Globalization is a class war without borders

Party of One -- by David Moberg.
Review of The Global Class War : How America's Bipartisan Elite Lost Our Future - and What It Will Take to Win it Back by Jeff Faux

During the debate over NAFTA more than a decade ago, a corporate lobbyist tried to persuade Jeff Faux, founder of the progressive Economic Policy Institute, that he should support the deal. Mexican President Carlos Salinas was "one of us," the lobbyist said. At first Faux didn't understand who the "us" was. Then, he realized, "Despite the considerable political and social distance between Carlos Salinas and me, she was appealing to class solidarity."

:At that moment," Faux writes, "I realized that globalization was producing not just a borderless market, but a borderless class system to go with it."

This is not some shadowy conspiracy. In his new book, The Global Class War , Faux describes the formation of a global elite of political, business, media and academic figures, who often attend the same schools, work directly or indirectly for the same multinational corporations and move in the same social circles. Even if they are from much different countries, they often have common interests. And their common interests are frequently different from -- even antagonistic to -- the interests of both their individual nations and the vast majority of the population.

All markets need rules that determine who gets what, and the creation of those rules is a political question. This global elite has tried to create those rules through a series of what are misleadingly called "trade agreements," like NAFTA or the World Trade Organization treaty. Members of this elite secretively draw up these agreements and approve them despite widespread popular opposition. There are two main objectives, Faux writes, to secure the rights of global corporations and to restrain the options of governments to manage their economies.

National elites disagree over specific policies, such as the sale of genetically modified food that divides the United States and the European Union. (The World Trade Organization recently ruled in favor of the United States.) But that's no different from the conflicts between competing transnational corporations. When it comes to essential matters, however, Faux argues that they demonstrate remarkable global class solidarity. And in this emerging politics of the global economy, there is only one party, which he dubs "the party of Davos," after the Swiss ski resort where the rich and powerful gather each January.

Like David Harvey's recent book, A Brief History of Neoliberalism, Faux provides a persuasive and revealing framework for understanding globalization in terms of class. It's a much-needed corrective to the way in which most news about the changing world economy is viewed, usually through a free market fundamentalist or, less frequently, a nationalist lens. But the class war he describes is still remarkably one-sided, despite the emergence of a relatively weak "party of Porto Alegre", the populist and left movements that began gathering as a counterpoint to Davos.

But Faux does not fully incorporate into his class analysis of globalization either the growing numbers of left-populist presidents in Latin America or even the political opponents of NAFTA-style agreements within the United States (primarily liberal Democrats but also a few right-wing Republicans). Are these minor divisions within the global consensus or expressions of substantial opposition to the ruling elite?

NAFTA is Faux's prime example of how this global class war works -- and how working people in all countries can end up being losers despite the claims of the elite that their trade deals are "win-win" propositions. Continuing the project of Reagan and Bush Sr., Clinton -- a key figure in the creation within the United States of what Faux calls bipartisan class war -- used his political muscle to push through NAFTA first, not the national health plan more important to his constituency. Why? Faux blames the influence of advisors like National Economic Council director and later Treasury Secretary Robert Rubin, a former Goldman Sachs executive, as well as the growing dependence of Democrats on corporate money.

He demonstrates how the "bipartisan elite" of Democrats, Republicans, Wall Street, multinational executives, the media, and think tanks falsely sold NAFTA to the populations of Canada, Mexico and the United States, and how it ultimately resulted in greater inequality, weakened social programs and reduced living standards for workers in all three countries. NAFTA never delivered the promises of jobs in the United States and reduced illegal migration, and Faux argues that Mexico became more democratic, not because NAFTA succeeded, but because it failed, and protests erupted.

Faux warns that the entire global edifice may come crashing down because of the unsustainable growth of the U.S. trade deficit -- maintained so far by the willingness of foreigners to hold dollars -- and growing personal, government, and corporate debt. American workers, who have been losing jobs and incomes as the U.S. elite crafted their new world order, are likely to suffer even more when the dollar tanks, and the United States has to start spending less and exporting more.

Counterintuitively, Faux judges that the best course after such a crash is to embrace the reality of North American economic integration and rebuild a productive continent-wide economy while preserving social safety nets, worker rights and environmental standards and reducing economic inequality.

Faux argues that governments, guided by more democratic citizen initiatives, will have to take the lead to strengthen competitiveness and well-being for citizens of the North American continent. But that would seem to require defeating the bipartisan elite that has been waging class war. If the real problem is the global ruling elite, but a global popular movement to challenge it is not currently a realistic prospect, can a nationalist, or regionalist, response succeed? Faux argues that each of the major regions of the world can craft their own economic strategy, and maybe the United States could even be a model, as the world more slowly and fairly moves towards "humankind's ancient dream of one world that works for everyone."

(David Moberg , a senior editor of In These Times, has been on the staff of the magazine since it began publishing. Before joining In These Times, he completed his work for a Ph.D. in anthropology at the University of Chicago and worked for Newsweek. Recently he has received fellowships from the John D. and Catherine T. MacArthur Foundation and the Nation Institute for research on the new global economy.)