World System Theory

Immanuel Wallerstein propounds the World-System theory, that is, a macrosociological approach that seeks to explain the dynamics of the capitalist world economy as a totality. The World-System economy is the widest geographical reality that comprehends different political structures and cultures, but a single worldeconomy: Capitalism. It has characteristics of an organism, because it is constantly moving and struggling to change its form, but still some of them remain stable. In other words, the systems life is constituted by conflicting forces which by tension hold it together and tear it apart as each group member seeks eternally to reshape it to its favor; the relationship between the core and its periphery and semi-periphery remains relative, not constant. Wallerstein demonstrates that such ultimate stage of world development (a classless society), especially predicted by left wing thinkers like Marx, is not getting closer to be reached. He insists that an analysis of the history of the capitalist world system shows that it has brought upon an unequal development in which economic and social disparities between the members of the world economy are still increasing instead of providing prosperity for all. First, to understand the dynamics within the World-system, it is necessary to know the agents who participate in it. These can be displayed in a pyramid structure. The top is occupied by the Core States (e.g. United States) who use the capitalist economy to assure their elevation and maintain their hegemonic position towards the rest. The middle level is integrated by the Semi-periphery states or the purgatory states (e.g. the BRIC, the so called emerging economies), which are seeking to run away from their embarrassing past, in order to achieve the status of a Core State. Their position is key to the World-System because it is an area with a mixture of about half core-like and half peripheral-like (Shannon, 1996); this means that it plays a double-role: on the one hand its activities are exploited by the capitalists from the Core, on the other hand, it acts as a Core State towards the periphery. Also, they play a crucial role in the relations within the World-system, that is, to be the mediator between the Core and the Periphery. At the bottom position, the Periphery States occupied the vast majority of the countries within the World-System. They are the weakest and the permanent losers of the Capitalist system; its economy is based on the trade of raw materials, which are plundered by the Core States. In essence, the periphery states are

disenfranchised and downtrodden peoples ruled by puppet governments subservient to the global capitalism1. Moreover, in the apex of the pyramid we will always find the leader or hegemony of the Core States2. A State can be considered to be on the top (hegemony) once it incorporates to its structure the following characteristics. First, a State must have a simultaneous advantage in the three economical sectors: agribusiness, merchandise and finances; yet this condition lasts for a short period of time because the imitators will soon gain strength and become strong competitors. Secondly, its ideology is Liberalism, which means that the hegemonies bet for an open market where tariffs decrease while the trade of merchandises increases. Hegemony also tends to interfere in political process occurring within the rest of the countries in order to assure its own advantage. Meanwhile, these countries have provided a better quality of life to the working class so they could have a higher purchasing power and stimulate the market. Thirdly, its behavior responds to a military global power (hard power), in other words, it has to be able to control the market by means of strong land forces and the consolidation of a thalassocracy. Lastly, to stay permanently as Hegemony within the World-system goes beyond challenge, because Hegemonies have demonstrated to have an ephemeral ontology by nature; they remain at the apex of the pyramid for a relative short-time period until they are defeated in the next World War. Furthermore, its essential to point out that the new Hegemony is the winner from a competition against its former rival (e.g. Spain vs. Netherlands in the seventeenth century); also it will always have as a minor-partner the former Hegemony (e.g. USA and UK). In essence, Hannah Arendt captures what is the Hegemonys role in the World-System: Since power is essentially only a means to an end a community based solely on power must decay in the calm of order and stability; its complete security reveals that it is built on sand. Only by acquiring more can it guarantee the status quo; only by constantly extending its authority and only through process of power accumulation can it remain stable3.

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Extract from the first video: World-Systems Theory. Historically, there have been three hegemonies, that are mainly characterized by winning a regional/ world war and reestablishing the international political system: First, Neatherlands with the Thirty Years war that ended up with the establishment of Peace of Westfalia (1648); second the United Kingdoms triump in the Napoleonic wars and the foundation of the Concert of Europe (1815); lastly the United States after the Second World War and the creation of international institutions, such as the UN, the WB and IMF. 3 H. Arendt, Imperialism (New York: Harcourt Brace Janovich, 1968),22.

Capitalism is characterized by being a never-ending process of capital accumulation; its aim is to include every single territorial space of the world in this interdependent trade-system, so the Core States could greedily devoured the natural resources from the Periphery countries. In short, what Wallerstein infers is that decolonization is not yet over because the Core status groups grasp still indirectly persists in the periphery societies. In fact, new regimes soon became partners of the old oppressors, underlining the presence of a global de facto segregation, where progress is assigned just for a few, while deprivation, abuse and disenfranchisement prevail throughout the majority of the worlds population. Moreover to understand the process of the Capitalist world-economy and its functional logic, it is quintessential to comprehend the key concepts of unequal exchange and surplus value. Unequal exchange is by excellence the Capitalist engine which makes possible that the Core States will always be the winners, while the Periphery states will always left aside with the impossibility of carrying through the plan of guaranteeing a decent lifestyle to its population. It is based on the trade between the periphery and the core; where periphery products (which have the lowest labor costs) are exchanged with the corelike products (obsolete technology and hallow aid). Consequently, off-balance surplus value is sent to the Core, as a result of wide gap wage differences between the periphery workers and the core employers, a world division of labor; and the political structures, such as the Nation-States, whose managers have the ability to act in ways favorable to the capitalist class but also pursue policies partially autonomous from the direct subordination to specific domestic interests(Shannon)4. The unequal exchange displayed these last centuries can be summarized in a few words written by Eduardo Galeano: The sugar of tropical Latin America gave powerful impetus to the accumulation of capital for English, French, Dutch, and U.S. industrial development, while at the same time mutilating the economy of Northeast Brazil and the Caribbean islands and consummating the historic ruin of Africa. The fulcrum of the triangular trade manufacturers, slaves, sugarbetween Europe, African and American was traffic in slaves for sugar plantations. As Auguste Cochin wrote: The story of a grain of sugar is a whole lesson in political economy, in politics, and also in morality5. Furthermore, the World-System have put into question the theory of The Stages of
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Shannon, Chapter 2 World-System structure (Colorado: Westview Press, 1996), 30. E. Galeano, Open vains of Latin America. Five centuries of the pillage of a continent (Croydon: CPI bookmarque, 1997), 78-79

Economic Growth proposed by the Modernization theory thinker W.W. Rostow. He insisted that the developing countries havent had become developed countries because they havent reached the fifth final stage and were trapped in a historic phase; he analyzed each part of the system without establishing any bridges between them. Another intellectual of this theory, Ernesto Laclau, rejected the Marxist economical determinism and the notion of class struggle as being the main component of antagonism within a society. He asserted that means of production and participation in Capitalist World-System are two different concepts. On the contrary, the World-System is accord with the Dependency theory; it instigates to analyze the world as totality. With this global approach we are able to explain many phenomenons occurring throughout the world, such as the thirteen colonies, the railroad in the United Kingdom, the Federal war, etc. Andre Gunder Frank (a dependency theorist), in a debate with Ernesto Laclau insists that between the 16th and 17th century capitalist-system was already implemented worldwide, even in the colonies. Slaves were basically considered not as an abnormality of capitalism, but another form of means of production, that is the reason soon afterwards, the capitalists preferred hiring manual workers from Africa, because the benefits of having slaves decreased spectacularly while the costs for having workers were getting lesser. In this sense, Capitalism is not just defined as a process of industrialization but as a process of obtaining goods and resources from the New World by the means of surplus value and exploitation. We are no longer talking about the invisible hand of the market, but about political mechanisms that make the World-system persists and works throughout the time.