Assault on Paradise: Perspectives on Globalization and Class Struggles

Chapter Six: Understanding Class Analysis: A Marxist Approach

157 Chapter Six Understanding Class Analysis: A Marxist Approach Overview The approach to class analysis that focuses on mechanisms of exploitation and domination is most closely associated with the Marxist tradition, although some sociologists more influenced by Weber also include these mechanisms in their conceptions of class. Most sociologists, however, ignore them; some explicitly deny their relevance. ‘Domination’ and, especially, ‘exploitation’ are contentious terms because they tend to imply a moral judgment, rather than a neutral description. Many sociologists try to avoid such terms because of this normative content. I feel, however, that they are important and accurately identify certain key issues in understanding class. ‘Domination’ refers to the ability to control the activities of others; ‘exploitation’ refers to the acquisition of economic benefits from the labour of those who are dominated. All exploitation therefore involves some kind of domination, but not all domination is exploitation. Introduction Analysis of class divisions and struggles is especially important in developing an understanding of the nature of capitalism. The reason is that classes are defined and structured by the relations concerning (i) work and labour and (ii) ownership or possession of property and the means of production. These economic factors more fully govern social relationships in capitalism than they did in earlier societies. While earlier societies contained various strata or groupings which might be considered classes, these may have been strata or elites that were not based solely on economic factors, e. g. priesthood, knights, or military elite. The Reality of Globalization It is important not to underestimate the significance of globalization. It might well be an ‘ideological mystification’ in the hands of a Martin Wolf or 158 some intellectuals and academics on the political left, but its impact on the economic and political lives of the vast majority of humanity is of great political consequence. To say, as I have argued in my earlier article on globalization, that ‘far from it being new it is a return to those unstable features of capitalism which characterised imperialism before the First World War’ is not to dismiss its importance but, on the contrary, to highlight it. It is beginning to create the very conditions which produced those dramatic shocks to the international capitalist economy and which led to the revolutionary developments in the first decades of the twentieth century. So what then are the crucial components of globalisation which suggest these developments? Multinational companies (MNCs)are the principle vehicle of imperialism’s drive to redivide the world according to economic power. In 1995 Foreign Direct Investment (FDI) outflows increased by a massive 38 per cent to $317bn, with a record $100bn going to Third World countries. That investment is concentrated in three competing power blocs, the ‘Triad’ of the European Union, Japan and the United States and their regional cluster of countries. 76 per cent of the investment in Third World countries (1993-5) went to only 10 countries. Five imperialist countries, United States, UK, Germany, Japan and France were responsible for almost two-thirds of the total outflows in 1995. The United States ($96bn), UK ($38bn) and Germany ($35bn) all exported record amounts (UN-WIR1996). Most MNCs are nationally based, controlled by national shareholders, and trade and invest multinationally with a large majority of sales and assets in their home country. A recent study showed 70 - 75 per cent value added by multinational companies was produced in the home country. They are highly concentrated. Only 100 MNCs, 0.3 per cent of the total, all from imperialist countries, own one-third ($1.4 trillion) of the total FDI investment stock. The process of concentration continues internationally through mergers and acquisitions. Cross border mergers and acquisitions doubled between 1988 and 1995 to $225bn. Globalization is devastating the lives of millions of people. Even the World Bank admits that in the case of the ex-Soviet bloc ‘transition has relegated an entire generation to economic idleness.’ Output in Russia fell by 40 per cent between 1990 -1995 and between 16 and 30 per cent in the other countries. Growth has been falling over the last 15 years in about 100 countries, with almost a third of the world’s people, dramatically reducing the 159 incomes of 1.6bn people. The declines are unprecedented, exceeding in duration and sometimes in depth the Great Depression of the 1930s. One billion people, 30 per cent of the world’s workforce, are either jobless or unemployed. Even...