and organize together to disrupt production. In other words, from the perspective of class struggle, a given technology and the social relations it instates might not be preferable to the one it replaces. The transition from labour-intensive agricultural systems to centralized industrial ones may not, as Huber assumes, pave the way for socialism.

Technology must also be understood in a broader sense than eco-modernists permit. Anti-colonial Marxists have described how colonialism de-developed and supplanted more ecologically sustainable technologies in the periphery, from vernacular architecture to agroecological farming systems. To take just one example from Climate Change as Class War, Huber argues that synthetic nitrogen production unleashed previously unknown levels of agricultural productivity – yet, on closer inspection, this claim does not stand up to scrutiny. Eric Ross and Glenn Stone have shown that the Green Revolution of the 1950s and 60s was entirely unnecessary to feed the world. Its main achievements were chronic overproduction, profits for input producers in the core, the loss of smallholder independence and suppression of communist and agrarian struggles for land reform. Ironically, by displacing producers from the land, it also accelerated the emergence of the mega-slums Huber cites as an argument against smallholder agriculture. All of which suggests that capitalist technological advancements may not be in the ultimate interest of the world’s producing classes. Historically, they have often conflicted with greener forms of production.

Instead of seeing capital’s abolition as the unfettering of productive forces, it is better to view it as freeing the world’s producers to choose from a richer and more diverse array of technologies and socio-ecological relations than capitalist industrialization can offer. Of course, it would be unwise to reject contemporary medical advances, green steel production or lithium batteries; but we might want to avoid nuclear in a world destined for water shortages, unpredictable weather events and geopolitical instability. And instead of using ‘green hydrogen’ to produce synthetic fertilizer, we might consider supporting and expanding agroecological farming systems, which already provide between 50% and 70% of food calories consumed globally, with fewer high energy off-farm inputs, and greater biodiversity and climate resilience than industrialized agriculture.

The question, then, is not about whether one is for or against technology – as if this were possible. It is about adopting appropriate technologies and collectively managing energy and food systems at relevant scales. A promising alternative to Huber’s vision lies in an anti-imperialist eco-communism that understands how relations of dependency and uneven ecological exchange devastate ecologies and exploit workers in both core and periphery. Such a politics must do the difficult work of developing strategies of struggle and ecological transition that meet the needs of the exploited and oppressed in the Global North in ways that are compatible with demands for colonial reparations, technology transfers, food sovereignty, land back, the lifting of sanctions, the end of occupations and the atmospheric space to develop freely and independently. This knotty problem can neither be wished away nor delayed until the US working class has won a Green New Deal. Huber is right that capital’s pursuit of profit is a fetter on our collective liberation. What he misses is that eco-modernism similarly fetters a world of flourishing for all.

Read on: Mark Burton & Peter Somerville, ‘Degrowth: A Defence’, NLR 115.

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New Reality?

Six months into the conflict, a Russian army incapable of taking Kyiv is presented as a threat to the entire continent. Ukraine has become, according to President Zelensky, ‘a springboard for an attack on other nations of Europe’. For the US Defense Secretary Lloyd Austin, Russia represents nothing less than ‘a challenge to free people everywhere’. Given in the American airbase of Ramstein, Germany, his speech sounded like a script for a historical reenactment of the Cold War.

The war in Ukraine is widely regarded a war against Russian expansionism and thus a war for Europe. The Cold War fantasy of seeing Cossacks watering their horses in the fountains of Saint Peter of Rome has gained a second life. The Cossacks are now motorized, and nothing short of a coalition of the so-called free world will prevent Kilo-class submarines from mooring in Gdansk or columns of T-14s from racing down the Autobahn. If we don’t want to stock up on flour and sugar, we need to enlarge NATO by bringing in Sweden and Finland. And while we are at it, why not fight and defeat Russia on the battlefield, with NATO on the front lines?

Realism is in short supply these days and we are teetering on the edge of a global war. It wouldn’t hurt to remind ourselves more often that since 1945 nuclear arsenals have set absolute limits to worldwide conflicts and to the possibility of substantially modifying the global order. Between nuclear powers, there is a tacit agreement that this order cannot be radically altered. We should not try to find out where the breaking point is.

Despite recurrent announcements that we live in a ‘new reality’, neither the end of the Cold War nor globalization have fundamentally altered this situation. A world interconnected by global markets and productive and communication systems is less flexible than we imagine. With its abundant reserves of raw materials and highly developed sectors in military and space technologies, it is already clear that Russia will continue to be part of the global system despite Western sanctions. At most, these limits have become less visible and more fragile. Nothing would be more dangerous than to mistake a proxy war between nuclear powers for an asymmetric conflict against a ‘terrorist state’ fought in the name of lofty ideals such as ‘democracy’ or ‘human rights’.

If realism struggles to be heard, it is also because in wartime everything is grist for the propaganda mill. Democracy, antifascist resistance, and the fight against imperialism are noble goals but they are also easily pliable (not so long ago, they motivated the special military operation to ‘denazify’ Iraq). Since they are now the main narrative for the Ukrainian resistance to the Russian invasion, realism has become de facto assimilated to Kremlin propaganda or worse. Whether it’s John Mearsheimer or Jürgen Habermas, woe betide those who dare to balance idealism against the realities of international politics!

And yet, we need a sober assessment of the objectives pursued by the coalition of countries supporting Ukraine. Is it to kick the Russians out of the country and to take back its eastern provinces? Despite the stunning performance of the Ukrainian military and even without considering Crimea, it is unlikely this can be achieved. Is it to put an end to the atrocious war crimes that Russian troops seem to commit on a daily basis? Only a perverse logic can seek justice in the continuation of a war that enables such crimes in the first place. Or is to deal Russia a decisive defeat on the battlefield, which would leave the country ‘weakened’ if not ‘humiliated’? This goes beyond Kyiv’s most intransigent demands and runs the risk of escalating the conflict and increasing the chances that non-conventional weapons are used. In any case, any talk of ‘victory’ is meaningless.

In this dangerous situation, what should Europe do? There is no doubt that the war in Ukraine represents a turning-point in which the future of Europe is at stake – but not for the reasons usually invoked. There is a distinct possibility that the war might generate a fracture between eastern and western Europe and spell the end of Europe as a political project. It is in the interest of the Europeans – and of the Ukrainians, who will eventually join the Union – to make sure that this project does not become a collateral victim of the conflict. To prevent this, a return to realism is necessary.

First, Europe must recognize that, increasingly, its interests do not coincide with those of Washington. It bears repeating that European unity was achieved outside the strategies that furthered US national interests: for the US, NATO has always been a greater priority than European unity. Yet, no matter how painstaking and tentative it may be, this unity has recently reached important milestones (with the mutualization of debt to face the pandemic, for instance). It should not be sacrificed to the goal of weakening Russia.

The United States can afford to bet on a protracted conflict and to raise the stakes because the consequences of these decisions are born mostly by Europe: the resettlement of millions of refugees, the cost of sanctions that are devastating for European economies, and the need to scramble for new sources of energy. The increase of European defense budgets will further impact welfare systems already weakened by decades of neoliberal policies and the 2008 crisis, which are nevertheless central to the regulation of the social equilibria upon which the political stability of the Union is premised. Finally, should the conflict escalate, Europe would become its primary theatre.

The war in Ukraine offers Washington an opportunity to shore up its declining hegemony by shifting onto European countries some of its costs while also drafting them in its global confrontation with China. In this respect, the continuity between the Trump and Biden administrations is striking. This would have a major impact on Europe’s constitutional order that will diminish the capacity of its historical members to define the political orientation of the Union, in favour of more docile governments.

The political weakening of Europe has become an explicit goal of NATO enlargement, especially among neoconservatives reinvigorated by the prospects of a war with Russia sold as a fight for democracy. To counteract the risk of an alliance made unwieldy by its swelling membership and a tumescent mission that now includes the containment of China, some suggest using NATO enlargement to adjust the balance of power within the Union. Their goal is to promote a coalition that would include ‘the Eastern European and Baltic states, with Poland in the lead…the Scandinavian states, in particular Finland and Norway’ but also ‘the English-speaking external powers, including the United Kingdom and Canada’. The same strategy is behind the recent British proposition of creating a ‘European Commonwealth’, which would amount to establishing a shadow Union more aligned with transatlantic agendas. This approach finds support in the new NATO strategic concept, which promotes the ‘fullest involvement’ of non-EU members in European defense efforts.

Against this backdrop, Sweden and Finland’s bid to join NATO stands out for its political implications rather than its strategic significance. As Adam Tooze has pointed out, their decision to apply was made possible by the weakness of the Russian military, not by the threat it represented. It’s too early to say how the emergence of a Nordic and rather hawkish NATO constituency will shape the conflict but it makes visible new fault lines in Europe.

Can we save Ukraine, and yet save Europe as well? As the physicist Carlo Rovelli recently wrote, ‘the problem of wars is not to win them: it is to put an end to them’. Europe is not a club of winners. It was built upon the rejection of war, the limitation of state sovereignty, and the adoption of federalism as a founding principle. Its main goal was always to organize peace on the continent and it must remain the same today if Europe is to survive.

The support of European governments to Ukraine cannot be the vehicle for strategies that prevent Europe’s further political integration. This does not mean abandoning Kyiv to its own devices or refusing to send military assistance. It means that this assistance must be accompanied by explicit diplomatic conditionalities, and that it must be carefully calibrated so as not to prevent future negotiations or future relations with Russia. Sooner or later, there will be a negotiated solution which will probably approximate the contours of the Minsk agreements.

Europe must also keep a safe distance from a US grand strategy that has not yet found the political formula for accommodating the global decline of American power and its loss of prestige. Going back to the Cold War will not restore American supremacy but it will hurt Europe. It will not restore prestige either: leading a global fight for ‘democracy’ is less convincing when the leading country is one whose Senate is holding hearings about a coup attempt, where women’s rights are trampled by the jurisdictions supposed to protect them, and where the possibility of civil war is a recurrent conversation topic. Unsurprisingly, most of the world does not go along.

It would be a mistake for Europe to throw its lot in with this strategy. Rather, it should bet on the rising cadre of ‘restrainers’ in Washington who advocate a different and less bellicose foreign policy, far from the unctuous homilies about the liberal international order and its military underpinnings. Caught between the crisis of American hegemony and the sly maneuvering of the Kremlin, which seeks to bolster the most anti-European and reactionary political forces, Europe must become a political subject and develop strategic autonomy at the global level. The war in Ukraine has made this an urgent task that can no longer be postponed.

Read on: Tony Wood, ‘Matrix of War’, NLR 133/4.

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Mish-Mash Ecologism

Things seemed to be looking up in late 2020. After yet another catastrophic season of fires, floods and heat, the US elected a president with the most ambitious climate plan of any candidate in history, directly shaped by the Sunrise Movement and the campaign for a Green New Deal. Yet here we are in 2022, and it’s all gone awry. The fossil fuel industry is earning windfall profits, and asset manager titans have reversed their efforts to shift the financial sector away from such enticing returns. Joe Biden’s breakthrough climate legislation, the misleadingly named Inflation Reduction Act (IRA), includes major concessions to the fossil fuel industry and has been met with their approval.

The IRA greenlights offshore oil and gas leases in Alaska and the Gulf of Mexico for the next ten years and backs the bitterly contested Mountain Valley pipeline. At its core, it aims to ‘derisk’ private capital investment in the green transition, in line with what Daniela Gabor calls the ‘Wall Street Consensus’. Its major policy tool is its tax-credit programme, available for mostly middle-class homeowners looking to buy EVs or new appliances and private companies that develop and manufacture electric cars, wind turbines, solar panels and batteries. (A direct pay provision might open the door for expanding publicly owned clean energy, but it will have to compete in a largely private market).  

Such measures have been hailed as the largest climate investment in US history – but that is not saying much. It is estimated that decarbonizing the US power grid alone will cost $4.5 trillion. Biden’s Act offers a mere $369 billion to be spent over a decade. Most of it will be handed to the private sector, including the fossil-fuel industry itself. The tax credit programme does contain prevailing wage and domestic content standards that aim to reinvigorate domestic industrial policy toward solar, wind and EV manufacturing, but it’s not clear if such standards can be met or how they will be enforced. Optimistic models suggest the IRA will lead to 40% reductions in carbon emissions by 2030, but they also admit that doing nothing at all would lead to reductions of between 24% and 35%. The wager for the planet thus appears to be that state-supported green capital can beat fossil fuels on the free market.

Meanwhile, fossil capital continues to win. In June, it was reported that of the top ten best performing stocks of 2022, three were coal producers and five were linked to the oil and gas industry. If it wasn’t clear already, it should be now: those who profit from the production of fossil fuels will continue to do so unless forced to stop. Market-based solutions such as the IRA neglect basic questions of political and economic power. As such, it is worth pausing to consider what answers eco-socialism can offer in the present conjuncture. Two new books – The Future is Degrowth by Matthias Schmelzer, Aaron Vansintjan and Andrea Vetter and Half Earth Socialism by Troy Vettese and Drew Pendergrass – both embrace utopianism as an Archimedean vantage point from which to imagine a reconfiguration of the world, beyond the narrow confines of mainstream climate policy.

Co-authored by an economic historian (Schmelzer), a political ecologist (Vansintjan) and a journalist (Vetter), The Future is Degrowth argues that the global economy must be scaled down to align with its natural limits. The book offers a broad overview of the degrowth movement and its critique of the postwar Keynesian paradigm – along with the colonialist, capitalist and patriarchal ideologies that underpinned it. Though the authors acknowledge ‘overlaps and similarities’ between their framework and the Green New Deal, they argue that the latter is fundamentally flawed. Not only is it hitched to a fantasy of ‘progressive productivism’, it would also require a neo-colonial mining regime for its build-out of renewable-energy infrastructure. Against this trend in climate policymaking, The Future is Degrowth articulates a form of utopianism rooted in the here and now, based on what Engels once called ‘model experiments’. Engaging with the work of Erik Olin Wright, the authors describe a series of ‘nowtopias’ – community-supported agriculture, communing, cooperative economies – which they see as an antidote to climate ‘megaprojects’ (on which they propose a blanket ‘moratoria’).

While defining degrowth in bland terms – ‘a fair reduction of production and consumption that encompasses both human well-being and ecological sustainability’ – Schmelzer et al. also lay out a concrete agenda: the ‘Global North’ must lower consumption while switching to renewable energy and more localized production. How will this ‘fundamental political and economic reorganization of society’ be brought about? The authors admit it may require ‘confrontations with private ownership structures’. Historically, they write, such transformations ‘have always been marked by fierce controversies, public disputes and, up to now, (violent) conflict.’ Yet their main strategy for enacting this green transition is borrowed from the well-worn post-1968 playbook of turning the Leninist Antonio Gramsci into an ecumenical pluralist. They predict that degrowth alternatives will add up, one by one, into a powerful ‘counter-hegemony’ able to simultaneously offer alternative lifestyles, pass ‘non-reformist reforms’ via the state machinery, and build revolutionary ‘dual power’ ready for ruptural crises.

Half Earth Socialism shares some features with the degrowthers: it too focuses on natural limits and calls for lower consumption, renewable energy and deindustrialized agriculture in the Global North. But the books differ in their focus and ambition. While The Future of Degrowth envisions a ‘pluriverse’ of diverse and localized alternatives, letting a thousand degrowth flowers bloom, Half Earth Socialism is much bolder, imagining nothing less than planetary-scale ecological planning. Co-authored by an environmental historian (Vettese) and an environmental engineer (Pendergrass), the book rejects the standard solutions to climate change – bioenergy, carbon capture, geoengineering and nuclear power. Instead, it combines the socio-biologist E.O. Wilson’s proposal to leave half the planet’s habitable surface to wild nature with Pendergrass’s computer models of a world defined by 100% renewable energy.

Whereas The Future of Degrowth avoids ‘indulging in the euphoria of expert-led planning’ and attempts to ‘give space for many different visions for the future’, Half Earth Socialism wants to resuscitate the socialist planning tradition. It draws on the work of Austrian philosopher Otto Neurath and Soviet mathematician Leonid Kantorovich to mount a trenchant critique of Hayekian planning-scepticism. Yet Vettese and Pendergrass explicitly reject Marxism as part of a Hegelian-Promethean thought-system marked by the ‘humanization of nature’ – ‘the process by which humanity overcomes its alienation from nature by instilling the latter with human consciousness through the process of labour.’

By contrast, the authors’ vision is almost as austere as Pol Pot’s. Their core claim is that nature should largely be left to itself, free from human manipulation. Citing Morris’s News from Nowhere, they imagine a world 25 years in the future, run on the principles of cooperation, democracy and ecological restoration. With Pendergrass’s algorithms to guide them, the ecological planners of the 2040s develop a variety of land-use models and let people democratically choose which scenario they prefer – some with more/less energy per capita, some with more/less land left to wilderness. The energy quotas range from 2,000 Watts per person to as low as 750.

One of Half Earth Socialism’s merits is that its authors take the land-use needs of different energy-production systems seriously. But their penchant is for the most land-hungry options – solar and wind power – even as they accept that the intermittency of these energy sources is likely to lead to regular blackouts. Their models also include land-intensive biofuels which, in one scenario, are estimated to cover 26% of land surface. And their plan to rewild half the Earth’s habitable surface would require perhaps the most preposterous proposal of all: the imposition of universal mandatory veganism (otherwise the numbers would never add up). They also reject the energy source that could free up space for biodiversity by using less land than all the others: nuclear power.

Vettese and Pendergrass invite us to imagine that ‘the Half-Earth socialist revolution happens tomorrow’, but they do not explain how this might occur. Though they gesture towards a pro-Half Earth political coalition, its members are vaguely delineated: ‘there should be animal-rights activists and organic farmers there, as well as socialists, feminists and scientists’ – constituencies that make up miniscule fractions of the eight billion-strong population they hope to corral. As for broader layers such as social classes, Half Earth Socialism is largely silent. Like The Future is Degrowth and much of the left for the last half-century, the authors assume that a ‘movements of movements’ – uniting various disparate and subaltern groups – will eventually gain enough power to confront capital.

Is there a Marxist alternative to this 21st-century utopianism? In Socialism: Utopian and Scientific, Engels saw the emergence of 19th-century utopian socialism, signalled by the work of Saint-Simon, Fourier and Owen, as a reaction to the defeated aspirations of the French Revolution. By the early 1800s it was already clear that it had failed to deliver the kingdom of reason and justice promised by the Enlightenment; instead, the triumph of the big bourgeoisie had brought corruption, war and the poverty produced by super-abundance. Industrial production was barely developed, and the proletariat, wrote Engels, appeared to these radicals as ‘incapable of independent political action’ – ‘an oppressed, suffering order’ which required help from outside. In these conditions, the utopian socialists attempted in idealist fashion to evolve the solution to social problems ‘out of the human brain’:

Society presented nothing but wrongs; to remove these was the task of reason. It was necessary, then, to discover a new and more perfect system of social order and to impose this upon society from without by propaganda, and, wherever it was possible, by the example of model experiments. These new social systems were foredoomed as utopian; the more completely they were worked out in detail, the more they could not avoid drifting off into pure phantasies.

Two hundred years on – and in the wake of the defeated aspirations of the 20th-century revolutions – utopian eco-socialists appear to be repeating the same pattern. A new ecological order will be conjured up out of their brains, trialed in micro-experiments – as in The Future of Degrowth – or, as in Half Earth Socialism, ‘imposed from without by propaganda’. What is missing here is any analysis of the concrete class relationships that both inhibit such transformations or might bring them about. For Engels, winning real socialism hinges on class struggle: ‘Socialism was no longer an accidental discovery of this or that ingenious brain, but the necessary outcome of the struggle between two historically developed classes – the proletariat and the bourgeoisie.’

As idealists, 19th-century socialists saw their mental adumbrations as the expression of an absolute truth – although, as Engels pointed out, the absolute truth differed for the founder of each school; each was mutually exclusive and hence the sects were in permanent conflict with each other. As a result, nothing could come of the early-socialist movement but ‘a kind of eclectic, average socialism’ – ‘a mish-mash allowing of the most manifold shades of opinion’:

A mish-mash of such critical statements, economic theories, pictures of future society by the founders of different sects, as excite a minimum of opposition; a mish-mash which is the more easily brewed the more definite sharp edges of the individual constituents are rubbed down in the stream of debate, like rounded pebbles in a brook.

Hard not to think of Engels when one reads The Future of Degrowth’s evocation of the ‘pluriverse’ or ‘mosaic of alternatives’ which will supposedly overwhelm the tightly defended capitalist interests of the ‘Global North’. In Socialism: Utopian and Scientific he insisted, on the contrary, that socialism could only emerge from the historical economic conditions of the age. This did not involve any condemnation of utopianism as such. Rather than crow over the failure of Owenite experiments, Engels wrote, ‘we delight in the stupendously grand thoughts and germs of thought that everywhere break out through their phantastic covering.’

In present conditions, as Mike Davis has put it, ‘utopian thinking can clarify the minimal conditions for the preservation of human solidarity in face of convergent planetary crises.’ But the initial problem remains: those who benefit from their massive fixed investments in fossil fuels seem hell-bent on sustaining them. Does this utopianism yield a strategy to confront the political and economic power of the planet’s opponents – in the first instance, key sectors of the American ruling class?

As Ellen Meiksins Wood wrote nearly four decades ago, the working class has done more to challenge power than any other social force. Where does it stand today? Engels argued that ‘scientific’ – that is, self-critical, rigorously conceptualized and empirically tested – socialism must be rooted in an investigation of historical development: ‘the process of evolution of humanity.’ He himself lived through the epochal ruptures of mass proletarianization and the industrial revolution. The 20th century saw those processes accelerate, in what Farshad Araghi calls ‘global depeasantization’ – a process continuing in China today, in what is probably the largest rural-urban migration in human history. According to David Harvey, global capitalism has added something like two billion people to the global proletariat over the past twenty years. While Marx and Engels thought this mass proletarianization would swell industrial factories, the result has more been the rise of a vast ‘informal proletariat’ deemed superfluous to the needs of capital; a surplus humanity, housed in a Planet of Slums.

Planetary proletarianization should be a central issue for eco-socialism: capitalism produces an urbanized majority with no direct relation to the ecological conditions of existence. The most pressing question of our times is how we can solve ecological problems while restructuring production to provision a society largely torn from the land. If that provisioning requires large-scale democratic planning – as Vettese and Pendergrass rightly assert it does – the ‘demos’ must include the global proletariat. But the eco-socialist penchant for a retreat to small-scale agriculture – Half Earth Socialism’s fictionalized utopia concedes agriculture will require ‘a lot more labor, for sure’ – implies hunger, if not starvation, for the world’s mega-slums (and, as Russia’s invasion of Ukraine demonstrates, urban gardens are no substitute for industrial scale grain production).  

The question of the actually existing productive forces poses a further set of problems. Eric Hobsbawm called the Industrial Revolution ‘probably the most important event in world history’. Machines and fossil fuels replaced a good deal of human and animal muscle-power – as he put it, ‘the shackles were taken off the productive power of human societies.’ In the 21st century it is easy to take this transformation for granted, while blaming it for our present ecological predicament. The Future is Degrowth offers a wholesale critique of ‘industrialism’ and proclaims, ‘the goal of degrowth society must be to overcome industrialism and towards a post-industrial society.’  Yet it was only with the development of modern productive forces that it became possible to envisage a standard of life that could allow the free development of all. Solving climate change undoubtedly requires massive new industrial infrastructure in energy, public transit and housing. We do need to develop the productive forces – but ecologically. 

A socialist eco-modernism should make the transformation of production and the productive forces the fulcrum of any new relation to the planet. One of the few thinkers to have explored this problem is Jonathan Hughes, who speculated about ‘ecologically benign forms of technological development.’ Clearly, the productive forces must develop beyond their historically entrenched reliance upon fossil fuel. Yet, the private ownership of energy prevents this from taking place – a contradiction realized through the wider crisis of planetary climate change, from rising seas in Bangladesh to drought in the horn of Africa. All known technological pathways to halting environmental breakdown are ‘fettered’ by the social relations of production: renewable energy might be getting cheaper, but that does not necessarily translate to profits. Other solutions like nuclear fission, green hydrogen, scaled geothermal and carbon removal all present the same key obstacle: they cost too much, and fossil fuels are more profitable. In sum, solving climate change requires new social relations of production that would develop the productive forces toward clean production.

While the utopian eco-socialists would likely scoff at these as ‘techno-fixes’ – technological solutions which don’t challenge capitalist social relations – an eco-modern socialist perspective would insist these technologies will not be developed unless we challenge capitalist social relations. Beyond climate, most other aspects of the ecological crisis hinge on developing new forms of production: greening nitrogen production and consumption and finding less land-intensive production to preserve biodiversity (e.g. lab meat). All of these ecological forms of production struggle to compete with dirtier and more profitable alternatives under capitalism.

In this context, the climate left does not lack for utopian imaginaries, which can make for productive (and enjoyable) exercises. But such utopianism can too easily avoid the material realities of the world as it exists. We need a climate politics that aims outward, beyond the already converted – towards the exploited and atomized working class.

Read on: Kenta Tsuda, ‘Naïve Questions on Degrowth’, NLR 128.

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Odourless Utopia

In Europe, the war bulletins come not just from Ukraine, but also from the climate front. The French government has cracked down on water use, banning watering lawns and washing cars in 62 of 101 departments, as more than 100 municipalities no longer have potable water. Nuclear power plants on the Rhône and Garonne have had to reduce production due to insufficient water in the rivers. In Italy, the government has declared a state of emergency in 5 of 20 regions, while Second World War bombs are discovered on the beds of its largest river, the dried-up Po. In Germany, the Rhine is so low that the barges plying its 1,000 kilometres from Austria to Holland have had to reduce their cargo from 3,000 to 900 tons so as not to run aground, and the river is expected to soon become impassable to freight traffic. In England, for the first time on record, the source of the Thames has dried up and the river is beginning to flow more than 5 miles further downstream. In Spain, restrictions on water consumption have been imposed in Catalonia, Galicia and Andalusia.

These are all warning signs. In a few centuries, the idea of water as an abundant resource and universal right may be unimaginable. It is easy to forget that even in the so-called advanced world, domestic running water – for toilets, cooking, personal hygiene, washing clothes and dishes – is a very recent and ephemeral phenomenon, dating back less than a century. In 1940, 45% of households in the US lacked complete plumbing; in 1950, only 44% of homes in Italy had either indoor or outdoor plumbing. In 1954, only 58% of houses in France had running water and only 26% had a toilet. In 1967, 25% of homes in England and Wales still lacked a bath or shower, an indoor toilet, a sink and hot- and cold-water taps. In Romania, 36% of the population lacked a flushing toilet solely for their household in 2012 (down to 22% in 2021).

The availability of domestic running water varies depending on one’s individual wealth and on the affluence of one’s nation. While in Western Europe and the US, the number of households with toilets equipped with running water currently exceeds 99%, in a number of African countries the percentage is between 1 and 4: Ethiopia 1.76%; Burkina Faso 1.87%; Burundi 2.32%; Uganda 2.37%; Chad 2.50%; Niger 2.76%; Madagascar 2.83%; Mozambique 2.87%; Mali 3.71%; Rwanda 3.99%; Congo 4.17%. In these countries the toilet is a marker of class status; in Ethiopia less than one in 56 households has one. The data also contains some surprises: there are more toilets in Bangladesh (35%) than in Moldova (29%), India is in roughly the same situation as South Africa (44% versus 45%) and just ahead of Azerbaijan (40%). While in Baghdad the number of houses with flushing toilets is 94.8%, in central Kabul it is 26%, and in Afghanistan as a whole it is 13.7%.

It is possible to trace the social and geopolitical history of running water. Its widespread accessibility was the the result of two primary factors: 1) the industrial revolution that provided the pipelines and purification plants needed for this colossal planetary enterprise; and 2) urbanization, for it is fairly obvious that bringing running water to a series of isolated cottages is far more expensive and complex than to centres of high population density. Urbanization was stimulated by the industrial revolution, and then in turn by the availability of running water for newly-arrived citizens. This may well be one of the most significant, and most peculiar, features of contemporary civilization. For what it created was the utopia of an odourless society. This would not have been possible without the spread of running water, but it was accelerated by the growing desire to deodorize the human habitat. In the twenty-first-century, we no longer perceive smells as our ancestors did.

In The Foul and the Fragrant (1988), Alain Corbin asks, ‘What is the meaning of this more refined alertness to smell? What produced the mysterious and alarming strategy of deodorization of everything that offends our muted olfactory environment? By what stages has this far-reaching anthropological transformation taken place?’ An incisive answer is offered by Ivan Illich in his brilliant little book, H2O and the Waters of Forgetfulness (1986), which reminds us that it was not until the last years of Louis XIV’s reign that a decree was passed for the weekly removal of faeces from the corridors of Versailles. It was in this era that the project to deodorize began. ‘The sense of smell’, Illich writes,

was the only means for identifying the city’s exhalations. The osmologists (students of odors) collected ‘airs’ and smelly materials in tightly corked bottles and compared notes by opening them at a later time as though they were dealing with vintage wines. A dozen treatises focusing on the odours of Paris were published during the second part of the eighteenth century…By the end of the century, this avant-garde of deodorant ideologues is causing social attitudes toward body wastes to change…Toward the middle of the century shitting, for the first time in history, became a sex specific activity…At the end of the century, Marie Antoinette has a door installed to make her defecation private. The act turns into an intimate function…Not only excrement but the body itself, it was discovered, emanates bad odours. Underwear that up to this time had served to keep one warm or attractive began to be connected with the elimination of sweat. The upper classes began to use and wash it more frequently, and in France the bidet came into fashion. Bed sheets and their regular laundering acquired a new importance, and to sleep in one’s own bed between sheets was charged with moral and medical significance…On November 15, 1793, the revolutionary convention solemnly declared each man’s right to his own bed as part of the rights of man.

Being odourless thus became a symbol of status:

smelling now began to become class-specific. Medical students observed that the poor are those who smell with particular intensity and, in addition, do not notice their own smell. Colonial officers and missionaries brought home reports that savages smelled differently from Europeans. Samojeds, Negroes and Hottentots could each be recognized by their racial smell, which changes neither with diet nor with more careful washing.

Naturally this myth was self-fulfilling, to the extent that colonized peoples were denied running water, soap and flushing toilets. Subaltern classes also began to smell and arouse revulsion. ‘Slowly’, Illich continues,

education has shaped the new sense for cleanly individualism. The new individual feels compelled to live in a space without qualities and expects everyone else to stay within the bounds of his or her own skin. He learns to be ashamed when his aura is noticed. He is embarrassed at the thought that his origin could be smelled out, and he is sickened by others if they smell. Shame at being smelled, embarrassment at coming from a smelly environment, and a new proneness to be offended by smell – all taken together place the citizen in a new kind of space.

Realizing this ideal of olfactory neutrality required increasing amounts of water. Before the Second World War, bathing once a week was considered hygienist paranoia. Only with the mass production of household washing machines did cleaning clothes become more frequent. I remember the London of the 1970s: on the Underground, the City clerks could be recognized by their detachable cuffs and collars; the former were changed regularly but the latter were grayish from having been worn for a week straight. The families that hosted us would ask us to insert coins into a special hot water meter: breakfast was included in the price, showering was not.

Now, though, the utopia of an odourless humanity has conquered much of the planet. Yet, as with many aspects of modernity, the moment we acquired the means to achieve a goal, its enabling condition (namely the abundant, unlimited availability of water) was lost. An ever more populous and rapidly warming planet will likely return to a state in which water is scarce and contested. This future may however be marked by a significant cultural difference. Whereas in the past, water was scarce for a humanity able to live happily with odours, now it will be scarce for one that considers their own odours insufferable, not to mention those of others.

I remember being struck by the extraordinary success of the Canadian TV drama H2O (2004), whose trailer announced:

A dead Prime Minister. A country in turmoil. A battle for Canada’s most precious resource – water. On the eve of testy discussions with the US Secretary of State, Prime Minister Matthew McLaughlin is killed in an accident. His son, Tom McLaughlin, returns to Canada to attend his fathers’ funeral where he delivers a eulogy that stirs the public propelling him into politics and ultimately the Prime Minister’s office. The investigation into his father’s death, however, reveals that it was no accident, raising the possibility of assassination. The trail of evidence triggers a series of events that uncovers a shocking plot to sell one of Canada’s most valuable resources – water.

As James Salzman noted in his book Drinking Water (2012), this omitted ‘the most exciting part, where American troops invade Canada to plunder their water supply’. A US–Canadian war over water! Until now, such conflicts seemed to be the preserve of semi-desert areas in the Middle East (think of Eyal Weizman’s writing on the Israelis’ use of water to surveil and punish Palestinians), or torrid Africa (as in the latent conflict between Egypt, Sudan and Ethiopia over the Grand Ethiopian Renaissance Dam built on the Blue Nile). But with the possible desertification of the central European plain, war for water will become a real prospect, even in regions once famous for high rainfall and water infrastructure. We citizens of ‘rich countries’, ‘industrialized nations’, ‘more developed powers’, will fight to smell less.

Translated by Francesco Anselmetti.

Read more: Nancy Fraser, ‘Climates of Capital’, NLR 127.

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A New Sorpasso?

Over the last decade, many left-wing activists have been heartened by events in Spain. While progressive projects ran aground elsewhere in Europe, Podemos rapidly rose to prominence before entering government as a junior coalition partner in early 2020. Yet, since then, its experience of state power has served as a cautionary tale. Podemos’s initial radicalism has been stifled by the strictures of government and the compromises of coalition politics. It has failed to pass significant political reforms or fix the structural problems in the Spanish economy. As a result, its base is atomized and its popularity is trending downwards. If the left is to remain relevant, it must learn how to revive its insurgent energy without forfeiting its influence.  

How did Podemos enter an electoral sphere dominated by two longstanding centrist parties, the Popular Party (PP) and the Socialist Party (PSOE)? Thanks to the so-called ‘economic miracle’ that started in the 1980s, Spain became one of the best-performing countries in the European Union, experiencing sustained growth rates and an unprecedented real estate boom. House prices rose by 8% per year from the mid-90s to the mid-2000s, while neoliberal labour and welfare reforms were applauded by the ‘modernizers’ in Brussels. Yet, when the 2008 financial crisis hit, it became clear that the Iberian Tiger had feet of clay. Its economic model – which was heavily reliant on tourism, construction and cheap, casualised labour – proved unsustainable once the large financial institutions that fuelled the construction bubble found themselves on the brink of collapse. The government bailed them out at a hefty price, and the Spanish people were forced to foot the bill.

The PP and PSOE were held equally responsible for this disaster. In 2011, the Socialist Prime Minister José Luis Zapatero rolled out a series of brutal austerity programmes that slashed public spending and caused the unemployment rate to rise above 25%. In doing so, he ignited a popular uprising. More than three million people staged demonstrations and occupied public squares across the country, in what became known as the Indignados Movement. Protests camps were set up – foreshadowing Occupy Wall Street – and activists held sit-ins at major banks. Polls showed that 70% of the public supported their demands for more democratic participation, employment, housing, public services and an end to the corruption of the political class.

Podemos was founded in 2014 to give this nascent struggle institutional form. It claimed to represent a new left, capable of channelling the anti-austerity movement while avoiding the minoritarian politics of older radical parties like Izquierda Unida. Its Laclauian approach involved speaking to broad social sectors – in the style of the Latin American Pink Tide – rather than the usual band of true believers. Podemos’s leader, Pablo Iglesias – a young political science professor from Complutense University who had already demonstrated his charisma as a regular guest on TV talk shows – came to embody this strategy. Instead of opposing ‘the right’, he focussed his attacks on la casta: a term borrowed from the Italian Five Star Movement, which presented the PP and PSOE as part of the same elite set.

From the outset, Podemos expressed the democratizing spirit of the Indignados Movement. Its first manifesto sought to frame diverse policy issues – economic, environmental, social, international – in terms of democratic rights. Proposals included the establishment of regular referendums, popular law initiatives and recall votes, as well as radical measures to combat corruption and increase transparency. Its economic platform, designed with the help of Thomas Piketty, had a strong eco-socialist current, setting out a series of green transition initiatives that have since gained mainstream acceptance. The party pledged to restore public investment and outlined a ‘new model of production’, which would combine green reindustrialization with investment in technology and the ‘knowledge economy’.  

Unlike Italy’s Five Star Movement and La France Insoumise, Podemos never entertained the prospect of exiting the euro, let alone the European Union. But it promised to break with Troika fiscal policy and restructure the country’s public debt, calling for a rescate ciudadano (citizens’ bailout) to repair the social devastation wrought by elites. It also advocated a guaranteed income, between €600 and €1,300 per month for poorer households, to be funded by new taxes on high incomes and financial entities. When the media attacked Podemos as communist or ‘Bolivarian’, Iglesias pointed out that, just a few decades ago, its manifesto would have been seen as a traditional social-democratic programme.  

Iglesias’s pitch was seductive. Just a few months after Podemos was established, it won 8% in the European elections, before picking up 20% in the national ballot the next year. Its ambition was to enact a sorpasso in which it would leapfrog the PSOE and become the official opposition, while the centre-left Pasokified itself and faded into obscurity. As part of this strategy, Iglesias decided to ally with other left parties including Izquierda Unida and rebrand as Unidas Podemos before the snap elections of 2016. This move was intended to consolidate the left’s gains by establishing a unified electoral bloc. Yet its effect was to sow division among the leadership. The mastermind of Podemos’s populist strategy, Iñigo Errejón, saw it as a betrayal of the party’s original purpose: to transcend the radical left tradition and court disenfranchised voters on the basis of their shared interests. By joining with Izquierda Unida, he claimed, Podemos would lose the political novelty on which its entire appeal was based. From this point on, Podemos was increasingly beset by internecine conflict. Having made no headway in the 2016 election – which returned a PP minority government under Mariano Rajoy – it entered a period of secular decline.

Although Podemos continued to act as a vocal opposition to the PP, it now occupied a different place in the Spanish public sphere. Having initially captured the sense of solidarity generated by the Indignados, it had since succumbed to a familiar sectarianism. Several bruising local election defeats indicated its waning organizational capacity and the weakness of its cadres. In the Madrilenian regional elections of 2019, Errejón dropped the Podemos brand and ran as part of an alliance with other small parties and civil society groups, mimicking the mayoral campaigns of Ada Colau in Barcelona and Manuela Carmena in Madrid. This precipitated a final rupture with Iglesias, in which Errejón jumped ship to found his own political party, Más País. Other leading figures such as Carolina Bescansa and Luis Alegre departed soon thereafter, citing a lack of internal pluralism.

By this time, however, the PP had been forced out of office amid multiple corruption scandals, and the PSOE, led by Pedro Sánchez, was struggling to keep its minority administration afloat. When the April 2019 snap elections returned an inconclusive result, Sánchez was forced to enter coalition talks with Unidas Podemos. These initially went nowhere, as the Socialists refused to make meaningful policy concessions. But in a follow-up election that November, both Unidas Podemos and the PSOE were punished by voters: the former reached a nadir of 12.8%, while the latter declined to 28%. Rattled by this poor showing, plus the strong performance of the Francoist Vox party, Sánchez changed tack and struck a deal with Iglesias, granting Unidas Podemos the powerful Ministry of Labour as well as greater policy influence. Since then, the left has continued to see its electoral support ebb away; yet it has also had a rare opportunity to put some of its ideas into practice.

Labour Minister Yolanda Diaz, a representative for the Spanish Communist Party who ran as part of the Unidas Podemos coalition, has achieved a series of impressive policy victories during her two-year tenure. In the first weeks of the pandemic, she introduced the Expediente de Regulación Temporal de Empleo (ERTE) – the functional equivalent of the UK’s furlough scheme – which covered 3.6 million workers and was praised for its faultless rollout. She subsequently introduced a historic labour reform to limit the use of temporary contracts, which Iglesias described ‘the most important law in the legislature’. The bill, which has so far tripled the number of permanent contracts in the Spanish job market, passed with a majority of just one, after a Popular Party MP accidentally voted in favour by pressing the wrong button. Diaz has also increased the minimum wage by 33.5% and issued a €200 cheque to poor households to help with the cost-of-living crisis. Podemos’s guaranteed minimum income programme has now been officially adopted, with poorer households eligible for an ‘Ingreso Minimo Vital’ ranging from €560 to €1,400 per month.

But these successes have been offset by many disappointments. Podemos has seen its policies consistently watered-down or obstructed by a Socialist Party whose economic agenda remains unabashedly pro-market. The roll-out of the Ingreso Minimo Vital, overseen by the Socialist Minister for Inclusion and Social Security, has been incompetent at best. A combination of underfunding, bureaucratic complexity and a lack of personnel to process the applications means that the benefit reaches only half the households it is supposed to cover. Meanwhile, the PSOE Economy Minister Nadia Calviño – a deficit hawk with close ties to the financial sector – has stonewalled Podemos’s fiscal policies and refused to countenance new wealth taxes. The Socialists have fought tooth-and-nail against the introduction of rent controls and dragged their feet over a windfall tax on energy companies. Such recalcitrance speaks to their broader refusal to reform Spain’s broken economic model, which remains over-reliant on construction and an unproductive service sector. There has been little progress in addressing high unemployment rates – close to 14% – or expanding the undersized manufacturing industry, since fixing such problems would require a level of interventionism which the PSOE is unwilling to contemplate.  

Podemos has therefore been forced to confront both the obstinate realities of institutional politics and the inertial tendencies of Spain’s rentier capitalist economy. This hasn’t helped its poll ratings, which hover at around 10%. Many erstwhile supporters are frustrated with the party’s ineffectual performance and feel that it has been duped by its coalition partners. Meanwhile, its failure to establish workable democratic structures continues to damage its credibility. The fact that Podemos cannot properly manage factional conflict means that internal struggles frequently break out into the open, damaging the organization as a whole. In the run up to the recent Andalusian elections, the Anticapitalistas – a Trotskyist outfit which played an important role in Podemos’s formation – decided to break away, claiming that the party had strayed too far from its original principles. When the vote was held, the left suffered heavy losses.

A further blow for Podemos came with its defeat in the Madrid regional elections of May 2021. Iglesias had stepped down as Deputy Prime Minister in order to lead the campaign, which was meant to rally grassroots support and secure a local foothold for the party. But his decision to focus his attacks on Vox, and present Podemos as a bulwark against the far right, failed to cut through. After winning a paltry 7% of the vote, he abandoned institutional politics altogether and returned to media punditry. In Iglesias’s absence, Yolanda Diaz may become the most important player in the party’s regeneration. She is currently trying to forge a new electoral platform called Sumar (meaning ‘to sum up’ or ‘unite’). As the name suggests, its mission is to overcome both the ideological and geographical divisions that have constrained the Spanish left. It has already secured the support of Izquierda Unida, Más Pais and Podemos, as well as regional formations such as the Valencian Compromis and the Catalunyan Comuns. Bringing these forces into a single political entity will be crucial to winning back the million or so voters that Podemos has lost since 2016, while also gaining the support of subaltern classes who typically shun the ballot box. If this ambitious strategy succeeds, it could open the door to a sorpasso of the kind that Podemos unsuccessfully attempted several years ago – relegating the PSOE to the status of junior partner in a left-led government.

Diaz’s profile may help her to carry out this momentous task. According to opinion polls, her record as Labour Minister has made her the most popular politician in Spain. Although her policies are radical, she has an instinct for pragmatic dealmaking and a softer rhetorical style than Iglesias. To her supporters, this makes her the perfect figure to reconcile Podemos’s institutionalization with its foundational idealism. But her approach also has its detractors in the party leadership, who believe they will continue to haemorrhage support if they retain their agreement with the PSOE after the next election. Further cracks have emerged over the Ukraine conflict, with Diaz proving more reluctant to criticize NATO than many of her comrades. Such cleavages reflect the basic fact that winning over disenchanted voters and unifying the left are two very different aims. Diaz wants to do both; but by moderating her position to appeal to wavering parts of the electorate she may end up alienating vital sections of her progressive bloc. It remains to be seen how she will attempt to solve this electoral puzzle. Recapturing the spirit of the Indignados will be no small feat when confronted with a recalcitrant PSOE, a demoralized electorate and a rising far right. Yet the Spanish left has already demonstrated a unique ability to defy the odds – and Diaz may do so again.  

Read on: Pablo Iglesias, ‘Understanding Podemos’, NLR 93.

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Tory Fractures

On 20 July, when the field of UK prime ministerial contenders was whittled down to Rishi Sunak and Liz Truss, an unnamed Conservative MP briefed that party members would now be forced to decide between a ‘backstabber’ and a ‘moron’. This was a fair assessment. Whoever wins the leadership election will be no more fit for office than their toppled predecessor. But its outcome will nevertheless have major implications for Britain’s macroeconomic direction. If the candidates’ pledges are to be believed, fiscal policy will either stay on its current course, as set by the backstabber during his time at the Treasury, or it will diverge sharply, as the moron rips up the status quo. The new premier will not only decide the fate of the ambiguous political formation known as Johnsonism; they may also get to define the contemporary meaning of another, equally contested legacy: Thatcherism.

Sunak and Truss are each posing as the legitimate heir to these traditions, yet they have adopted markedly different perspectives on them. The former Chancellor describes his outlook as a ‘common-sense Thatcherism’ that prioritises whipping inflation over cutting taxes. His doxa is based on fiscal responsibility and reluctance to increase the public debt. He condemns borrowing as ‘immoral’ short-termism and insists that the tax burden can only be lightened when such reductions are within our means. The costly measures he implemented during the pandemic – such as the furlough scheme and Universal Credit uplift – were, he says, necessary to boost demand and avoid economic collapse: pragmatic adjustments to save the neoliberal model, not a repudiation of it. As the Independent’s Sean O’Grady writes, ‘Thatcher was a balanced-budget, sound money right-winger, as Rishi Sunak is now.’

A traditional Thatcherite programme might seem to conflict with the populist-interventionist tendencies of the Johnson government. But in fact, Sunak’s balanced budgets involve retaining the flagship reforms of the last three years: raising National Insurance contributions, increasing corporation tax, and keeping public service spending on its upward trajectory (though without restoring any departmental budget to its pre-2010 level). Sunak has even paid lip-service to the ‘levelling up’ plan for regional realignment, framing himself as the saviour of England’s ‘northern powerhouses’. He claims that in these turbulent times, common-sense Thatcherism means continuity Johnsonism. Sensible economic management – of the kind supposedly required to confront the cost-of-living crisis – relies on a tactical expansion of the state.  

For Truss, however, Thatcherism means something more fundamental: an insurgent libertarian creed willing to drastically depart from economic orthodoxy. She plans to make annual tax cuts worth more than £30 billion, ‘putting money back into people’s pockets’ rather than swelling the state coffers. Under her administration, green levies would be scrapped while defence spending would skyrocket. Such a spree would need to be funded by higher borrowing, which Truss may enable by changing fiscal rules. Although she has officially rejected a return to austerity, she has also promised a raft of ‘public service reforms’ and an overarching Spending Review – both of which will likely lead to cutbacks. Extant regulations would meanwhile be repealed as part of a ‘red tape bonfire’.

Truss justifies these potentially inflationary policies by appealing to the essence of Thatcherism – viewed as a disruptive individualist philosophy rather than a conservative approach to budgeting. Whereas Sunak is seen as a joyless ‘bean-counter’, Truss has cast herself as a ‘new Iron Lady’ capable of revitalising the party and reversing its downward polling trend. Yet, far from marking a break with Boris, her campaign purports to be more Johnsonist than Johnson himself. Of all the Tory candidates, Truss has been the least willing to criticise the PM, declaring that he should have stayed on in the job and refusing to question his personal integrity. Johnson’s loyalists have lined up to endorse her, and his final remarks at the dispatch box – ‘cut taxes and deregulate wherever you can’ – seemed to resonate with her agenda. Although the candidate pledges to upend the economic consensus, she is clear that this consensus came from Number 11, not from Number 10. Truss’s wing of the party views the big-state policies of the Johnson era as the Chancellor’s impositions, which the PM grudgingly accepted to mitigate the Covid meltdown. They believe that Prime Minister Truss will realise the free-market reforms which Johnson always wanted. By returning to authentic Thatcherism, she will rescue the rebellious spirit of Johnsonism from the prison-house of the Treasury.  

What we have, then, are competing attempts to define – and reconcile – the legacies of the Tory Party’s two most successful leaders in living memory. The stakes of the struggle are high, as one can glean from the gloves-off atmosphere of the campaign. Sunak labels Truss a ‘socialist’ for her uncosted ‘something-for-nothing’ policies. Jacob Rees-Mogg, in turn, excoriates Sunak as the ‘much-lamented socialist Chancellor’ for his soaring taxes and pandemic hand-outs. These recriminations are more than just the typical mudslinging of Tory husting events. They are a symptom of the present economic conjuncture, in which it is impossible to act as both a competent bean-counter and a radical free-marketeer. Amid the spiralling costs of the pandemic, the care crisis and the knock-on effects of the Ukraine conflict, a ‘sound money’ approach requires constant intervention, while shrinking the state entails piling up debt and flouting restrictions on expenditure. In the post-Covid landscape, these two features of Conservative ideology – fiscal discipline and laissez-faire – can no longer be synthesized. The different factions of the party must decide which is more important and denounce the other as a leftist deviation.

This rupture within the Tories also helps to explain the peculiar tone of Sunak’s leadership bid. During the last decade, opposition to spending cuts was dismissed as infantile and unrealistic. Theresa May famously told voters there was ‘no magic money tree’ that could be used to maintain public sector wages. Now, Sunak has mobilised the same themes – railing against ‘comforting fairy-tales’ and ‘fantasy economics’ – to attack a programme which, according to the Institute for Fiscal Studies, is more austerian than his own. The discourse of capitalist realism, of making the ‘tough choices’ that the market dictates, has been harnessed to a post-austerity politics based on rising investment and selective tax hikes. Against this new norm, Truss has managed to imbue her low-tax policies with a utopian energy. Whereas Sunak claims there is no alternative to measures like the National Insurance rise, Truss offers a forward-looking vision that may, in practice, involve recalibrating the lean Conservatism of the 2010s.

If there’s one lesson to be learned from the upheavals of recent British history – Brexit, Corbyn, Johnson – it is that realism has lost its grip on the popular imagination. In each instance, an optimistic force triumphed over ‘project fear’ and widened the sphere of political possibility. If this pattern holds, Sunak’s pitch to the membership will fail to cut through. His attempt to paint Trussonomics as a boosterish illusion may ultimately heighten its appeal. But, if Truss wins, the upshot of this anti-realist sentiment could be austerity 2.0, dressed up as a dynamic form of right-wing populism and accompanied by culture-war crackdowns on migrants and trans people. Should she decide to fund her policies by slashing spending, Britain may soon regress to its recent past, disguised as its non-existent future.

Read on: Tom Hazeldine, ‘Transformatrix’, NLR 131.

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Sinking Germany

Whoever the victor may be, it’s become increasingly unclear what winning the war in Ukraine would mean. The greater the destruction, the more intractable the conflict appears. With a rising death toll and escalating sanctions, the objectives of the belligerents seem ever more inscrutable. What would Russia gain from annexing an obliterated corner of Ukraine, compared to everything it would lose? Why would Ukraine run itself into the ground to retain a region which does not want to be detached from Russia? And to what ends would NATO erect a new Iron Curtain, thereby consolidating a Russian-Chinese bloc endowed with both raw materials and advanced technology?

Granted, for some time now the United States and its allies have fought wars in which victory is impossible to envision. What would winning have looked like in Iraq? If it involved turning the country into a Muslim replica of Israel, this was never a realistic outcome. In the end, it was practically handed over to the Iranian sphere of influence, while Afghanistan was abandoned to Pakistan and China. (All this without even mentioning the Syrian civil war.) Yet, if it is difficult to identify a potential victor in Ukraine, it is easier to pinpoint the potential losers. As we shall see, one of these will likely be what the Australian economist Joseph Halevi has termed the ‘German bloc’: a set of economically interconnected nations stretching from Switzerland to Hungary.

Of course, more or less all of us are losing out in the present conjuncture. When the invasion began, everyone was primarily concerned with the supply of gas and petrol. It was only later brought to public attention that Russia and Ukraine account for 14% of the world’s grain production and up to 29% of global grain exports. It was subsequently revealed that they provide 17% of corn exports and 14% of barley. As the treasure hunt continued, analysts realized that 76% of the world’s sunflower products come from the two states. Russia also dominates the fertiliser market, with a global share of more than 50%, which explains why the blockade has caused agricultural problems as far afield as Brazil.

More surprises were in store. The war hit not just the oil and gas sectors, but nickel too. Russia – home to Nornickel, a giant in the sector – produced 195,000 tonnes of nickel in 2021, or 7.2% of global production. The invasion, combined with increased demand for nickel used in power lines and electric vehicles, caused prices to skyrocket. Meanwhile the global superconductor industry, which produces calculators and computer chips, was heavily affected. The Russian steel industry sends neon gas to Ukraine, where it is purified for use in lithographic processes such as the inscription of microcircuits on silicon plates. The most important centres of production are Odessa and Mariupol (hence the relentless struggle over these areas). Ukraine provides 70% of the world’s neon gas, as well as 40% of its krypton and 30% of its xenon; its major clients include South Korea, China, the US and Germany. The supply of several other ‘critical’ metals is also endangered, as the Columbia Center for Global Energy Policy reported in April:

Other metals of interest in the Russia crisis include titanium, scandium, and palladium. Titanium is strategic for aerospace and defense applications and Russia is the world’s third-largest producer of titanium sponge, the specific application that is critical for titanium metal. Used extensively in aerospace and defense sectors, Scandium is another key metal for which Russia is one of the three largest global producers. Palladium is one of the most notable critical minerals affected by the Ukraine crisis because it is a critical input to the automotive and semiconductor industries and Russia supplies nearly 37 percent of global production. Russian palladium illustrates one of the key geopolitical features of critical minerals: alternative supplies are often located in equally challenging markets. The second largest palladium producer is South Africa, where the mining sector has been wracked by strikes for the past decade.

Each day, then, we discover new difficulties in decoupling Russia from the global economy. This is partly because sanctions have proven less effective than predicted, despite the tenacious efforts of the US and Europe. To date, there have been at least six sets of successive sanctions, each more drastic than the last: the removal of Russia from the international financial system operated by SWIFT; the freezing of the Russian Central Bank’s foreign reserves, which amounted to around $630 billion; the freezing of $600 million deposited by Russia in American banks, and the refusal to accept these funds as payment for Russia’s foreign debt; the exclusion of Russia’s most important banks from the City of London; and the restriction of Russian deposits in British banks.

Western airports (and airspace) are now closed to Russian planes, and the Russian merchant navy is forbidden from docking in Western ports (Japan and Australia included). Technological exports to Russia are banned, as are many imports. The European Union has sanctions in place against 98 entities and 1,158 individuals, including President Putin and Foreign Minister Lavrov; oligarchs with ties to the Kremlin like Roman Abramovich; 351 representatives to the Duma; members of Russia’s National Security Council; high-ranking officers of the armed forces; entrepreneurs and financiers; propagandists and actors. All Western banks and a majority of Western companies have closed shop in Russia and sold their branches. Russia has responded by banning the export of more than 200 products, demanding ruble payments for oil and gas exports, and blocking provisions to Poland, Bulgaria and Finland when they refused to accept this stipulation.

Paradoxically, though, certain sanctions have played into Moscow’s hands. The embargo on oil and gas has increased Russian revenues due to the price rises it has caused, while foreign observers note that Russian supermarket shelves still seem to be well-stocked. In the first four months of the year, Russia’s balance of trade ran its highest surplus since 1994, at $96 billion. Yet, after its initial collapse during the first days of the war, the ruble gradually recovered, such that it is now worth more than it was last year. In 2021, 70 rubles were needed to buy a dollar. On 7 March – its worst day – that figure had nearly doubled; but as of 18 July it dropped back down to 57.

The relative inefficacy of sanctions was predictable. If decades of economic warfare had proved incapable of bringing down effectively defenceless regimes such as Castro’s Cuba (by now targeted for over 70 years), Bolivarian Venezuela (30 years) or Khomeinist Iran (42 years of American sanctions, plus around ten years of international measures), it’s difficult to imagine them triggering regime change in a country like Russia, which has been preparing for this eventuality by revamping its industrial capacities. Yet the more ineffective the sanctions the more the war drags on, lurching from one escalation to the next, and deepening divisions that seem ever more irremediable. By now we can assume that relations with Russia will be interrupted for at least some decades (a regrettable situation for any Westerner who hasn’t had the good fortune to visit Moscow and St Petersburg). The new Iron Curtain has been raised, and won’t be crossed for years to come.

This will frustrate the strategic designs pursued over the last thirty years by the German bloc. Halevi’s thesis is that since the fall of the Berlin Wall and the collapse of the USSR, Germany has sought to construct a series of mutually interdependent economies which now essentially amount to a single economic system. This grouping has a Western flank (Austria, Switzerland, Belgium and the Netherlands) and an Eastern one (the Czech Republic, Slovakia, Hungary, Poland and Slovenia), with different roles and sectors divided between them. The Netherlands acts as a global platform and transport hub; the Czech Republic and Slovakia as seats of the automobile industry; Austria and Switzerland as producers advanced technology, and so on. If Germany is the hegemonic centre of this bloc, we must revise our view of its geopolitical role and global significance. As a whole, the bloc has 196 million inhabitants compared to Germany’s 83 million, and a GDP of $7.7 trillion versus Germany’s $3.8 trillion. This makes it the world’s third economic power – smaller than US and China, but larger than Japan.

This web of relations is especially visible when we look at trade. German exports to Austria and Switzerland – which have a combined population of 17 million – amount to €132 billion, compared with €122 billion to the US and €102 billion to France. When it comes to total trade with Germany, France (with its population of 67 million) is behind the Netherlands (with only 17 million): €164 billion to €206 billion. Italy, meanwhile, receives less than Poland, despite having a bigger population (60 million to 38 million) and a per capita income almost twice as large. This marks a spectacular reversal, given that in 2005, the year after its accession to the EU, Germany’s trade with Poland was only half of that with Italy.

What has occurred, then, is the reorientation of Germany’s industrial apparatus away from other European partners towards its own economic bloc, on the one hand, and trade with China on the other. Beijing has now become Germany’s prime commercial partner, with a relationship worth €246 billion. The other members of the German bloc have also seen a marked rise in trade with China. ‘If we take 2005 as a reference’, Halevi writes,

that is to say, the year immediately after the entry of Eastern European countries into the EU, the value in dollars of Germany’s global exports in goods increased, up until 2021, by 67%, whilst its trade with China increased more than fourfold. In the same period — and though they nearly tripled — French and Italian exports to China showed a rate of growth far inferior to that of German trade. For the states in the German bloc, integration with Germany has generated a veritable explosion of exports to China, with Germany not only paving the way for these states, but also establishing ties between sectors and individual companies that in turn stimulate their local exports. To Germany’s west, the Netherlands’ direct exports to China grew by at least five since 2005, whilst Switzerland’s increased twelvefold, making it China’s second largest European exporter. These tendencies have been a lot more contained in Belgium and Austria. In the east, Poland’s exports to China multiplied by 5.5, by 6 for Hungary, by around 10 for Czech Republic, and by nearly 21 for Slovakia. The natural consequence of this process is the formation of a Eurasian economic zone, a real necessity for China both because of its need for Russian raw materials, and because of growing nodes of railway infrastructure that cross Russia, Kazakhstan and Ukraine. In the last decade, the first convoys of freight trains departed China for Dortmund and the Netherlands, news which was even reported by the Financial Times. The Germans had, at least in industrial circles, the intention of creating synergies between China, Russia, Kazakhstan, Ukraine, and thereby Europe and Germany. In other words, the aim was to integrate states bringing together logistical, productive and energy exporting zones (Russia, Ukraine, Kazakhstan) and imports of industrial goods both from China and Germany.

Here we can glimpse the Teutonic equivalent of the new Silk Road – or Belt and Road Initiative – launched by Xi Jinping in 2013. Indeed, the ultimate objective of the German bloc as parsed by Halevi is the creation of a Eurasian continental front with Germany and China as its two extremities, and Russia as an indispensable connector. This explains the persistence with which the Germans have pushed, against the interests of Washington and NATO, for the gas pipeline Nordstream 2. The first tangible geopolitical effect of the Ukraine war was the burial of this project.

The war has effectively put an end to the dream of a common Eurasian space because it forces Germany to weaken its ties with China and closes the Russian channel of communication between them. It also bars Germany’s use of Russia as a resource-rich backwater and Lebensraum – or more accurately Großraum, in Carl Schmitt’s sense of the term. Now, instead of a Great Space, Russia has become an insurmountable geopolitical obstacle. This will compel the strategists of the German bloc to revise their entire plan, to rethink the relationship between their own sub-imperial power and the US empire, while also redefining their relations with other European states. At the same time, the German bloc has been strained by the conflicting interests of its individual members. A small yet significant fact indicates how much the rules of the game have changed: in May this year, Germany’s monthly balance of trade tipped into the red for the first time since 1991. It wasn’t much (only around $1 billion), but it was a trade deficit nonetheless. A situation is thus emerging out of the Ukraine conflict which is not without historical precedent: the defeat of German strategy. In the Third World War, the losers still seem to be the Germans.

Translated by Francesco Anselmetti.

Read on: Joshua Rahtz, ‘Germany’s Faltering Motor?’, NLR 93.