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Hi, Yves. One of Richard Wolff’s key points is that even very early on, US military efforts to maintain and expand hegemony were not particularly successful, even though by the end of WWII the USSR had been weakened by the conflict and European countries had lost their empires, giving the US overwhelming advantage (coups are a whole other matter, e.g. Mossadegh in Iran is evidence of that). Despite the US’s role in WW1, even in the 1930s the US did not have a very large military by the standards of the time (and why would you if you were in a safe geographical position?). So I think part of our arrogance was due to our PR belief in winning WWII when the USSR was the overwhelming liability in Europe, and conflating US economic superiority with our ability to physically project force.
Richard D. Wolf is Professor Emeritus of Economics at the University of Massachusetts Amherst and Visiting Professor at the School of International Affairs at the New School in New York. Wolf’s weekly show, Economic Update, is broadcast on over 100 radio stations and reaches millions of viewers on multiple television stations and on YouTube. His latest show is Books on Democracy in Practice Published in 2024, Understanding Capitalism was a response to requests from readers of his previous books, Understanding Socialism and Understanding Marxism. An economy for alla project of the Independent Media Institute
Evidence suggests that empires often respond to their own decline by overextending their coping mechanisms. Military operations, infrastructure problems, and social welfare demands combine or clash, accumulating costs and rebound effects that a declining empire cannot cope with. Policies aimed at strengthening the empire—and once did—now weaken it. Contemporary social changes within and outside the empire can intensify, slow, or reverse decline. But decline can become self-accelerating if leaders deny its existence. In the early years of an empire, leaders and those led may emphasize decline or suppress those who simply mention it. Similarly, social problems may be denied, downplayed, or, if acknowledged, blamed on convenient scapegoats such as immigrants, foreign powers, or ethnic minorities rather than linked to the empire’s decline.
The American empire, boldly proclaimed by the Monroe Doctrine immediately after winning two wars of independence against Britain, grew throughout the 19th and 20th centuries, peaking in the decades between 1945 and 2010. The rise of the American empire coincided with the decline of the British Empire. The Soviet Union, while a limited political and military challenge, never posed a serious economic rivalry or threat. The Cold War was an asymmetrical struggle whose outcome was programmed from the beginning. All potential economic rivals or threats to the American empire were destroyed by World War II. In the years that followed, Europe lost its colonies. America’s unique global position at the time, with its disproportionate share in world trade and investment, was abnormal and probably unsustainable. The attitude of denial then, when decline was almost certain, too easily morphed into the attitude of denial now, when decline is well underway.
The United States was unable to win the entire Korean peninsula militarily in the Korean War of 1950-53. The United States was defeated in subsequent wars in Vietnam, Afghanistan, and Iraq. The NATO alliance was insufficient to change these outcomes. U.S. military and financial support for Ukraine, and the massive U.S. and NATO sanctions war against Russia, have so far failed and are likely to continue to fail. U.S. sanctions programs against Cuba, Iran, and China have also failed. Meanwhile, the BRICS alliance has countered U.S. imperial defense policies, including sanctions wars, with increasing effectiveness.
In the areas of trade, investment, and finance, the decline of the U.S. empire can be measured in a number of ways. One indicator is the decline of the U.S. dollar as a central bank reserve holding. Another is the decline of the U.S. dollar as a trade, lending, and investment vehicle. Finally, consider the decline of the U.S. dollar alongside its decline as an internationally desirable store of wealth. Across the global South, countries, industries, and businesses seeking trade, lending, and investment, for decades, went to London, Washington, and Paris, but now have other options. They can go instead to Beijing, New Delhi, and Moscow, where they can often secure more attractive terms.
Empires give special advantages that bring huge profits to companies based in the countries that control them. The 19th century was a remarkable time of endless conflict and struggle between empires over territory to control and increasing industrial profits. The decline of any one empire can expand opportunities for a rival empire; if the latter seizes the opportunity, the decline of the former can be exacerbated. One set of competing empires caused two world wars in the last century; another seems increasingly likely to cause an even worse, possibly nuclear, world war in this century.
Before the First World War, theories were widespread that the evolution from merely national to multinational corporations would end or reduce the danger of war. Owners and directors of increasingly global corporations would oppose war between nations as a logical extension of their profit-maximizing strategies. The two world wars of the 20th century upset these theories. The fact that multinational corporations increasingly bought off governments and subordinated national policies to the competing growth strategies of their corporations also upset these theories. Capitalist competition dominated national policies at least as much as vice versa. From these interactions came the 21st century wars in Afghanistan, Iraq, Syria, Ukraine, and Gaza. Similarly, from these interactions came the growing tensions between the United States and China around Taiwan and the South China Sea.
China presents unique analytical problems. The private capitalist half of its hybrid economic system presents a need for growth in tandem with a stimulating economy in which 90-100% of the companies are private capitalist in organization. The state-owned enterprises that make up the other half of the Chinese economy present different drivers and motivations. Profit is not their end goal as much as private capitalist enterprises. Similarly, the Communist Party’s governance of the state (including state regulation of the entire Chinese economy) introduces objectives other than profit that also dictate the decisions of the companies. China’s uniqueness may yield different outcomes than past imperial clashes, as China and its major economic allies (BRICS) now constitute a competing entity with the declining US empire and its major economic allies (G7).
In the past, one empire often replaced another. That may be the future of this century being the “Chinese” century. The previous empires were the US, the UK, etc. But China’s history also includes empires that have experienced the rise and fall before it. This is a unique feature of China. Will China’s past and present hybrid economy influence China not to become another empire, but rather to become a truly multipolar world organization? Will the dreams and hopes behind the League of Nations and the United Nations become reality when China makes it happen? Or will China become the next world hegemon amid growing resistance from the US, bringing the risk of nuclear war closer?
A look at broad historical parallels might shed some additional light on where today’s empire is headed, from a different angle. The movement for independence in the North American colonies infuriated Britain, which tried to thwart the movement in two wars (1775-1783 and 1812-1815). Both wars failed. Britain learned a valuable lesson: peaceful coexistence, with each planning and coordinating together, allowed both economies to function and grow, including cross-border trade and investment. This peaceful coexistence extended to the influence of one empire feeding into the influence of the other.
Why not chart a similar trajectory for the next generation of US-China relations? The world would prefer it to nuclear weapons, except for ideologues who are out of touch with reality. Addressing the two huge, undesirable consequences of capitalism, climate change and the unequal distribution of wealth and income, would be a project of US-China partnership that the world would admire. Capitalism has changed dramatically in both the UK and the US since 1815. The same will probably happen after 2025. The opportunities are temptingly endless.
