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THE RISE OF CHINA AND THE DEMISE OF THE CAPITALIST WORLD-ECONOMY Dr. Minqi Li, Assistant Professor Department of Economics, University of Utah Mailing Address: 343 South 500 East #537 Salt Lake City, UT 84102, USA Phone: 801-828-5279; 801-581-7697 E-mail: [email protected]; [email protected] York University, Toronto, Canada, April 24-27, 2008 Paper presented to the Historical Materialism Conference The Rise of China and the Demise of the Capitalist World-Economy (Minqi Li, Pluto Press, November 2008) • Introduction: China and the Capitalist World-Economy • Accumulation, Basic Needs, and Class Struggle: The Rise of Modern China • China and the Neoliberal Global Economy • Can the Capitalist World-Economy Survive the Rise of China? • Profit and Accumulation: Systemic Cycles and Secular Trends • The End of the Endless Accumulation • Between the Realm of Necessity and the Realm of Freedom: Historical Possibilities of the Twenty-First Century The Capitalist World-Economy • Inter-state competition (politically necessary for production for profit and capital accumulation) • Hegemonic State (system-level solutions to system-level problems) Historical Hegemonies • United Provinces (16th – 18th Century, less than a full nation-state) • United Kingdom (18th – 20th Century, an European nation-state with overseas colonial empires) • United State (20th Century – ?, a continent-sized state) Decline of US Hegemony? • US industrial, financial, and military power relative to other states • Is US still capable of providing system-level solutions to system-level problems? Share of World GDP, 1975-2006 0.24 0.2 0.16 0.12 0.08 0.04 US Brazil Eurozone India Japan China Russia Source: World Bank, World Development Indicators Online. Website: <http://devdata.worldbank.org/dataonline> (retrieved November 1, 2007). 2010 2005 2000 1995 1990 1985 1980 1975 0 System-Level Problems • “Peace”: long-term nuclear proliferation? • Global Macroeconomic Management • Post-Neoliberal Global New Deal? • Preventing Global Ecological Catastrophes? Can Global Capitalist Economy Be Stabilized? • No Keynesian state on a global scale / hegemonic state as an imperfect proxy • Early postwar years: Marshall Plan / US foreign investment global economic expansion • Neoliberal era: global stagnation / financial crisis / US current account deficits have played an indispensable stabilizing role • US cannot run large and rising current account deficits any longer / US recession, followed by persistent stagnation? • Can China lead the global economy into another golden age? Macroeconomic Structure of the Chinese Economy Share of GDP, 1980-2006 0.7 0.6 0.5 0.4 0.3 0.2 0.1 0 Consumption Net Exports 2005 2000 1995 1990 1985 1980 -0.1 Investment Exports Source: National Bureau of Statistics of China. Website: <http://www.stats.gov.cn/tjsj/ndsj> (retrieved October 15, 2007). A Global New “New Deal”? • Global Social Compromise: accommodating new political and social forces / without undermining global profit-making and capital accumulation • Postwar Global New Deal: western working classes / national bourgeoisies / “socialist states” • A Post-Neoliberal New Deal? • The Rise of China and India, and their working classes • Non-white, immigrant working classes in the West • Demographic Trends: pensions and health care spending • Can the capitalist world-economy afford a global new “new deal”? How to Prevent Global Ecological Catastrophes? • Ecological sustainability requires steady-state economy; capitalist world-economy is based on endless accumulation of capital • Inter-state competition and the universal drive for “development” rule out meaningful global coordination • It is probably already too late to prevent major catastrophes Ecological Footprint of the World’s Major Regions, 2003 (Global Hectares per Person) Regions (countries) Eco-Footprint Eco-Footprint Bio-Capacity (Total) (Non-Energy) China 1.6 0.84 0.8 India 0.8 0.54 0.4 Africa 1.1 0.84 1.3 Middle East and Central Asia 2.2 0.85 1.0 Asia and Pacific 1.3 0.71 0.7 Latin America and the Caribbean 2.0 1.4 5.4 North America 9.4 3.35 5.7 European Union 4.8 1.91 2.2 Rest of Europe 3.8 1.47 4.6 World 2.23 1.09 1.78 Source: World Wildlife Fund in the USA and Canada, Zoological Society of London, and Global Footprint Network, Living Planet Report 2006, pp. 28-37. Website: <http://assets.panda.org/downloads/living_planet_report.pdf> (retrieved January 15, 2007). Carbon Dioxide Emissions, Selected Countries (Million Tons, 1990-2005) 6000 5000 4000 3000 2000 1000 0 1990 1992 US China 1994 1996 1998 2000 Eurozone Japan India Russia 2002 2004 UK Source: World Bank, World Development Indicators Online. Website: <http://devdata.worldbank.org/dataonline> (retrieved March 1, 2008). The Demise of the Capitalist World-Economy • Towards an American-led world-empire? (failed) • Towards China-led system-level solutions to systemlevel problems? (capitalist world-economy restructured and renewed? an “anarchic” world order, non-capitalist world market economy?) • Towards global nuclear / ecological catastrophes? End of human history? • Towards a socialist global world-government? (up to us)