These different dynamics are “orthogonal” to one another. That is to say, they interact but not in a systematic way. This means that we can only identify up to a certain degree “internal” dynamics within a power source, since each is not absolutely autonomous from the others, and the development of each affects the development of the others. Once we admit the importance of such interactions we are into a more complex and uncertain world in which the development of capitalism, for example, is also influenced by ideologies, wars and states. I will demonstrate this when I seek to explain two previous crises of capitalism, the Great Depression and the present Great Recession. Unfortunately, it makes predicting the future much more difficult.
Second, complexity is heightened by the fact that planet Earth is a very big place, in which nation-states and macro-regions differ considerably from each other, so that the general tendencies just identified affect some countries and regions more than others. There might now be a really serious capitalist crisis in Greece, but only a slight one in neighboring Turkey, and almost none in China. These differences might also generate different trajectories of world-historical development, indicating for example that China might be economically overtaking the United States, or Asia the West. Macro-regional shifts have many historical predecessors.
Yet the emergence of nuclear weaponry ensures for the first time in the history of the world that any rivalry between them is unlikely to be resolved by war. But not impossible—and this raises the third complexity. Human beings are not rational calculating machines. Sometimes they face complex problems to which there is no obvious solution. Sometimes they are driven not by instrumental rationality but by what Weber called value rationality, sacrificing personal calculative interest to an overall ideology. Sometimes they are driven by strong emotions overpowering reason. So human actions are often unpredictable. In the 20th century humans often took decisions which seem to us today to have been irrational—going into two devastating world wars or seeking an utopian total transformation of human society. There is no reason to think that the twenty-first century might be different.
Thus the best I can do in the way of prediction is to pose possible alternative scenarios. I will consider whether the end or, less dramatically, the decline of capitalism might be nigh for America, for the West, for the whole global economy, or for the whole planet Earth. Some of my scenarios will be more optimistic than others, some will have more coverage of the earth than others, with the likelihood of each being affected by capitalism’s complex interactions with other sources of power and other crises. I will try to assign some degree of probability to these scenarios, though these are really only rough guesses.
SYSTEMS AND CYCLES
I am skeptical of theories which depict a terminal crisis of capitalism as a single system (with two possible exceptions to be explained later). Take, for example, Wallerstein’s notion that the “capitalist world-system” is in crisis. His system has two parts. The first is the “internal” crisis of capitalism, given by the logic of capital accumulation and expressed in terms of worsening Kondratieff 50–60 year cycles of boom and slump. The next slump, he says, will be much worse and may indeed finish off capitalism (he hopes so, anyway). We are now entering a systemic crisis of capitalism, he says, because profit levels are falling and they will almost inevitably keep on falling.
The second part is a geopolitical crisis manifested in longer-term “hegemonic cycles.” Hegemony means domination. Crises come in the transition period between different hegemonic regimes. His examples are the transition from the hegemony of the Dutch Republic to that of the British Empire, and again from British to American hegemony. These geopolitical cycles tend to be of more variable length than the economic cycles. From the Netherlands to Britain spanned just over one hundred years, from Britain to the United States took fifty. American hegemony is now declining and will be soon ended, he says, after a reign of about seventy to eighty years. He is understandably unsure of what is to follow. He does posit Chinese hegemony as one possible future, but he seems to think it more likely that there will be no single hegemon. Given his Hobbesian view of the human need for a single Sovereign, that bodes ill. He does not see the two crises of capitalism and hegemony as undercutting or complicating each other. Instead at certain junctures crises of both the capitalist and the hegemonic cycles coincide and reinforce one another to produce a systemic crisis of the whole.
This is a succinct theory, full of insights, but I have difficulty in accepting either half of it. First, consider his list of historical hegemons. The Dutch Republic seems a bizarre choice as Europe’s first hegemon. In the late 17th century the Dutch pioneered some capitalist institutions, they defended themselves well on both land and sea, and they acquired a few colonies. But they never dominated Europe, let alone the rest of the world. The Habsburgs and France were the leading powers at this time in Europe, but the continent (and its empires) had essentially multipower geopolitics. Britain was more dominant in the 19th century, for it was the leading industrial capitalist power with the biggest navy, the biggest empire, and for a time the reserve currency, but it was never hegemonic over the continent of Europe and it relied on a balance of power between other states to protect itself. Wallerstein then sees a period of rivalry between two potential hegemons, Germany and the United States, before the latter triumphed. He describes the period 1914 to 1945 as a “thirty years war” between the two, an odd description for wars into which America only entered tardily, and only when attacked by Japan in the second war. American hegemony was indeed established after World War II, but mostly as the unintended consequence of a war started by the suicidal fascist and military bravado of Germany and Japan, though these did succeed in finishing off the British and French Empires. US hegemony over much of the world was completed by the Soviet Union turning inwards into economic autarchy. Such a contingent set of outcomes resulted from complex interactions among all four sources of social power. The United States was already in the interwar period the leading economic power—though without World War II the dollar would have probably shared reserve status with other national currencies—but had much less military or geopolitical power. The outcome of the war was that America became the great historical exception, the only global empire, the only true hegemon the world has ever seen. But with only a single case, it is hard to identify hegemonic cycles. Nonetheless, I do agree with Wallerstein that the United States has been hegemonic in the recent past, that its hegemony is now weakening, and that it may well end sometime around 2020 to 2025. This unique world-historical process may lead to a crisis specific to the United States.