Crises and Counter-Movements in World Evolutionary Perspective*

Christopher Chase-Dunn and Roy Kwon

Institute for Research on World-Systems

University of California-Riverside

Draft v.6-19-11

Abstract:  This paper considers the meaning of the recent global financial meltdown by comparing it with earlier debt crises and periods of collapse. Is this just another debt crisis like the ones that have periodically occurred over the past 200 years, or is it part of the end of capitalism and the transformation to a new and different logic of social reproduction? We discuss the contemporary network of global counter-movements and national regimes that are seeking to transform the capitalist world-system into a more humane, sustainable and egalitarian civilization and we also discuss how the current crisis has affected the network of counter-movements and regimes, including the Pink Tide populist regimes in Latin America and the Arab Spring movements. We describe how the New Global Left is similar to or different from earlier global counter-movements.  The point is to provide a comparative and evolutionary framework that can discern what is really new about the current global situation and inform collectively rational responses. 

*A keynote address on this topic was presented at the international conference on “The Global Economic Crisis: Perceptions and Impacts” September 10-11, 2010 The World Society Foundation, University of Zurich.

Forthcoming in Christian Suter and Mark Herkenrath (Eds.) The Global Economic Crisis: Perceptions and Impacts (World Society Studies 2011).Wien/Berlin/Zürich: LIT Verlag


            The recent financial crisis has generated a huge scholarly literature and immense popular reflection about its causes and its meaning for the past and for the future of world society.  This paper is intended to place the current crisis, and the contemporary network of transnational social movements and progressive national regimes, in world historical and evolutionary perspective. The main point is to accurately determine the similarities and differences between the current crisis and responses with earlier periods of dislocation and breakdown in the modern world-system and in earlier world-systems. What is different in this approach from most of the literature on the financial meltdown is a much greater temporal depth and a more world-systemic form of analysis. This paper will employ three different time horizons in the discussion of crises and counter-movements:

1.      50,000 years;

2.       5,000 years;

3.       500 years.

We will discuss the evolution of the regime of global debt restructuring since 1820 and the consequences of the trajectories of global governance, globalization and counter-hegemonic movements over the next several decades of the future. We will also address the depth of the crisis. Is it just another cyclical debt crisis following a boom of the kind that has happened eight times since 1820 (Suter 2009: Tables 1and 2)? Is it a structural or systemic crisis of capitalism as a logic of accumulation and social reproduction? The several time horizons will be germane to the analysis of the depth of the latest crisis and its significance for the future.

The Evolutionary World-Systems Perspective

            Hall and Chase-Dunn (2006) have modified the concepts developed by the scholars of the modern world-system to construct a theoretical perspective for comparing the modern system with earlier regional world-systems. The main idea is that sociocultural evolution can only be explained if polities are seen to have been in important interaction with each other since the Paleolithic. Hall and Chase-Dunn propose a general model of the causes of the evolution of technology and hierarchy within polities and in linked systems of polities (world-systems).  The most important idea that comes out of this theoretical perspective is that transformational changes are brought about mainly by the actions of individuals and organizations within polities that are semiperipheral relative to the other polities in the same system. This is known as the hypothesis of semiperipheral development.

            As regional world-systems became spatially larger and the polities within them grew and became more internally hierarchical, interpolity relations also became more hierarchical because new means of extracting resources from distant peoples were invented.  Thus did core/periphery hierarchies emerge. Semiperipherality is the position of some of the polities in a core/periphery hierarchy. Some of the polities that are located in semiperipheral positions became the agents that formed larger chiefdoms, states and empires by means of conquest (semiperipheral marcher polities), and some specialized trading states in between the tributary empires promoted production for exchange in the regions in which they operated. So both the spatial and demographic scale of political organization and the spatial scale of trade networks were expanded by semiperipheral polities, eventually leading to the global system in which we now live.

            The modern world-system came into being when a formerly peripheral and then semiperipheral region (Europe) developed an internal core of capitalist states that were eventually able to dominate the polities of all the other regions of the Earth. This Europe-centered system was the first one in which capitalism became the predominant mode of accumulation, though semiperipheral capitalist city-states had existed since the Bronze Age in the spaces between the tributary empires. The Europe-centered system expanded in a series of waves of colonization and incorporation (See Figure 1). Commodification in Europe expanded, evolved and deepened in waves since the 13th century, which is why historians disagree about when capitalism became the predominant mode. Since the 15th century the modern system has seen four periods of hegemony in which leadership in the development of capitalism was taken to new levels. The first such period was led by a coalition between Genoese finance capitalists and the Portuguese crown (Arrighi 1994). After that the hegemons have been single nation-states: the Dutch in 17th century, the British in the 19th century and the United States in the 20th century (Wallerstein 1984).  Europe itself, and all four of the modern hegemons, were former semiperipheries that first rose to core status and then to hegemony.

Figure 1: Waves of Colonization and Decolonization Since 1400- Number of colonies established and number of decolonizations (Source: Henige, 1970)     

 In between these periods of hegemony were periods of hegemonic rivalry in which several contenders strove for global power. The core of the modern world-system has remained multicentric, meaning that a number of sovereign states ally and compete with one another. Earlier regional world-systems sometimes experienced a period of core-wide empire in which a single empire became so large that there were no serious contenders for predominance.  This did not happen in the modern world-system until the United States became the single super-power following the demise of the Soviet Union in 1989.

            The sequence of hegemonies can be understood as the evolution of global governance in the modern system. The interstate system as institutionalized at the Treaty of Westphalia in 1644 is still a fundamental institutional structure of the polity of the modern system. The system of theoretically sovereign states was expanded to include the peripheral regions in two large waves of decolonization (see Figure 1), eventually resulting in a situation in which the whole modern system became composed of sovereign national states. East Asia was incorporated into this system in the 19th century, though aspects of the earlier East Asian tribute-trade state system were not completely obliterated by that incorporation (Hamashita 2003).

            Each of the hegemonies was larger as a proportion of the whole system than the earlier one had been. And each developed the institutions of economic and political-military control by which it led the larger system such that capitalism increasingly deepened its penetration of all the areas of the Earth. And after the Napoleonic Wars in which Britain finally defeated its main competitor, France, global political institutions began to emerge over the tops of the international system of national states. The first proto-world-government was the Concert of Europe, a fragile flower that wilted when its main proponents, Britain and the Austro-Hungarian Empire, disagreed about how to handle the world revolution of 1848. The Concert was followed by the League of Nations and then by the United Nations and the Bretton Woods international financial institutions (The World Bank, the International Monetary Fund and eventually the World Trade Organization).

            The political globalization evident in the trajectory of global governance evolved because the powers that be were in heavy contention with one another for geopolitical power and for economic resources, but also because resistance emerged within the polities of the core and in the regions of the non-core. The series of hegemonies, waves of colonial expansion and decolonization and the emergence of a proto-world-state occurred as the global elites tried to compete with one another and to contain resistance from below. We have already mentioned the waves of decolonization. Other important forces of resistance were slave revolts, the labor movement, the extension of citizenship to men of no property, the women’s movement, and other associated rebellions and social movements. 

            These movements affected the evolution of global governance in part because the rebellions often clustered together in time, forming what have been called “world revolutions” (Arrighi, Hopkins and Wallerstein 1989). The Protestant Reformation in Europe was an early instance that played a huge role in the rise of the Dutch hegemony.  The French Revolution of 1789 was linked in time with the American and Haitian revolts. The 1848 rebellion in Europe was both synchronous with the Taiping Rebellion in China and was linked with it by the diffusion of ideas, as it was also linked with the emergent Christian Sects in the United States. 1917 was the year of the Bolsheviks in Russia, but also the Chinese Nationalist revolt, the Mexican revolution, the Arab Revolt and the General Strike in Seattle led by the Industrial Workers of the World in the United States. 1968 was a revolt of students in the U.S., Europe, Latin America and Red Guards in China. 1989 was mainly in the Soviet Union and Eastern Europe, but important lessons about the value of civil rights beyond justification for capitalist democracy were learned by an emergent global civil society.

            The current world revolution of 20xx (Chase-Dunn and Niemeyer 2009) will be discussed as the global counter-movement in this paper. The big idea here is that the evolution of capitalism and of global governance is importantly a response to resistance and rebellions from below. This has been true in the past and is likely to continue to be true in the future. Boswell and Chase-Dunn (2000) contend that capitalism and socialism have dialectically interacted with one another in a positive feedback loop similar to a spiral. Labor and socialist movements were obviously a reaction to capitalist industrialization, but also the U.S. hegemony and the post-World War II global institutions were importantly spurred on by the World Revolution of 1917 and the waves of decolonization.

The Meltdown of 2008

            Financial bubbles and meltdowns are business as usual in the modern world-system.  Christian Suter’s (1987,1992,2009; Pfister and Suter 1987 ) studies of government-guaranteed loans, financial crises and debt settlements since 1820 show that there have been nine boom periods in the expansion of lending from core lenders to non-core governments, including the most recent period from 2003-2007 (Suter 2009: Table 1).  These have been followed by debt crises in which governments in the non-core have defaulted or come close to default (Suter 2009: Table 2). The huge debt crisis of the 1980s did not result in financial collapse, unlike all earlier debt crises in the last two centuries, because the European, Japanese and U.S. banks, led by the U.S. Federal Reserve and helped by the International Monetary Fund and the World Bank, managed a coordinated renegotiation of the terms of the debt and avoided a “beggar-thy-neighbor” panic of the kind that had caused the house of cards to tumble down in earlier collapses. This was significant as a harbinger of the rise of a more coordinated transnational capitalist class and an emerging transnational state.[1]

            The coordinated ability of the global financial institutions to reschedule the terms of the debts allowed countries that were in trouble to continuing paying interest, albeit on somewhat better terms. This meant that the mountain of “securities” did not completely collapse as it had done in earlier debt crises.  It also facilitated the further financialization of the global economy and the continued expansion of the debt bubble such that it is now much larger than the “real” world economy of goods and services (e.g. see Figure 2).

Figure 2: The expansion of credit as a % of global GDP, 1960-2009 (Source: World Development Indicators, 2011)



Figure 2 shows the trajectory of one indicator of global financialization from 1960 to 2009. The indicator is global domestic credit provided by the banking sector as a percentage of the global GDP. This indicator of financialization, which does not include credit that banks offered to borrowers abroad, rose dramatically over the last 4 ½ decades, indicating that the relationship between real goods and services and symbolic forms that may be used to pay a debt has changed. Financialization means that the symbolic economy and the activities of financial services have come to be larger than the “real” economy of the production and exchange of goods and other services. It also indicates that finance capital has become a predominant player in the whole world economy. Though we do not have comparable quantitative indicators to produce the kind of graph shown in Figure 1 for the last decades of the nineteenth century, it is well-known that there was a somewhat similar expansion of finance capital during the period of British hegemonic decline in industrial production

            Suter’s (2009:9) most recent study of the evolution of the global debt restructuring regime that deals with sovereign debt (government-guaranteed bonds) delineates five debt restructuring regimes since 1820, including the most recent (1999-2008) regime. The most recent regime is called the “post-Washington Consensus” and is characterized as being organized as market-based debt restructurings and a decreased institutionalization of creditor coordination. This is interesting because it indicates a less-coordinated debt regime relatively to the highly-coordinated earlier Washington Consensus regime from1960 to 1998. Suter (2009: Table 3) also shows that the average duration of debt servicing incapacity has remained relatively low since 1999 and the degree of debt relief is similar to what it has been since 1926. Suter interprets these findings as indicating that the seemingly less coordinated market-based “post-Washington Consensus” regime is still embedded in the larger cooperative framework of the Washington Consensus.

Figure 3: U.S. Balance of Trade, 1960-2009 (Source: World Development Indicators, 2011)

 It is also possible that the less institutionalized and coordinated framework has arisen because the U.S. has become a debtor country in the last few decades with a large negative balance of trade (see Figure 3) and a negative balance of payments. The federal deficit that exploded during the late 1970s and was used to support the U.S. military budget has been generated by “dollar sovereignty” -- the ability of the U.S to sell its own bonds abroad and to be the recipient of huge inflows of foreign direct investment (Mann 2006). This is one of the most important differences between the period of U.S. hegemonic decline and the period during which Britain was declining in the last decades of the 19th century. A market-based global debt regime allows Wall Street great flexibility and facilitates the production of new financial instruments and credit expansions. Figure 3 also shows that the U.S. trade deficit was cut in half from 2007 to 2009 as a result of the economic depression.  Figure 4 (below) shows the U.S./China trade interaction.  Note that the balance of trade deficit with China, which is due mainly to huge U.S. imports from China, resumed its downward trend between 2009 and 2010.

 When Nicolas Sarkozy, the neo-liberal French President, wanted to raise the issue of global financial regulation at the September 2009 meeting of the G-20, the U.S. Obama administration completely ignored him. Wall Street, the Club of London and the Club of Paris do not want greater global financial regulation and they have the political clout to undercut serious reform.

Figure 4: U.S. /China Trade 1985-2010. Source:  US Census Bureau. 2011. Foreign Trade [online]. Washington DC.

We agree with David Harvey’s (2010) analysis of the causes of the current crisis, which is mainly due to the contradictions of capitalism as a logic of development. Capitalism must expand in order to continue to exist. Investors are not content with very low rates of return. As capitals compete with one another they develop overcapacity in the ability to produce commodities relative to the effective demand. Effective demand is a function of the ability of buyers to purchase the products that capitalists produce. A good part of effective demand is composed of the wages that capital pays to workers. As workers are displaced from production as result of automation they often get lower-paying jobs, reducing effective demand. This is called the “realization problem.” Capitalists seek to escape from this by expanding into new markets, developing new products, and finding cheaper sources of labor.  Keynesian full-employment policies are an effort to deal with the realization problem. But when profits are squeezed because of too much perceived government support for labor unions, capitalists and their political allies launch an attack on unions and the welfare state. But these contradictions of capitalism are long-standing. As Harvey has long shown, capital is flexible and continually comes up with new “fixes” to allow for the continuation of expanding accumulation despite the basic long-term contradictions. The question really is not so much a matter of the long-term contradictions of capitalism but rather: why did the previous fixes come to grief when they did to bring about the current meltdown? And what are the fixes that remain viable, and what new ones may be in the offing?

             At the same time as the debt crisis of the 1980s there was a crisis of profitability in core manufacturing. The productive capacity of Germany and Japan had been devastated by World War II. They recovered but did not really catch up with the U.S. until the 1970s and 1980s. This led to a global glut of productive capacity relative to effective demand in manufacturing and a reduction of average profits (Brenner 2002; Arrighi 2006). This set the scene for the rise of neoliberalism and an attack on the welfare institutions and labor agreements that had emerged during the 1930s and after World War II. The capitalists tended to blame the profit squeeze on the perceived power of labor unions and they came to believe that the welfare state had become a fetter on free investment. Neoliberalism portrayed state regulation and public institutions as inefficient and advocated the “lean state,” lower taxes, privatization, free markets and greater access by capital investors across the world. This became known as the Washington Consensus and it was adopted by the World Bank and the International Monetary Fund as policy, leading to the famous Strurctural Adjustment Programs (SAPs). Big capital tried to solve the problem of overcapacity relative to effective demand by global expansion, a race to the bottom in finding the cheapest work-force, and the further expansion of credit. This temporarily worked, allowing the U.S. economy to grow again in the 1990s. But neoliberalism did not seem like a long-term solution, even to its purveyors. So a faction emerged that has been called “neoconservatives,” who decided unilaterally to use U.S. military power to try to shore up U.S. hegemony and global capitalism by controlling the dwindling global supply of oil. This led to the Bush administration’s wars in Iraq and Afghanistan, which only exacerbated the legitimation problems of U.S. leadership and accelerated the fiscal crisis of the U.S. public debt by spending huge amounts on wars that reaped little in return except dead soldiers and civilians. Thus was neoconservatism failed crisis management. Samir Amin (1997) had made the same point about neoliberalism. It was probably the growing fear among certain circles in power that neoliberalism was going to have a short half-life that provoked the neoconservative gambit. 

            Giovanni Arrighi (1994) and Immanuel Wallerstein (1984) have argued that finance capitalism is not a stage in the long-term evolution of capitalism, as claimed by Rudolf Hilferding, but is rather a recurring last phase of the rise and fall of a hegemonic core power. Hilferding’s work was inspired by the great wave of financialization that occurred in the decades of the declining British hegemony (Hilferding 1981). It is the basic Marxian insight about the contradiction within capitalism based on the realization problem (overcapacity relative to effective demand), plus the world-system insight that this tends to become most acute during the decline of a hegemonic core power, that provides the best conceptual basis for understanding the main outlines of the current crisis in world historical perspective.

            Some of the details of the financial meltdown that escalated in October of 2008 are relevant for this long-run structural perspective, and for the task of delineating how this crisis is different from earlier crises.  The timing of the financial collapse, occurring as the “October surprise” of the U.S. presidential election of 2008, reminds us that world historical social change is both a structured process and is open-ended because historical conjunctures are so complex that they cannot be completely explained by a structural model of social change. This October surprise was an important reason why Barack Obama won the presidency. At the time this seemed to portend new possibilities that the U.S. would be able to confront its internal and external difficulties in a more constructive way. Three years on, the election of the first black U.S. president seems to confirm that the structural forces at work in U.S hegemonic decline and global capitalist crisis are bigger than any president. Despite having been elected on an anti-war platform, the Obama administration has continued the war in Afghanistan, opposed European proposals to construct a global regime that could regulate finance capital, made little or no progress on the issue of global warming, and passed a compromise health reform bill that does not challenge the control that insurance companies wield over the U.S. medical industry. The progressive potentialities of the conjuncture have been neutralized. The bailing out of Wall Street has made little headway toward resolving the huge imbalances in the world economy. The main effort has been to try to reflate the financial bubble so that the U.S. can continue to receive capital inflows and the U.S. government can continue to sell its bonds at home and abroad.

Time Horizons

            So what can be said about the most recent financial meltdown and the contemporary global counter-movement from the long-run perspectives? Is the latest meltdown just another bout of financial expansion and collapse? Does it constitute or portend a deep structural crisis in the capitalist mode of accumulation. What do the meltdown and the counter-movement signify about the evolution of capitalism and its possible transformation into a different mode of accumulation?

50,000 Years

            From the perspective of the last 50,000 years the big news is demographic and ecological. After slowly expanding, with cyclical ups and downs in particular regions, for millennia the human population went into an upward surge in the last two centuries.  Humans have been degrading the environment locally and regionally since they began the intensive use of natural resources. But in the last 200 years of industrial production ecological degradation has become global in scope, with global warming as the biggest consequence. A demographic transition to an equilibrium population size began in the industrialized core countries in the 19th century and has spread unevenly to the non-core in the 20th century. Public health measures have lowered the mortality rate and the education and employment of women outside of the home is lowering the fertility rate. But the total number of humans is likely to keep increasing for another five or six decades. In the year 2000 there were about 6 billion people. But the time the population stops climbing it will be 8, 10 or 12 billion. This population big bang was made possible by industrialization and the vastly expanded use of non-renewable fossil fuels. Fossil fuels are captured ancient sunlight that took millions of years to accrete as plants and forests grew, died and were compressed into oil and coal. The arrival of peak oil production is near and energy prices will almost surely rise again after a long fall. The recent financial meltdown is related to these long-run changes in the sense that it was brought on partly by sectors of the global elite trying to protect their privileges and wealth by seeking greater control over natural resources and by over-expanding the financial sector. But non-elites are also implicated. The housing expansion, suburbanization, and larger houses with fewer people in them have been important mechanisms, especially in the United States, for incorporating some of the non-elites into the hegemonic globalization project of corporate capitalism. The culture of consumerism works on both those who actually have expanded consumption and on those who hope to have it.

5000 Years

The main significance of the 5000 year time horizon is to point us to the rise and decline of modes of accumulation. The story here is that small-scale human polities were integrated primarily by normative structures institutionalized as kinship relations – the so-called kinship-based modes of accumulation. The family was the economy and the polity, and the family was organized as a moral order of obligations that allowed social labor to be mobilized and coordinated, and that regulated distribution. Kin-based accumulation was based on language, consensus-building through oral communication, and institutionalized reciprocity in sharing and exchange. As kin-based polities got larger they fought with one another and polities that developed institutionalized inequalities had selection advantages over those that did not. Kinship itself became hierarchical within chiefdoms, taking the form of ranked lineages or conical clans. Crises and countermovements were important forces of social change all along. Kin-based societies often responded to population pressures on resources by “hiving-off” in which a subgroup would emigrate, usually after formulating grievances in terms of violations of the moral order.

            Around five thousand years ago the first early states and cities emerged in Mesopotamia over the tops of the kin-based institutions. This was the beginning of the tributary modes of accumulation in which state power became the main organizer of the economy, the mobilizer of labor and the accumulator of wealth and power. Similar innovations occurred largely independently in Egypt, the Yellow River valley, the Indus river valley, and later in Mesoamerica and the Andes. The tributary modes of production evolved as states and empires became larger and as the techniques of imperialism, allowing the exploitation of distant resources, were improved. This was mainly the work of semiperipheral marcher states. Aspects of the tributary modes (taxation, tribute-gathering, accumulation by dispossession) are still with us, but they have been largely subsumed and made subservient to the logic of capitalist accumulation. Crises and counter-movements were often involved in the wars and conquests that brought about social change and evolution of the tributary modes.

            A tributary mode became predominant in the Mesopotamian world-system in the early Bronze Age (around 3000 BCE). The East Asian regional world-system was still predominantly tributary in the 19th century CE. That is nearly a 5000 year run. The kin-based mode lasted even longer. All human groups were organized around different versions of the kin-based modes in the Paleolithic. If we date the beginning of the end of the kin-based modes at the coming to predominance of the tributary mode in Mesopotamia (3000 BCE) this first qualitative change in the basic logic of social reproduction took tens of thousands of years.

500 Years

            This brings us to the capitalist mode, here defined as based on the accumulation of profits rather than taxation or tribute. As we have already said, early forms of capitalism emerged in the Bronze Age in the form of small semiperipheral states that specialized in trade and the production of commodities. But it was not until the 15th century that this form of accumulation became predominant in a regional world-system (Europe and its colonies).  Capitalism was borne in the semiperiphery but in Europe it moved to the core, and the fore-reachers that further evolved capitalism were former semiperipheral polities that rose to hegemony. As we have seen above, economic crises and world revolutions have been important elements in the evolution of capitalism and global governance institutions for centuries.

            Thus, in comparison with the earlier modes, capitalism is yet young. On the other hand, many have observed that social change has speeded up. The rise of tribute-taking based on institutionalized coercion took tens of thousands of years. Capitalism itself speeds up social change because it revolutionizes technology so quickly that other institutions are brought along, and people have become adjusted to more rapid reconfigurations of culture and institutions.

            For Immanuel Wallerstein (1974), capitalism started in the 16th century, grew larger in a series of cycles and upward trends, and is now nearing “asymptotes” (ceilings) as some of its trends create problems that it cannot solve. Thus, for Wallerstein the world-system became capitalist and then it expanded until it became completely global, and now it is coming to face a big crisis because certain long-term trends cannot be accommodated within the logic of capitalism (Wallerstein 2003). The three long-term upward trends (ceiling effects) that capitalism cannot manage are:

1.      the long-term rise of real wages;

2.      the long-term costs of material inputs; and

3.      taxes.

All three upward trends cause the average rate of profit to fall. Capitalists devise strategies for combating these trends (automation, capital flight, job blackmail, attacks on the welfare state and unions), but they cannot really stop them in the long-run. Deindustrialization in one place leads to industrialization and the emergence of labor movements somewhere else (Silver 2003). The falling rate of profit means that capitalism as a logic of accumulation will face an irreconcilable structural crisis during the next 50 years, and some other system will emerge. Wallerstein calls the next five decades “The Age of Transition.”

Wallerstein’s “Age of Transition” is the next 50 years. Most analysts do not have that kind of time horizon. He sees recent losses by labor unions and the poor as temporary. He assumes that workers will eventually figure out how to protect themselves against market forces and capitalists. This may underestimate somewhat the difficulties of mobilizing effective labor organization in the era of globalized capitalism, but he is probably right in the long run. Global unions and political parties could give workers effective instruments for protecting their wages and working conditions from exploitation by global corporations if North/South issues that divide workers could be overcome.

Wallerstein is intentionally vague about the new system that will replace capitalism (as was Marx). He sees the declining hegemony of the United States and the crisis of neoliberal global capitalism as strong signs that capitalism can no longer adjust to its systemic contradictions. He contends that world history has now entered a period of chaotic and unpredictable historical transformation. Out of this period of chaos a new and qualitatively different system will emerge. It might be an authoritarian (tributary) global state that preserves the privileges of the global elite or an egalitarian system in which non-profit institutions serve communities (Wallerstein 1998).

Giovanni Arrighi’s (1994) evolutionary account of “systemic cycles of accumulation” has solved some of the problems of Wallerstein’s notion that world capitalism started in the long 16th century and then went through repetitive cycles and trends. Arrighi’s account is explicitly evolutionary, but rather than positing “stages of capitalism” and looking for each country to go through them (as most of the older Marxists did), he posits somewhat overlapping global cycles of accumulation in which finance capital and state power take on new forms and increasingly penetrate the whole system. This was a big improvement over both Wallerstein’s world cycles and trends and the traditional Marxist national stages of capitalism approach.

            Arrighi’s (1994, 2006) “systemic cycles of accumulation” are more different from one another than are Wallerstein’s cycles of expansion and contraction and upward secular trends. And Arrighi (2006) has made more out of the differences between the current period of U.S. hegemonic decline and the decades at the end of the 19th century and the early 20th century when British hegemony was declining. The emphasis is less on the beginning and the end of the capitalist world-system and more on the evolution of new institutional forms of accumulation and the increasing incorporation of modes of control into the logic of capitalism. Arrighi (2006), taking a cue from Andre Gunder Frank (1998), saw the rise of China as portending a new systemic cycle of accumulation in which “market society”  will eventually come to replace rapacious finance capital as the leading institutional form in the next phase of world history.

Wallerstein’s version is more apocalyptic and more millenarian. The old world is ending. The new world is beginning. In the coming bifurcation what people do may be prefigurative and causal of the world to come.   Wallerstein agrees with the analysis proposed by the students of the New Left in 1968 (and large numbers of activists in the current global justice movement) that the tactic of taking state power has been shown to be futile because of the disappointing outcomes of the World Revolution of 1917 and the decolonization movements (but see below). 

Economic Globalization

          Regarding the issue of whether or not the recent meltdown is itself a structural crisis or the beginning of a long process of transformation, it is relevant to examine recent trends in economic globalization. Is there yet any sign that the world economy has entered a new period of deglobalization of the kind that occurred in the first half of the 20th century?

Immanuel Wallerstein contends that globalization has been occurring for five hundred years, and so there is little that is importantly new about the so-called stage of global capitalism that is alleged to have emerged in the last decades of the 20th century. Well before the emergence of globalization in the popular consciousness the world-systems perspective focused on the world economy and the system of interacting polities, rather than on single national societies. Globalization, in the sense of the expansion and intensification of larger and larger economic, political, military and information networks, has been increasing for millennia, albeit unevenly and in waves. And globalization is as much a cycle as a trend (see Figure 5). The wave of global integration that has swept the world in the decades since World War II is best understood by studying its similarities and differences with the waves of international trade and foreign investment expansion that have occurred in earlier centuries, especially the last half of the nineteenth century.

Wallerstein has insisted that U.S. hegemony is continuing to decline. He interpreted the U.S. unilateralism of the Bush administration as a repetition of the mistakes of earlier declining hegemons that attempted to substitute military superiority for economic comparative advantage (Wallerstein 2003). Most of those who denied the notion of U.S. hegemonic decline during what Giovanni Arrighi (1994) called the “belle epoch” of financialization have now come around to Wallerstein’s position in the wake of the current global financial crisis. Wallerstein contends that once the world-system cycles and trends, and the game of musical chairs that is capitalist uneven development, are taken into account, the “new stage of global capitalism” does not seem that different from earlier periods.

Figure 5: Trade Globalization 1820-2009: World Imports as a % of World GDP[2] (Sources: Chase-Dunn, Kawano, and Brewer 2000; World Development Indicators, 2011)


Figure 5 is an updated version of the trade globalization series published in Chase-Dunn, Kawano and Brewer 2000). It shows the great 19th century wave of global trade integration, a short and volatile wave between 1900 and 1929, and the post-1945 upswing that is characterized as the “stage of global capitalism.” The figure indicates that globalization is both a cycle and a bumpy trend. There have been significant periods of deglobalization in the late 19th century in the first half of the 20th century.

Figure 6: Trade Globalization Since 1970 (Sources: Chase-Dunn, Kawano, and Brewer 2000; World Development Indicators, 2011)


Figure 6 displays the same series as in Figure 5, except that it starts in 1970 instead of 1820. This enables us to see more clearly what has happened in the last four decades.  As mentioned above, the long-term upward trend has been bumpy, with occasional down-turns such as the one shown in the 1970s.  But the down-turns since 1945 have all been followed by upturns that restored the overall upward trend of trade globalization. The large decrease of trade globalization in wake of the global financial meltdown of 2008 represents a 21% decrease from the previous year, the largest reversal in trade globalization since World War II. The question is whether or not this sharp decease represents a reversal in the long upward trend observed over the past half century. Is this the beginning of another period of deglobalization?

Figure 7: Investment Globalization 1970-2010[3] (Sources: World Development Indicators, 2011)

A similar series that shows total FDI (foreign direct investment) as a percentage of global GDP is shown in Figure 7.  This shows a long relatively flat period from 1970 to 1990 followed by a very steep upsurge until 2000, then a steep drop which is then followed by a steep recovery and then another drop.  Investment globalization is much more volatile than is trade globalization (compare Figures 6 and 7).  While trade globalization flattened in the first years of the 21s century, investment globalization took a sharp dive between 2000 and 2004 and sharply recovered and then took another dive from 2008 to 2010.

The World Revolution of 20xx

            The contemporary world revolution is similar to earlier ones, but also different. Our conceptualization of the New Global Left includes civil society entities: individuals, social movement organizations, non-governmental organizations (NGOs), but also political parties and progressive national regimes. In this paper we will focus mainly on the relationships among the movements and the progressive populist regimes that have emerged in Latin America in the last decade and on the Arab Spring that began in Tunisia in December of 2010.  We understand the Latin American “Pink Tide” regimes to be an important part of the New Global Left, though it is well-known that the relationships among the movements and the regimes are both supportive and contentious.

            The boundaries of the progressive forces that have come together in the New Global Left are fuzzy and the process of inclusion and exclusion is ongoing (Santos 2006). The rules of inclusion and exclusion that are contained in the Charter of the World Social Forum, though still debated, have not changed much since their formulation in 2001.[4]

            The New Global Left has emerged as resistance to, and a critique of, global capitalism (Lindholm and Zuquete 2010). It is a coalition of social movements that includes recent incarnations of the old social movements that emerged in the 19th century (labor, anarchism, socialism, communism, feminism, environmentalism, peace, human rights) and movements that emerged in the world revolutions of 1968 and 1989 (queer rights, anti-corporate, fair trade, indigenous) and even more recent movements such as the slow food/food rights, global justice-alterglobalization, anti-globalization, health-HIV and alternative media) [Reese et al 2008]. The explicit focus on the Global South and global justice is somewhat similar to some earlier instances of the Global Left, especially the Communist International (COMINTERN), the Bandung Conference and the anti-colonial movements. The New Global Left contains remnants and reconfigured elements of earlier Global Lefts, but it is a qualitatively different constellation of forces because:

1.      there are new elements,

2.      the old movements have been reshaped, and

3.      a new technology (the Internet) is being  used to mobilize protests in real time and to try to resolve North/South issues within movements and contradictions among movements. 

            There has also been a learning process in which the earlier successes and failures of the Global Left are being taken into account in order to not repeat the mistakes of the past.  Many social movements have reacted to the neoliberal globalization project by going transnational to meet the challenges that are obviously not local or national (Reitan 2007).  But some movements, especially those composing the Arab Spring, are focused mainly on regime change at home. The relations within the family of antisystemic movements and among the Latin American Pink Tide populist regimes are both cooperative and competitive. The issues that divide potential allies need to be brought out into the open and analyzed in order that cooperative efforts may be enhanced and progressive global collective action may become more effective.

The Pink Tide

The World Social Forum (WSF) is not the only political force that demonstrates the rise of the New Global Left. The WSF is embedded within a larger socio-historical context that is challenging the hegemony of global capital. It was this larger context that facilitated the founding of the WSF in 2001. The anti-IMF protests of the 1980s and the Zapatista rebellion of 1994 were early harbingers of the current world revolution that challenged the neoliberal capitalist order. And the World Social Forum was founded explicitly as a counterhegemonic project vis a vis the World Economic Forum ( an annual gathering of global elites founded in 1971),

            World history has proceeded in a series of waves. Capitalist expansions have ebbed and flowed, and egalitarian and humanistic counter-movements have emerged in a cyclical dialectical struggle. Polanyi (1944) called this the double-movement, while others have termed it a “spiral of capitalism and socialism.” This spiral of capitalism and socialism describes the undulations of the global economy that have alternated between expansive commodification throughout the global economy, followed by resistance movements on behalf of workers and other oppressed groups (Boswell and Chase-Dunn 2000). The Reagan/Thatcher neoliberal capitalist globalization project extended the power of transnational capital. This project has reached its ideological and material limits. It has increased inequality within some countries, exacerbated rapid urbanization in the Global South (so-called Planet of Slums [Davis 2006]), attacked the welfare state and institutional protections for the poor, and led to global financial crisis.

            A global network of counter-movements has arisen to challenge neoliberalism, neoconservatism and corporate capitalism in general. This progressive network is composed of increasingly transnational social movements as well as a growing number of populist governments in Latin America – the so-called Pink Tide. The Pink Tide is composed of populist leftist regimes that have come to state power in Latin America, some of which advocate dramatic structural transformation of the global political economy and world civilization.

            An important difference between these and many earlier Leftist regimes in the non-core is that they have come to head up governments by means of popular elections rather than by violent revolutions. This signifies an important difference from earlier world revolutions. The spread of electoral democracy to the non-core has been part of a larger political incorporation of former colonies into the European interstate system. This evolutionary development of the global political system has mainly been caused by the industrialization of the non-core and the growing size of the urban working class in non-core countries (Silver 2003). While much of the “democratization” of the Global South has consisted mainly of the emergence of “polyarchy” in which elites manipulate elections in order to stay in control of the state (Robinson 1996), in some countries the Pink Tide Leftist regimes have been voted into power. This is a very different form of regime formation than the road taken by earlier Leftist regimes in the non-core. With a few exceptions earlier Left regimes came to state power by means of civil war or military coup.

            The ideologies of the Latin American Pink Tide regimes have been both socialist and indigenist, with different mixes in different countries. The acknowledged leader of the Pink Tide as a distinctive brand of leftist populism is the Bolivarian Revolution led by Venezuelan President Hugo Chavez. But various other forms of progressive political ideologies are also heading up states in Latin America. Indigenist and socialist Evo Morales is president of Bolivia. The Fidelistas in Cuba remain in power. The Brazilian Workers Party is still an important player, though its elected presidents have been pragmatic politicians rather than revolutionary leaders.. In Chile social democrats are in power. Sandinistas in Nicaragua and the FMLN in El Salvador have elected national leaders. Argentina bravely and unilaterally restructured its own debt obligations in 2005. The President of Peru is a leftist.  And several European-style social democrats lead some of the Caribbean islands.

Most of these regimes are supported by the mobilization of historically subordinate populations including the indigenous, poor, and women. The rise of the voiceless and the challenge to neoliberal capitalism seemed to have its epicenter in Latin America before the emergence of the Arab Spring. While there are important differences of emphasis among these Latin American regimes, they have much in common, and as a whole they constitute an important bloc of the New Global Left. We agree with William I. Robinson’s assessment of the Bolivarian Revolution and its potential to lead the global working class in a renewed challenge to transnational capitalism (Robinson 2008).

            The rise of the left has engulfed nearly all of South America and a considerable portion of Central America and the Caribbean. Why has Latin America been the site of both populist Leftist regimes and most of the transnational social movements that contest neoliberal capitalist globalization up until recently? We suggest that part of the explanation is that Latin America as a world region has so many semiperipheral countries. These countries have more options to pursue independent strategies than the mainly peripheral countries of Africa do. But some of the Pink Tide countries in Latin America are also peripheral. There has been a regional effect that did not seem to be operating in either Africa or Asia. The Pink Tide phenomenon and the anti-neoliberal social movements may have been concentrated in Latin America because the foremost proponent of the neoliberal policies has been the United States. Latin America has long been the neocolonial “back yard” of the United States. Most of the people of Latin America think of the United States as the “colossus of the North.” The U.S. has been the titular hegemon during the period of the capitalist globalization project, and so the political challenge to neoliberalism has been strongest in that region of the world. Both Africa and Asia have a more complicated relationship with former colonial powers and with the U.S. hegemony.

           President Hugo Chavez of Venezuela is perhaps the most vocal advocate of an alternative to global capitalism, and his advocacy is greatly aided by the massive Venezuelan oil reserves. The Banco del Sur (Bank of the South) the Chavez has founded, for example, has been joined by many Pink Tide nations and seeks to replace the International Monetary Fund and the World Bank in sponsoring development projects throughout the Americas. The goal is to become independent of the capitalist financial institutions headquartered in the Global North.

            The early Structural Adjustment Programs imposed by the International Monetary Fund  in Latin America in the 1980s were instances of “shock therapy” that emboldened domestic neoliberals to attack the “welfare state,” unions and workers parties. In many countries these attacks resulted in downsizing and streamlining of urban industries, and workers in the formal sector lost their jobs and were forced into the informal economy, swelling the “planet of slums” (Davis 2006).  This is the formation of a globalized working class as described by Bill Robinson (2006). In several countries the swollen urban informal sector was mobilized by political leaders into new populist movements and parties, and in some of these, the movements were eventually successful in electing their leaders to national power, creating the Pink Tide regimes. Thus did neoliberal Structural Adjustment Programs provoke counter-movements that eventuated in the Pink Tide regimes..

            The very existence of the World Social Forum owes much to the Pink Tide regime in Brazil. The Brazilian transition from authoritarian rule in the 1980s politicized and mobilized civil society, contributing to the elections of leftist presidents. One of these was Fernando Henrique Cardoso, a famous Brazilian sociologist who was one of the founders of dependency theory. The Brazilian city of Porto Alegre, where the first World Social Forum meetings were held, had been a stronghold for the Brazilian Worker’s Party.  The World Social Forum was born in Porto Alegre with indispensible help from the Brazilian Worker’s Party and its former leadey who had been elected President of Brazil, Luis Lula Ignacio ds Silva. The political trend of the Pink Tide was an important element in context and conditions that allowed for the rise of the World Social Forum.  

           The relations between the progressive transnational social movements and the regimes of the Pink Tide have been both collaborative and contentious. We have already noted the important role played by the Brazilian Workers Party in the creation of the World Social Forum. But many of the activists in the movements see involvement in struggles to gain and maintain power in existing states as a trap that is likely to simply reproduce the injustices of the past. These kinds of concerns have been raised by anarchists since the nineteenth century, but autonomists from Italy, Spain, Germany and France now echo these concerns. And the Zapatista movement in Southern Mexico, one of the sparks that ignited the global justice movement against neoliberal capitalism, has steadfastly refused to participate in Mexican electoral politics. Indeed the New Left led by students in the World Revolution of 1968 championed a similar critical approach to the old parties and states of the Left as well as involvement in electoral politics. As mentioned above, Immanuel Wallerstein (1984b, 2003) agrees with this anti-statist political stance. This anti-politics-as-usual has become embodied in the Charter of the World Social Forum, where representatives of parties and governments are theoretically proscribed from sending representatives to the WSF meetings.[5]

            The older Leftist organizations and movements are often depicted as hopelessly Eurocentric and undemocratic by the neo-anarchists and autonomists, who instead prefer participatory and horizontalist network forms of democracy and eschew leadership by prominent intellectuals as well as by existing heads of state. Thus when Lula, Chavez and Morales have tried to participate in the WSF, crowds have gathered to protest their presence.  The organizers of the WSF have found various compromises, such as locating the speeches of Pink Tide politicians at adjacent, but separate, venues.  An exception to this kind of contention is the support that European autonomists and anarchists have provided to Evo Morales’s regime in Bolivia (e.g. Lopez and Iglesias 2006). 

Latin America has been the epicenter of the contemporary world revolution. If the movements and the progressive regimes could work together this would be an energizing model for the other regions of the globe. The challenges are daunting but the majority of humankind needs organizational instruments with which to democratize global governance and the World Social Forum has been designed to be the venue from which such instruments could be organized.

The Meltdown and the Counter-movements

            What have been the effects of the global financial meltdown on the counter-movements and the progressive national regimes? The World Social Forum slogan that “Another World Is Possible” seems far more appealing now than when the capitalist globalization project was booming. Critical discourse has been taken more seriously by a broader audience. Marxist geographer David Harvey has been interviewed on the BBC.  The millenarian discourses of the Pink Tide regimes and the radical social movements seem to be at least partly confirmed. The “end of history” triumphalism and theories of the “new economy” seem to have been swept into the dustbin.  The world-systems perspective has found greater support, at least among earlier critics such as the more traditional Marxists.  The insistence of Wallerstein, Arrighi, and others that U.S. hegemony is in long-term decline has now found wide acceptance.

            On a more practical level, most of the social movement organizations and NGOs have had more difficulty raising money, but this has been counter-balanced by increased participation (Allison et al 2011). The environmental movement has received some setbacks because the issue of high unemployment has come to the fore.  The Copenhagen summit was largely understood to have been a failure. The wide realization that energy costs are going to go further up has increased the numbers who support the further development of nuclear energy, despite its long-run environmental costs. But the Japanese earthquake and nuclear meltdown has led to the declaration of a non-nuclear future by the German government.  And the radical alternative of indigenous environmentalism has gotten a boost (Wallerstein 2010). The World People's Conference on Climate Change and the Rights of Mother Earth, held in Cochabamba, Bolivia in April of 2010, discussed a Universal Declaration of the Rights of Mother Earth, a World People's Referendum on Climate Change, and the establishment of a Climate Justice Tribunal. The meeting was attended by 30,000 activists from more than 100 countries, and was financially supported by the governments of Bolivia and Venezuela.

The Arab Spring

          The movements that have swept the Arab world since December of 2010 are also part of the world revolution of 20xx and they may play a role in the New Global Left. As in earlier world revolutions contagion and new technologies of communication have been important elements. And as in earlier world revolutions, rather different movements stimulated by different local conditions converge in time to challenge the powers that be.  The Arab Spring movements have been rather different from the global justice movements. Their targets have mainly been authoritarian national regimes rather than global capitalism. Youthful demonstrators have used Facebook to organized mainly peaceful protests that have succeeded in causing several old entrenched regimes to step down.  The countries in which these movements have succeeded are not the poorest countries in Africa and the Middle East. Rather they have been semiperipheral countries in which a large mobilizable group of young people have access to social media. In many cases the old autocrats had been trying to implement austerity program in order to be able to borrow more money from abroad and this set the stage for the mass movements. But the Arab Spring movements have not explicitly raised the issues of austerity and global financial dependency.[6]  

The issues raised by the Arab Spring movements have mainly been about national democracy, not global justice.  But the example of masses of young people rallying against unpopular regimes now seems to be spreading to the second-tier core states of Europe.  Both Spain and Greece have seen large anti-austerity demonstrations that have been inspired by the successes of the Arab Spring.  And in these cases the connection with the global financial crisis is even more palpable. The austerity programs are the conditions imposed by global finance capital for reinflating the accumulation structures of these counties of the European second-tier core.  The popular anti-austerity rebellions might provoke an even deeper financial collapse if investors and their institutional agents lose faith in the ability of the system to reproduce the existing structures of accumulation. And successful anti-austerity movements might also spread even to some of the core states where severe fiscal crises have led to the dismantling of public services.  


          The financial meltdown of 2007-2008 was similar in some ways with earlier debt cycles, but different in others.  Despite greater reliance on a less centrally-coordinated market-based approach to debt problems and frequent comparisons with 1929, there has not yet been a total collapse of the global financial system. The Wall Street bail-out allowed the stock markets and the credit system to recover. And there has been a very slow recovery of the real economy with a continuing high level of unemployment. There have been few protectionist challenges to the “free trade” regime. No large movements toward trade protectionism of the kind that became rampant in the 1930s have yet emerged.  Trade globalization has seen a rather large decrease (Figures 5 and 6 above) and investment globalization has become wobbly, but it is not yet clear that these dips will be the beginning of another great wave of deglobalization. 

The United States has not seen a rebirth of strong anti-capitalist social movements of the kind that emerged in the 1930s. Rather the populist right is making the most hay out of anti-Wall Street sentiment. A “New Deal” situation has not emerged. Rather the right appears to be gaining support by accusing the black President of being a socialist and a Muslim, while those on the Left who are disgruntled by what has happened see him more as a Hoover than a Roosevelt.  All this portends the continuation of the slow decline of U.S. hegemony rather than any abrupt descent or another round of hegemony by the U.S. This is not surprising from the point of view of world-systemic cycles of hegemonic rise and fall.

But things are more interesting in the semiperiphery and the Global South. So far the U.S. has not used much muscle in opposition to the rise of the Pink Tide in Latin America. Expensive U.S. military involvements in the Middle East and Central Asia have continued, and these may partly explain the relative inaction in Latin America.  Can the progressive transnational social movements and the left populist regimes of the Pink Tide forge a coalition that can move toward greater global democracy? Could the emergent democratic regimes in the Arab world and protests against the austerity imposed by finance capital in the European second-tier core lead to a situation in which a strong force for global social democracy would challenge the powers that be? As in earlier world revolutions the institutions of global governance are likely to be reshaped by forces from below. Hopefully a more democratic and collectively rational global commonwealth can emerge without the violence and totalitarianism that was so prevalent in the first half of the 20th century.


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[1] Suter (2009:8) points out that there is no international bankruptcy law for sovereign (government-guaranteed) debt of the kind that exists at the national level. The principle of sovereign immunity, which goes back to the Treaty of Westphalia, holds that governments cannot be sued in foreign courts without their consent. After the 1970s both the U.S and Britain implemented a more restrictive interpretation of sovereign immunity.

[2] Using Mitchell’s (1992; 1993; 1995) national estimates of imports in country currencies, Chase-Dunn et al. (2000) created a measure of trade globalization from 1795 to 1995.  While Chase-Dunn et al. explored the possibility of converting these import estimates to comparable currency units by using exchange rates (FX) between country currencies and the US dollar, this strategy proved unrealistic as it assumes that FX transformations accurately reflect the relative value of goods and services in different countries.  Although a popular solution to remedy the “shortcomings” of FX has been to convert these measures into purchasing power parities (PPP) – which estimate the price for a domestic basket of goods for a more relative estimate of national currencies (Firebaugh 2003) – Korzeniewicz and Moran (2009: 60-63) show that PPP estimates are unrealistic for research that examines long periods of time unless PPP weights are recalculated for earlier time periods. Given the issues associated with currency conversion, Chase-Dunn et al. carefully compiled their estimate of trade globalization by computing each nation’s level of international trade openness separately.  To do this, they computed a nation’s level of trade openness (imports/GDP) using local currencies in both the numerator and denominator, thus eliminating the need to convert local currencies into US dollars or other comparable units.  These scholars then took each nation’s trade openess ratio (trade/GDP) and weighted the ratios by multiplying them by a country’s population, which is estimated as a proportion of the world population (for a more detailed description see Chase-Dunn et al. 2000:84-86).  But while the Chase-Dunn et al. estimates of trade globalization end in 1995,  Figure 5 extends the estimates using data from the World Development Indicators (World Bank 2009; 2010). We also compared Chase-Dunn’s trade data to the World Development Indicator’s trade data for the 1960 to 1995 period and found a high degree of similarity between these measures.

[3] Data for foreign direct investment (FDI), unlike trade, were much more limited across time.  All FDI data were found in the World Development Indicators (World Bank 2009; 2010).  The World Bank retains a comprehensive database on both inflows and outflows of FDI from 1970 to present times.  We use FDI inflows, which the World Bank calculates as the total inflow of investment in an enterprise that is operating in an economy other than that of the investor.  This includes equity capital, reinvestment of earnings, and all other long-term and short-term capital as reported in the balance of payments.  The total sum of world FDI inflows is reported as a proportion of world GDP.


[4] The Transnational Social Movement Research Working Group at the University of California-Riverside has studied the movements participating in the World Social Forum since 2005. The project web page is at

[5] The charter of the World Social Forum does not permit participation by those who attend as representatives of organizations that are engaged in, or that advocate, armed struggle. Nor are governments, confessional institutions or political parties supposed to send representatives to the WSF. See World Social Forum Charter

[6] The NATO intervention in Libya mainly illustrates the illegitimacy of both Khadafy and of the nascent global state that is seeking to depose him.