Saturday, January 10, 2015

Islam



"Islam is a religion adapted to Orientals, especially Arabs, i.e., on one hand to townsmen engaged in trade and industry, on the other to nomadic Bedouins. Therein lies, however, the embryo of a periodically recurring collision. The townspeople grow rich, luxurious and lax in the observation of the "law." The Bedouins, poor and hence of strict morals, contemplate with envy and covetousness these riches and pleasures. Then they unite under a prophet, a Mahdi, to chastise the apostates and restore the observation of the ritual and the true faith and to appropriate in recompense the treasures of the renegades. In a hundred years they are naturally in the same position as the renegades were: a new purge of the faith is required, a new Mahdi arises and the game starts again from the beginning. That is what happened from the conquest campaigns of the African Almoravids and Almohads in Spain to the last Mahdi of Khartoum who so successfully thwarted the English. It happened in the same way or similarly with the risings in Persia and other Mohammedan countries. All these movements are clothed in religion but they have their source in economic causes; and yet, even when they are victorious, they allow the old economic conditions to persist untouched. So the old situation remains unchanged and the collision recurs periodically. In the popular risings of the Christian West, on the contrary, the religious disguise is only a flag and a mask for attacks on an economic order which is becoming antiquated. This is finally overthrown, a new one arises and the world progresses."
F. E.


Lineages of Revolt: Issues of Contemporary Capitalism in the Middle East, by Adam Hanieh.


"Conventional accounts of political economy in the Middle East tend to adopt a similar methodological approach, which begins, typically, with the basic analytical categories of “state” (al-dawla) and “civil society” (al-mujtama’ al-madani). The former is defined as the various political institutions that stand above society and govern a country. The latter is made up of “institutions autonomous from the state which facilitate orderly economic, political and social activity” or, in the words of the Iraqi social scientist Abdul Hussein Shaaban, “the civil space that separates the state from society, which is made up of non-governmental and non-inheritable economic, political, social and cultural institutions that form a bond between the individual and the state.” All societies are said to be characterized by this basic division, which sees the state confronted by an agglomeration of atomized individuals, organized in a range of “interest groups” with varying degrees of ability to choose their political representatives and make demands on their political leaders. The institutions of civil society organize and express the needs of people in opposition to the state, “enabling individuals to participate in the public space and build bonds of solidarity.” The study of political economy becomes focused upon, as a frequently cited book on the subject explains, “strategies of economic transformation, the state agencies and actors that seek to implement them, and the social actors such as interest groups that react to and are shaped by them.”
A conspicuous feature of the Middle East, according to both Arabic- and English-language discussions on these issues, is the region’s apparent “resilience of authoritarianism”—the prevalence of states where “leaders are not selected through free and fair elections, and a relatively narrow group of people control the state apparatus and are not held accountable for their decisions by the broader public.” While much of the world managed to sweep away dictatorial regimes through the 1990s and 2000s, the Middle East remained largely mired in autocracy and monarchical rule—“the world’s most unfree region” as the introduction to one prominent study of authoritarianism in the Arab world put it. A dizzying array of typologies for this authoritarianism has been put forward, characteristically dividing the region between authoritarian monarchies (the Gulf Arab states, Morocco, Jordan) and authoritarian republics (Egypt, Syria, Algeria, Yemen, Tunisia). These authoritarian regimes are typically contrasted with a third category, the so-called democratic exceptions, in which “incumbent executives are able to be removed and replaced.” Israel is frequently held up as the archetype of this latter group—with Turkey, Iran, Lebanon, and Iraq (following the 2003 US invasion) also included, each with a varying “degree” of democracy.
An entire academic industry has developed around attempting to explain the apparent persistence and durability of Middle East authoritarianism. Much of this has been heavily Eurocentric, seeking some kind of intrinsic “obedience to authority” inherent to the “Arab mind.” Some authors have focused on the impact of religion, tracing authoritarian rule to the heavy influence of Islam, and the fact that “twentieth-century Muslim political leaders often have styles and use strategies that are very similar to those instituted by the Prophet Muhammad in Arabia some 1400 years ago.” Similarly, others have examined the source of regime legitimacy in places such as Saudi Arabia, where the “ruler’s personal adherence to religious standards and kinship loyalties” supposedly fit the “political culture” of a society whose reference point is “Islamic theocracy coming from the ablest leaders of a tribe tracing its lineage to the Prophet.” Other more modern explanations for authoritarianism have been sought in intra-elite division, leaders’ skills at balancing and manipulating different groups in society—so-called statecraft, natural resource endowment, and the role and attitudes of the military. All these approaches share the same core methodological assumption: the key categories for understanding the Middle East—and, indeed, any society—are the state, on one hand, counterposed with civil society, on the other.
This state/civil society dichotomy underlies another frequent (although not unchallenged) assertion made in the literature on the Middle East—that of a two-way, causal link between authoritarianism and the weakness of capitalism. According to this perspective, authoritarianism not only means that political and civil rights are weak or absent but also that the heavy hand of state control interferes with the operation of a capitalist economy. Individuals are prevented from freely engaging in market activities while state elites benefit from authoritarianism by engaging in “rent-seeking behavior”—using their privileged position to divert economic rents that pass through the state for their own personal enrichment and consolidation of power. Authoritarian states seek to dominate and control economic sectors through their position of strength, allocating rents to favored groups in order to keep society in check. In the Middle East, as a result, “private property is not secure from the whims of arbitrary rulers...[and] many regimes have yet to abandon allocation for alternative strategies of political legitimation, and hence must continue to generate rents that accrue to the state.”
Within this worldview, the agency of freedom is neatly located in the realm of the market, while tyranny lurks ever-present in the state. The history of the region is thus characteristically recounted as a long-standing struggle between the “authoritarian state” and “economic and political liberalization.” Told from this perspective, the narrative usually begins with the emergence from colonialism in the aftermath of World War II, when various independence movements sought a definitive end to British and French influence in the area. These independence movements were typically led by militaries or other elites, which seized power in the postcolonial period and began an era of “statism” or “Arab socialism.” By the 1980s, however, these authoritarian states would come under severe strain due to the inefficiencies of state-led economic development and the desire of increasingly educated populations for greater economic and political freedom. These pressures for economic liberalization were compounded in the era of globalization by the ethos of “democratization” that swept the globe through the 1990s. There was—as two well-known scholars of the Middle East put it—a “direct correlation between economic performance and the degree of democracy...the more open and liberal a polity, the more effective has been its economy in responding to globalization.” Authoritarian states that had “waged literal or metaphorical wars against their civil societies and the autonomous capital that is both the cause and product of civil society” might sometimes choose the “right” economic policies, but these were inevitably “dead letters in the absence of implementation capacity, which only a dynamic civil society appears to be able to provide.” Capitalism was, in short, best suited to—and a force for—democracy.
This logic was widely replicated outside of academia through the 1990s and 2000s, forming the core justification for a wide-range of so-called democracy promotion programs. Integral to this was the US National Endowment for Democracy (NED), established in 1983 and funded by the US State Department. NED, in turn, supported other organizations such as the National Democratic Institute (NDI) and the International Republican Institute (IRI)—linked to Democratic and Republican Parties respectively—and bodies such as the Center for International Private Enterprise (CIPE) and the Solidarity Center (affiliated to the AFL-CIO). A host of other private corporations and NGOs were also involved. Through these institutions, the US government focused on programs that twinned the extension of neoliberal policies with the democracy promotion agenda in the global South. As then president George W. Bush noted in 2004, this policy was based around “free elections and free markets.” It was a form of democracy understood in the narrow sense of regular electoral competitions, usually waged between different sections of the elite, which largely aimed at providing popularly sanctioned legitimacy for free market economic measures. While organizations such as NED, NDI, and IRI were the most visible and explicit face of this policy orientation, all international financial institutions were to employ the same basic argument linking “free markets” and “a vibrant civil society” with the weakening of the authoritarian state.
In this vein, the response of Western governments and institutions to the revolts of 2011 and 2012 was largely predictable. Instead of viewing the Arab uprisings as protests against the “free market” economic policies long championed by Western institutions in the region, they were framed as essentially political in nature. The problem, according to the Western angle, lay in authoritarianism, which stifled markets, and the popular rage expressed on the streets of the Middle East could thus be understood as pro-capitalist in content. US President Obama noted, for example, in a major policy speech on the Middle East in May 2011, that the region needed “a model in which protectionism gives way to openness, the reins of commerce pass from the few to the many, and the economy generates jobs for the young. America’s support for democracy will therefore be based on ensuring financial stability, promoting reform, and integrating competitive markets with each other and the global economy.” Likewise, the president of the World Bank, Robert Zoellick, argued that the revolts in Tunisia occurred because of too much “red tape,” which prevented people from engaging in capitalist markets. This basic argument would be repeated incessantly by Western policy makers throughout 2011 and 2012—autocratic states had stifled economic freedom; “free markets” would be essential to any sustained transition away from authoritarianism."
[Excerpted from Lineages of Revolt: Issues of Contemporary Capitalism in the Middle East, by Adam Hanieh.

Friday, January 02, 2015

The Peculiar Modalities of Capitalism in the Arab Region

Excerpts and notes from 
The People Want: A Radical Exploration of the Arab Uprising 
Gilbert Achcar 2013 

The 23 July 1952 coup of the Free officers led by Gamal Abdel Nasser "unquestionably led to a transformation of Egypt much more radical than anything that has so far resulted from the Revolution of 25 January 2011. 

The 1952 coup led to the overthrow of a dynasty, the abolition of the monarchy and parliamentary regime, the creation of a republican military dictatorship, the nationalisation of foreign assets, the subversion of the old regime's property-holding classes (big land property, commercial and financial capital), a major drive to industrialise and far-reaching progressive social reforms. These changes certainly better deserve to be called a 'revolution' than do the results of the uprising set in motion in January 2011..." The People Want, p. 15 

"The Tunisian and Egyptian political revolutions have...left the state apparatuses of the fallen regimes essentially intact; only in Libya was the old state machine largely dismantled by a civil war. However, none of these countries has yet experienced a social [in italics] revolution, in the sense of a thorough transformation of its social structure. Only factions at the pinnacle of the social hierarchy - big or small, depending on the case - have been affected. Nowhere has that hierarchy itself been modified." 16-17 

It is a fact "that the political revolutions...cannot by themselves eliminate the profound causes of the explosion that has set the region ablaze; only profound socio-economic transformations can do that." 17 

My comment: even this "political revolution" has been proven so far to be quite limited: in Tunisia those who were more funded dominate parliament and a faction of Ben Ali regime still controls the state. In Egypt, however, the 'political revolution' itself has been overturned and and a military dictatorship has taken over since 30 June 2013. 

"Is what have been witnessing in the Arab region since 2011 an 'era of social revolution' brought on by a blockage impeding the development of productive forces. If so, is this blockage due to factors common to the countries of the region and specific to them, as in the two historical cases mentioned [the 'bourgeois' revolutions in Europe and the collapse of the Soviet Union]." 20 

"Whereas the European upheaval of the 1980s resulted from a crisis at the very heart of bureaucratic mode of production, the crisis in the Arab region affects only one of the peripheral zones of today's globalised capitalist mode of production. 
The fact that the crisis in Arab countries is clearly limited to them as far as its peculiar modalities are concerned plainly shows that specific factors are at work." 
However, "it is not always necessary to replace the basic mode of production in order to overcome the blockage. A change in modality or "mode of regulation' does, however, have to occur. 
"Such changes do not necessarily presuppose social or even political revolutions. They can result from economic crises that induce the economically dominant class to change tack." 21 

Albert Soboul's definition of "revolution" as a "radical transformation of social relations and political structures on the basis of a renewed mode of production", as long as we admit that such renewal may be limited to a profound change in the modalities of a mode of production, with no accompanying change in the generic mode itself. 22 

Development 
Example: 
"MENA's growth rate [between 2000 and 2008, see World Bank figures, p. 27] is not merely far lower than South Asia's and East Asia's, it is below even that of sub-Saharan Africa. This comparison of total GDPs also neutralises the impact of the demographic factor on per capita GDP growth, although it is perfectly legitimate to argue that the latter is the sole valid indicator of growth. Indeed, underscoring the oil wealth of this region of the world - richly endowed in both raw materials and capital, and with no shortage of labour supply, so that it has the three basic prerequisites for industrialisation - throws acuteness of the problem plaguing it into even sharper relief." 27 

"As measured by HDI [UN Human Development Index using Purshasing Power Parity/PPP], the Arab states were outperformed by East Asia in the period 1980-2010, despite the fact that the Arab region is much richer." [see UN Figure, p. 28] 

Thus, "according to World Bank data, the percentage of people living in extreme poverty - that is under the international poverty line of $1.25 (PPP) per day - is lower in MENA as opposed to all other developing regions. In 2008 it was 2.8 in MENA as opposed to 6.5% in Latin America, 14.3% in East Asia, and a shocking 36% in South Asia and 47% in sub-Saharn Africa. The percentage of inhabitants living on less than $ a day was the lowest in MENA..." 30 

However, these figures as indicators of poverty are questioned by the Arab Human Development Report 2003. See pp. 31-3 

The Arab region "exhibits poverty and inequality rates that are quite high, although they are on average lower than those found in other developing regions in Africa and Asia. But MENA breaks indisputably breaks a number of world records when it come to...precarity - understood as a combination of informal labour, unemployment and underemployment." 36 

"Yet the fact remains that the so-called 'informal sector' - 'informal' because it is not subject to state regulation - is, overall, smaller in Arab countries than in other developing regions in Asia and Africa, even if it accounts for a sizeable proportion of those countries' labour force and total employment." See Figure p. 37 

"Paradoxically, the fact that income and educational leveld are higher in the Middle East and North Africa than in the other developing regions of Asia and Africa is responsible for MENA's significant higher unemployment rates." See Figure, p. 38 

"[I]n the Arab states, 97.8% of the unemployed receive no allocations at all... In fact, in most Arab states, 100% of the unemployed receive no unemployment benefit at all..." 39 

"...MENA societies are not particularly young compared with the world's other developing regions..." They are "scarcely younger than societies in sub-Saharan Africa or South Asia..." 

"...what distinguishes the conditions of young people in MENA from their peers in other developing regions is not demographics, but plainly, the social and political conditions responsible for an economic situation thanks to which nearly one-quater of youth between the ages of 15 and 24 are, according to officla statistics, looking for work." 43 

"The other major distinguishing feature of MENA unemployment is the disparity, greater than anywhere else in the world, between the proportion of men and women in the 'labour force' seeking employment." 43 

"The third major characteristic of unemployment in the Arab region is the high percentage of unemployed people who have completed their tertiary education." 47 

"The weaker economic growth is, the less the economy is capable of absorbing a potential labour force that is expanding in step with population growth. The underemployment of the region's population as a whole indicates, in the clearest possible way, the extent to which its potential for development is being thwarted, with an employment/population ratio well under 50% in 2010..." 51 

"Yet, since its 1972 peak due to the 1971 nationalisations of oil, and its 1974 and 1976 peaks due to the price surge that followed the 1973 Arab-Israeli war, the region's per capita GDP growth rate has exhibited a clear downward trend, in a context marked by the dismantling of the state-led developmentalist model." 53 

The neoliberal turn was dominated by the "idea that the command economy had failed to overcome underdevelopment and absorb the population explosion. The panacea...had it that development should be based first and foremost on the private sector." 54 see Figure, p. 54: GDP per capita annual growth 1969-2010 

"The decline in GDP per capita growth has gone hand in hand with a decline in the ration of investment, or gross fixed capital formation (construction, transport, infrastructure and industrial equipment) to GDP." See Figure, p. 55 

"Between 1974 and 1988, MENA registered strong investment growth, culminating in 1978 in an investment rate of 30% of GDP." 55 

Comparison: "After a drop induced by the 1997 Asian financial crisis, the ration of fixed investment to GDP in East Asia started rising again at the turn of the century, climbing back up to 35% by 2004 and approaching 40% in 2009. In MENA, in contrast, it has since 1985 consistently fallen short of 24%." 56 

"East Asia's very high public investment rates are an index of the state's major role in this region...thus belying the basic assumptions of the neoliberal ideology..." 

The Economist on China: "[I]s investment, not exports, that leads China's economy. Spending on plant, machinery, buildings and infrastructure accounted for about 48% of China's GDP in 2011..." 26 May 2012, Achcar's, p. 58 

Net official financial flows: See Figure, p. 59 

"The relative levelling off or decline in MENA public investment has not been offset by an increase in private investment. The private sector's contribution to gross fixed capital formation in MENA countries (except for the six GCC monarchies) essentially stagnated between 1982 and 2007..." 60 

Example: Syria 
"Mohammed Jamal Barout has pointed out that the accelerated liberalisation of the economy under Bashar al-Assad brought on a record fall in the rate of public investment, from 13% of GDP in 2005 to 8% in 2008, whereas the rate of private investments that were supposed to make up for the slackening public effort stagnated at 11% to 12%..." 60 

As the World Bank's September 2011 regional report points out "the bulk of this FDI [foreign direct investment between 2002-2011] went to the GCC states..." 62 

Conclusion: "the low per capita GDP growth rates and record unemployment rates dispalyed by MENA region, despite a slowdown in population growth, are natural corollaries of steadily declining growth in fixed capital." Example: Egypt, see Figure, p. 63 

Women's conditions: p. 66-7 

Mode of production 
What features of the mode of production dominant in the Arab region account for the blockage of its development? 

According to the World Bank "the developing countries of the Middle East and North Africa region were less affected than other developing regions by the global recession..." However, this does not mean the recession had no impact at all especially on food prices. 

Sub-Saharan Africa "experienced inflation rates higher than MENA's in the two years preceding the 2011 explosion: 10.6% and 7.4% in 2009 and 2010, respectively, against MENA's 6.6% and 6.9%. Yet it has not witnessed a comparable uprising..." 69-70 

We shouldn't then confuse an aggravating circumstance such as exceptional droughts in Syria with an efficient cause. We shouldn't confuse 'structure with conjuncture'. 

"In the tradition of Marx and Jean Jaures, [Albert] Soboul distinguishes between, on the one hand, the basic, long-term contradictions that bring the development of the productive forces into conflict with political and social structures and, on the other, the conjunctural variations that exacerbate these basic contradictions." 70 

"The Great Recession has merely exacerbated the specific structural factors underlying the regional explosion." 71 

The explanation of the sociopolitical explosion in MENA as a consequence of the general failure of neoliberalism has been vitiated by the good performance of other developing countries such as Chile, India or Turkey, which have applied neoliberal policies consistently. Thus the argument of the international financial institutions is that the results of neoliberal policies depend on those charged with carrying them. The same institutions claim that the Arab region is suffering from insufficient economic liberalisation... 

"By exacerbating corruption on the highest rung of the social ladder while simultaneously producing disastrous results for the social strata on the lowest groups, these [neoliberal] policies have very obviously precipitated the explosion." 71 

Feature 1: the role of state rents. A significant share of MENA' countries' state revenues derives from rents: net exporters of petroleum, gas, minerals, etc. 
Rent designates regular revenue that is not generated by labour. 72 
Forms of rent: rent derived from natural resources, geographical rents (e.g. transit fees), capitalist rents (e.g. Real estate or portfolio investments), strategic rents (funds received for military or security-related functions), mercenary services (US military subsidies, racketeering). 72-3 

Cliche 1: the less governments depend on tax receipts, the less democratic they are. 
Cliche 2: the existence of a large 'middle class' is a prerequisite for the proper functioning of representative democracy. 

"Patrimonialism is an absolute, hereditary type of autocratic power, which is, however, capable of functioning with an entourage of 'kith and kin'. The patrimonial power appropriates the state for itself." 77 'crony capitalism', dominated by a state bourgeoisie, is the type of capitalism that develops under this type of regime. 
The state bourgeoisie benefits from a rent-generating situation and, in return, it pays the rulers a rent in cash. The market bourgeoisie is often compelled to follow suit. 

Neopatrimonialism is "an institutionalised form of republican authoritarian power... To a greater or lesser extent, the neopatrimonial state enjoys autonomy vis-a-vis- its rulers, who can always be replaced. Nepotism nevertheless reigns in this type of regime as well... Once an autocratic neopatrimonial regime has achieved long-term stability, it tends to become a patrimonial regime, with hereditary or semi-hereditary...transmission of power." 77-8 

Patrimonial regimes: the GCC monarchies, Morocco, Iraq until 2003, Libya until 2011, and Syria. 
In the case of the Jordanian and Moroccon monarchies neopatrimonial regimes a government and parliament coexist with royal patrimonialism. 
"The regimes of Algeria, present-day Iraq, Mauritania and Sudan are all neo-patrimonial regimes", as was the regime in Tunisia before 2011. 
In Lebanon, however, "various interests groups with Mafia-like components hold central power by turns and thus share the spoils." 78 

"Taken as a whole, the Arab region appears, in the final analysis, to be a vast concentration of patrimonial and neopatrimonial regimes in which the former preponderate to an extent unmatched in any other region of the world today." 78-9 

'The resource curse' "is a typically tautological explanation of underdevelopment whne it is brought to bear on the economy in isolation, without regard for the overall sociopolitical configuration. What fetters development is not the abundance of natural resources as such, but the uses to which resources are put under the prevailing type of social domination." 79 

However, "neopatrimonial regimes can oversee successful economic development..." South Korea and Taiwan "only confirm an observation that Max Weber made long ago about the potential role of patrimonialism in this regard." Other examples are Colbertism in France and Bismarck's Germany. Saddam Hussein's and the Shah's regimes were other examples.