by Roland Watson
October 2001

The United States is viewed as the leading democracy in the world. We are seen as the defender and central distribution point of democratic ideals. And indeed, sometimes we do take, or would appear to take, steps to fight dictatorship solely on the basis of principle; for example, our role in the defeat of Iraq’s aggression against Kuwait and of Serbian aggression against other members of the former federation of Yugoslavia. However, these actions did serve our interests; they were not wholly altruistic. We needed Kuwait’s oil (not to mention that we ignored the fact that the nation is itself a dictatorship), and we were supporting our European allies in the various fights in the Balkans.

On the other hand, the U.S. sanctions against Burma can be seen to be a direct expression of the desire to defend freedom and human rights.

But again, for Burma, such sanctions are overshadowed by our many other, contradictory steps, particularly relative to China, the godfather of the Burmese dictators, including: that we have not taken a strong position, and action, against its repression of the people of Tibet; even more, that we de-linked our trade with the nation from any human rights concerns; that we granted it permanent normal trade relations status and ended our opposition to its entry into the WTO; and that we did not oppose its being awarded the 2008 Olympics.

Of course, regarding the WTO (and also NAFTA), our government supports granting the organization even more power, including the power to overrule any consideration or effort that blocks international trade in any way, such as the fight for human rights and against dictatorship, or to oppose child and sweatshop labor (not to mention more generally to guarantee the rights of workers everywhere), or to preserve the environment. The United States’ position is that such considerations and efforts, if they interfere with trade in any way, should be made against the law.

What has happened is that the ethical agenda of the government has been conquered by business interests. The businesses have said that they will police their own behavior, and the government has accepted this. It is worth noting that people who support the idea of self-policing are basically saying that the framers of the United States Constitution were wrong, and that we do not need a system of checks and balances. (It is also worth noting that the police, themselves, cannot police themselves!)

Businesses are of course also far from altruistic. They do not, and cannot be trusted to, control their own behavior. They are myopic: they have the sole motivation of self-interest, and this self-interest is itself pursued in the context of the single-minded focus of capital markets on the earning of profits. When faced with any tradeoff between ethical considerations and the earning of greater profits, they always choose the latter; indeed, they believe they are compelled, by the markets, and by the idea that they must maximize shareholder value, to do so.

The consequence of the above is that United States policy is fundamentally conflicted. We speak against dictatorship, but actively support trade and business practices which strengthen it. One must ask the question: which is the better measure, our words, or our actions? Obviously, the answer is the latter.

However, this is not all. There is another, deeper factor at work. The United States, and also many of the nations of Europe, and Japan, actually prefer that the political dictatorships of the world remain dictatorships. They have no desire to see that the dictatorial regimes are overthrown, and replaced by democratic systems. The reason for this is that they recognize that dictatorship is decidedly second-best as a political system through which to create economic competitiveness.

In the world of the 21st century, the historical patterns of military conflict between nations have been supplanted by a global environment characterized by economic competition. And the leading democracies understand this, and also the fact that their political system, when coupled with the now dominant economic paradigm, capitalism, gives them a large competitive advantage over dictatorships. Indeed, they have already gained a huge lead: their companies and banks dominate global commerce. And, as their nascent competitors remain dictatorships, this lead is certain to grow.

In effect, such nations are containing China and the other dictatorships by not pushing for their conversion to democracy. By doing so, the former ensure that they retain economic supremacy.

Of course, one might argue that many dictatorships, particularly China, have achieved rapid growth in recent years. But, while this may be true, the following points must be kept in mind:

- Their economies started from a very low base: in such a situation it takes little real growth to create large percentage increases in such measures as GDP.
- The growth was funded by externally-supplied capital: it could not have been achieved without this.
- The growth has been based mainly on the exploitation of low-wage labor and natural resources, but both of these are only temporary advantages: they will exist for only a limited duration.
- Even with the growth, the economies remain non-transparent and are highly susceptible to corruption.
- And, there is the fact that the dictatorships spend exorbitant amounts on security apparatus - the military, etc. - which do little to yield the quality-of-life increases that economic growth presupposes.

The classic example of this was the Soviet Union, which demonstrated clearly that dictatorial political systems are economically non-competitive. Dictators strive to maintain control, and for this to be best accomplished, such control must be centralized. But centralized planning, i.e., economic planning, cannot compete with a system where economic institutions - businesses - are decentralized. The latter are far more flexible, and hence better equipped to adapt to changing customer demands and market conditions. Decentralized organizations are also less subject - to a degree - to corruption, since a great centralization of control enables corruption on a truly massive scale.

In summary, the U.S. government (and the governments of many other democratic nations) has been taken over by business interests. Its announced anti-dictatorship policy is a charade: for public consumption only. Our democracy is not principled. It does not care about the crimes against humanity, and nature, which are committed daily by the many dictatorships of the world. It wants these dictators to remain in power, in recognition of the fact that this will enable it to retain the real power which now dominates the world, which is economic power. In the contest between the ideal of working to build a better world, and the selfish desire to satisfy one’s greed and make a lot of money, and accrue the power which this money provides, greed, money, and power clearly have won.

Through supporting the Chinese dictatorship, this in turn means we support the dictatorships in its client states, such as Burma, North Korea and Pakistan, even though our avowed policy states otherwise.


© Roland O. Watson 2001-3