Enduring resistance

• China has served as a convenient bipartisan adversary. It has taken the place of the Soviet Union in reflecting both tremendous technological potential and a supposed enemy that must be contained. But military confrontation in the Pacific remains perhaps even less likely. The demonstration effect is powerful in what the US and Russia have encountered while trying to subdue far weaker countries in the age of drone and missile defence
• There is a renewed possibility of a political challenge to finance on a world scale. The interest rate shock initiated by US Federal Reserve chairman Paul Volcker in the late 1970s was the death knell for proposals for a New International Economic Order. It plunged developing countries into severe debt crisis as debt servicing costs skyrocketed in the 1980s. But the new Democratic affordability agenda raises broader questions about what kind of finance is possible under alternative, more progressive circumstances
• Already Trump has crowed that the reversal in stock market gains in the aftermath of Democratic victory is the result of the threatened overturning of his AI agenda. If finance is heavily intertwined with the fortunes of a decent segment of the American electorate, then it is unclear what other kind of settlement would produce an electoral bloc that can resist the tendency to conflate fiduciary responsibility for people’s retirement portfolios with all the aggressive entrapments of what world systems scholar Peter Gowan called the ‘Dollar-Wall Street Regime’
• New political frameworks are being hammered out in an ongoing battle across an extremely fragmented global landscape, despite tremendous dangers, whether war, fascism, or worse. As the recent elections in the American antipodes show, this struggle has far from been determined. That elusive moment when the tide looks like it may turn offers hope amid chaos

Grappling with the profound shifts in the global order seems especially foolhardy these days. But occasionally, it is also uplifting exercise when it seems we are on the cusp of change that, however tentatively, may produce a better order out of the hegemonic one that is crumbling. 

The US midterm elections—right on the heels of Lula’s crushing of the far-right candidate, Flavio Bolsonaro, in Brazil—proved to be a real shock. The US results appear to be as decisive as Trump’s initial victory in 2016, when he won the upper Midwest that has long been associated with post-industrial decay. 

In the case of the most recent electoral results, the inroads of the Democratic Party into the South anticipate a potential transformation. That includes the possibility that the Democratic party line affiliation becomes competitive again in the region, only this time organised along the lines of multiracial democracy. 

It appears to be the end of the generational loss of the South to the Democratic Party, which Lyndon Baines Johnson feared would be the outcome of the Voting Rights Act. That Act was the legislative capstone of the Civil Rights Movement. Its dismantling by the Supreme Court in the Louisiana v. Callais case this year is what shaped the political earthquake of the midterm elections. 

While keeping this poetic reversal in mind, there is also a brute reality we must face: as much as ‘vibes’ have arguably taken over elections in many places around the world, in places like the US there is still a material contradiction at the core of the AI boom that has yet to be resolved. The economy continues to diverge between the fortunes of capital and labour. However, there is no guarantee that the diverse constituencies marshalled under opposition to Trump will cohere into a durable bloc. 

Still, the mere fact that they voted in a way that subverted the hackneyed claim of irreversible polarisation gives us a clue as to how things might become unstuck and start moving again in terms of the great confrontation with wealth and power. This struggle is essential for avoiding the most disastrous outcomes for the planet. The spectre of destruction became especially visible this year with the unhinged joint US/Israeli assault on Iran as part of the broadening of Israel’s sanguinary campaign in Gaza and beyond, and last year with the Trump trade shock.

Changing external orientation

Meanwhile, what might the US posture be towards the rest of the world because of the tremendous churn in the country’s politics? It is not obvious if, and even how, it might try to revive its hegemonic position. Deploying the 1960s ‘Cold Warrior’ as the closest analogy, New York Times columnist Jamelle Bouie argued that in his victory speech, Jon Ossoff, the victorious Democratic senator from Georgia, embraced rhetoric very close to the ‘evil empire’. Only in this case, Ossoff used it to describe MAGA fascism, not the Soviet Union. 

As a domestic metaphor, it was a deft counterpoint to the right-wing attempt to turn the US midterm elections into another Red Scare, which was laced with noxious Islamophobia for good measure. But in terms of foreign policy, the explanatory power of this analogy is limited by the fact that the US battle against domestic totalitarianism cannot be projected as part of a reassertion of its global hegemony, which continues to unravel. 

There is no Vietnam that sits on the other side of the Civil Rights Movement. In fact, Democrats along with most of the country already rightly resist Trump’s reasons for the war against Iran. Some of the core myths of American hegemony have been perhaps permanently shattered by imminent strategic defeat in the Gulf. That includes the potential emergence of a new security order—perhaps order is too strong a word, given the highly transactional nature of the repressive regimes involved—based on mutual non-aggression between countries like Saudi Arabia, Turkey, and Iran. 

Of course, Israel remains the wild card given the paroxysm of violence it has unleashed. In his piece, “The Collapse of Zionism”, Israeli historian Ilan Pappe observed the parallel with the dying apartheid regime in South Africa. 

At the same time, there is Russia. It remains a gravitational lens for the West’s political anxieties—in the past conservative, today progressive, with the latter’s fears surrounding the global expansion of the far right. Even in the age of Marx, he considered the Tsardom the ‘gendarme of European reaction’. Strategically though, Russia’s aggressive expansionism is a non-starter as the rationale for renewed US ambition, given that the European Union sees the absolute need, at least rhetorically, for a separate defence umbrella. 

The transatlantic relationship has permanently ruptured under Trump. That does not mean that the US and the EU will no longer collaborate as part of a residual hegemony that they exercise on a contingent basis in other parts of the world. But the relationship is no longer an unquestionable pillar of support for the US’s global ambitions.

Meanwhile, China has served as a convenient bipartisan adversary. It has taken the place of the Soviet Union in reflecting both tremendous technological potential and a supposed enemy that must be contained. But military confrontation in the Pacific remains perhaps even less likely. The demonstration effect is powerful in what the US and Russia have encountered while trying to subdue far weaker countries in the age of drone and missile defence. 

While Xi Jinping has concentrated an enormous amount of power around himself—not to mention the fact that sabre rattling is always useful for distracting from economic malaise—unless he reaches Trumpian levels of delusion, China will likely continue to apply pressure in ways that do not necessarily lead to decisive confrontation in the Taiwan Strait. Still, the US has long inserted itself into regional politics. It is unclear if and how there would be a return to détente in the region, especially with the growth of militarism and the increasing insertion of Big Tech into the US national security State.

A Nascent anti-imperialism?

This looming question is where US domestic politics will almost certainly play a role in determining the unravelling of its imperial trajectory. Democrats may discover a purpose not only in regulating frontier AI development because of its impact on local communities, but also the corollary that by confronting tech overlords, they must reckon with a major shift in attitude towards the exercise of military power abroad. 

Already Elon Musk’s gamble to throttle Starlink in Ukraine has produced murmurs about the need for nationalisation. And Musk’s role in the assault of the ‘Department of Government Efficiency’ on federal bureaucracy is almost certain to come under powerful congressional scrutiny. However, war making is not only the arena of private tech oligarchs. It is also the animating principle of the modern State. 

Perhaps even more relevant, it remains extremely unclear whether there is genuine space for anti-imperialism, given that the US’s financial fortunes have been tied to the maintenance of its global hegemony. 

Already Trump has crowed that the reversal in stock market gains in the aftermath of Democratic victory is the result of the threatened overturning of his AI agenda. If finance is heavily intertwined with the fortunes of a decent segment of the American electorate, then it is unclear what other kind of settlement would produce an electoral bloc that can resist the tendency to conflate fiduciary responsibility for people’s retirement portfolios with all the aggressive entrapments of what world systems scholar Peter Gowan called the ‘Dollar-Wall Street Regime’. 

This argument does not mean we must revert to the assumption that the ‘labour aristocracy’ in the West is constitutively incapable of producing material alliances with working people in the global South. But it is a fact of politics that the organisation and maintenance of class hegemony in the US through finance has inserted a time bomb into the social order. 

It must be defused carefully to avoid provoking the kind of resentment and frustration that could support revanchist moves to try and claim as much plunder abroad to compensate for further downward mobility among the ill-defined ‘middle class’. Trump’s gambit might have temporarily failed in Iran. But unless it is replaced by a clear alternative, the most extreme elements of aggression abroad could reappear.

The global south

Nevertheless, with the US midterm results, there is a renewed possibility of a political challenge to finance on a world scale. The interest rate shock initiated by US Federal Reserve chairman Paul Volcker in the late 1970s was the death knell for proposals for a New International Economic Order. It plunged developing countries into severe debt crisis as debt servicing costs skyrocketed in the 1980s. But the new Democratic affordability agenda raises broader questions about what kind of finance is possible under alternative, more progressive circumstances. 

It would be extremely ironic if neoliberalism, having claimed to slay the inflationary dragon in the West, is in turn unmade by underinvestment in sectors like renewable energy, which could have eased the pain of post-Covid supply shocks. This is to say nothing of what would happen if there was another financial crisis and attempted bailout of banks or other powerful actors that reeks of corruption. The latter already became an explicit target of public anger and frustration in the US midterm elections. 

At the same time, the potential reversal of the class project of finance capital may not provide immediate relief to peripheral countries that are on the frontlines of climate change and debt crisis, even while facing IMF-mandated austerity. As others have pointed out, the latter has restrained the investments needed to cope with shocks. But growing scrutiny of Big Tech, and, by extension, finance within the metropole could create breathing room for countries in the global South to at least conduct more of their own domestic experiments. In this case, the results of the US midterm elections are yet another data point revealing a possible progressive turn in the global order, even if they are not the ultimate result.  

At the very least though, we should be aware of how our shared global terrain is being reshaped. Latin American historian Greg Grandin has pointed out in his lyrical history ‘America, América’ that North and South are interlinked in their destinies. Much as Franklin Delano Roosevelt’s New Deal helped facilitate Import Substitution Industrialisation in Latin America under figures like Getúlio Vargas, and vice versa, we may be at another historical juncture. 

For example, the structural changes that occurred in the global order during and after the Great Depression—especially the wide acceptance of capital controls—facilitated the domestic experiments needed for countries to either rebalance their economies or begin the long process of development in the aftermath of the tremendous colonial extraction that occurred. On the other hand, the current AI boom also represents perhaps the most extreme form of what the political economist Robert Brenner has called the ‘politically driven upward redistribution of wealth’. 

There is plenty to fear about the potential tendency towards dispossession. Sri Lanka was threatened with it only several years ago at the height of its economic crisis, including the attempted fire sale of its assets. But the US midterm elections and Lula’s victory in Brazil also show that there are always going to be forces of resistance. More than the national boundaries that supposedly resemble coherent geopolitical blocs, it is the ongoing ‘civil war’, as Lenin reminds us, that will be central to restraining finance capital and the imperial powers backing it. 

In the context of recent political developments abroad, even a small country like Sri Lanka may find more room for manoeuvre to engage in experiments that were long since banished as anathema to the market. That includes revitalising the public sector without fear of the kind of foreign policy crisis that temporarily resulted in the suspending of US aid in the early 1960s, when Sri Lanka nationalised its oil industry. In this regard, geopolitics is intimately tied to economic relations. 

But equally important are the ideological imaginaries shared across places, which can inspire solidarity. New political frameworks are being hammered out in an ongoing battle across an extremely fragmented global landscape, despite tremendous dangers, whether war, fascism, or worse. As the recent elections in the American antipodes show, this struggle has far from been determined. That elusive moment when the tide looks like it may turn offers hope amid chaos.