The Global GamblelVashington's Faustian Bid for llVorld Dom:inance

PETER GOWAN

VERSO

London I'lew Yorl:

TO MY SONS

First publishod h~' Verso -t mlH Ii) Peter Gowan 19n9 All rights rusmved The 11I0rai rIghts of the author havu boon3 5 7 " 10 R 6 ~ Zass(~rt[J[1

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Verso UK: G )I.leard Stroet, London \VIF oEG USA: 1110 Vanek Streut. New York. NY tOOH--tliIJ(i wW\\'. vorsohooks.!:ol1l

Vorso IS tim IIllpnnt of Now L(lfl Books ISBN l-U5~l8-1-1174-5 ISBN l-II!i!J/J.J-Z7t-2 (pbk)

British Library Catalugumg in Publica lion Data t\ catalogue rncord for this hook IS available from the Brilish Librar.\' Library of Congress Cataloging-III.Publication Dala A catalog rucord for this book is i1vailable li'DlIl the Lihrary of CongmssTypes!!t by 1\1 Rules Printed and hOllnd ill Groat )]l'il'ifll)' U,jllrm. I ~Ji 1-19i1 (!'ids"", I !17i), :!, Sl"" .I"hll \\'illialllslIlI. nu' I';,il/lll' IIf 1"""I1I/IIIII/II/,I/(JII ..I,,,.\" U,p".m, I (Ii I-i' (:\l'I"II1, r~li7l, I' :Ii :1, S,', T.. , /1;111, ()/'rc. T/,,./III/1I,''\/,,,r" ,I. S,," A, .\, KlIllu!'! alld S, ~\;'"'III'. "Thl' 1'lllillr:oI [('001100111\' or \Iiddl .. Ea,'II"1'II (IiI'. III (:" R. D, l'lIllt"rl,ill :'lId R" SllIhbs. /'u/iliml h"",,/I'\' 11111/ /1,,' CIIIIII!!'I"!!' (;1"/,,,1 (htf,.,. (~I:ll'IlIillall. I ~1!11)" :J. S,," \'. H, 0PP"IIIIl'IIIl, '\I'h)" ()il I'l'Ir", (:00 L'p~ TIl, exceeds that of France, Germany, and haly,l:1 He aiso, of course, would make the spurious cbum that the mllows of' speclilauve Atlantic funds JnlO these seCUrlLles markets III the 1990s were a kind of nct aid for the de"e1opment of' productive capllal in the region, The reality was exactly the reverse; in his Per./acobssoIl LeClllre to the assembled centn\i bankers and government oHicials m Hong Kong (Il!' the !MF /WB meetlllgs tn Septembel' 1997, the Clue/' ExeclItlvc of the Hong Kong rV!oJletary AlIlhol'lty explamed the SlluaLlOIl as follows: 'Milch orAsl'II:-.'ISTRXrlO;\i

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the reSI orlile world, thlls easlI1~ leliSIOliS wit hill the cure. En~n Illore imporlalll. Illdia IlIdireClly slislallll'd d\(' 11l1('rtl;tlHlIlal mO\ll'Wry syslCIll or the day. I r the Indian lIlarkl'1 had dosed alld LancashIre had collapsed. lhe pn:sSlires, already g-ro\\'illg- \\,lIhlll the LIK lIlduslrial heartlalld III lhe early l\\'l'lllielh ('clltlln,S ror prllteCliollislll wOlild han' beell ullstoppablc. IF the UK llacl opted fill' protectiollism. Lhe IlIlerllal10llallllClllelary syslelll would Ila\'l' bl'l'11 scrapped. :\11 allalog-ous S\'SIl'1ll has (it-\'(:Ioped ill lhl' COlileXt ()r the core stagllation ()r 11ll' last qllarter of a Cll1tlll~. Tht' LIS has sOllght to use the ckpl'nclent Supp()rt-regItll hL' also silared a 'g-lobalisL' Vlel\'. Till' olltlook oj' thIS new team I\',IS expressed 1Il hooks like L\lIl~\ Tvsoll \ "'l1O \- IJtI.\hi 11K IV/Will and bva host or other such works b\' those wllhlll or dose to thl' adlllllllstratioll. ls The ollliook I\'as orten l'xpress~d most hllll\ll\' by Clil1loll's Ilew US Trade RepresentalJ\'(.', iVlicke\' I';.anlOr, who openly argued for a lIew kind oL-\merican Open Door stratq,,'y to ensure thatlhe twentv-lirst cellllll'V will he the 'New Amencan Centur\" As he plll It: 'The days Ihl' Cold War, when we sometimes looked the other war whell our tradingII.

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partners Eli led to live lip to thell' obligallllils. an: IIIlr. \!auollal seCllJ"ltl' alld our n;l1ll1l1al t'conOIl1K secunty Clllllol iw .~epar.tlt"(I. . No more sOIlll"thrrlgror IIt)tlllll~. IlO mllrc fn-c riders.' I!I Kalltor's lillkage IIr eXlernal l'l"OJlOJl11l" ()1~Jel'IJ\'l'S alld US Nallorr;11 Se("UJ"lty "';IS rdll"t"ll'c1 III Clinton"s n.'llIlHllding oj" insllllltiolls ill Ihl' con' exeCUtI\'l':.lUst aner Clillton 's lI1aug'urallDlI 1H' created a NatIOnal ECOJloJlJIC Council Il'lthlll the White House aiollg"sldl' the ~alional Sccunt\, (:oullcil. The chOICe or name was deslg"lIed to indicate t.hat Ihe IIl'W hod\' would acc)llire the kind or nodal roll' III LIS gioilai strate!,'")' which the NS(: had played dUring Ihe Cold War. At the sallie tlllle Congrcss Illstnlcted the COIllIlll:rCe Departlllent to set up till' Trade Prolllollon Co-ordillatillg COlllmlttl'e (T(>(;(;) to co-ordinate IIl1leteen LIS g(}\'{~rlllllCJlt agencies In the area "r conlllll'ITial policy, Instructive aisil was till' [;lCl that the head or till' Natloll,1I ECOIIllIllIC Council was to he a n:n' expl'l"lellced hedgc fund speculator. Robert. Ruil\ll, forlller sellinr partner III (;oldlllan Sachs, thc hcdge hllld masqueradillg as an Il1\'cstlllcnl bank.:!o ThiS ga\"l' the Clintoll tealll prlllle links Wllh Wall Strcet. Thc wav tilal the Clinton adllllnlstralloJl ddilled liS approach has hlTII sUlllllled lip I)V SOll1conc who was 1I11L1alh' part or ii, DaVId Rothkopf". He has charal'll'rtscd the Clinton adll11l1lstration' s ne\\' Illtl'l"llalional strateg~' as OIH' of 'ManIC l....len:alltilism' :!I Stanley HolTmall makes a sllllil;u' POIlI!, 1l0\Jllg the ne\\' US aCtiVIsm in world eCOIlOllllC ar!;urs ullder the Clinton adlllll1istratloJl alld its drive to ope)} borders to US goods. capllal and ser\"ices.~~

TIl(' Simllgll" FO("/Is (III ElIsl fllld SOlllh-Jo.'ml .. 1.1'/(/

It has bCl'1l wldch' sllggeslccI throughollt the C1illtoll Presidenn' I)\" mall\' altCJllJ\'c ohscl"\'ers lhal liS erforts III CCOIlII\llK slatecra!"t Ita\'e bcen Illallri\" directed at olle particular gcugrapillcal area: East alld South-East ASI". Rothkopf suggests tit IS was the Ill;UIl l11olI\'c fOI' til e enl1 rc d I"I\'C, S;l\'lllg: 'Collllllercial dipiolllac\', howe\'Cr eldil1l:cl ,lIlel practised, owes liS dc\'dopnll'nts as Illuch to the rise or A~ta 's elllt'rging econOIllles as Il docs to an\" othcr /"actor.' East and South-East ASIa \\"lTC o/" deCISI\'C IlllponanCl' if Ihl' United States 'was to mailltain its CClJ!lOllllC Ic;rdcrsillp :!:\ The (:lintol1 adllllllistratioll Ilcvcr admJUcci CJlllle thiS, or cOllrse. [t claimed IIlstead that Its targct was to bl'cak IIlLo what It Gtlled the 10 Big- Emerg-lIlg i'vlarkets (BEi\'!s): blll SIX or the tcn werc ill Asia: Chllla, Illdoncsia. Korca. Thailalld. i\laJa\'sia and Illdia, or the other (illlr, lite Unlled Statcs alrcadv had two: rv!olllllng 10 the lack of alHlllllallc slahilisers III lite con' ,'COliOlll\,. Tltl'lr queslIon: who will prmid(.' tlw 'Jlublic goods' of slahililY IS besl answen'c1 Ity sal'lIl!r II IS provided by the depend"nl suppnrl-collnllws of the SOlllh, even lhouJ.:h Ihe J.:omls Ihey provide an' nol r"all), 'puhlic' Slllce lhe~'.are l'1\IO\'"d only b\' Ih,' core ,'(:onollli,,,. On Ihl' lheon', set' \\'aher, I'll"'",. /Iud l\'mM ,\}I/Illi' (I-lan"sl"r). 10, P_ P;llIIaik. :\n'lIl11l1ll1ll1JlI 1I11d Sillbilily VII/I,'r (;u!Jllllli.\/11 (C1an'ndon Prl'ss, I !l!l7). II. ESllmates Ill' Mallh,,\\' Simon, cHed hI' Palnaik III Palltaik, _'\,-mllllllllIIlJl/ 1I11t1 .'i//lbilil\" f!!. Will l\1a rsh'all , head of Ihe I'nlJ.:r"ssin' Polin' Jnsllllll", 1\11.1!tillgl/J1/ }'o.\"I, :!I J)en',llIlwr 1!)9!!. 1:1. Rogel't>.lorns, ':\ Ne\\' ForeIgn Policy fill' a New Era', N,o" lillk /j/II".\. ~l lkn'lIlhl'r I !l!l!!. H. Asp"u III Dclcnc" had a 1lI11\"(' ani\'lst, radical aJ.;"nda_ I:'. S"", hll- exalllpl", Anlholl)' I-Ianl,,\", 'The C1illlllll :\ppm:Kh: IdealislII aud I'n\(!elll"(", 'l1I1' I\llIld '/il//III' (February 1!19:\). IIi. Of lhis lisl one parilal dissident was Rohert ReIch: he sharl'd a hcli"r in Slale ac!toll III IlIt"rnallOllalt'Cllllomics and his CDIICel'n 1'01' lahour slanrlards aud protectIon clluld h,' IIsl'!'II!1V IIlslrlllllelllali~ed ill el"!lI101I11C dipllllllacv ",'er lmde ISSIll'S. 1I\ll he lacked SOIlll' or Ihe Amen"aFirsl-III-b'el'ylhiug wal oflhe lIlhers alld drupped (Jill oflh" adllllluslI~llIOII e\enllla!l\". 17. GiOia IIlal'lnl allllJan Roorl, '1Ilalllt;lIlIlIIg Global DlIlIllll:llln:: The Ullu"d Slaies as a EII\"('p"an and ASlall 1'00\'"r' III Manalllll' \-all LeeulI'en and An[;e \bll'lIla (l'ds.), Sd,m ....

'"I1M

POWER POLITICS AND THE Cl.INTONl:'lIgl1g"III"lIi:

'-\[)~[[N[STRAT[ON

101

:\1111'1'11"1111 fOfr'lglI PolitI' tli th,' TII/,II "llh,' e,."lIlf\' (NI'lherlands AlIalllic the cOlltrar\'. In thc case or Kuwan. s()\'erel~nty WilS aclllel'C(I, above all, due to the streng-th or Bntish military power and political mJlul'l1ce throughout the penod lip to 1961 whcn II1tematlonal recug-IlIt1ol1 was granted. Such recol{l1ition of Slale sovcrelgnty IS, m thcory. a malleI' or international iaw, setllccinot by Simple force but by leg-a I title to tern tor\'. As It happens. Iraq had a very strong chulll, 11\ legal terms. to the terrllon' of !\.ulI'all. I!! But such chullls are 1;11' li'om being dCClslve for liberal de1l\ocrats or SOCIalists. It is significant that rIghtS-based liberalism does not, in hlCt, speak with one vOIce on the key quesllo11 of Iraq's denial of l-il{hlS III Kuwait, although lhel-c IS a common stress on the mfringement of individualliberucs b\' the Iraqi armed forces .u'lCl police. (According- to Amnesty's I1ndil1gs thiS Infringcment applied particularly to the ImprlSOl1l1lent of ii)rmer members of the: Ku\\'alli seclInty forces and to the savage repre.~sl!)I\ against slIspected armed resislCrs or SpICS, with 110 respect accorded to the due process or law. Expressions of CIVIC resistance - such as the refusal to usc lrac)1 number plates on cars - were aiso pUllIshcd. Kuwaitis lleclI\g Im'ariabl), suffered, though theil- we\lilre was probably lIot greatly affected_ On the other hand. Ill(' sufferings of the fleeing or deponed !lOll-KuwaIti seuled populatlOll were often conSiderable.) But what abollt till' IIlJlIStlCC or the alllll'X,lllOlI itself? This did not actually IIlvolvc a loss or CIVIC and polillcai rIghls 1'01' the m'~iority because, being debarred from holding ullzenshlp, they ha