– Some of the Main World Problems
– Perverse Dynamics of “Free” International Competition As Immediate Cause of the Main Problems
– Competition Between the Big Organizations
– Weakness of the Present Models of Liberal Democracy
– Incompetence of the Marxist Model
– Difficulty of Sustainable Usage of the Amazon Rainforest and Brazilian “Underdevelopment”
– Origins of the So Called “Underdevelopment”
– Industrialization and the Creation of Added Value
– Relative and Convenient Economical “Freedom”
– Finitude of the Natural Resources
– “Success” Through Exploitation
– Necessity of a New Political Model
Having examined the dominant thought currents (which have become largely hegemonic since the end of World War II), as well as the limitations of their main institutions, especially their models of political organization, we must now examine the direct link between these political models and world problems, although this may have already been glimpsed throughout the analyzes presented in the previous chapters.
Let us begin, then, by explaining some of the main world problems of our time, which must be fundamentally related to these dominant thought currents. That is, as a root cause, these great problems must have been generated by these dominant ideas, since basically it is the ideas that rule the world. As an immediate cause of these problems, however, we have to examine the great social institutions derived from these dominant ideas, especially their models of political organization, due to their determining role over other great institutions.
For the sake of justice, we cannot ignore that the main alternatives that were presented to the world, especially in the first half of the 20th century, that is, Nazism and Fascism, were thought currents (with their models of social-political organization) even more tragically mistaken than the two already examined, which today are globally hegemonic.
In the same way, the alternative examples to the current dominant models, although of less significance in the world context, are even worse than Liberalism and Marxism. We refer, above all, to religious fundamentalism, such as Islamic fundamentalism, among others. These fundamentalist regimes also contribute significantly to the problems of our time, although no longer in a hegemonic way. Therefore, we cannot attribute all the evils of our day to Liberalism and Marxism.
In fact, it is certain that, in spite of everything, we should feel a good deal of gratitude to these two thought currents and their institutions, since they were the ones who saved us from a much greater tragedy, which would be a Nazi-Fascist world domination. In this sense, regarding Liberal democracy, Winston Churchill made famous the ironic statement that it is “the worst political model, with the exception of all others”. He was realistic enough not to expect fantastic results from this model of political organization, and he used to say that the best argument against liberal democracy was “a five-minute conversation with an average voter”. (https://www.pensador.com/frases_churchill_democracia/)
Having made the observations of the previous paragraphs, let us proceed to the analysis of some of the main world problems, among which we certainly have:
1) The wealth gap between nations, that is, the contrast between rich and poor countries, or between so-called “developed and underdeveloped” countries, and
2) The aggression and consequent imbalances in the natural environment, with the resulting ecological and climatic disasters.
We say “some of the main problems” because, in fact, there are other very serious problems that demonstrate the seriousness of the current world situation. “Your house is burning”, would allegorically say a “philosopher” like J. Krishnamurti.
We remember here, albeit by way of example, of the abyss of wealth existing within the population of the same nation, that is, the contrast between the very rich and rich and the very poor and miserable within the same country. Likewise, the aggression, or the immense cruelty of the current forms of treatment given to animals, sentient beings. And yet, violence of many kinds that seems unsolvable and, perhaps, growing within nations, especially the poorest ones, but also international violence, whether in the form of terrorism, or in the form of armed conflicts.
Other serious social problems could be added, just mentioning the precarious health support conditions of the most needy; the inadequacy and brutality of educational systems; or the cruel and inefficient treatment of prisoners.
We hope, however, that the analyzes we will make of the first two examples of these major problems (highlighted above) can, by analogy, be applied to the other major global problems.
As for the first example of a major global problem, the so-called “underdevelopment” has behind it the extreme poverty, violence and abandonment of millions and millions of human beings. This is a completely unacceptable scenario, which will sooner or later generate indignation and an uncontrollable revolt, bringing with it great risks, such as increasingly violent forms of terrorism, forced migrations of large populations and even wars.
As for the second example of a global problem, that is, the increasing forms of pollution and destruction of the natural environment, they are generating very serious imbalances, which point to consequences that are already beginning to be observable on the world horizon, and whose effects of wide catastrophes, which are already scientifically predictable, even though they may still be a little distant.
Perverse Dynamics of “Free” International Competition As Immediate Cause of the Main Problems
Moving forward in the analysis of these problems, we must now answer the following questions:
1) Why has the wealth gap between nations increased so much over the past five centuries, creating an economic and social gap between the richest and the poorest nations?
2) What is the main cause of the increasing aggression to the natural environment, and what has made its control so difficult?
Again, we hope that the analyzes presented below can be applied, by analogy, to the other major global problems.
Alberto Guerreiro Ramos, in his work The New Science of Organizations, offers us a clue in the direction of answering these questions. Guerreiro Ramos, it is important to note, had his political rights revoked during military authoritarianism, and was also criticized and marginalized by the left. He passed away in the 1980s (after teaching at the University of Southern California, among other universities). Let’s see the quote:
“The current results of modernization, such as psychological insecurity, degradation of the quality of life, pollution, waste to the exhaustion of the planet’s limited resources, and so on, barely disguise the deceptive character of contemporary societies. The self-definition of advanced industrial societies as carriers of reason is being undermined daily. This atmosphere of perplexity can enable a theoretical reformulation of enormous magnitude.” (The New Science of Organizations, p. 22; emphasis added)
This quote by Guerreiro Ramos suggests that these problems are the results of the current form of globalization, because it has generated a kind of insane and uncontrollable competition between nations (and big transnational organizations) for productivity gains, which characterizes, centrally, the ability to compete economically in international terms.
What is behind the real compulsion for productivity gains (and consequent profitability), therefore, is the current form of economic globalization, which has generated unrestrained and uncontrollable competition between nations, in a kind of economic war against everyone in the global international scene. And why is this process so uncontrollable (often considered, for that very reason, to be “necessary”, or “inevitable”), whose clear and scientifically predictable results are catastrophes? Why is there no force in the world capable of regulating this process?
The answer to this fundamental question for the understanding of the great world problems lies, exactly, in the insufficiency of the models of political organization derived from the dominant ideas in our time. This is because, as we saw earlier, the weakness, injustice and incompetence of these models make them subject to the power of the gigantic national and, above all, transnational corporations.
These gigantic organizations, in turn, cannot help but seek productivity gains (which means the ability to produce more and better, if possible with less resources), with the technological advances, and other continuous changes of this type, that is, they need to seek gains in relation to the other gigantic competitors, which means greater economic competitiveness, especially internationally. And they cannot leave this compulsory search because if they do, they will be excluded from this global competitive market.
Focusing the analysis on this economic aspect, we can see that large business organizations are obliged to a permanent struggle for productivity gains, which implies technological advances, etc., because they know that if they fail to do so, they will be destroyed, to the extent that they will be defeated in the competition with the other gigantic economic organizations. And it is these gigantic economic organizations, along with other large public or private corporations, that often have governments as “puppets”, at least within the weakness, incompetence and injustice that are absolutely inherent in the current models of so-called Liberal democracies, which should not even be called “democracies”, as we have already stated before, because, in fact, they are pluto-demagogicracies.
Large companies and corporations, thus, irresistibly drag countries into this constant economic war, with its inevitable consequences that are – among many others, as we said before – the economic and social abyss between nations, and also the immense destruction of nature, generating environmental imbalances with catastrophic consequences.
This international competition by large companies has even forced the creation of large economic blocs of countries, as large companies need a market dimension that allows them to gain in scale, in order to be able to compete, on equal terms, with those of countries with the largest national and international consumer markets.
We can see, therefore, that the world today is dominated by this uncontrollable war by advances in competitiveness. The important thing is to understand that, within the framework of the current models of political organization, no State, and no international organization of States (such as the UN, or any other smaller one), has sufficient strength to regulate or harmonize this global process.
This is because, as we have seen, these models, whether Liberal or Marxist, do not at the same time guarantee freedom, equal opportunities, and adequacy between functions and capabilities in the selection processes of government officials. And, therefore, they do not promote a good choice of government officials, while, organizationally, they do not generate the sufficient power of coercion, or the political force necessary to regulate the activities of these gigantic organizations.
This fact may not seem to be true in the case of Marxist totalitarianism, as in the paradigmatic example of China and its great economic and geopolitical growth in recent decades. Its totalitarian and cascading (or pyramidal) political model generates a lot of force for coercion. However, in the long run, the lack of freedom vitiates the entire process of choosing leaders, which ends up generating major problems, which result in crises and a consequent weakening of that regime, as we could clearly see in the case of the Soviet Union, or in a significant transformation of these regimes, as in the case of China, which today is more a form of authoritarian state capitalism than a typically Marxist regime. Later in this chapter, we will return to the case of Marxist models.
It is worth emphasizing that these bad choices of leading managers occur, above all, within the scope of public institutions, or of the State, because in the large private companies the search for ever greater competitiveness requires that the rule of adequacy between functions and capabilities be met, at least in terms of technical (since in ethical terms the selection of companies is also obviously questionable, since their ultimate goal is profit). This makes large corporations even more powerful in relation to state governments, because their leaders are often more capable than the political leaders of nations. A real absurd, but clearly real.
To this inherent and inevitable incompetence of the governments, in the case of the current Liberal models, we have to add the weakness of a loose and fragmented social organization. Besides this structural weakness, in this model, as seen in previous chapters, government officials are often “puppets” who have their expensive election campaigns financed by large organizations. In this system, as unfair as it is incompetent, the only alternative that remains are demagogues of all kinds, who present themselves demagogically as voluntarist saviors capable of solving the great problems generated by this system itself. This, in addition to so many other problems, opens the way for the emergence of different forms of authoritarianism, as we can see at various times in Brazilian history and in so many other peripheral nations.
This inevitable incompetence in the process of choosing political governors, of course, is the main mechanism that generates the immense corruption that is inherent in the current forms of Liberal democracies. And large-scale corruption results in a distortion of the entire social-political process in these countries, helping to perpetuate the enormous wealth differential between nations, not to mention other problems, such as the socioeconomic abyss within the nations themselves, and so many other problems already mentioned. This is necesserily so because big political, economic decisions, etc., end up being flawed and diverted from the best directions for the general well-being, because of the privatist interests of individuals and groups that influence them – groups that are often associated with the interests of gigantic organizations, national and very often transnational.
It is worth remembering, since this book was revised approximately in this period (2019-20), that the recent and even current facts of Brazilian political life seem to suggest that these analyzes have been made in recent years. However, the original of this book is from 1994, and the work was initially an adaptation to the public of a master’s dissertation in Political Science from 1984. This observation is only intended to emphasize the correctness of the analyzes made, more than thirty years before the current political scandals, which have now made these facts almost obvious, pointed out here decades in advance.
In the current situation of enormous inequality between nations – initially the result, above all, of centuries of exploitation and mercantile-colonialist accumulation, enhanced, in the last two centuries by the gains provided by the Industrial Revolutions, which started and developed within an international colonialist order, and that are perpetuated to this day within an international neo-colonialist order – the only hope that this abyss of wealth, economic, military power, etc., can be reduced and harmonized lies precisely in that these poorer nations could have fair and competent political systems, which would allow the advent of honest governments committed to the general well-being of the population, in addition to being technically well trained and endowed with sufficient coercive power to enable them to regulate the activities of the large powerful corporations.
We are saying that the only hope for significant improvements to the great problems of peripheral countries (and, therefore, to the world globally) lies in the advent of political structures that enable governments that are ethically reliable and endowed with sufficient power to allow them to guide socioeconomic processes, as well as international policies in the direction of less and less inequality between nations, and with less and less destruction of natural environments.
This is exactly what does not happen within the panorama of incompetence, corruption and weakness inherent in the current forms of Liberal democracy, which are today, not by chance, worldwide hegemonic. In other words, these so corrupt and incompetent models are promoted in all ways (including through wars), by the wealthiest and most dominant countries, since these models serve their interests of perpetuating this Neo-colonialist framework that characterizes our time.
On occasions when this logic of international domination does not seem to occur (within the regimes of the current forms of Liberal pluto-demagogicracies), and some type of demagogue-populist is elected for the highest political positions, which is the only other possibility within the current political rules – besides the “puppets” of large companies and corporations – this demagogic-populist government, even if it intended to take truly sanitary and harmonizing policies, would be powerless in the face of the overwhelming power of large organizations (public and private). Recent history presents clear examples of this type, starting with Brazil, with its various coups d’état and constitutional ruptures.
The countries that adopted the Marxist model, like the now extinct Soviet Union, also did not avoid the fate of being affected by the force of this war for competitiveness-productivity, imposed by the central countries, more industrialized and organized within the current dominant models. This forced path of being influenced by the war of productivity between nations, however, is due less to the merits of the central countries, and much more to the internal insufficiency generated by the rigidity and the lack of freedom of the Marxist model. These characteristics of this model, as we analyzed before, in addition to facing human dignity, hurt equal opportunities and dull creativity. This necessarily results in social, economic and environmental problems and, as a result, widespread dissatisfaction in the long run.
It is important to repeat and emphasize that this global process – which is uncontrollable within the framework of the current models of political organization – is the immediate responsible both for the immense attacks on the natural environment, and for the framework of perpetuation of the economic and social exclusion of the so-called “underdevelopment”. Let us examine a little more in detail how this happens, taking examples of concrete cases for analysis.
Let us now consider, as concrete cases of global problems, 1) the continued difficulty in preserving and enjoying technically consistent and sustainable use of the Amazon Forest (which is one of the major environmental problems of global relevance, since it concerns the preservation of a biome of the greatest importance for the whole world), and also, 2) the biggest problem within which this environmental issue is located, which is the panorama of inequality, relative poverty and the various social and economic problems that characterize the Brazilian case, that is, let us examine the bigger question of the so-called Brazilian “underdevelopment”.
This analysis, by analogy, should serve to help the understanding of other serious environmental aggression, as well as other problems inherent to inequality and poverty that afflict many other nations, which often present more serious conditions than the Brazilian case. With that in mind, let us move on to the analysis of these concrete examples.
The table, graphs and map that we bring below aim to offer a synthetic view of what was the deforestation of the Amazon Forest from 1960 until the time of writing this review.
Deforestation Rate in the Legal Amazon 1988-2019 (INPE)
Until the sixties, the percentage of deforestation in the Amazon Forest was still small, and the systems of land use and exploration of natural resources had not yet had a major impact. From the seventies onward, the federal government’s policy began to aim at territorial occupation and the exploration of the Amazon’s wealth. Thus, several incentives promoted migration to that region, resulting in deforestation, which from then on becomes significant, as shown in the table and graph presented above.
In the same way, the map presented above aims to show in a synthetic view how much of the Amazon Forest has already been deforested. We see there that although much of the central Amazon is preserved, deforestation is already very significant, especially in the southern and eastern borders, which clearly show the so-called “arc of deforestation”.
The government promoted a colonization project, along with the opening of roads, the main one being the Transamazonic Highway, which entered the forest in the East-West direction. But there were also other highways that advanced in the South-North direction. In addition, there were government incentives, both in the tax and credit areas, aimed at the occupation and exploration of the region’s resources.
These government projects alone have taken hundreds of thousands of families to the Amazon region. However, in addition, the region has become a pole of attraction both for those seeking ways of survival and for those seeking quick profitable businesses.
At least in the first two decades, there was little concern about the conservation of natural resources. This, of course, accelerated deforestation, as we can see in the historical series in the table above.
After that, then, the legislation gradually began to reflect the concern with the recovery and protection of the Amazon Forest biome. The percentages of compulsory Legal Reserve increased from 20% (1965), to 50% (1989), and to 80% (2001).
These measures, among others, which meant greater concern with conservation, such as the satellite monitoring system, and the application of fines, etc., had an impact that can also be seen in the graph presented, in order to decrease the size of the areas annually deforested.
Thus, we have reached the present day, when deforestation has found some stability, but at levels still worrying. For a visualization of the current situation and its problems, we present below two quotes from people focused on the study and the preservation of the Amazon Forest. Note that at the conclusion of the two quotes from scholars concerned with the conservation and sustainability of the economic use of the Amazon Forest, we can read that the political issue is brought to consideration. In summary, the two quotes state difficulties related to the political issue, as well as the need for changes in this area. Let’s look at the quotes.
First, some paragraphs from the study “Panorama on Deforestation in the Amazon in 2016” and, second, some paragraphs from an interview with filmmaker Fernando Meireles, known for his involvement in environmental causes, especially the preservation of the Amazon Forest:
(1) First quotation:
(2) Second quotation:
As we see, in the two quotations we have the conclusion of the great responsibility and the necessary involvement of the public power, as well as changes in public policies. The fact that such changes are practically impossible within the current political model escapes the concern of the two quotations, a fact that only demonstrates what we call “the poverty of the elites”, that is, the insufficiency and the need for a major reform in the ideas dominating of the elite’s minds. As we have tried to show, this “poverty of the elites” today is not only a Brazilian problem, but a global one.
With that in mind, we can now go a little further in our analysis. What are the immediate agents of the continued devastation of the Amazon Forest? A combination of the poverty of many migrants (who flock to that region in search of jobs, or a piece of land that allows them to improve their survival), with the search for quick profits by individuals and companies moving to those lands to explore wood, raise livestock, plant, explore minerals, and so on. This entire process, as we have seen, for two decades had the encouragement of government policies, with the results in deforestation that we present in the table with the historical series of deforestation in the Amazon Forest.
The motivation of many, then, was and remains survival, which was hampered, among other reasons, by the extreme poverty and lack of jobs in their regions of origin. The motivation of others is the opportunity for bigger and faster profits. Counting, first with the support and then with the neglect and incompetence of public policies, these are the direct agents of poorly planned exploration, which results in the devastation, perhaps irreversible, of a biome of the greatest importance, as has already happened in the case of the Cerrado, with the extinction of many plant and animal species, seriously compromising natural environments, and how it is happening presently with the Amazon Forest. It goes without saying that the wealth and ecological importance of these two biomes are unmatched on our continent and, possibly, on the entire terrestrial surface of the planet.
Again, why is such serious process of destruction of the natural environment not prevented? Why is it not ordered and controlled in a scientific and planned way regarding the correct and therefore sustainable exploitation of the rainforest? Obviously, because of the incapacity and lack of political strength of the government. And the cause of this, as we have already shown, is the incompetence and corruption inherent in the current models of selection of the chief governors, which also give rise to a social organization without cohesion (and, therefore, they are models that do not generate sufficient political governmental power). These aspects characterize the current forms of the so-called Liberal democracies, among which we have the models adopted by the Brazilian political organization.
It could be argued that in Brazil we had periods of Liberal democratic order interspersed with long periods of authoritarianism. But what does that prove? Only, on the one hand, it reinforces the exposed argument of the enormous weakness and incompetence of the current forms of Liberal models, and on the other, that the authoritarian leaders in question, certainly also influenced by the dominant ideas, were not able to generate an alternative model of organization policy that could guarantee a more just, equitable and sustainable social and economic progress for the nation.
In fact, periods of authoritarianism have failed to generate models that have become dominant in the thinking of elites, not even military elites. And when constitutional ruptures occur, initiating authoritarian periods, this is much more due to the incompetence and crisis of Liberal institutions (or even those of Marxist inspiration, in other countries), and not because they are finished and lasting models. Proof of this is that these authoritarian periods end up returning towards the dominant, Liberal or Marxist models (depending on the countries considered). Which again prove to be incompetent, generate crises, etc., and give rise to new authoritarian ruptures.
We emphasize here that the logical sequence described in the paragraphs above occurs normally in the sphere of peripheral countries. This is because in the central countries, where the average wealth level of the population is much higher, the current forms of Liberal democratic models find a much greater stability.
It is very important to understand that this huge wealth differential (between rich and poor nations), in general, originated in centuries of colonialism, which made possible and leveraged the stupendous aggregation of value and exploitation that occurred during the period of the Industrial Revolutions (from the second half of the 18th century onward). And that this immense inequality is maintained today by the neocolonialist system which is presently dominant, with some nations having much more complex and industrialized economies and, therefore, generating much greater added value, as we will analyze more accurately in the following sub-chapters.
The concrete example in question, of the continued deforestation of the Amazon Forest, in addition to what has already occurred in the Cerrado biome, therefore, is clearly linked to the incompetence and lack of political strength of the chief governors, which is one of the central characteristics of the current forms of pseudo-democracies, which are actually Liberal pluto-demagogicracies.
What, then, about the existence of extreme poverty, corruption and violence that characterize the so-called Brazilian “underdevelopment”, as well as the peripheral countries in general? Its perpetuation, that is, the inability of these countries to overcome this tragic situation, year after year, decade after decade, is also, of course, directly linked to the incompetence and weakness of their unfair and incompetent political systems, as we have already discussed in the previous chapters.
These harmful aspects are inherent in the current dominant political models, whether Liberal or Marxist inspired. As we have seen before, both models are unable, for different reasons, to cope with the dominance of large corporations over their social, political and economic processes. And, as we have also analyzed before, the consequence of this is the continuity of the tragic global situation, which we try to exemplify here with the aspects of the gap between the wealth of the central and peripheral countries, as well as with the destruction of the natural environments, which we claim to be inescapable within the scope of the current ideational “metaphysics and ethics” of the elites and, consequently, within the dominant political models generated by that same ideational “poverty”.
In the Brazilian case, the relationship between this situation is evident, above all, with the current forms of Liberal pluto-demagogicracies, because in this country we have not yet applied a model of political organization inspired by Marxism, and the periods of authoritarianism have always returned to the dominant one, which is the Liberal model. In the case of several other poor countries on our continent, and for the peripheral world in general, we see similar consequences under models of political organization inspired both by Liberalism as well as by Marxism.
The question of how this poverty, corruption and violence that characterizes the peripheral countries, called “underdeveloped”, was generated, requires a deeper analysis. This is necessary mainly because there are countries that apply the current Liberal models and that are rich, and where extreme poverty has been practically abolished, or such poverty exists in a much smaller dimension than in the peripheral countries. Being so, these countries are often presented as models to be copied. In other words, the question that is imposed on the so-called “underdeveloped” countries, and which many seem not to clearly understand is: – if this model worked there, why didn’t it work here?
In other words, why did these rich countries achieve so-called “development”, and most of the rest remained “underdeveloped”? Why did they win in the past and continue to win in the present the “race” for growth, advancement and greater complexity of their economies? A “race” that means greater productivity and competitiveness, with the necessary and corresponding technological advancement of its production processes.
This “race” is still the central aspect of the global economic order, and it perpetuates to this day (and in some cases even increases) the gap of wealth and of relative competitive advantages that separates the central countries from the peripheral ones.
In order to give a reasonable answer to this question, we need to understand the beginning, the origins of these great differences in wealth and geopolitical dominance between the countries. And, therefore, we need to go back some five centuries, that is, to the time of the advent of the Great Navigations (with their cultural, economic and military backgrounds), which gave rise to the establishment of colonies, with their multiple and vast consequences.
With the advent of the Grand Navigations modern Colonialism arises, and with it the struggles and wars for the dominion of colonies, as well as the commercial competitions (Mercantilism) resulting from it. Subsequently, but as a continuity of these competitive processes and of so many armed conflicts, we have the advent of Industrial Revolutions that have increasingly widened the distance between colonizing countries and colonized regions.
That is, some countries began to exercise, by force of arms and economic strength, a geopolitical domination (cultural, economic, military and other types) over other countries or regions of the planet. These nations established domains (colonies), which served both as sources of abundant and cheap raw materials and as captive consumer markets, initially for the various processes of Mercantilism, and later for the growing industrialization of the metropolises.
Here in Brazil, for example, there were laws during the colonial period that forbade the establishment of various types of manufactures and any type of industry, something that only changed after the royal family, expelled from Portugal by Napoleon’s armies, came to settle for some time in Brazil. The reason for the existence of these laws was, of course, to ensure that the colony (Brazil) remained only as a supplier of raw materials and as a consumer market for products manufactured or industrialized by the metropolis, or only traded through it.
Concretely, the economic history of the last five centuries reveals something of the greatest importance, which is the fact that the difference in wealth between nations has widened in an impressive way, through a process of domination that is rarely well understood by people in general, even those with university degrees. In order to have an initial idea of the complexity of this process – which in part explains why it is still relatively poorly understood and controversial to date: – let’s see the following quote from the well-known Brazilian economist Celso Furtado:
“The rapid and unusual growth of the productive forces known as the Industrial Revolution is a phenomenon that escapes any attempt at a schematic explanation, and which can only be understood in the context of European history. Indeed, the innovations that started the revolution in the forms of production, which began in the last quarter of the 18th century, and allowed the acceleration of the capital formation process, are a result of the convergence of multiple social processes, such as the accumulation of commercial capital in liquid form – which was possible thanks to the expansion of commercial activities and the discovery of precious metals in the Americas – the exacerbation of mercantilist competition resulting from the formation of European national states, the development of techniques for mercantile and financial organization, access to the wealth of technical knowledge that had accumulated in Asia. The development of experimental science, facilitated by the secularization of knowledge and the dissemination of knowledge that accompanies the rise of the bourgeoisie, will act as a multiplication mechanism, whose significance was only indirect in the initial phase, but which will become decisive in the subsequent phase, opening the way to the technological revolution we referred to.” (Celso Furtado, The Hegemony of the United States and the Underdevelopment of Latin America, p. 9; emphasis added)
Understanding these transformations, of course, is of central importance for the understanding of the great global problems of our day, as well as for the possibility of consistent solutions to these problems.
Just before the beginning of the Modern Era, coinciding with the period that preceded the advent of the Great Navigations (end of the Middle Ages), it is usually considered, as a generic parameter, that the wealth differential between the poorest and the richest nations was situated somewhere around thirty, or at most fifty percent (30 to 50%).
Over the past five or six centuries, this wealth differential has increased dramatically. This did not happen by chance, as we have already said, this was due to the multiple changes that occurred mainly in Europe, in which we must highlight the centuries of colonialist domination, which is the most well-known geopolitical aspect of a set of transformations.
However, what is less well known is that, initially, the transformations took place mainly in the field of ideas, or cultural (religious, philosophical, artistic, scientific ideas) and, only later in the socioeconomic institutions (political, economic, military, educational, etc).
Although we do not have exact data on these differences in wealth between nations, only estimates, it is worth remembering that it was at the end of the Middle Ages that the greatest historically known empire in continuous extension of land emerged, which was established by the Mongols and their great chief Temudjin, better known as Genghis Khan.
This fact is of great relevance because it demonstrates the relatively small distance (in terms of wealth and technology) existing between the world regions until the end of the Middle Age. This is the first point to be noted, that this relatively small distance is a fact the characterized the historical period prior to the beginning of the Great Navigations, or the beginning of the Modern Age. How else would it be possible to establish the largest empire in continuous land extension of all time, basically mounted on small horses and having as main weapon only powerful curved arches?
Is it possible even to imagine the emergence of something like the gigantic empire established by the Mongols after the advent of trans-continental colonial empires? Of course that is not possible! That was only possible under the circumstances that characterized the relatively small differences existing among nations up to that period.
Now, the modern colonial empires have already established themselves with the emergence of new armaments based on gunpowder, cannons and small arms, not to mention the expansion of knowledge in general (heliocentrism, anthropocentrism, experimentalism, etc.) and navigation technologies in particular (compass, cartography, caravels, etc). And we need to note clearly that in addition to the technology and navigation instruments, such as caravels and compasses, these ships were equipped with cannons!
And, within the new geopolitical configuration of the world under the hegemony of the great colonial empires, wars with some chance of military equilibrium will take place, from there on, only between centric countries, and no longer between centric and peripheral countries, due to the huge difference of wealth and, consequently, of military power that came to exist between rich and poor countries, that is, between colonizers and colonized.
Just to corroborate the affirmation of the relatively small differences in wealth and military power that existed between the regions of the world around the end of the Middle Ages, let us see some aspects of this empire established by the Mongols and their great Khan:
“The Mongol Empire is considered the largest in history in continuous land extension: it reached from the western border of Germany to the Korean Peninsula, and from the Arctic Ocean to Turkey and the Persian Gulf, dominating about a third of the total population of the planet at the time. It began in 1206, when a warrior named Temudjin was proclaimed Genghis Khan, the supreme sovereign of Mongolia. Using war and political strategies, the leader was responsible for the unification of the numerous nomadic tribes that inhabited the region and resembled customs and language.
After Mongolia’s unification, Genghis Khan’s first target was China. Armed with a skillful, organized and disciplined army, he crossed the Great Wall and surrendered Beijing in 1215. Between 1221 and 1225, in incessant campaigns, the Mongols advanced over Muslim states and became owners of an empire that extended to the Persian Gulf. Even after the leader’s death in 1227, the conquests continued with his successors, who continued to expand the territory through Muslim Asia and Christian Europe. The Russian principalities were annihilated in 1238 and the city of Kiev was surrendered in 1240. In the same year, there were attacks on Poland and Hungary. Troops also overthrew Baghdad in 1258. Until the end of the 13th century, advances continued mainly through China and Southeast Asia.
In short, the Genghis Khan armies were feared across Asia. His soldiers rode horses and fought with bows and arrows. In 1215, the Mongols had taken over northern China. When Genghis Khan died in 1227, the Mongols controlled a territory that stretched from the coast of China to European Russia.
Despite so many quick conquests, the empire failed to maintain unity, ended up divided into kingdoms and formally ended in 1368, with the expulsion of the descendants of Genghis Khan from China. Regarding the legacy to the world derived from this empire, the silk route stands out. The great Asian trade routes of antiquity could be restored, among them, the largest and most famous was the Silk Road, which connected China to the Mediterranean Sea, being important for Europe’s commercial renaissance.”
It should be noted that the Mongol Empire formally ended only in 1368, less than a century before the beginning of the Modern Age (1453) and practically a century before the beginning of the Great Navigations! It is also worth remembering that the main space of this great empire was subsequently occupied by the three Islamic empires called “Gunpowder Empires”: the Ottoman Turkish Empire, the Persian Iranian Empire (Safavid), and the Great Mongol Empire. The latter was later succeeded by the Mugal Empire, initiated by a distant relative of Genghis Khan. This empire dominated much of India, Pakistan and adjacent regions until the middle of the 19th century, when the English won the already decaying and diminished Mugal Empire.
This last fact is symbolic of the great transformation of the world during these centuries of the Mugal Empire (1526-1857), which at its height became one of the most powerful empires in the world, and which in the course of three centuries was finally defeated militarily by the English, thus being an emblematic example of the immense transformations that occurred in the world during these three centuries.
Therefore, the first important point to understand and emphasize is the fact that there was a relatively much smaller difference in wealth between nations and regions of the world, when we compare this difference in wealth with the huge difference in wealth between nations that exists today. This global situation (of a relatively small difference in wealth) lasted practically until the beginning of the Modern Age, which has as one of its landmarks, precisely, the taking of Constantinople by the Ottomans, that is, the end of the Eastern Roman Empire (Christian).
With that in mind, let us now try to synthetically analyze this complex process of increasing distance of wealth and geopolitical power between nations. Right from the start, we need to clearly understand the reasons why this process is so controversial and poorly understood until today, as we can see in the quote above by the well-known economist Celso Furtado, where we read: “The rapid and unusual growth of the productive forces known as the Industrial Revolution it is a phenomenon that escapes any attempt at schematic explanation.”
This difficulty of a clear “schematic explanation” of this process – which is of the greatest importance for the understanding of the great world problems of our days – lies in two main reasons:
1) The domain of materialist philosophies and theories (considered scientific) that, in fact, prevent a clear understanding of any global process of significant social-economic transformation; and,
2) The lack of interest in this issue on the part of centric countries, largely hegemonic not only in economic and military terms, but which are also, and above all, hegemonic (dominant) in cultural terms (scientific, religious, artistic, etc.). This cultural hegemony is of such magnitude that any cultural advance that occurs in the sphere of peripheral countries is, until today, seen with surprise and strangeness.
It is interesting for the history of Humanitarianism, and something related to this aspect of the cultural domain of the centric countries, a fact that occurred during the first attempt to create a Humanitarianist Party in Brazil. In those days when we were visited by agents of the federal intelligence agencies, among the various questions that were presented to us, the point that caused the greatest suspicion and surprise was that when asked which model of country served as a model for our party, our answer was that it was a new proposal, and we were not copying any of the existing models! The poor agents found it hard to believe, but after much insistence they said: “Yeah, maybe it’s time to create something of ours!”
Something similar, which should not be hard to imagine, also occurred in my master’s dissertation, when criticizing both the principles of Liberalism and Marxism. The reward of those who propose ideational changes, as we can see in so many historical examples, is usually quite unpleasant. “University passions are more shy than political passions, but no less violent.” (Maurice Duverger. Political Science: Theory and Method)
Still on the subject of cultural domain, it is worth remembering a contemporary historical example that occurred in India, which is also an important fact for the history of Humanitarianism. This is because India was the country that deserved a proposal for a Constitution made under the leadership of Dr. Annie Besant, as President of the All Parties Conference, and National Convention , with the participation of representatives of the Home Rule Club and the India Women’s Association): Constitution Proposal for India: The Commonwealth of India Bill (National Convention).
This remarkable fact is an “ideal type” (as Marx Weber would say) to illustrate the understanding of the overwhelming dimension of this cultural hegemony. This very illustrative fact is that India, after fighting heroically against English colonialism, when it finally achieved its political liberation, after the end of the Second World War, sought as a model for its great political institutions, incredible and paradoxical as it may seem, precisely the English political institutions!
This ideational “poverty” of Indian leaders, both Hindus and Muslims (which also explains the tragic India-Pakistan partition), in addition to exemplifying this overwhelming cultural domain, explains why India, after more than 70 years as a politically independent nation, remains unable to free itself from injustice, corruption and political incompetence and, therefore, to stop being a country subjected to such an unjust and cruel condition towards its people. After all these decades, India remains a very poor, corrupt and violent country, even though today it is a nuclear power. [India’s GDP per capita (2019) is still something between $ 2,000 (nominal) to 6,000 (PPP: at purchasing power parity) – see: Lists of GDPs per capita for all countries:
At purchasing power parity (PPP):
In the linke above we find lists of GDPs per capita for all countries, which is a great revealing synthesis of the abyss that separates the wealth of countries today, which should, in itself, be a proof of the mistakes of the Liberal theses, however dominant they may be until the beginning of the third decade of the 21st century!
If we get rid of these two great impediments to understanding this process of enormous distance of wealth between nations – something that until today is a matter of controversy, for the two reasons presented – then a clear “schematic explanation” will not be so difficult.
Initially, as we said, without the understanding that ideas govern the world, no clear understanding is possible of the great global processes of social transformation.
In this sense, broadly speaking, we must remember Max Weber’s thesis that without the cultural transformations that took place in Europe at the end of the Middle Ages and the beginning of the Modern Age, this whole process would not be possible, which resulted in the advent and the world’s social-political hegemony of Liberal capitalism. Max Weber centers his analysis (correct as far as it goes) on the role of the Protestant Reformation, in his work The Protestant Ethics and the Spirit of Capitalism, as a decisive aspect for the advent of capitalism. Here we need to go a little further than that point, while agreeing with the importance of his hypothesis.
We need to go beyond that point in the sense that the ideational transformations that led to the so-called Reforms of Christianity (Luther, Calvin, Puritanism, etc.) started well before these reforms, which already occurred in the Renaissance period. And the Renaissance was the result of ideational transformations (in Europe) that preceded it by some centuries. The Renaissance would not be possible without Pre-Renaissance thinkers. Here we need to highlight in the religious field the examples of Roger Bacon, Albertus Magnus and Thomas Aquinas.
Each of them brought important contributions within the Roman Church, leading in the direction of the need that religious theses should be supported by logic, which was already a great ideational transformation, implying a movement back to the great classics of Western civilization, Greek and Latin. And also, at least in the case of Roger Bacon, in an emphasis on the importance of experimentation (in addition to logic), which places him as a brilliant precursor of modern science, even in the 13th century (1200-1300), when these three influential thinkers lived.
Suffice it to mention, in the case of Roger Bacon, the fact that this religious is attributed the formula of gunpowder, which although known for a long time in China, gains greater precision in its use. As we have emphasized, the greater mastery and use of gunpowder is one of the decisive antecedents for the entire Modern Age and its transformations, as in the example of the Great Navigations.
We also need to mention the transformations in the field of the arts, in the so-called “humanists” of Pre-Renaissance. In the same way, we should mention Gutenberg, with his inventions of the mobile mass printing process, the use of oil-based paint, a wooden press system, and the combination of these elements in a practical system that allowed the mass production of printed books, the first of which was the Gutenberg Bible, published between 1450-1455. Needless to say, it is another of these preconditions for the transformations of the Modern Age and the dissemination of knowledge.
Another fact, not much emphasized, that occurred in Europe from the 13th to the 16th centuries is the occurrence of the Plague, which decimated a large part of the European population. In some areas, such as parts of kingdoms in what is now Italy, it has reduced the population by more than half (50%). It should not be difficult to imagine the impact, in all senses and in all fields of human activities, caused by an event of this magnitude.
This impact, with the force of an immense catastrophe, naturally goes in the direction of questioning the status quo that was dominant at the time. And not by chance, it was precisely in the region most affected by the Black Death – in terms of the greatest reduction in population, that as we said were regions in Italy – where the Renaissance took place with greater emphasis. Nor was it a mere coincidence that one of the synthetic “icons” of the period of the beginning of the Great Navigations is the association of the Genoese with the Spanish, and the fact that the first commander of the Spanish ships to arrive in the New World was a Genoese.
Finally, a reasonable “schematic explanation” of the antecedents of the Modern Age is not possible without an understanding of the influence of Islam. The growth and conquests of the Islamic empires of the time require (in our days) some effort to understand how much they influenced Europe, not only because they blocked traditional maritime routes, as want to make us believe the poor materialistic analyzes (even if academically dominant) with their hyper materialist economic theories, self-proclaimed scientific.
For us in Latin America, this should be obvious, since we are so much the children of Iberian culture, and the Iberian peninsula was dominated for centuries, and in every way influenced, by Islamic caliphs (invasion started in the 8th century and only ended in the 15th century, a domain, therefore, of about 7 centuries).
With these factors in mind, we now arrive at the beginning of the Modern Age, the Ottoman conquest of Constantinople (the end of the Christian Eastern Roman Empire in 1453), the Renaissance, the beginning of the Great Navigations, the Protestant Reformation initiated by the religious Martin Luther (his 95 Theses were published in 1517), further elaborated by John Calvin (Institutions of the Christian Religion, 1536) whose importance for capitalism and, therefore, for the entire formatting of the modern world was addressed by the work already mentioned by Max Weber.
This period of about three centuries that preceded the beginning of the Modern Age, in our view, is the most difficult to understand and the most neglected by contemporary analyzes. Once these various factors are reasonably clear, we can understand that, far beyond the mere growth of cities and the blocking of maritime routes, there were ideational factors that acted towards a profound transformation of Europe, which led to a loosening of the rigidity of thought medieval, with a revaluation of the classics, with a growing anthropocentric views, to the detriment of Theo-centered ones, which progressed in parallel with heliocentrism, to the detriment of geocentrism, and with the consequent growing affirmation of the spherical shape of the Earth.
All of these factors lead to the advancement of the defense of freedom of thought, simultaneously in the religious and secular fields, with the consequent stimulus to what we now call the scientific method of validating knowledge, and the series of knowledge and techniques that have come to be mastered, affecting all fields of human activity.
Without the understanding of these ideational changes and their consequences synthetically discussed above, it would not be possible to understand neither the Grand Navigations, nor the Protestant Reforms, nor the growing economic freedom, especially of commerce and finance (suffice to mention here that the dominant medieval thought considered usury a sin).
With the understanding of these changes, we can understand how that “ideal landmark” of the beginning of the Modern Age, which is the beginning of the Great Navigations, became possible. And, thus understanding, we can now (in view of the limits of this work) present a “schematic explanation” for the growing wealth differential between the nations and regions of the planet.
With the establishment of trans-continental colonies, the world definitely becomes “round”, so to speak, a fact that accelerates the ideational changes already underway, having as a landmark not only the expansion of the Protestant Reformation thinking, but also what today it is called scientific methodology, a sphere in which we can take as the “ideal landmark” Francis Bacon’s works The Advancement and Proficience of Learning Divine and Human, 1605; Novum Organum: Instauratio Magna (New Instrument: The Great Renewal), 1620; among other works of this great genius.
The wealth that flows from the colonies completely changes the geopolitical map of the planet. First, it places the Iberian kingdoms as the global geopolitical center, awakening the greed of the other European kingdoms, which, on the one hand, those who can, set out to obtain new colonies, and for various wars between them and, mainly, against the Iberian kingdoms, aimed at dominating these colonies, or parts of them. Without going into the details of these various wars, either in the European continent or in the colonies, it is enough to mention the various French and Dutch invasions that occurred on the Brazilian coasts (that is, only in this Portuguese colony).
At the same time and largely as a result of this influx of wealth, especially gold and silver (but also profitable products in general), an economic thought called Mercantilism is established as hegemonic, which takes on different shapes in different regions, but which, centrally, advocates that the enrichment of kingdoms must be linked to foreign trade, which with a positive trade balance makes the wealth of one nation (mainly conceived as gold and silver) flow to the other nation, which, on the other hand, it also allows for gains in scale and finding a way out of surplus production.
Naturally, in this context, the National State acquires a central role in the development of national wealth, by adopting protectionist policies and increasing the competitiveness of domestic production in general, as measures to increase the quality of domestic production, as well as establishing tariff barriers and export support. This, of course, also stimulates and accelerates the establishment of stronger and more cohesive National States, and the kingdoms that advanced in this direction obtained great commercial advantages.
But what interests us most here is the notion, until today not very clear, that this process of political and economic transformation is what is at the base of both the beginning of the huge wealth gap between nations (of the so-called “development” against “underdevelopment”), but it also constituted the fundamental stimulus for the so-called Industrial Revolutions, which clearly accelerate even further the distance of wealth that we try to explain schematically. In this sense, from that point on, we can dispense with the effort of creativity and simply bring quotes from a highly successful work in the field of teaching these processes, having deserved some revisions and many editions: Man’s Worldly Goods: The Story of the Wealth of Nations, by Leo Huberman.
Even though this work has a materialistic interpretive matrix, these quotations seem to us sufficient to show how this stimulus and protection to manufactures with increasing quality/competitiveness (aiming at positive balances in the trade scales), also operated in the same direction for the establishment and protection of the first industries. Only the titles of the sub-chapters of Chapter 11 (Gold, Greatness, and Glory) of this work are already a synthesis of the beginning of this process: “Accumulation of Treasures – Stimulus to Industry – Migration of Workers – Wealth by Maritime Transport – Colonies – Mercantilist Policy.”
As we said before, the Iberian kingdoms were transformed, due to the exploitation of the wealth of their colonies, throughout the centuries XVI and XVII, in the richest and most powerful kingdoms in the world. Let us see some quotes (taken from Chapter 11 of this work by Leo Huberman):
“If governments believed this theory that the more gold and silver in a country the richer it would be, then their next step was obvious. Pass laws forbidding people to take these metals out of the country. (…)
Such measures might keep within a country whatever gold and silver it already had. And countries which had mines within their own boundaries, or other countries, like Spain, which were lucky enough to own colonies whose mines were rich in gold and silver, could constantly add to their stock of metals. But what of those countries which had neither? (…)
For these countries the mercantilists offered a happy solution. A “favourable balance of trade” was their way out. What was meant by a favourable balance of trade?
In Politics to Reduce this Realm of England unto a Prosperous Wealth Estate written in 1549, we find the answer: “The only means to cause much Bullion to be brought out of other realms into the King’s mints is to provide that a great quantity of our wares may be carried yearly into beyond the Seas and less quantity of their wares be brought hither again’’ (…)
Countries could increase their supply of bullion, argued the mercantilists, by engaging in foreign trade – always being careful to see that they sold more to other countries than they bought from them. The difference in the value of their exports over their imports would have to be paid to them in metal. (…)
The trick, then, was to export valuable goods, import only what you needed, and get the balance in hard cash. This meant encouraging industry in every possible way, because the products of industry were more valuable than those of agriculture and so would sell for more in the foreign markets. Also, what was equally important, having your own industry in your own country, making the things your own people needed, meant that you would have to buy less from foreigners. This was a step in the direction of attaining that favourable balance of trade as well as in making your country self-sufficient, independent of other countries. (…)
There was, for example, the bounty given by the government on manufactured goods for export. (…) Government bounties on production were designed to stimulate manufacturing. So was the protective tariff. (…) The protective tariff to encourage “infant” industries was a device at least as old as the mercantilists, and probably older. (…)
Not only was industry to be fostered by bounties and high tariffs, but skilled foreign workmen who could introduce new trades or new methods were to be encouraged by every means possible to settle in the country. Foreign craftsmen were attracted by tempting privileges such as tax exemption, free dwellings, a monopoly for a certain number of years on the manufacture of their product, or loans of capital with which to set up their necessary equipment. When they could not be induced to come of their own free will, then occasionally governments resorted to kidnapping them. (…)
Not only were grants of monopoly given to inventors, but in some countries prizes were also held out as bait to those who would put their minds to work on the problem of building up home industry through the invention of new and better methods. In France, Colbert established state institutes for technical education, at well as industrial works run by the state itself. In Bavaria, at the end of the seventeenth century, the state cloth works employed 2,000 hands. These state works were to act as models, as inspiration, as laboratory. It was in these large-scale undertakings, not subject to gild restrictions of any kind that experiment and progress could go on freely, which was often difficult for single enterprising craftsmen.
But though it was difficult, it was not impossible. And the state was ever willing to encourage industry by direct subsidy, as well as in the other ways mentioned. The French textile industries, while Colbert was in charge, received some eight million pounds in subsidies of one kind or another. To a group of men who were to set up a plant for the manufacture of silk and of cloth of gold and silver in seventeenth-century France, the government gave many valuable privileges as well as direct aid in money: “One of the principal means of attaining this end [common good of our subjects] is the establishment of arts and manufactures, both for the hope which they give of enriching and improving this kingdom, that we may no longer have to go to our neighbours like beggars … seeking afar what we do not ourselves possess, and also because it is an easy and good means of cleansing our kingdom of the vices produced by idleness [unemployment], and the only way by which we may no longer have to send out of the kingdom gold and silver to enrich our neighbours (…).” [Recueil Géneral, vol. 15, pp. 283-7] (emphasis added)
This edict introduces another advantage the mercantilists emphasised in their reasons for wanting to build up industry. They continually pointed out that the growth of industry not only meant an increase in exports, which in turn helped toward a favourable balance of trade, but also brought about an increase in employment. Mr. T. Manley, writing in 1677, argued that “a pound of wool Manufactured and Exported, is of more worth to us by employing our people, than ten pounds exported raw at double the present rate.” (…)
So industry which brought employment to workers was to be encouraged. And considerable attention, too, was paid to the production of corn, to ensure enough food to the people, so they would be sturdy – when war came.”
Now, at a time when, due to all these transformations of the medieval order, beggars and unemployed people were a serious problem and cost good sums in social assistance, such an argument was of considerable value. It is worth asking ourselves if this has changed a lot from that time to the present day? But let’s continue a little more with Leo Huberman’s Man’s Worldly Goods: The Story of the Wealth of Nations:
“Fighting-men. War-time. People who were thinking in these terms would naturally concern themselves with the number and quality of their ships. Both for defending the home country and attacking the enemy country, ships would be needed. And just as the mercantilists thought of encouraging industry as a vital step in bringing about a favourable balance of trade, so they looked upon the building up of a merchant marine as essential for the same reason. To the extent that governments were interested in foreign trade, they emphasised the importance of adequate shipping facilities to carry their industrial products to other countries. They turned their attention, therefore, to the encouragement of shipping with much the same zeal that they showed for the fostering of industry. (…)
The English Navigation Acts so famous in American history had for one of their major purposes the wresting away from the Dutch of their command of the carrying service on the sea. That intent is plain in one of the Acts, dated 1660, which reads: “(…) be it enacted … that from and after the first day of December one thousand six hundred and sixty … no goods or commodities whatsoever shall be imported into or exported out of any lands, islands, plantations or territories to his Majesty belonging or in his possession … in Asia, Africa or America, in any other ship or ships, vessel or vessels whatsoever, but in such ships or vessels as do truly and without fraud belong only to the people of England (…) as the right owners thereof, and whereof the master and three-fourths of the mariners at least are English.” (…)
But you know that there were other parts of the Navigation Acts not so advantageous to the colonies. It was part of the mercantilist idea to regard colonies as another source of revenue for the mother country.
So it was that laws were passed prohibiting the colonists from turning to any industry which might compete with the industry of the mother country. The colonists were forbidden to manufacture caps, hats, and woolen or iron goods. All the raw materials for these things were on hand in America; yet the colonists were expected to tend these raw materials to England to be manufactured, then buy them back in the form of manufactured goods. (…)
This was England’s attitude not only to America, but to all her colonies. (…)
Certain American products, such as tobacco, rice, indigo, masts, turpentine, tar, pitch, beaver-skins, pig-iron (the list increased with time), had to be sent to England only. The English wanted these things for themselves, for their own manufacturing industries. And what they couldn’t consume themselves, they would re-export – at a profit. (…)
The key to an understanding of the friction that arose between mother country and colonies was that, while the mother country thought that its colonies existed for her sake, the colonies thought they existed for their own sake. Sir Francis Bernard, the royal governor of Massachusetts, made the mercantilist notion of the relation between mother country and colonies quite dear: “The two great objects of Great Britain in regard to the American trade must be (i) to oblige her American subjects to take from Great Britain only, all the manufactures and European goods which she can supply them with; (a) To regulate the foreign trade of the Americans so that the profits thereof may finally centre in Great Britain, or be applied to the improvement of her empire. [Quoted by Challes and Mary Beard, The Rise of American Civilization. New York, The Macmillan Company, 1933, vol. I, p. 115]
Here was a plain statement of the fact that colonies existed solely as an aid to the mother country in its struggle for national wealth and power. This was true not only of England but of France, of Spain, of every mother country of the mercantilist era. It’s important to remember that. (…)
Colbert wrote to M. Pomponne, the French minister at The Hague in 1670, “Since commerce and manufacture cannot decrease in Holland without passing into the hands of some other country . . . there is nothing so important and necessary for the general welfare of the State, as that we should, at the same time as we see our commerce and manufacture increasing within the kingdom, also be assured of their real and effective diminution in the States of Holland.” [A.J. Sargent, Policy of Colbert. London, Longmans, Green and Co., 1899. pp. 78-9]
You can see that belief in the idea that “there is nothing so important and necessary for the general welfare of the State” as to be certain that the commerce and manufacturing of a rival state be diminished, was bound to lead to only one thing: War. The fruit of mercantilist policy was war. The scramble for markets, the fierce competition for the trade of this country or that, the fight for more colonies – all these plunged the rival nations into one war after another. Some of these wars were openly labelled what they really were – trade wars. The purpose of the others was disguised by high sounding names, as so often happens, even today. But we have the word of the Archbishop of Canterbury in 1690 that: “In all the Struggling and Disputes, that have of late years befallen this corner of the World, I found, that although the pretense was fine and Spiritual, yet the ultimate end and true scope, was Gold, and Greatness, and Secular Glory.” [Quoted in C.J.H. Hayes, Essays on Nationalism, pp. 37. New York, The Macmillan Company, 1926. Emphasis added. Quotations, as noted before, from Chapter 11 of Leo Huberman’s Man’s Worldly Goods: The Story of the Wealth of Nations.]
Have there been any essential changes regarding these real goals and objectives in the last three centuries? Have they essentially changed the ends and objectives that guide and shape the dominant political systems today, that is, the western civilizing pseudo-scientific model now dominant, and the “wars” for economic competitiveness and the geopolitical dominance of today’s globalization?
We hope that this “schematic explanation” helped to clarify the beginning of the process that created the wealth gap between nations that exists until today.
The first stage of this process, therefore, was simple colonial-mercantile “prey”. This step has already markedly increased the wealth gap between nations. Next, we have a step to widen this wealth differential thanks to the advent of the Industrial Revolutions, with the metropolises establishing themselves as leading industrialized zones, while the colonies were restricted (even because they were obliged to do so) to be commodities supplying zones and consumers of industrialized goods. In other words, “prey” has now started to include the differential obtained thanks to the added value of industrialized products, in comparison to the small value added to primary goods in general.
We say “prey”, even for this differential generated by industrialization, because we cannot help noticing that this whole process developed (for a long period) while the world was still characterized by the dichotomy of the existence of colonizing nations and colonized nations. And it was only at the beginning of modern industrialization (called the First Industrial Revolution) that Liberal economic thinking, in favor of “free” competition, or “freedom” of international trade, became gradually dominant.
At the beginning of this process, this “freedom”, which later became the dominant thought (as it still is today) was something very restricted to the companies (commercial and industrial) of the colonizing countries. As we have already said, for centuries, for example, the establishment of industries in colonial Brazil was prohibited.
What is the concrete result of these centuries of colonialism and neocolonialism? The wealth differential between the richest and poorest nations, which at the beginning of the period in question was thirty, or at most fifty percent (a multiple of 1.3 or 1.5), since the end of the 20th century is on the order of well over a thousand percent. Thus, hypothetically, if the difference in wealth (between the richest and the poorest) was in the order of one thousand to one thousand and five hundred (50%), today that differential roughly is, in terms of GDP per capita, one thousand dollars to fifty thousand dollars (that is, something close to 5,000%)! See:
Lists of GDPs per capita for all countries:
At purchasing power parity (PPP):
Industrialization and the Creation of Added Value
Why is that so important? We need to clearly understand that, unless a country has exceptional natural resources (for example, countries that have a lot of oil in their territory, or a small population in relation to a very large territorial dimension), there is no other way to reach the level of wealth reached by the richest nations on the planet, if not through an intensive industrialization process.
This is because each time a given raw material goes through an industrial transformation process of any kind, it is added an additional value that includes the gain from the profit obtained in this transformation process. In economics, this differential obtained at each moment of transformation of the production process is called “added value”. Industrialization, therefore, allows the generation of a much more complex economic structure, with more stages of transformation in the production process, with each of these stages adding more value.
This greater industrial complexification has several positive effects in terms of generating greater wealth. For example, it generates a higher occupancy rate in the labor force; it generates an inter-industrial complement that allows productive processes with an increasing number of transformation stages; it generates the need to complement a very wide range of services of all kinds; and this complementation between the sectors of agriculture and the exploration of other raw materials, industry and services and trade generates impressive productivity gains, above all, through the increasing mechanization of productive processes of all kinds, as well as the gains of scale that this greater industrial complexity makes it possible.
Now, this process, considered globally, occurred first in some nations and thanks mainly to the advantages obtained over others, by fire and sword, through colonialist domination. When this process was well advanced, then the dominant discourse became different, and the purely Mercantilism philosophy was replaced by the Liberal philosophy.
In a broad sense, it was the advance of this process of domination and competition between nations that led the world to two great World Wars (which, basically, were wars between rich nations over the dispute for colonial or neocolonialist spaces), as well as the present period, and the current form of economic globalization characterized by “free” international competition, that is, by the “war” of all against all for profitability, economic competitiveness and the resulting mercantile gains.
Relative and Convenient Economical “Freedom”
This broad and “free” economic globalization, that is, this “war” with the weapons of “modernization” (productivity, adding value, competitiveness, etc.) is characterized by some illusory and very perverse aspects.
First, the so-called “freedom” applies only to certain economic factors, that is, it applies in general to primary products, industrialized products, including machines, and services. But, it doesn’t apply to the work factor. This economic factor does not enjoy the freedom to move around at will. This, of course, aims to ensure that the advantages obtained by some are not threatened by migratory movements in search of better wages, job opportunities, etc. The freedom that characterizes the current form of globalization and its “war” for “modernization” (competitiveness, etc.), therefore, is much more interesting for rich countries than for poor countries.
Second, this selective “freedom” (which exists only for certain economic factors) inherent in the current form of globalization and “modernization”, is a sort of “fox inside the chicken coop” process. Let’s see if this is not the case. As we have seen, it is a struggle for productivity, etc., among competitors who did not leave on an equal footing, since we cannot ignore the period prior to this current one, which was a period of centuries of colonialist and Neo-colonialist exploitation.
Today, therefore, competition is established between very unequal forces and in a “war” game like this, in which the one with greater power is the one who suffer the least, this selective “freedom” only tends to maintain the initial differences, and often even to accentuate them, which clearly characterizes a process in which the weakest have no chance of victory. We see, therefore, that this freedom is like the “freedom” of the fox inside the chicken coop, very interesting only for one side.
Finitude of the Natural Resources
Even from the point of view merely related to the exploration and consumption of the main raw materials, it is possible to see that the poorest will never be able to reach, within the current rules of the game, the standard of wealth reached by the richest. Just to mention a well-known example, let us examine a projection of the level of per capita oil consumption for the world population. That is, let us examine an example of raw material that is still an indispensable source for the energy generation, as well as a necessary input to many production chains (chemicals, plastics, etc.).
If we take into account the average per capita consumption of the USA, Canada, or even Germany and Japan, which are examples of rich countries, what would happen? This question is not at all absurd, since if we imagine that poor countries should imitate the example of rich countries, then they will also develop a pattern of consumption and a very similar energy matrix. In that case, it would happen that all known oil reserves would be consumed in just over six years, according to data from “British Petroleum”. (BP – Statistical Review of World Energy, 06/85 and 06/87).
Let’s look at this data a little. World oil reserves would be 95,200 million TEP’s (tons of oil equivalent). The US population was about 250 million and its consumption in 1986 was about 750 million TEP’s. While its population was about twenty times less than the world population, its oil consumption was only four times less than world consumption, which in 1986 was about 3 billion TEP’s.
Therefore, if we project its per capita consumption (750 divided by 250 = 3), for the entire world population, which at the time was about 5,000 million (five billion) people, we will have a world consumption five times greater, that is, 15,000 millions of TEP’s. Now, dividing world reserves by what would be world consumption (95,200 by 15,000 = 6.3) we see that in just over six years we would have exhausted the world reserves known at the time.
Therefore, even if these data can be reevaluated, and if the reserves to be discovered doubled, this would give us a horizon of just twelve years, which would not change much the panorama we want to demonstrate. In other words, it is obviously not possible for all poor countries to reproduce the pattern of “development” and wealth of rich countries. This is a material impossibility, quite simply, both in relation to oil and several other raw materials.
In this way, even from this angle, we can see that the current “freedom” of international trade, and the modernization that “worked” for rich countries, has absolutely no chance of equally “working” for poor countries in which, it is always good to remember, two thirds of the world’s population live. However, most people, even among those with university degrees, are unaware of these hard facts of the world reality.
“Success” Through Exploitation
Therefore, many countries that are examples of places where the Liberal model “worked”, established a prosperity that was only possible at the expense of the poverty of the greater part of the world population. Furthermore, this process continues to “work” at the expense of Neo-colonialist forms of exploitation, which guarantee them a victory in the “war” or, as we said, in the “race” of productivity and profitability (via adding value, competitiveness, etc.), that guarantees the maintenance of this unfair state of affairs.
Many people, in view of these general conditions, claim that Brazil is a country that can still “work”, or a country with a “future”. This is because due to its natural resources, its territorial dimensions, etc., Brazil could be a kind of last wagon on the train of the countries that benefit from the exploitation of the others. Even if that were true, should we call it “success”?
That is, to establish a “beautiful” standard of living at the expense of the poverty of Bolivia, Paraguay, etc.? We can call it “success” if we want to, but we cannot help recognizing that from the point of view of the well-being of humanity as a whole, this is a failed model, which implies the impossibility of a global solution to the problem of this “underdevelopment” (among other major world problems) and, therefore, implies immense immorality.
Now, being better understood the process how the enormous wealth differential between nations originated, and how this panorama of exclusion and injustice is perpetuated, we can now see that, especially with regard to the possibilities of overcoming the poverty of poor countries (within a scenario like this) the failure of the current forms of the Liberal models (and also of the Marxist model, as we have seen) becomes even more evident.
A system of social-political organization such as the current dominant models of Liberal pluto-demagogicracies (as we have today in Brazil), is characterized by a terrible process of selection of the government officials, and by the weakness and small capacity of coercion (or political strength) of these leaders. Therefore, this model implies, at best, the perpetuation of the current state of affairs. In view of this, it is not surprising that rich countries find it so interesting.
Necessity of a New Political Model
The world as a whole and, above all, poor countries have as their only hope the advent of new institutions, mainly political institutions (from which leaders, legislators etc. are chosen), that is, the advent of a new political model, which, as we have seen, depends on true new metaphysical and ethical ideas. A model that guarantees the selection of morally trustworthy and technically competent rulers, as well as that guarantees these rulers a great capacity for coercion or political strength. This great political force is necessary so that these leaders can control, discipline and harmonize, for the sake of collective welfare, the power of the gigantic organizations. This capacity can only come, in a natural and benign way, through a good organization of the entire population.