In These New Times

A Programme for the End of Empire

Cailean Bochanan

7th March, 2010

With an election coming soon and Britain blindly heading towards the abyss now is the time to put forward a programme of action to get ourselves out of the deep hole we have dug, and persist in digging, for ourselves. The world’s foremost debtor nation per head, bankruptcy proceedings seem inevitable, both for our citizenry and for UK PLC, and the question must inevitably arise of where the bailout money has gone and how we manage to run prohibitively expensive wars on other peoples money especially when these same wars seem to be directed against those creditors themselves.

Trying to characterise Britain today one word insistently comes to mind; parasitism. I don’t mean this simply as a term of abuse although it certainly could be. It is simply a notion which forces itself on us when we try to answer the question of how we pay our way in the world. After all our industrial base is largely gone, a fact  eloquently attested to by the fact that a near one third fall in the value of sterling has done nothing to improve our balance of trade. Evidently our agriculture cannot suffice to maintain our accustomed life style since much of our food is imported. No country could expect to prosper under these conditions but, strangely, fortune continues to favour us: we continue, in general, to enjoy a favourable standard of living  compared to most places and immigrants continue to see it as a place worth coming to.

In fact, we continue to pay our way in the world using,… well, money. Specifically pounds sterling, which continue to roll hot off our presses. But how can we use these to finance a massive and persistent trade deficit and how, given that we also print these to create a massive internal debt, of government, corporation and private citizen do our  trade partners not become wary of accepting them. In its heyday the pound sterling was backed by gold as was the dollar until 1971. It is an anomalous and unprecedented situation that a nation can run a trade deficit in perpetuity on the basis of a fiat currency used as a means of international payment. That this situation prevails with regard to the dollar is well known and well documented: it has become recognised as the global reserve currency. But, in essence Britain also enjoys the same privilege. The basic elements of the situation are the same: a massive trade deficit is paid for in pounds which presumably are the same pounds which are recycled into UK government bonds which are pound denominated and to a large extent held abroad. This is clearly a very convenient arrangement, but what could make such an arrangement possible? What underpins it? It basis lies in British, or rather Anglo-American, prestige, that is to say, power and influence which , in the last analysis, is based on military force.

But let us return to my characterisation of Britain as parasitic. Let me clarify this. Britain is rather the host and the parasite is financial power and its sisters, war and want. The parasite destroys the host just as it seeks to extend its tentacles globally destroying all who allow it in. Historically this final decadent phase of Anglo-American power issued from the Thatcher-Reagan revolution. A high pound/dollar based on high interest rates destroyed most of the industrial base and formed the basis of a new phase of Wall Street/City of London dominance and a new cycle of wars although, it has to be said, flowing fairly seamlessly out of older cycles of war. We established, if you like, permanent war on a more permanent basis, a process which we have, more recently,  institutionalized and theorized within NATO, the ultimate instrument of war, of the triumph of brute force over international law. There is , of course, an exception to the de-industrialization of US/UK: the military-industrial-complex straddling both countries remains sacrosanct and flourishes in proportion to our reliance on military force to maintain our “prestige”.

The logical connection between war and the bizarre form of imperial privilege I have outlined above is  illustrated by the attack on Saddam who was trading oil in Euros and the hostility to Iran who is doing the same. Indeed, those who founded the Euro may have been unaware of the stir it would cause, and may well have been taken by surprise by the campaign now launched to destroy it, a campaign emanating, of course, from London and Washington. That European elites have been caught unawares is no surprise given the ease with which they were lured into a war against themselves in Yugoslavia.

The emergence of a system based on finance(debt), permanent war and expansion was, as I never tire of pointing out, documented in a series of pamphlets written by Jonathan Swift in the midst of the great losing battle against Whig hegemony he fought around 1711/1712. These writings are invaluable in showing the system in embryo.The evolution of this system culminated in what we see now with the metropolitan powers as debtors and the emerging, onetime third world powers as creditors in a bizarre inversion of the more straight forward system of usury which J.A Hobson and Lenin described. Through the black arts of finance, threats and naked brute force we intend to force feed  the whole world on worthless paper and destroy the sovereignty of nations by forcing privately incurred debt to be taken on by the state, in a process whose telos or end point is a global system of feudalism in which a small oligarchy presides over a decimated world population reduced to total slavery. Many commentators  seem to feel this is an inevitability choosing to see in the multipolar world a mere redivision amongst elites, a mere deception. I beg to differ: the nascent global oligarchy has no intention of sharing the world with the European bourgeoisie, Chinese communists, Bolivaristas, Argentinian nationalists,Islam or Russian nationalists like Putin. It intends to destroy them, pure and simple. It is on the basis that the multipolar world is  a reality, in other words, that the above powers do indeed serve as a barrier to Anglo-American power projection that I seek to draw up a political programme for Britain. Otherwise, I wouldn’t think it worth the trouble. In other words, I see the above system as entering a terminal phase in which the choice is between the ultimate war of destruction with no winners or the acceptance of the new multipolar reality and the reconstruction of Britain as a European nation amongst a global community of nations.

So I view Britain having the following three interlocking features:

1) A military power, permanently engaged in war, continually generating new enemies (or revisiting old enemies like Argentina) and with a correspondingly large military budget and influential military-industrial lobby.

2)A country living beyond its means with huge internal and external debts. The state has bankrupted itself taking on the debt of the banks, much of which could be in foreign currency which we don’t have, and crucially is dependent on capital inflows

3)A depleted industrial/agricultural base and  infrastructure in an advanced state of decay. PFI or private/public partnership schemes have only increased the cost and deferred the day of reckoning.

These are the characteristic symptoms of the disease called oligarchy, the rule of unaccountable, cosmopolitan,monopolistic elites. The cure would then appear to be democracy, understood as the restoration of accountable, sovereign government in the interests of all. A democratic programme, clearly anathema to the oligarchy, would then take as its starting point the above features. It would:

1) Bring to an end the wars in Iraq and Afghanistan. Reduce military spending to normal levels adequate for national defence or as a share in legitimate regional security arrangements. Convert military production to civil production. Seek friendly rather than hostile relations with our international partners.

2) Put UK PLC through bankruptcy process with taxpayer as priority creditor regarding funds donated to the banks. In other words the funds to be traced and returned to Treasury ( Most of them will stashed offshore or channelled into assorted carry trades). Renegotiate foreign obligations with a view to getting them written off with imperial retrenchment described above as quid pro quo.

3)Begin reconstruction of Britain. This will be difficult without continued capital inflows from abroad. 1) and 2) above will help facilitate this as will the fact that the reconstruction of the real economy will begin to end our trade imbalances and restore Britain’s credibility. A national investment bank will be set up to direct investment towards necessary industrial, infrastructural and agricultural developments.

This the merest outline of a programme. The question a new constitutional structure for Britain which will undoubtedly be necessary has not been dealt with. Continual reference to the USA is natural since it is difficult to see these two powers as acting completely separately. As an example, BAE, essentially Britain’s military-industrial network has in the US government its main client. Britain also plays an unusual role in maintaining the dollar seemingly at the expense of the pound: to this end we sold our gold reserves at great loss and are now accumulating US government bonds at great speed, holding over $300 bullion worth. This confirms that Britain acts more a base of operations for a supranational project than as a nation state.