Yes, happy birthday Karl Marx, but his work on political economy was incomplete as he only ever presented exactly half the conceptual picture he intended to publish before he died.
In Capital 1 Marx begins with the dialectic of the commodity, saying that it has both use-value and exchange-value, the former representing the utility of the commodity, the later its price in the market. From this abstraction, Marx proceeds to unravel his scientific explanation of class exploitation. All well and good.
But what about the dialectic of money? Marx certainly identifies that money is both a means of exchange, and a measure of value, the former being that you can acquire commodities with money, the latter being that money also serves as an abstract measurement of value. Even crypto-currency, which its supporters say challenges fiat is stilled ‘measured’ in fiat.
According to Utsa and Prabhat Patnaik, the dialectic of money is what ultimately leads to a theory of national exploitation, or in other words, a theory of imperialism. Imperialism is not when the capitalists of nation A exploit the workers of nation B, it is when nation A forcefully extracts wealth from nation B, something most people intuitively associate with ‘imperialism’ anyway.
Historically, this forceful extraction of wealth operated via the dialectic of money. For money to function as a means of exchange, there must be an availability of goods, which formal empires would extract from enslaved nations by various means of tribute, taxation and slave-rents being the two major forms.
What backed the value of the British pound? India and other colonies-for-plunder. What backs the value of the US dollar? Unlike Britain, the US has no formal colonies-for-plunder that it can simply loot from, which is why the US could only run a gold-standard for 27 years, whereas Britain maintained one for over a century.
How does the US maintain currency hegemony? After getting off gold in 1971, the dollar price of oil skyrocketed, leaving many postcolonial nations in extreme debt. In exchange for IMF/WB loans, these nations ‘liberalized’, that is, they exported more to the West (even at the expense of domestic consumption like India), and their elites moved their money to the Anglo-American financial centres.
This supported the US dollar, especially after the collapse of the USSR, when more countries had no choice but to accept the diktats of the IMF/WB. But in the 21st century, the US suddenly turned to war, particularly in the centre of Eurasia, in the space between East and West. The goal is to prevent Eurasian economic integration, by raising the cost for any industrial competitor, most importantly Russia and China.
This is where the dialectic of money logically leads, which is to a rational explanation of the wars we’ve witnessed over the past two decades. Remember, the entire purpose of ‘imperialism’ theory in Lenin’s era was to explain WW1 with the aim of mobilizing workers against it.
You simply cannot get to a theory of imperialism-as-national-exploitation via the path of class-exploitation. They are two separate dialectical poles, which is why I argue in my thesis that ‘capitalism’ should NEVER be used to describe a world system, and that’s because when a capitalist exploits a worker, the assumption is that both are paid profits/wages in the same currency.
Therefore, the question, ‘what gives that currency value to begin with?’ does not enter into the equation. For most countries, the value of their currencies depends on their own internal productivity, whereas for other countries, that value depends on subjugating other nations, or sabotaging the development of other countries to prevent them from developing.
If ‘capitalism’ is to be used, then it refers to class exploitation and industrialisation within a specific state, region, or currency zone. The true world system is ‘imperialism’, which has divided the world into three camps in the post-WW2 era.
a) Former empires and their settler-states
b) Former extractive-colonies
c) Mercantile rivals
Theoretically, it does not matter what kind of ‘ism’ these camps are internally. If you detach yourself from the romanticism attached to the word ‘socialism’, then theoretically, it is entirely possible for an internally ‘socialist’ state to exploit other nations.
In camp a) you have the US-Anglo alliance, the former Axis powers, Japan and Israel. They are united by the shared interest of maintaining the economic advantages won against camp b) for as long as possible, which refers to the Tri-continent of Asia, Africa, and Latin America. This is what makes camp a) ‘imperialist’.
But to capture change we must introduce camp c) which refers to those countries that are excluded from camp a) for whatever reasons (most importantly Russia), or they’re from camp b) and have managed to use their postcolonial freedom to rapidly ‘catch up’ technologically (most importantly China).
Russia has relatively inexhaustible resources, meaning that it does not need to keep camp b) poor, rather its interests with camp b) have been mutually beneficial. This is what made Soviet decolonisation possible in that allowing the nations conquered by the former Russian empire to develop ‘evenly’ with Russia was not much of a sacrifice to Russian workers because there were plenty of resources for everyone to share.
Camp a) obviously perceived the USSR as a threat for precisely this reason. The USSR was a resource rich state, and therefore, did not need to exploit its once conquered nations, or at least not to the same degree as camp a), and on top of that, the USSR was openly backing the right of camp b) to free itself from camp a).
That’s why the faction of camp a) with the least colonies/resources (the Axis) invaded the USSR, and why it was also a victory for camp b) that the Red Army won!
The major player in camp c) is China, which industrialised by producing in exchange for the currencies of camp a). Given the hyperinflation of the 1970s, the US needed a workforce to pump out commodities for dollars, which China did, gaining strength and gaining technology in the process, including by IP theft (which is based).
The leader of camp a), the US is in the worst shape. It lives beyond its means and requires loans from the rest of the world to stay afloat. Being ‘friendly’ to the US means financing their debt. The expiry date on the US dollar is precisely when camp c) has enough technological parity (if not monopoly), that their state-backed financial assets are considered more lucrative as a ‘measure of value’ (going back to Marx) than the US dollar.
The US still has semi-conductor production and some of the best military technology. As the US economy enters this decline phase, the ability to violently intervene in the affairs of camp b) and c) using its military dominance becomes the ‘last line of defence’ for the US dollar, leading to war.