The Economic Background to the Gulf War

Alan, Freeman (1991): The Economic Background to the Gulf War. Published in: Yuval-Davis,N and Bresheeth,H (eds) (1991) The Gulf War and the New World Order, pp153-162. London: Zed Press ISBN 1 85649 041 6; 1 85649 042 4 : pp. 153-162.

Abstract

This chapter appeared in ‘The Economic background to the Gulf War’, in Yuval-Davis,N and Bresheeth,H (eds) The Gulf War and the New World Order, pp153-162. London: Zed Press ISBN 1 85649 041 6 <a href="javascript:Pick it!ISBN: 1 85649 041 6"><img style="border: 0px none ;" src="http://www.citavi.com/softlink?linkid=FindIt" alt="Pick It!" title='Titel anhand dieser ISBN in Citavi-Projekt übernehmen'></a> ; 1 85649 042 4 <a href="javascript:Pick it!ISBN: 1 85649 042 4"><img style="border: 0px none ;" src="http://www.citavi.com/softlink?linkid=FindIt" alt="Pick It!" title='Titel anhand dieser ISBN in Citavi-Projekt übernehmen'></a>

The book, a landmark in dissent against the conflagration that has become the war in Iraq, collated works from scholars throughout the world who sought to penetrate the rhetoric of war, and understand its economic and political causes.

In this chapter I sought to give meaning to the idea that the war had economic causes, going however beyond simplistic formulations of direct and immediate economic interest. The First Gulf War, as we now know it to have been, was not just about oil. It was, I argued in this chapter, about the disintegration of the entire postwar order. This order, although it was established by military victory and defeat, rested on profound economic relations, most notably hegemony over surplus profit arising from three principal sources:

*the technical superprofit arising from the superior productivity of the ‘advanced’ countries as a whole, in the appropriation of which the USA and Germany established dominance during the long decline of UK hegemony

*commercial superprofit enjoyed within the ‘spheres of influence’ of the victorious powers, domination over the world market as a whole having been fragmented by the Russian and Chinese revolutions and subsequently (to a lesser degree) the realisation of colonial independence and the formation of the non-aligned bloc – as expressed in the suspension until 1982 of the project of constructing the WTO

*the financial superprofit enjoyed in partnership by the victorious powers and expressed (including the relation of forces within the partnership) in the Bretton Woods settlement

The chapter argued that the war was provoked, fundamentally, by the decline in the relative productive advantage with which the US emerged from WWII, provoked primarily by the rise of Japan and Germany and expressed in the inexorably growing US deficit. The US, I argued, had been driven to try and reconstruct the world order in such a way as to claw back this loss through an ever-growing monopoly of the second two sources of superprofit – commercial and financial superprofit. The maintenance of these depended on the direct assertion of political and specifically military force – the true driver behind the USA’s ever more violent military stance in world politics.

This reorganisation however had provoked an extremely rapid rise in poverty, as the US sought to compensate both for its trade deficit, and for its weaknesses vis-à-vis its rivals (Germany and Japan) by ramping up its direct and indirect receipts from the third world. This drastic impoverishment was creating the crises of governance that drove the US to re-enforce its flagging hegemony by more and more directly interventionist means.

• Item Type: MPRA Paper
• Language: English
• Keywords: development; oil; military expenditure; globalisation
• Subjects: F - International Economics > F2 - International Factor Movements and International Business; F - International Economics > F0 - General > F02 - International Economic Order and Integration; H - Public Economics > H5 - National Government Expenditures and Related Policies > H56 - National Security and War

References

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'The rise in world poverty', Socialist Economic Bulletin, no. 3

A. Maddison, The World in the Twentieth Century.

Karl Georg Zinn, 'Die Konjuntur im Herbst 1990', in Sozialismus, September 1990

Astrid Schwartz, 'Ein Marshallplan fuer die DDR?', IPW Berichte, no. 7,1990.

H. Magdoff, The Age of Imperialism, New York, 1969, p. 55. Harrison and Glyn, Capitalism since World War II, London, Fontana, 1984.

Susan Willett, Economic Implications of the Gulf Crisis, London, Centre for Defence Studies, Kings College. 'A nice little earner', Economist, 9-15 March 1991, p. 36.