from GSP 3-19

The USA is trying to impose its will on the rest of the world with its IT companies and its money.
On some recent advances in the competition between states ...

Digitization and the dollar

Given the benefits of internet-based services for the growth of a nation’s monetary wealth, every state in principle wants the creators and leaders of these services not only being productive on, but conducting their global business from, their business location. In fact, this interest is the subject of an increasingly ruthless struggle between the few world economic powers which host, support, and promote the corporations in question. This struggle is being waged with a decisive lead by the USA, which created the internet, released it for general commercial use, and from the outset cultivated the corporations that are using it for their business, continuing to grow beyond it, and by virtue of the size of their capital and technological advantage, dominating the world market in this sphere.

A global battlefield

The competing world economic powers’ interest in hosting companies that are recognized as global leaders who wage their cut-throat struggle with the size of their capital is based – in a first, economic-political respect – on the special nature of the business that the IT and industrial groups in question pursue or aim at. As basic businesses that supply companies around the world with their services and therefore tend to earn a share in virtually all business transactions, they are not just registered as an outstanding source of national wealth. For the world’s economic powers, the far-reaching dependencies that these global players create with their costly services open up strategic economic access to virtually all global market transactions with their nation’s control over these industry giants, along with opening completely new industries for digital services and control over access to old as well as new markets based on global connectivity. Before their eyes is the promise of control over the creation and distribution of the world’s wealth in national hands.

With this in mind, they mobilize the means at their disposal, with an eye on their competitors and rivals. They push the protection, promotion, and development of their own global players with legal instruments, in particular tax, patent, and anti-trust laws, as well as financial contributions paid out of the national budget – depending on the status they have attained. Of decisive relevance here is “intellectual property,” which they protect by using it against one another. With their legal sovereignty, they ensure that scientific knowledge and innovative ideas can only be made available exclusively for commercial purposes as objects of private use. In the interest of promoting their global players, this can’t be left at that; they use their power for the international protection of the “intellectual property” of their national champions in order to open the entire globe to them as a freely accessible business sphere. So they begin the fight for this “intellectual property” as an international right. From each other and from the rest of the world of states, the major world economic powers demand recognition of their own national legislation as a voluntary obligation which is binding on all and which their state competitors have to use their sovereign power in the service of. Conversely, they reserve the right to free cross-border business in their area of control under conditions that put foreign corporations at a disadvantage compared to their own.

Apart from this, another battlefield is placed on the agenda of the world economic powers for reasons other than economic strategy. To the extent that their global players are dependent on (new) satellites for their dominance on the world markets for internet-based services and IT technology, the few world economic powers that can afford the necessary expense also make the conquest of space a concern from this point of view. In principle, nothing is too expensive for them in the competition against their competitors and rivals for their own advantage. Because of the immense initial investment and maintenance costs for the research, development, and provision of the necessary technology, they produce satellite-based global communications in state hands until they can be handed over to potentially large corporations which, if they only receive orders at state expense for long enough and thereby gain the necessary capital size and technical power, will tackle this competition on their own account.

All these struggles are mainly waged by the USA to maintain the position of power it has won against China, but also against the EU and its major powers, conversely China against the USA for its own advancement, and finally the EU – whose members are in turn made up of a few activists, cooperative participants, and critical appendages separate from them – in unwilling cooperation with the USA against China and avoiding direct confrontation with the USA. They fight from different starting points for the appropriation of the largest possible parts of the world market as a secure source of their national wealth.

“National security”

In still another respect, every state focuses on the economic agents of “digitization” and their internet-based services. The global network, which extends into every conceivable subdivision of modern society, is on its material side a special kind of hardware- and software-supported infrastructure; capitalist nations depend to varying but increasing degrees on its proper functioning. It makes it possible to log on from anywhere to use networks as intended. Because of this technical peculiarity, however, it also goes hand in hand with the power to spy on, control, disrupt, or even destroy these networks and therefore poses fundamental challenges to all states in their capacity as sovereign powers over movements within their own spheres of control. In the interest of the undisturbed reproduction of their societies and the secure exercise of their rule, the achievements of “digitization” are therefore subordinated to the requirements of “national security,” “resiliencies” are demanded and developed, cyber security and the sovereign need for more “digital autonomy” are placed on the political agenda. 

Dealing with the contradictory challenges of “digital revolutions” concurrent with the requirements of “national security” is only mastered from the outset by those states which have corporations at their disposal that run their business with the supply of various points of stationary and mobile networks. The fact that these companies are domiciled in their own location, from where they conquer the world market, is given new weight by the security needs of the world economic powers. These powers leave no doubt that their interest in “national security” is not merely a defensive question, but rather includes the claim to be able to access the economic foundations of foreign nations, the sensitive infrastructure of modern capitalist societies, but also the institutions of their state rule.

Here the USA in particular is fighting for its global supremacy over China, which is the only nation to have hoisted up comparably large corporations, and the major powers of Europe are fighting to not be “left behind” completely. The USA is currently waging this battle against the Chinese network supplier Huawei, among others. From the point of view of its “national security,” the US government has identified the company’s business with illegitimate attacks by the Chinese government which are dangerous for the US, so it is put on a black list, and sanctions are imposed which, mediated by the economic ruin of this Chinese global player – really or even potentially – are intended to limit claims to national control over global network infrastructures. The fact that the US treats Huawei as a case like this and sanctions it testifies above all to the quite universal dimensions of the world power’s claims and the quality of its “national security” which is to be respected by all other sovereigns.

“America first!”

In order to achieve this dual purpose – to secure control over the world market, i.e. over the basic transactions that regulate access to it, as well as the technical capability to spy on and damage the inner life of all capitalist nations – the USA already has another means of economic power at its disposal, one which has long since realized the strategic ideal of complete control over the capitalist activities of the world of states, regardless of the development of IT capacities.

The instrument for which the USA did not have to first invent the internet is called the US dollar, and it consists of the financial power of its domestic capitalism and its state, which is responsible for and controls the credit that guarantees the “depth” and indestructibility of the US financial market that generates this credit. This US dollar credit is used not only by the US, but by the whole world. All nations, including the major world economic powers, are existentially dependent on the dollar-based world financial market and especially the US financial market via their globally-positioned companies. Embedded within global capitalism, they are only able to survive as appendages of the universality of the dollar and dollar credit. Thus they are indirectly subject to the legal sovereignty of the USA, which extends into their domestic business locations and into the creation and circulation of money and credit in their own countries, i.e. the indispensable sustenance of all other nations. That is why the jurisdiction of the USA, by virtue of its incomparable financial power, is an essential lever of US imperialism, in that World Economic Power #1 has long since discovered the universal lever which gives it the ability to extort other countries for its strategic interests up to the point of threatening their very existence. 

The leaders of the USA have always used one and the same basis for this. The use of dollar imperialism as an effective weapon in the competition between states is based on the world order of global capitalism which the USA, after winning the second world war, set in motion with superior force as a regime of globally valid rights and later a “cold” war against the last remaining military strategic rival as a binding premise of all sovereign calculations. As the only remaining superpower, the USA, in the interest of opening up the whole world as a field of activity for its capitalists and its national credit, made an offer to all other nations that they could only reject at the price of a threat to their own existence. They were permitted and allowed to integrate, on their own account, their recognized national interests into the American world market order, earn dollars, manage their own business location with dollar loans, and compete according to the rules of this order. With its offer and the necessary guarantees, the USA insisted at the same time on the subordination of all sovereign competitors to its monopolistic claim to define the rules of this competition, to monitor them, to prosecute deviations, and to punish them. The imperialist domination of the world by the USA in the form of supranational rights therefore had a contradictory nature from the outset: it thrived on a universally valid order that is respected and supported by all competing sovereign powers intent on their own national advantage, and also includes their formal subordination to a set of rules which has its reason and purpose in the universal demands of the world power, the decisive and indispensable subject of this regime.

The leaders of the USA have always been quite unconcerned about this objective contradiction. If anything, they have been bothered by one side of it, the aspect of voluntary commitment to the formal universal validity of their world market regime. However, in the interest of the other side, the one-sided functionalization of this regime for the concerns of their nation, they have always known how to help themselves – without discarding the political point of view that the success of the USA is to be ensured in principle precisely by its guarantee of a universal supranational legal order of free transnational capitalism. The same is true of the extortionate deployment of the USA’s preeminent financial power as a civilian weapon against enemies and insubordinate rivals.

Previous American administrations always helped enforce the demanding equation between the American and global legal situation by invoking a universal world market order that is also respected by the USA. The assured validity of this state system as the permanent premise of all sovereign state calculations was to be emphatically enforced with sanctions programs against deviants who were identified as lawbreakers, i.e. by means of an exception to the rule of a universally accessible world business decreed by Washington. In this way, the objective contradiction was set in motion – to relativize the universality of its global order, which all nations calculate with as a secure condition of their success, and to subvert the basis of universal validity, namely the respect of the world of states for the American world order – in order to assert the special political interests of the leading power. The leaders of the world power of course did not care about this either, or only in one respect: that they were confronted with the “problem” of how to effectively enforce their claim to global order, the “solution” to which produced, in addition to accusations of preceding administrations’ failure, different versions of how the USA can better fulfill its leading role as the world policeman of the world market order.

The right of the strongest

The combination of nurturing and exploiting this supranational order has ended under Trump. He identifies every moment of formal self-obligation on the part of the USA as nothing but a “shackle” that definitely doesn’t have to be put up with by a superpower that is superior in every respect. This is showed by the Trump administration’s extortionate use of the financial power of the USA, which the president takes so much for granted that he simply disregards it. Unlike his predecessors, the current leader imposes sanctions without any reference to supranational law or international rules of procedure as the binding denominator of the community of states and without any binding consultation with “partners,” but rather by explicitly referring to the global interests of his own nation and to its self-evident right, given by its economic and military superiority, to successfully enforce these against any resistance.

Without wanting to cancel world market business, the US deprives the immediate targets of its sanctions regime of the previously guaranteed freedom to compete for participation in world market business and, by means of secondary sanctions against all other sovereigns, imposes orders to agree with the US’s definition of the enemy and to comply with the unilaterally imposed punishment. In particular, the world’s powerful competitors have to put up with direct, clearly polemical attacks on their sovereignty and on their ability to autonomously guarantee the global freedoms of their global players. They must subordinate their political calculations to conditions unilaterally defined by the USA and to recognize, untied to any obligations, the unconditional and in each individual case newly defined benefit of the USA as the premise of their ambitions, i.e. the right of the superpower to solely determine the modalities of all global relations when and how it pleases.

So the Trump administration is pushing the radicalization of the contradiction of US imperialism ever further: it declares the benefit of the USA to be the solely valid criterion of American policy, against which it measures and breaks all competing state calculations, and replaces its supranational legal regime with the right of the strongest as the principle of a global capitalism, the profits of which must of course go to its “great” and “beautiful” nation. This approach therefore amounts to a test of whether the collective legal system of the global market economy, built up over decades with western partners and successfully imposed on the Russians and Chinese, can withstand the unilateral demands made on it by the USA. Through the restrictions and prohibitions it has imposed, the Trump administration is making use of the established world market order, including its interdependence, in a way that is intended to make it clear that the USA is and wants to remain the sole authoritative subject of world market business, and at the same time practically calls into question what the USA has achieved in this role with its money, with its dollar loans, and not least with its military deterrent capability in terms of useful imperialist control over the world of states. At the same time, it is putting at risk the basis of its dollar imperialism, the guaranteed universality of the dollar as the substance of regulated competition, with its one-sidedly polemical use as a weapon.

Carrying out this contradiction is one thing, namely, the practical matter that no head of state needs to have a clue about when going about his business. Trump prefers to stick to the effects of his sanctions regime, which (for the time being) prove him right, but that’s also why he doesn’t limit himself to sanctions. What actually becomes of them is a completely different matter. That, after all, depends on the willingness and ability of the imperialist rivals to either submit unconditionally to the supremacy of the USA to control the world market as it sees fit, or to oppose this militant claim with the prospect of their existence as respectable world economic powers being threatened. This opens the transition from the ruthlessly waged competition for the largest possible shares of one big world market to the struggle for the division of the world into exclusive sources of wealth, for the appropriation and safeguarding of exclusive spheres of political influence, for which “all options are on the table,” from economic policy to military instruments.