The sun is setting in the West

On the disaster of the turning point and the war in Ukraine

by the Hanover Peace Discussion Group

[This article posted on 3/19/2024 is translated from the German on the Internet, https://www.akweb.de/ausgaben/702/im-westen-geht-die-sonne-unter-zeitenwende-imperialismus-krieg-ukraine/.]

A stylized setting sun in front of a camouflage pattern, bombs raining from the sun

The war of aggression against Ukraine is part of an imperialist war for global spheres of influence. On the surface, it appears to be a rebellion by the former world power Russia against its own loss of status. But on closer inspection, this also applies to the global West, which is losing its previously unchallenged supremacy after the era of neoliberalism.

China as a global power

The competition that is emerging in the Indo-Pacific region with the new power center China has apparently only been recognized in the West in recent years. According to data from the World Bank's International Comparison Program, China overtook the USA as the largest economy in 2017. With the RCEP (ak 666), it has created the world's largest free trade zone and is pursuing a global expansion strategy with the Belt and Road Initiative. As part of this initiative, 75% of all countries in the world 147 had signed a memorandum of understanding, i.e. a trade policy cooperation declaration, with China by 2022. As the leading power of the expanded BRICS group, consisting of China itself, the emerging economies of Brazil, Russia, India, South Africa and, since 2024, Egypt, Ethiopia, Iran and the United Arab Emirates, the country has also long been setting geopolitical priorities and is said to have concluded 50 strategic partnerships with countries.

This rise is having an impact on the global economy. Of the global economic growth forecast by the IMF for 2023 and 2024, 50 percent is expected in China and India and only ten percent in the USA and the EU.

This means that the slogan of a capitalist Oneworld is proving to be outdated. For the first time in centuries, in which the countries of the old and new Western world with changing hegemonic centers had almost unrestricted access to the raw materials, trade routes, markets and workforce of the Global South, more successful alternatives have emerged with the capitalist planned economy of China and, in a different way, India. Their state-owned banks and key industries enable the controlled development of a social and technical infrastructure that is superior to Western neoliberalism. These are increasingly authoritarian states with an immensely polarized distribution of wealth and income. And even if China itself is now experiencing a structural crisis, the question arises as to what means the West will use to respond to the loss of its supremacy.

Europe's economic self-destruction

Part of the Western counter-strategy consists of trying to find economic answers to the decline of Western states and their economies. After decades of neoliberal restructuring, redistribution and austerity policies have led to a collapse in purchasing power. Slowly but steadily, the European domestic market is losing ground to China and the USA in particular. Measured in US dollars, economic growth in the EU has stagnated since the financial crisis. Meanwhile, the US trade deficit is growing exponentially. The ongoing austerity measures have worn out the public infrastructure everywhere. Trade unions, political parties and churches have each lost up to half of their members. With hardly any younger people still participating, we are witnessing the end of a political style based on negotiation. Western societies are barely able to maintain regular institutional operations due to their collapsed infrastructures. Five years ago, a backlog investment requirement of at least EUR 450 billion was estimated for education, transport, communication networks and decarbonization by 2023. The progressive loss of legitimacy has led to landslide electoral successes for far-right parties everywhere.

The US and EU are taking different approaches to overcoming this crisis: under the Biden administration, the US has at least developed outlines of conceptual ideas. The strategy known as "Bidenomics" describes an open break with neoliberalism. The USA recognizes the superiority of the Chinese model. Four parallel strategies are being pursued to restore the ability to innovate, the damaged democracy, the decaying infrastructure and the attractiveness of the business location:

First, since 2021, the US has launched four programs to stimulate the economy, mitigate the consequences of the corona crisis, promote the manufacture of semiconductors and computer chips and invest in climate protection with a total of USD 3.749 trillion in fresh public money. Secondly, they are waging a graduated economic war against Russia, China and, increasingly, the EU. They are imposing sanctions, diversifying their foreign trade and discriminating against non-American companies when awarding subsidies. The battle for leadership in the development of digital technologies, particularly semiconductors, is central to this. Thirdly, the USA is expanding its military spending to a record 842 billion US dollars. Fourthly, the use of fracking has made it the world's largest oil producer, making it less dependent on international energy prices.

In contrast, there is no consistent strategy in the EU. Comparable programs have been launched with the Green Deal and the Chip Act. However, no new money is being made available. Instead, existing funding pots are reallocated and the costs distributed among the member states. The EU is also imposing sanctions against Russia and wants to diversify trade with China. However, for both the EU and Germany in particular, where export quotas have soared to more than 50% of gross domestic product (GDP), the question arises as to which markets their products and services should still be sold on to the same extent as before. An economic stimulus program to boost domestic demand could be a way out here too. However, European governments are doing the opposite. The adherence to the debt brake, the refusal to increase property, corporate and top tax rates and the lack of public investment have an overall self-destructive character in the face of declining real incomes. In combination with inflation and energy price increases, Western European countries in particular are falling into a structural recession. Exports are collapsing and deindustrialization is progressing. Germany is forecast to have the weakest growth among the economically strongest countries. At the same time, it is recording the highest net outflow of direct investment to date. The "dirty Keynesianism" of excessive arms spending will hardly have any effect. Some of the weapons currently being financed from German special funds will be supplied by the USA.

New bloc confrontation?

The second counter-strategy falls within the context of global rearmament. According to the Stockholm International Peace Research Institute (SIPRI), a historic record was set in 2022 with global arms spending of 2,240 billion US dollars. This not only applies to the USA, China, Russia, India, Saudi Arabia, the UK and Germany. In most countries around the world, military spending was already ramped up years before 2022. The nuclear arms build-up is particularly worrying, especially as there is no longer any control agreement following the US withdrawal from the ABM and INF treaties and the suspension of NEW-START and CTBT by Russia.

This rearmament is unmistakably confrontational. In the NATO Strategic Concept adopted in 2022, the member states declare that they want to "extend their reach" in order to be able to "deter, defend, contest and deny use in all dimensions and directions".

The so-called 360-degree approach means a frontline position in all directions. The focus is particularly on Russia, China, North Korea, Syria, Iran, the Middle East and Africa. Among other things, NATO wants to increase its troops deployable within a month from 40,000 to 200,000 soldiers, expand its presence in the Indo-Pacific and station modernized nuclear weapons (without renouncing a first strike) in Germany, Belgium, Italy, the Netherlands and Turkey.

In the experience of its own powerlessness, the global West seems to want to recapture lost territory by military means. So far, China has advanced its world market position without wars and limited its military activity to the regions around its borders. Despite drastic rearmament, China lags far behind the military capabilities of Russia and the USA. In view of the more aggressive military strategy of the USA and NATO and its own claim to world power, however, it is unlikely to adhere to the concept of non-violent imperialism. In order to withstand the military superiority of the USA and NATO, it (still) needs Russia as a geostrategic partner.

The extent to which this will result in a new bloc formation is difficult to assess. The situation differs from the Cold War in that the rivals in global capitalism are interdependent. An abrupt dissolution of trade relations would have catastrophic consequences. For both sides, therefore, it can only be a matter of reducing dependencies, gaining a lead in key technologies and winning over trading partners, raw material resources and labor markets. On the other hand, the allocations of all other states have also become more fluid. In both constellations, the majority try to obtain the most favorable conditions for themselves. However, entering into economic cooperation can trigger military counterattacks and turn affected countries into theaters of proxy wars. Many previously non-aligned states may therefore not only have to rearm, but also align themselves militarily.

Ukraine war: overestimation of the West

In this situation, the war in Ukraine reflects a changed balance of power and the damage to Western supremacy. At the same time, it also reflects the crisis of neoliberalism.

The authoritarian character of the Russian state and the formation of a class of oligarchs does not date back to Putin, but to the 1990s. Under the guidance of the World Bank and IMF, neoliberal shock therapy was introduced in Russia, as in all countries of the former Eastern bloc, and as a result public property was transferred to later oligarchs. The subsequent recession in Russia is said to have been worse than during the Second World War. Measured in current US dollars, GDP collapsed to 35.3 percent of its 1988 value by 1999. 53 percent of the population lived below the poverty line. The wealth of the richest compared to the poorest citizens increased from six to 250,000 times. This met with fierce resistance until the then President Boris Yeltsin ordered the army to fire on the parliament. The result was a referendum on a constitution that extended the power of the president vis-à-vis parliament. This process, which was approved by the West, is the basis of the Putin system today.

His presidency began in 1999 with the goals of consolidating the economy and regaining global political significance. The state became the central economic player again and curbed the political power of the oligarchy, but left the general ownership structure untouched. By 2013, GDP in US dollars had increased more than tenfold. Real income had doubled. Growth then declined again at a slower pace.

The second goal was initially to be implemented in the context of European integration (NATO membership was discussed in 2001 and 2010). In contrast, the current confrontation represents a mutual escalation. It began on the part of the West with variously interpreted verbal assurances that NATO would not expand beyond the former inner-German border. This was followed by the eastward expansion of Nato and the prospect of Nato membership for Georgia and Ukraine. In addition, rotating troops were stationed in Bulgaria and Romania and, from a Russian perspective, nuclear-capable missile defense systems in Romania. Ukraine was already armed before 2022, primarily by Western states. On the Russian side, this was followed by intensified armament and a more aggressive foreign policy from 2008 onwards, including in Georgia, Syria and Mali. This culminated in the annexation of Crimea, the interventions in the Donbas and finally the war of aggression against Ukraine, which violated international law.

Russia's miscalculation first became apparent in the repulsed advance on Kiev and in north-eastern Ukraine. Two years later, the arrogance of the West also became apparent. First, the attempt to force Russia to give up through economic pressure failed. This was because the credibility of the USA and NATO had been exhausted since the wars of aggression in Iraq and Afghanistan, which violated international law. As early as 2022, no country - apart from the NATO states and their immediate allies, especially in the Global South - participated in the sanctions imposed. The OPEC countries refused to significantly increase their production capacities and continued to form a cartel with Russia (OPEC+). Russia managed to offset exports of energy sources to the West through sales to China and India, the conversion of payment transactions to the yuan and rouble and higher world market prices, among other things. The Russian economy is also being boosted by rising wages and military spending. The consequences of the sanctions are having a knock-on effect on the West, particularly Western Europe. The growth forecasts of the IMF and OECD assume higher growth in Russia than in the USA, the eurozone and Germany, which is lagging behind economically.

The West's misjudgement also applies to the course of the war, where the Russian army is advancing again after the failed counter-offensive in Ukraine. There is a shortage of weapons, ammunition and soldiers. The strategy of wearing down the West seems to be working. In the US, the Biden administration is already encountering difficulties in mobilizing further war credits. The probable re-election of Donald Trump as US President will then probably mean the end of US involvement. How the European NATO states intend to raise the additional war costs plus almost half a trillion US dollars for reconstruction and push them through politically will remain the secret of these governments. If the debt ceiling is maintained and there are no tax increases, these sums can only be financed through unprecedented cuts in the social budget and infrastructure maintenance. In view of the electoral successes of right-wing parties, which have long been rampant, this would also be tantamount to political self-destruction. It is to be feared that future crises will be met with more authoritarianism.

1914 revisited?

The war in Ukraine is often compared to the First World War. In view of the 17 million dead at the time, this is far too much. Nevertheless, disturbing parallels can be identified. Then, as now, the aim was to redivide the world into imperial spheres of influence. The peace order negotiated at the Congress of Vienna in 1815 had held for over a century. Then, with Japan and the USA, but even more importantly with the German Empire, emerging powers joined the fray and made imperial claims.

Today, the world order agreed at the Crimea Conference in Yalta in 1945 is disintegrating. China in particular is another great power that is challenging the hegemony of the USA. In this respect, it makes little sense to view the war in Ukraine in isolation. It is part of a struggle for a new division of the world, in which the aim is to tie up and wear out each other's military capabilities. It will therefore probably only mark the beginning of a global escalation. The danger of a nuclear world war would remain even after a possible freeze. Outside Europe, a war between China and the USA over Taiwan, the country that supplies the absolute majority of semiconductors worldwide, has long been expected.

It is currently extremely difficult for grassroots movements to intervene in this dispute. On the one hand, economic decline, cultural and political disintegration and the erratic overreach of governments in the West are worrying. On the other hand, China and Russia are authoritarian and also imperialist states that leave little room for opposition forces. It would be fatal to side with such states. Nevertheless, a new international order can only be negotiated between the existing superpowers China, the USA, India, Russia and, with decreasing relevance, the EU. It is therefore not enough to simply call for an end to the war in Ukraine. A contemporary peace movement must campaign for a global peace order and seek alliances with social movements in all other countries. For opponents of war worldwide, their own government is always the first address in the country in which they live.

Hanover Peace Discussion Group

is a small group made up of people from academia and trade unions. In 2022, we began to pursue the political exchange that has taken place to date more systematically and to prepare contributions to the discussion.