chycho: Recolonization of Africa, a Symptom of Our Addiction to Growth: Differential Accumulation, Why GDP Growth Rates Influence Foreign Policy

Friday, February 8, 2013

Recolonization of Africa, a Symptom of Our Addiction to Growth: Differential Accumulation, Why GDP Growth Rates Influence Foreign Policy

The following is Part 3 of: “The future of Africa looks bleak, here is why” (Introduction, Part 1, Part 2).

The name of the game when it comes to investing in the markets is that you must not only be ahead of inflation but you must also beat the averages, exceeding the normal rate of return. If you don’t do both then you are neither protecting nor accumulating capital, i.e., in the limit you will lose your wealth. This principle also applies to nations.

Ignoring our need to rely on different economic measures (pdf) other than the Gross Domestic Product (GDP) of a nation to indicate progress, wealth and well-being, if a countries GDP growth rate is below the global average, then over time that country will lose influence and be subject to an unstable economy. In essence, how a countries economy performs is relative to how other countries perform – there is a “growth imperative in capitalist economies” (pdf).

“But why do capitalist economies need to grow? Because competition and the quest for profit compel each business to grow or be wiped out by its competitors.”

The economic theory that best encompasses this principle is Differential Accumulation. It “emphasizes the powerful drive by dominant capital groups to beat the average and exceed the normal rate of return.” The video linked below and the following excerpts from an article entitled “Differential Accumulation” by Shimshon Bichler and Jonathan Nitzan provide further information on this train of thought (emphasis added).

“The concept of differential accumulation is part of a new approach to the study of capitalism. This approach, first developed by Shimshon Bichler and Jonathan Nitzan, emphasizes the primacy of power rather than of consumption and production. The emphasis on power accentuates the centrality of relative rather than absolute measures and of disaggregate rather than aggregate methods. It focuses attention not on the quest for profit maximization by capital in general, but on the drive for differential accumulation by dominant capital in particular…

“Capital, Bichler and Nitzan claim, is nothing but organized power. This power, they say, has two sides: one qualitative, the other quantitative. The qualitative side comprises the many institutions, developments and conflicts through which capitalists constantly creorder – or create the order of – their society; that is, the processes through which they shape and restrict the social trajectory in order to extract their tributary income. The quantitative side is the universal algorithm that integrates, reduces and distils these numerous qualitative processes down to the monetary magnitude of capitalization…

“In principle, every stream of expected income is a candidate for capitalization. And since income streams are generated by social entities, social processes, social organizations and social institutions, we end up with capitalization discounting not the so-called sphere of economics, but potentially every aspect of society. Human life, including its social habits and its genetic code, is routinely capitalized. Institutions – from education and entertainment to religion and the law – are habitually capitalized. Voluntary social networks, urban violence, civil war and international conflict are regularly capitalized. Even the environmental future of humanity is capitalized. Nothing escapes the eyes of the discounters. If it generates expected future income, it can be capitalized, and whatever can be capitalized sooner or later is capitalized…

“Now, power, argue Bichler and Nitzan, is never absolute; it’s always relative. For this reason, both the quantitative and qualitative aspects of capital accumulation have to be assessed differentially, relative to other capitals. Contrary to the claims of conventional economics, say Bichler and Nitzan, capitalists are driven not to maximize profit, but to ‘beat the average’ and ‘exceed the normal rate of return’. Their entire existence is conditioned by the need to outperform, by the imperative to achieve not absolute accumulation, but differential accumulation. And this differential drive is crucial: to beat the average means to accumulate faster than others; and since the relative magnitude of capital represents power, capitalists who accumulate differentially increase their power…

“The centrality of differential accumulation, claim Bichler and Nitzan, means that the analysis of accumulation should focus not only on capital in general, but also and perhaps more so on dominant capital in particular – that is, on the leading corporate-state alliances whose differential accumulation has gradually placed them at the centre of the political economy.

Accumulation Through Crisis: Global Stagflation & the New Wars -- by Jonathan Nitzan
(relevant for this piece: 18 to 25 minute mark)

So how is this related to what’s going on in Africa?

Below you will find a graph of the global GDP growth rate in addition to the growth rates for certain regions and countries. Google Public Data is being used to present the information compiled from The World Bank. The annual growth rate is provided for France, The United States, Italy, the UK, and Belgium – five countries involved with the Mali conflict from the onset - as well as Canada who’s troops have now been drawn into the war, and Japan which has pledged $120 million in aid and support. In addition, the growth rates for Sub-Saharan Africa, Latin America and Caribbean, South Asia, East Asia and Pacific, and China have been included.

“’Africa is booming. Sub-Saharan Africa will have the second highest regional growth after Asia in 2012 with a rate of 5.5 percent,’ [France's Finance Minister Pierre Moscovici] said. ‘The new phenomenon is that African growth has the potential to stimulate growth in France. We want to be present there.’…

“At the same time China's trade with Africa reached $166.3 billion in 2011, according to Chinese statistics, and African exports to China - primarily resources to fuel Chinese industries - rose to $93.2 billion from $5.6 billion over the past decade. China in July offered African countries $20 billion in loans over the next three years, double the amount pledged in the previous three-year period.”

Adjusted for inflation GDP growth rate per annum (1990 to 2011)

The countries underperforming the global average are the main Western powers that have been involved in the recent conflicts in Africa. They are the ones pursuing the regions and countries that are outperforming the global average. To get a clearer picture, let’s eliminate the secondary players in the above graph and leave only the United States, France, Italy, and the UK from the west, and China from the east, since it is China that they are in competition with as U.S. intelligence reports have indicated.

“China's economy is likely to surpass the United States in less than two decades while Asia will overtake North America and Europe combined in global power by 2030, a U.S. intelligence report said on Monday…

“The health of the global economy increasingly will be linked to progress in the developing world rather than the traditional West.”

Adjusted for inflation GDP growth rate per annum (1990 to 2011)

This discrepancy between the GDP growth rates of these nations is proving to be very problematic for those lagging the leaders. It is this addiction to growth that is fueling the recolonization of Africa through these dirty wars:

“…this is something that we’re seeing throughout the Horn of Africa and in places throughout the Sahel and North Africa, where these groups are getting stronger and stronger. And so, you know, the U.S. is increasingly getting itself involved in these dirty wars in Africa. And, you know, we could have easily gone to Uganda or Somalia or Mali and reported on this, but there’s—you know, since AFRICOM was created as a full free-standing command, like Southern Command and Central Command, AFRICOM has been expanding these wars.”

Dirty Wars: Jeremy Scahill and Rick Rowley’s New Film Exposes Hidden Truths of Covert U.S. Warfare

“More accurate it seems, AFRICOM had been ‘brewing’ the crisis for five years since it began operations in late 2007. Mali for the Pentagon is but the next building block in the militarization of all of Africa by AFRICOM using proxy forces like France to do the dirty work. The Mali intervention using France upfront is but one building block in a project for the total militarization of Africa... The strategic target is China and the rapidly growing Chinese business presence across Africa over the past decade. The goal of AFRICOM is to push China out of Africa or at least to irreparably cripple her independent access to those African resources.”

click to enlarge - Source

This fact is, of course, not lost to many around the world:

“The purpose of this war in Mali is very clear… The purpose is to fight against China and allow our American ally to maintain its presence in Africa and the Middle East. This is what guides these neo-colonialists operations.

“And you will see, when the military operation will be over, France will, of course, keep its military bases in Mali. These bases will be a benefit to the Americans as well. And at the same time, as has always been the case, western corporations will put their hands on juicy contracts that will once again deprive re-colonized countries of their wealth and raw materials.”

Belgian MP LAURENT LOUIS stands against war in Mali and exposes the international neo-colonial plot

To accomplish this task, the United States has been very busy expanding its military presence on the continent.

click to enlarge - Source

As for what the future holds for Africa? The answer should be obvious, more wars as western powers follow up their military operations by trying to secure investment from these newly colonized nations.