viernes, 10 de agosto de 2007

X Globalization and Security: The US ‘Imperial Presidency’: Global Impacts in Iraq and Mexico[1]


John Saxe-Fernández[2]



X.1 Introduction


This chapter approaches globalization and security from a theoretical and a historical perspective, making reference to the centrifugal processes observed in the development and impact of US capitalism in the international strategic scene as well as in Mexico. It also focuses on the centripetal forces involved in this process; forces derived from a historically observed centralization of police-military and intelligence power in the US executive branch over the last two centuries. This is a power used to deal with the propensity of capital, in its search for opportunities and profits, to tear and de­stabilize the social milieu within which it acts. As described below, this presidential power is pro­jected domestically and internationally. The impact of expansionism and Manifest Destiny in the US political and constitutional system has been enormous. In fact, in the view of some analysts, it has led the ‘Imperial Presidency’ to usurp legislative and judicial functions, eroding democracy in the process.[3]



From the Louisiana Purchase (1803) to the present, many US presidents have simply ignored Con­gress when it opposed the interests which they directly represent. Through their control over foreign policy, and usually through covert actions, they have tended to draw power out of both the judicial and legislative branches and into the executive. War (and the Civil War) – as well as secret diplomacy and what today is known as black operations – to manipulate the US Congress and the public have been used frequently. As for example, by President Polk (1845-1849) in the process that led to the war against Mexico; by Abraham Lincoln (1861-1865) who, as commander in chief of the military during the Civil War “raised and committed an army to oppose secession without even consulting Congress”[4] (and more significantly, authorized the head of the military to suspend the writ of habeas corpus when necessary (LaFeber 1989; Agamben 2004); by Franklin Roosevelt, in his use of various executive-legislative agreements to circumvent constitutional restrictions in the formalization of treaties; by Lyn­don Johnson, in his secret operations to obtain the war powers via the Bay of Tonkin Resolution of August 1964 (LaFeber 1989).



Since World War II, it has been the US that has generated a worldwide corporate and military-indu­strial structure: its repercussions and interrelationships with the economic sphere require greater eluci­dation but because of its very nature, the phenomenon represents one of the most daunting challenges to conceptualization and, especially, to explanation (Saxe-Fernández 1994: 283). This is especially the case since following – and as a result of – World War II, military ‘globalization’ came to mean that a ‘superpower’ in the Western Hemisphere located in an area historically ‘conquered’ by European colonial and imperial powers, has been ‘occupying’ militarily the most highly developed economic poles of Eurasia, and is now projecting its “national military might” as an occupying power at the sites of the main oil reserves of the world located in the Middle East (Klare 2004; Saxe-Fernández 2006), generating an unprecedented local and regional resistance and destabilizing the whole strategic equation.
The chapter addresses how these two forces – the centrifugal and the centripetal (that is, the economic and police-military) – relate to each other in what Arthur Schlesinger conceptualized as the ‘imperial presidency’ and its modus operandi in the international scene as well as in Mexico. Passing reference is made to the Porfiriato – for the Mexican case –, but the focus is mainly on a description of some of the trau­matic and disruptive consequences of the World Bank’s Structural Adjustment Programmes (SAP) on the Mexican peasantry and their socio-political impacts as reflected since the Chiapas rebellion (1994).



The impacts of such an ‘imperial presidency’ in the US domestic mileu, particularly in the constitu­tional arena, are addressed in the context of the war on terrorism at home, through a régime d´exception formalized in the Patriot Act, The Military Commissions Act which carries with it the abrogation of “habeas corpus” and a new Martial Law, The John Warner Defense Authorization Act of 2007, signed on 17 October 2006, which allows the president to involve the military in domestic law enforcement (Morales 2006).[5] The ‘American Gulag’, as experienced in Abu Ghraib, in Guantánamo, and in a global prison camp infrastructure holding – at this point in time – , 14 thousand persons, is interpreted as a testing ground for a “new legal system” (Saxe-Fernández 2006a, 2006b; Delgado 2007). George W. Bush’s has used ‘anti-terrorist’ war powers granted after 11 September 2001 to undermine civil liberties, establish secret military tribunals, and destabilize civil-military relations as exemplified by his request to US Congress to modify the 1878 Posse Comitatus Act and the Insurrection Act, which does not permit the military to act within the United States. Since earlier 2007, the power granted to the Exe­cu­tive by the John Warner Defense Authorization Act, according to Senator Patrick Leahy, encourages the President to declare federal martial law as it allows the ‘commander-in-chief’ to declare a ‘public emergency’ and station troops anywhere in the United States and take control of state-based National Guard units without the consent of the governor or local authorities, in order to “suppress public dis­order”.[6]



Some crucial impacts of the US national security regime in Mexico such as the export of weapons and military training to Mexico are illustrated. The paper concludes with a general assessment of the relationship between the ‘contradictions’ of capital, in its monopolistic stage, and the etiology and prospects for a general war.
The chapter focuses on the impacts of the imperial power of the United States on international security (the occupation of oil-rich Iraq), and its power projections in Mexico. A historical analysis will show that there is a clear imperialist pattern that emerges in a review of developments from the early l9th century to the most recent turn of US imperialism in the wake of 11 September 2001. At issue in these developments is the need for, and efforts of, the US Executive branch (the ‘imperial presidency’) to reconcile conflicting imperatives of economic power, projected by US-based multinational corpora­tions, and the political imperative to foster stability and order. Some of the implications of the efforts of the US imperial presidency to ‘resolve’ this problem manu militari are analysed.



X.2 The US Imperial Presidency and Monopoly Capital: Then and Now


Advanced initially by LaFeber (1995), the main thesis centres on the notion that:
Americans, often viewed as ardently anti-revolutionary, acted as catalysts for revolution as they searched for economic and missionary opportunities around the world; then as they willingly sacrificed order for the sake of opportunity, they supported a new presidency that emerged with this imperialism. Indeed, the Pre­sident’s chief function in foreign affairs became his use of constitutional commander-in-chief powers to use force, when necessary, to restore enough order so opportunities could again be pursued. (LaFeber 1995: xiii)

The ways through which US imperialism has tried to solve what appears an irreconcilable contra­dic­tion between the destabilizing thrust of its economic agents (the big monopolies and oligopolistic sec­tors)[7] and the advocacy of its foreign policy to foster stability and order, centre on the recourse to po­li­ce military interventions to face repeated socio-political explosions. This pattern increased in frequency with the spectacular growth of US capital after the Civil War when, in many industries, monopoly — and managerial — capitalism had already replaced family enterprises. Large monopolies grew and do­minated major sectors of the US economy. As Alfred Chandler points out, these growing monopolies altered the basic structure of these sectors and of the economy as a whole taking over:
From the market the coordination and integration of the flow of goods and services, from the production of the raw materials through the several processes of production to the sale to the ultimate consumer. Where they did so, production and distribution came to be concentrated in the hands of a few large enterprises (Chandler 1995: 11).

Thus, the visible hand of monopoly power, through its ownership and management structures, denied any credibility to the notion of the invisible hand of the market forces, the very notion upon which US corporate expansionism, following the British imperial rhetoric of free trade, was launched. As Prince Bismarck, the Iron Chancellor, pointed out in reference to England: “Free trade is the favourite doctrine of the dominant power, afraid others might follow its example.”

Its most basic imperialistic expression is to be found in an increased symbiosis of state power and cor­po­rate interests. By the end of the l9th century, the coordination of American foreign policy and nation­al private interests became more intense and extensive. The US overseas expansion was entirely fo­cu­sed on markets and moved along many routes to all corners of the world and under the impulses stem­ming from the relationship of its foreign policy and the dynamics and needs of monopoly capita­lism.


From a general theoretical and global perspective, Paul Sweezy (1997), Baran and Sweezy (1968), Harry Magdoff (1992), and István Mészáros (1995), have identified capitalism’s contradictory tenden­cies to greatly overreach itself with regard to one of its most important dimensions that directly affects the relationship between its economic and political command structures. According to Mészáros:
The contradiction between the rival national states of the capital system and the problematical drive of its most powerful economic units – the giant corporations – towards transnational monopolism is the clear ma­nifestation of this overreaching (Mészáros 1995: 170).
This theoretical proposition is crucial, taking into account that at the beginning of the 1960’s and of the war in Vietnam, Herbert Marcuse, Baran and Sweezy insisted on the centrality of the ‘warfare state’ in the dynamics of US monopoly capital and its ‘Pax Americana’[8]. By the ‘warfare state’ Marcuse (1964) meant, a social construct distilled from US capitalist experience, based on a massive mobilization of human and material resources, for the eventuality of war, internal or external, against an enemy, internal or external, real or imaginary. Baran and Sweezy (1968) described and analysed the political economy and the basic power mechanisms utilized in favour of powerful corporate interests by dealing with the deep-seated and indeed ‘systematic’ modus operandi of what US political science calls ‘the iron triangle’.[9] In its dynamics the role of the ‘imperial presidency’ is crucial: the ‘iron triangle’ concept is used to portray a politically interdependent relationship between the Executive branch – the imperial presidency[10] – and its Federal bureaucracy (Departments of Defense, Energy, Homeland Security, NASA, etc.), the private interests of giant corporations, particularly in the defence, aerospace and the oil and gas sectors, including labs, research institutes, trade associations and trade unions in the industry itself, and the key committees and members of US Congress, the House and Senate Committees on Energy and Natural Resources, the Armed Services Committees and Defense Appropriations Subcommittee, as well as Congressional members from defence-related districts and states. As special interests, the Federal bureaucracy and Congress develop business relations and inter­penetrate each other, so does their effort to defend their interests not only from outsiders but also from ‘insiders’ (‘whistle blowers’) and alternative perspectives (and after 9-11 through drastic restriction of public access to governmental documents and other ‘State of exception’ police and ‘intelligence’ regu­lations, as indicated, now formalized as part of the ‘anti-terrorist’ clauses of the Patriot Act and other laws).



To shed light on the dynamics of the Iron Triangle’s machinery[11], which is centred in the generation of profits – through the use and manipulation of information and influence – there are two related concepts. The first, ‘pork-barrel politics’ describes the use of this interdependency to boost and protect the priva­te interests.[12] At its very core US economy is centred on military Keynesianism involving a sort of ‘military-industrial’ populism (pork and barrel) used by politicians, presidential candidates, senators and congressmen in their efforts to obtain public support through obtaining ‘contracts’ that favour em­ploy­ment and business in their districts and states, irrespective of any economic or military efficiency (Engler 1966; Adams 1982; Briody 2003) All these three components (hence the expression iron ‘triangle’), usually carried out their transactions under the umbrella of the ‘national security’ rhetoric.
The second notion is the ‘revolving door’ practice that is the on-going traffic of personnel (and with it, of information, contacts and influence), from the private to the public sector, and vice versa. This is crucial in the area of governmental contracts:
A contractor seeks information from Congress and the Executive in answer to many questions: What pro­grams are forthcoming and where and how are they being defined; What are Federal procurement plans and regulations going to look like; Where do bureaucrats and members of Congress stand on particular sy­stems; When will legislation be considered and what form will it take? The company reworks this informa­tion, which flows in vast quantities, to focus on company needs and possibilities … it becomes intelligence (Adams 1982: 23).



This conceptual framework briefly sketched, shades light on current trends towards the formation of economic, monetary and geopolitical blocs, as well as the increased reliance by Washington, not on mul­tilateralism or ‘market-friendly policies’ to obtain access to key raw materials, but on political-military unilateralism and economic nationalism. Within the US ‘power elite’ there is a deep-em­bed­ded mistrust of the ‘invisible hand’ to deal with key geo-strategic issues such as access to oil and other key resources. Instead they rely on the Pentagon’s iron fist as it can be observed in Iraq or the constant intelligence community’s black operations practices.



As in Middle East, Mexico and other Caribbean and Latin American nations, what it is involved is the material base and thus the survival of our civilization since it carries with it the big decisions on war or peace. Needless to say, an understanding of the modus operandi of the imperial presidency under mo­nopoly capital is crucial in any attempt to elicit a ‘non-terminal’ resolution of the current deep crisis of ‘Pax Americana’, a central feature in the era of intercontinental ballistic missiles and thermonuclear weapons. As Richard Barnet foresaw these issues in the late 1970’s:
A global struggle over resource distribution is already underway. A key political question is whether the holders of power over the present resource system will control the next. War has been a favourite way for great nations to meet their resource needs. If there is another world war, the conflict will most likely be over what the industrial states have come to regard as the elements of survival. Oil, of course, but also iron, copper, uranium, cobalt, wheat, and water (Barnet 1980: 19).


X.3 The Imperial Presidency in Iraq and Mexico
X.3.1 The Case of Iraq



While the ‘iron triangle’ is a social construct at the core of the relationship between ‘state violence’ in Iraq and corporate behaviour and profits, both the ‘pork and barrel’ and the ‘revolving door’ practices are at the centre of any attempt to analyse current US involvement not only in that oil-rich country but also in Mexico’s political and economic life and most directly in Petróleos Mexicanos (Pemex); the country’s most important corporation, public or private. A good example is provided by the activities and political-economic forces – and actors – surrounding Halliburton’s participation in Iraq and in Mexico’s Pemex.
In the case of Iraq, the main Federal contracts of Halliburton, the giant oil services company based in Houston Texas, and its subsidiary, Brown and Root, now Kellog, Brown and Root (KBR) are imple­mented through the Department of Defense´s (DoD) Army Corps of Engineers (ACE), through a modality known as the Logistics Civilian Augmentation Program (LOGCAP).

Initiated by the Pentagon in 1985, during the Reagan administration, the LOGCAP intended to use hundreds of private contractors to supply the DoD and the troops stationed abroad, with support services ranging from food services to latrine cleaning, trucks to cots and tents, gymnasiums and showers, to generators and air conditioners, transportation, housing, construction of jails, distribution of gasoline, cleaning and maintenance of installations and barracks, et cetera. By this ‘outsourcing’ of ma­ny of its non-war-fighting functions, it was argued that thousands of troops would be freed to serve in battle.

The LOGCAP did not get momentum until 1992, when Dick Cheney, as Defense Secretary of President George Bush, gave it a push through a multi-million dollar classified investigation his office granted to KBR, to assess the costs and benefits of an extended LOGCAP, that is, to all logistics including not only basic services but also ‘security’ functions such as ‘interrogation of prisoners’, use of death squads and other paramilitary and illegal operations. The main conclusion of the study stresses the advantages to the Federal Government from an ‘expanded LOGCAP’, since private contractors could carry on questionable clandestine and security operations that would not fall under the military code or the US international commitments on human rights violations such as genocide and torture.[13]



In August 1992 Cheney awarded KBR, Halliburton´s subsidiary, the first extended LOGCAP. Soon afterwards, in 1995, he was appointed CEO of Halliburton. The Cheney-Halliburton ‘pork and barrel’ and ‘revolving door’ practices are part and parcel of the ‘modus operandi’ of monopoly capital. In 1997 the US Governmental Accountings Office (GAO) detected significant irregularities and Halliburton was substituted by DynCorp, another service contractor founded and staffed by former CIA directors and corporate personnel. Nonetheless Halliburton was awarded a non-bid 5 year contract for the recon­struc­tion of Iraq’s oil fields destroyed during the first Gulf War. Halliburton’s role as the main contractor in Iraq illustrates the way substantial profits can be made through the destruction of entire countries. Lancet, the British medical journal, had estimated Iraq’s civilian toll by 2006 in the hundreds of thousands (Roberts 2007). By 2007, more than 3,000 US soldiers have been killed and the seriously wounded and mutilated young men run in the 22,000 figure. But thanks to the ‘modus operandi’ of monopoly capital in the US, as the human tragedy and costs of the war in Iraq escalate, so do the profits to the corporations (Saxe-Fernández 2003, 2005, 2005a).



Since KBR received more money from the US involvement in Iraq than any other contractor, natu­rally many analysts think Halliburton’s high level connections may have given it undue influence in winning sole-source business. Halliburton’s shares in the stock market have soared as the price tag of Iraq’s military occupation increases (Witte 2005). At the beginning of the aggression in March 2003, the White House estimated the war would cost 60 billion dollars. Information provided by the New York Times (year) indicates that since then 137.5 billion dollars have been used just on military operations, out of a total of 250 billion.[14] The cost of the war in Iraq for the period from 2006 to 2010 has been esti­mated at over 1.3 trillion dollars.
The wide use of hundreds of contractors that operate under ‘cost-plus’ contracts is at the root of this pri­ce escalation and mounting abuses. During the late 1950’s and mid-1960’s, government contracts for the military and space agencies were assigned to companies on a ‘cost-plus basis’, a ‘device’ engi­neered under the American oligarchy’s exorbitant ambition for higher profits that gave the contracting firms a strong incentive to run up costs. Thus, as Melman pointed out, cost overruns were actually enc­ouraged by the Pentagon’s managers and the Federal government’s economics, on the grounds of “bolstering the economy” and “getting America moving again”.[15] Thus, “cost maximizing” became an in­sti­tutionalized practice among the Pentagon’s 37,000 industrial firms and over 100,000 subcon­tractors – including the “military divisions” of US 500 most important corporations (Melman 1987). According to the trade journal Defense Week, by the 1980’s, the prices of the military-serving goods produced by this network of firms were rising 20 per cent annually (Melman 1987: 4).



In 1991, prior to the terrorist attacks of 9 September 2001, and with Cheney as vice-president, KBR got a 10-year LOGCAP. As a result Halliburton is the largest contractor of the Pentagon in Iraq, in charge of 90 per cent of the LOGCAP. In June 2003 KBR got 320 million dollars in contracts. By September of that year the company was awarded 2 billion. According to Associated Press’ Lolita Baldor from 2003 to 2004 KBR contracts in Iraq were estimated at 10.7 billion, but Halliburton’s Iraq-related contracts in the Middle East could reach the 18 billion mark, not including operations in many coun­tries – such as the construction of jails in Guantánamo and Afghanistan.[16] The Army has ordered nearly 5 billion in work from Halliburton to provide logistic support to the US troops in Iraq over the next year, 1 billion above what the Army paid for similar services the previous year. This was happening while Halliburton is being audited for irregular practices (Witte 2005).



It occurs within the context of what Murray Weidenbaum (cited in: Adams 1982: page) perceives as a conver­gence between the Executive – such as the DoD’s ACE, or its Air Force, and its major suppliers, which blurs and reduces much of the distinction between public and private activities in key branches of the US economy, such as aircraft and aerospace, defence, and oil and gas (Adams 1982: 26). Weidenbaum´s assessment is corroborated almost daily.
The involvement of Halliburton and KBR, and the Vice-president, in the decision-making process that led to this ‘petro-war’ is clarified by the events surrounding these ‘irregularities’. For example, in late 2002, KBR was deployed to Kuwait to support the 150,000 or so Army troops pouring into the country in preparation for the March 2003 invasion of Iraq. According to information gathered by , KBR took up residence in villas paying 200 dollars per person with a total hotel tab soon reaching 1.5 million per month. The work was part of the above-mentioned weeping ten-year LOGCAP, and the decision to attack Iraq, strenuously fostered by Cheney, Rumsfeld, Rice and Wolfowitz at Bush’s National Security Council, meant billions of dollars in contracts and profits.



The demotion of key military officers and civilian employees of the Federal Government reporting accounting irregularities is part of a vast – and indeed extreme – ‘damage control’ effort by the Bush/Cheney administration (and its related private sector and Congressional allies and partners), which is reaching dictatorial proportions for its ‘state of exception’ mechanisms in the crucial area of accountability and official auditing practices. This case illustrates the fact that, as Adams points out, once moulded, the triangle sets with the rigidity of iron. Its key participants exert strenuous efforts to keep it isolated and protected from outside scrutiny (Adams 1982: 25).


Halliburton´s ‘pork and barrel’ scandals and ‘revolving door’ features are far from being the exception, as virtually all major corporations (like Boeing, Bechtel, Lockheed Martin, Northrop Grumman, General Dynamics, Raytheon, United Technologies, General Electric, Science Applications Interna­tional Corporations and CSC/Dyn Corp, to name but a few), and tens of thousands of subcontractors spread all over the US are involved in the ‘iron triangle’ dynamics[17]. For the past three years, for instance, and due to the Pentagon’s need for fuel for its global involvement, which includes pro­minently the war in Iraq, the Air Force sponsored a 30 billion dollar proposal to convert passenger planes into military refuelling tankers and lease them from Boeing, “as an efficient way to obtain air­craft the military urgently needs” (Smith 2005: A01).



But according to Ronald Garant, an official at the Pentagon comptroller’s office, the scheme “is a bailout for Boeing” and information gathered by Jeffrey Smith of the Washington Post indicate that the prevailing opinion at the Pentagon is that the proposed lease of Boeing’s 767 would cost too much for a plane with serious shortcomings. To senators John McCain, John Warner and Carl Levin of the Armed Services Committee, this is “one of the most significant military contracting abuses in several decades” (quoted in Smith, 2005). The incident provides an extraordinary glimpse of how the ‘Iron triangle’ and the ‘imperial presidency’ operate.[18] It shows the US Air Force working hand-in-glove with one of its chief contractors, the financially ailing Boeing, to help it try to obtain the most costly government lease ever.



By February 2007, the three top auditors overseeing work in Iraq told a US House of Representatives Committee their review of 57 billion dollars in Iraq contracts found that Defense and State Department officials condoned or allowed repeated work delays, and bloated expenses and payments for shoddy work or work never done:
About 10 billion has been squandered by the US government on Iraq reconstruction aid because of con­tractor overcharges and unsupported expenses, and federal investigators warned … that significantly more taxpayer money is at risk (Yen 2007: AP 1)
The warning is important since after the November 2006 elections, ‘resistance’ to the war for oil in Iraq is also widespread in the US Congress and, so far, the Bush administration has spent more than 350 billion dollars on the Iraq ‘reconstruction and stabililization’ effort.
The ‘iron’ dimension of the ‘triangle’ is fully illustrated by a new inspector general’s report detailing the US Air Force’s vigorous efforts on Boeing’s behalf and also showing how Air Force leaders and Boeing officials jointly manipulated legislation to authorize the deal, and later sought to suppress dissenting opinion throughout the Pentagon (Blustein 2005: PED 1).[19]



There is an ongoing persecution and punishment of federal workers including military and intelligence officers who object to the doctoring of facts that clash with policy and business: an Army general sidelined for questioning the administration’s projections about needed troop strength in Iraq; a former intelligence officer and journalist whose credibility is being questioned because he has written about the Pentagon’s efforts to expand covert capabilities within the US, and provides documental evidence that former Defense Secretary Rumsfeld was building up ‘an elite secret army’; a Medicare expert mu­ted when he tried to inform Congress about the true cost of the new prescription subsidies and a White House Specialist on climate change, who was punished after complaining that global warming statistics were being manipulated by White House political tacticians.


In addition to the hounding and bullying of ‘whistle blowers’ (NYT 2007), the White House, at the close of the second Bush presidency and in the face of a democratic victory in the 2008 presidential elections, behaves like an embassy in foreign territory getting ready for war, - or as a band of crooks facing an imminent inspection by the Internal Revenue Service: it is ‘burning evidence’ on a colossal scale. It is removing all embarrassing documents and data from public scrutiny. According to the New York Times this is being implemented at the unprecedented rate of ‘125 documents a mi­nute’:
The move toward greater secrecy has nearly doubled the number of documents annually hidden from public view – to well more than 15 million last year, nearly twice the number classified in 2001 – as bureaucrats have invented more amorphous categories like ´sensitive security information´. At the same time, the declassifi­cation of documents required under the Freedom of Information Act has been choked down to a fraction of what it was a decade ago, leaving the government working behind an ever darker, ever denser screen (NYT 2005).



X.3.2 The Case of Mexico

Since the North American Free Trade Agreement (NAFTA) came into operation, the imperial presi­dency’s centrifugal-centripetal dynamics is increasing in Mexico. While the ‘free market’ economic scheme boosts social and political frustrations, police-military initiatives led by the White House become more pronounced. It is worth taking into account that this country’s massive concessions in de­regulating foreign trade – without reciprocity – and direct investment, formalized in the NAFTA were the basis for setting up an area of ‘hemispheric commercial, monetary, investment and military annexationism’ through the Free Trade Area of the Americas (FTAA) and related programmes such as Plan Puebla Panama (PPP) and Plan Colombia (PC) now euphemistically called Plan Patriota, The FTAA, PPP and PC are backed by an elaborate public relations structure that barely conceals their real intention, namely, to justify the absorption of cheap labour, markets and strategic raw materials such as oil, natural gas, minerals, water and the control of huge biodiverse areas from Latin America ( Delgado 2004; 2005), as part of an arsenal of instruments (including those of military and ‘security projection’) used by the US government to face an increasingly fragmented and competitive world economy.


Over the last 140 years, in the Americas the enforcement of the Monroe Doctrine (1823) has been geared to providing state protection to US investment and trade. The needs of the fast-developing US industrial and agricultural system – based on protectionism and plagued by overproduction – were and are at the root of the US promotion of free trade agreements. This key structural feature was central in the l9th century and in the late 20th century: NAFTA and FTAA, as well as hemispheric and indeed US global economic and military diplomacy.
Former US Secretary of State, James G. Blaine (1889-1892)[20], spelled out the US economic policy to­­ward Latin America as follows:
I wish to declare the opinion that the United States has reached a point where one of its highest duties is to enlarge the area of its foreign trade. Under the beneficent policy of (tariff) protection we have developed a vo­lume of manufactures which, in many departments, overruns the demands of the home market. In the field of agriculture, with the immense propulsion given in it by agricultural implements, we can do far more than produce breadstuffs and provisions for our own people. ... Our great demand is expansion. I mean expansion of trade with countries where we can find profitable exchanges. We are not seeking annexation of territory. At the same time 1 think we should be unwisely content if we did not seek to engage in what the younger Pitt so well termed annexation of trade (cited in LaFeber 1995: 165),


Blaine’s interest in Latin America, and his idea to persuade US hemispheric neighbours to accept a kind of ‘older sister’ relationship, was influenced by economic motives. Blaine was a Republican representing big business interests. Naturally, he was aggrieved by the US’s adverse balance of trade with Latin America, a region which at that time was shipping huge quantities of raw materials to the US and which bought the bulk of its manufactured goods from Europe (Bailey 1980: 399). Like today, inter-capitalist rivalry was at the core of hemispheric free trade agreements. “Blaine’s aim,” writes Thomas Bailey:
was to elbow aside foreign competitors by forming closer commercial ties south of the border. And since economic relationships could not flourish amid whistling bullets, Washington would use its good offices to terminate wars in Latin America (Bailey 1980: 399).
This is of particular relevance when analysing the ways in which the centrifugal forces of US capitalism relate to the centripetal powers vested in the ‘imperial presidency’ and how they have related to each other in the past and at present – for example, through granting the President ‘fast track’ power to negotiate ‘trade agreements’.


In the 1870’s, for example, Mexican dictator Porfirio Díaz opened the country to free trade and foreign investment, making Mexico a dependent of the US. In the years 1903-1910, investments skyrocketed to three times those of 1876-1900.[21] By 1910, 43 per cent of Mexico’s prosperity is owned by US investors, 33 per cent by 15 million Mexicans, and 24 per cent by other foreign capitalists (LaFeber 1995). The investment was put into oil concessions, silver and other mining operations and huge plantations for export agriculture. In 1905 James Speyer, a prominent US banker, told the German ambassador to Mexico that “In the US there [was] a pervasive feeling that Mexico [was] no longer anything but a dependency of the American economy” (cited in LaFeber 1995: 221).


As massive foreign investments transformed Mexico and haciendas shifted to export crops, landless peasants proliferated and the production of staple food dropped. In 1910 Mexico was more modernized than in 1876, but had less corn and beans for domestic consumption than in 1876. Under the govern­ment of Porfirio Díaz the centrifugal forces of US capitalism had torn the social fabric. Americans built railroads to carry the goods to the ports, but also penetrated and threatened communal life. There had been discontented peasants here and there in the country, but by 1910 they swelled over the country, as never before in Mexican history. In 1910, the country exploded into cycles of civil wars, lasting seven years and costing 1.2 million lives, out of a population of 15 million. By 1916 there had been frequent US military incursions into Mexico. President Wilson even ordered the naval bom­bard­ment of Veracruz. The centripetal forces of the imperial presidency played different instru­ments of military, intelligence and diplomatic nature.

The social and political consequences of the Porfirian laissez-faire policies were traumatic. Trade, in­vestment and banking deregulations, similar to today’s economic agenda, collapsed under both internal and external forces. At that time – as is increasingly the case today, as demonstrated by the financial collapse of December 1994 – Mexican dependence on the liquidity of the international system created serious vulnerabilities:
The US panic of 1907 demonstrated the price of dependence on the giant northern neighbour. As New York capital dried up, Mexican exports dropped, investment disappeared, thousands of Mexican immigrants to the United States suddenly began to return home and unrest spread (LaFeber 1995: 222).


The historical experience of the Porfiriato with US corporate greed and its destabilizing thrust is an important precedent when dealing with current trends, impacted by Mexico’s ‘neo-oligarchs’ (Saxe-Fernández, Eduardo 1999) and foreign interests articulated under the umbrella of the Bretton Woods arrangements. Under Washington’s initiative the Bretton Woods conference celebrated in mid-1944 aimed at providing the US with a “new world economic order” that “could keep the nation’s economy pumping away so that the war shocked world could be rebuilt and the US system saved from a possibly fatal shock of another 1930’s like depression” (LaFeber 1989: 410, Kolko/Kolko 1972: 16; Hudson 2003 [2004?]: 179-216) To solve these problems the meeting established two new organizations: the International Monetary Fund (IMF) and the International Bank for Reconstruction and Development (IBRD) or the World Bank (WB).



Since the US at that time controlled two-thirds of the world’s gold, the Roosevelt administration insisted that the post-war economic system rest on gold and the US dollar. Thus, both institutions were designed, as Gabriel and Joyce Kolko agued, not merely to implement disinterested principles, “but to reflect the US’ control of the world’s monetary gold and its ability to provide a large part of its future capital. The WB was tailored to give a governmental framework for future private investment, much of which would be American” (Kolko/Kolko 1972: 16).


The US dominated the WB and the IMF, and these institutions, and the powerful dollar, were used by Roosevelt, first of all, “to force the British Empire to open up to the American goods and investment” (LaFeber 1989: 411), and soon after, as a powerful tools to do the same to the rest of the world, and most particularly to the Latin American and Caribbean region (Saxe-Fernández/Delgado 2004).
According to Dean Acheson (1969) who was ‘present at the creation’ of this new international economic architecture, the aim was to create not just an American dominated international mar­ketpla­ce, but one that did not need excessive state interference or high tariffs. The GATT arrangement later on the World Trade Organization, was central to these goals (Kolko/Kolko 1972). As both the IMF and the WB were designed to prevent or solve key international problems of the US – and later on of its associates (and competitors) in Europe and Japan – , in this chapter they are treated as state instruments of US national private interests and not as ‘international financial institutions’ or as ‘multilateral instruments’, as Roosevelt, not without sarcasm, liked, and seriously demanded, to label them.



Like the dollar, they have been vital tools of ‘Pax Americana’ and bringing about agricultural and industrial productivity in the capitalist periphery were not – and have never been – part of its agenda. Nor is it bringing about a social restructuring of any kind. The aim has never been to set into motion a cumulative process of development south of the Río Bravo, of the type which has characterized the per­formance of ‘advanced’ economies such as the US, British, Japanese or European economies. The East Asian ‘new industrial economies’ have developed by not following WB-IMF recipes. South Ko­rea, Taiwan and Japan, during the crucial period of 1950 to 1973 used a wide array of interventionist instruments including
import controls; control over foreign exchange allocations; provision of subsidized credit, -often at negative real interest rates- to favour firms and industries; control over multinational investment and foreign equity ownership; heavy subsidization and coercion of exports, particularly in South Korea; a highly active state technology policy; restrictions on domestic competition and government encouragement of a variety of cartel arrangements in the products markets; promotion of conglomerate enterprises through mergers and other government measures; and wide use of ´administrative guidance´ indicating non-transparency of government interventions (Singh 1998: 70).


As Singh points out, the economic history in South-East Asia “is unequivocally an argument for adopting an industrial strategy, for guiding the market, and not following the hands-off ‘market friendly’ approach recommended by the World Bank” (Singh 1998: 71).
The World Bank was specifically designed to promote primarily US national private interests and exports, not foreign development and resources. As a matter of fact, the WB operations are biased to aid the US, and in the case of WB’s agricultural modernization loans in Mexico, US agricultural exports. It is true that during the 1946 to 1952 period it helped US industrial exports and the position of its oil companies in the Middle East by financing the reconstruction of Europe and not primarily to aid the US. But from 1952 onward its lending activities concentrated in developing mechanism for the extraction of surplus from so-called ‘developing’ economies. It financed nearly 10 billion dollars of exports from the industrial nations to these ‘imperialized’ economies, about one-third were US ex­ports (Hudson 2004: 196-195).


The aggregate return to this country, on its total net investment position in the Bank, had exceeded 100 per cent from the Bank’s inception of through 1969. …On balance-of-payments accounts, US receipts from Bank operations approximated 2.1 times its investments in the institution. The Bank thus was not exactly an instrument of altruistic American generosity (Hudson 2004: 197).
When it comes to the ‘modernizing of Mexican agriculture the ‘laissez faire’ policies in Mexico ended up protecting US industrial and agricultural exports and investors against Mexican commercial, agri­cultural, and industrial nationalism.


In both, the Porfirian and in the ‘NAFTA periods’ what we have is a classic form of free trade im­perialism, and in both cases the economic strategy pushed social and political stability to the limits (and beyond!). While the US government lavished enormous subsidies on its domestic agriculture, aero­space, and other industries in order to assure a strong position in world markets, in Mexico the WB’s Agricultural Sector Loans and NAFTA’s free trade impositions in the agricultural sector have stimulated an unprecedented collapse of public expenditure and investment in the rural and industrial sector, generating an equally unprecedented exodus of untrained migrants into the cities and into the US. The social, political and military consequences of SAPs, and privatization and deregulation packages sponsored in Mexico by the IMF and the WB have been, and are being, implemented with the acquiescence of the Mexican government, dominated as it is by a powerful oligarchy.[22] Under this policy, the so-called ‘neoporfiriato’,[23] the government of Mexico, is being treated almost as if it were a part of the US.

Neoporfiriato’s basic features centre on the unilateral opening of Mexico’s domestic market, the pri­va­tization of some of the most important sectors of the Mexican economy – through a process designed to socialize costs and privatize benefits – all sorts of constitutional modifications designed to suit foreign in­terests, the transformation of Mexico into an exclusive paradise for US and Canadian investors by means of NAFTA, and the application of SAPs in the countryside. After listening to a major presen­tation on the privatization programme and the new Law of Foreign Privatization and Foreign Investment, sponsored by the World Bank during the government of President Salinas (year-year), a US entrepreneur expressed his satisfaction by calling the Salinas regime “the best thing that has happened to us since López de Santana delivered more than half of the Mexican territory to the United States” (source is needed).



The SAPs sponsored by the IMF and the WB are at the centre of neoporfiriato policies that were the major immediate cause of the insurrection in Chiapas. There is a virtual consensus among Mexican and many foreign analysts that the SAPs were a major precipitant of internal war, not in Chiapas but also in the case of other rural and urban sociopolitical explosions in the other states of Mexico, as well as elsewhere (for example, in Caracas, Santiago del Estero in Northern Argentina, and again [in 2002] in Buenos Aires and Montevideo). Social upheaval in Chiapas has deep roots in a colonial history of vio­lence, dispossession, and indignities suffered by the native Indians, and such grievances were not ad­dressed or even affected in any vital way by the Mexican Revolution. As is well known, the revo­lu­tionary government’s economic and political policies favoured landowners, cattle-ranchers, and those whose interests depend on the exploitation of the forests.



A crude coalition of these groups based on the political exploitation and inequities of caciquismo, the power structure of local bosses, was and still is the order of dominance in Chiapas. The agrarian and social structures derived from capitalist modernization benefited a small group and proletarianized a vast numbers of peasants in Chiapas and throughout Mexico (Calve 1993). According to research carried out by the Centro de Investigaciones Ecológicas del Sureste in where, by 1989, 64.7 per cent of the Chiapas peasants were jornaleros (day workers), 28.4 per cent were abjectly poor, and a mere 6.9 per cent were relatively well off. It was during the 1960’s and 1970’s that jornalerización mainly occurred, but during that period peasants rejected the use of armed conflict to solve their grievances (Saxe-Fernández 1994).


The general conditions for social frustration have been present for a long time, but the events that actually triggered the Chiapas rebellion must be traced to the SAPs of the WB and IMF, particularly their ‘modernization’ schemes for the agricultural sector in Mexico. The adjustment package of reduc­tions in public spending, channelling government and private resources toward the payment of foreign debts, and the control of wages to reduce inflation and increase the international competitiveness of Mexican products had devastating effects on the Mexican people.


The IMF and WB policies initiated a steep decline in real incomes. WB sources corroborate that real wages fell substantially in Mexico throughout the 1980’s and 1990’s and that the decline was greatest in the agricultural sector. By 1989 it was estimated that 60 to 80 per cent of the population suffered a situation approaching the despair of sub-Saharan Africa or Bangladesh. Declining real incomes have afflicted both low-income and middle classes. The ‘proletarianization’ of the Mexican middle class has become even more acute, evoking ominous reminders of Crane Brinton’s findings in his famous Anatomy of Revolution that a serious deterioration of the position of the middle class seems to be a recurring theme in the English (Cromwellian), American, French and Russian revolutions. This development is clearly not restricted to Mexico as it has already pushed the middle classes of Argentina and Uruguay to join the peasants and workers in their struggle against this economic model.
In the case of Chiapas (Saxe-Fernández 1994, 2002), the decline in real wages was even more deva­stating due to the high proportion of jornaleros (salaried peasant). When the minimum salary was dramatically reduced, it represented an unacceptable decrease in the standard of living of 64.7 per cent for the Chiapas peasants. In relation to the living standards of 1979, the IMF-WB’s SAPs reduced real wages by 60 per cent. According to an analysis by Calva (1993), the highly recessive policies im­plemented from 1983 onward, the collapse of coffee prices in the international market, and the uni­lateral opening of the domestic market reduced employment and greatly increased underemployment (Calva 1993: 30). As a result of these trends, a large portion (38.8 per cent) of the agricultural population of Chiapas saw its income reduced to 50 per cent of the minimum wage, or less than US$1.74 a day; another 36.6 per cent of those employed in the agropecuario (agrarian sector) earned between US$1.74 and TJS$3.48 a day (Calva 1993: 30?).

In contrast to the highly subsidized agriculture in the US, the WB’s agricultural sector loans, through conditioned programmes implemented by the Mexican government, opened the way to US grain exports and agribusiness by eliminating subsidies to peasants and small farmers, as well as price con­trol mechanisms and price guarantees for the crops, creating the biggest crisis in Mexican agriculture since the 1910 revolution. Small-scale producers throughout Mexico now face competition from cheap US imports of massively subsidized staples like maize, while domestic public investment has been cut drastically. In 1982, public investment in agriculture (in the form of credit subsidies, fiscal transfers, and other public investments) was 2.5 per cent of the GDP. By 1991, under heavy World Bank pressure and loans, it had fallen to 0.7 per cent (Calva 1993).


Chiapas is a symptom of a generalized condition that now affects the very fabric of Mexican society, because the main factors that led to the Zapatista Rebellion are now present everywhere in the country. Carlos Montemayor (1998), a noted analyst of guerrilla movements in Mexico and the author of La Guerra del Paraíso, which analyses some of the most important anthropological features of the Chia­pas social structure, pointed out that the Ejército Zapatista de Liberación Nacional (EZLN) was only the tip of the iceberg of popular unrest and rebellion. He is right, for this type of social movement does not appear spontaneously. Montemayor argues that there is a long period of incubation that makes such movements resistant to violent repression. They are also strongly resistant to actions imposed from out­side the community of struggle, and, of course, are lot themselves products of ‘foreign’ or ‘external’ forces, as official explanations have tried to characterize the Zapatistas.


The preconditions for internal war are not restricted to Chiapas – because the frustration of social, economic, and political aspirations is a general feature of the current Mexican landscape, and the so-called ‘economic modernization’ being implemented under the impact of all sorts of loans from the WB and the Inter-American Development Bank, have serves as major precipitants of social conflict through­out the country. The concept of relative deprivation is an essential tool for any diagnosis of the national, and certainly the bilateral, origins of the Zapatista insurrection. That is, it is not absolute po­verty that is the main precipitant of internal war but social perceptions regarding the discrepancy between the community’s value expectations and its value capabilities. As expressed by Gurr:
Value expectations are the goods and conditions of life to which people believe they are rightfully entitled. Value capabilities are the goods and conditions they think they are capable of getting, and keeping (Gurr 1970: 24).



It is in this sense that the situation in Chiapas indicates a much deeper problem: relative deprivation might even be greater in states such as Chihuahua or Coahuila, which have higher standards of living and therefore face even greater relative inequities. There are growing indications that this is the case. There is a widespread perception that regressive distribution of income is an essential feature of current economic policies. The programme to combat ‘extreme poverty’, basically designed by the WB, has led to results that contradict what was expected to accomplish. This is mainly a consequence of the fact that it was unable to counteract the widespread effects of its wage control policy. The contraction of wages has been brutal. In the 1970-1982 period, wages were 37.1 per cent of the GDP, whereas in the 1990’s they were under 25 per cent. It is estimated that between 1983 and 1993, Mexican wage earners lost US$ 46.9 billion. From 1989 to 1993 the loss was estimated at US$ 160.9 billion.



Analysts often classify developmental policies as belonging to one of two types. Fragmenting develop­ment tends to concentrate wealth. Integral development tends to promote economic equity. Neopor­firiato economic policy has been decidedly of the former type. That it has served to concentrate wealth in the midst of increased absolute poverty is a major recipe for social violence, as it was during Don Porphyries’ tenure. The actual concentration of wealth has reached levels that are difficult to imagine: 0.2 per cent of the population – the very top of the Mexican plutocracy – holds 51.1 per cent of the country’s assets.[24]


Social expenditures have been cut drastically. In 1980 such expenditures amounted to US$ 3.2 billion, and in 1981, the last year of the López Portillo administration, they increased to US$ 3.5 billion. From 1989 to 1993, under IMF-World Bank economic ‘guidance’, social spending was reduced to US$ 1.96 billion while the regional anti-poverty programmes in Chiapas amounted to US$ 527.5 million, and the losses of wage earners in the state, according to Calva’s (1993: 4) calculations, were over US$ 3 billion.[25]


It is no accident that the Chiapas insurrection coincided with the official approval of NAFTA on 1 Ja­nuary 1994. The linkage between both events is associated with several other factors. In addition to the problems caused by the wage-control policy of IMF and World Bank, Calva underscores the impor­tance of the crisis of the coffee market, which affected about 60,000 small producers across the state. The crisis resulted from the Salinas government’s rejection – in compliance with US presidential trade policies – of the International Coffee Agreement (Calva 1993: app. 702.3), thus meeting the require­ments of NAFTA, that Mexico would not act in coalition with other producers to restrict exports and thereby affect international prices:
But the coffee clause, was not the only reason why the Indians rejected NAFTA, for peasants had al­ready been suffering the effects of trade liberalization on the prices of other items such as the collapse in the prices of meat, soybeans, sorghum, bananas, and cocoa, which further reduced the peasants’ income and threw the whole agricultural sector of the country into disarray (Calva 1993).


Global public investment in Mexico from 1981 to 1992 declined by 60.4 per cent. Public investment in agropecuario was especially hard hit by the WB’s economic policies, showing a decline of 79.04 per cent during the period.[26] The IMF-WB’s SAP has caused a major social trauma for Mexican rural and urban society. It has precipitated the biggest crisis in Mexican agriculture since the 1910 revolution. Only the historical record can fully explain the enormous social, political, and military implications of current neoporfirian regression fostered by the imperial presidency through the IMF-World Bank agricultural SAP.
In a synthesis of the historical record on this vital experience, the editors of the New Internationalist recall that Emiliano Zapata’s main concern during the Mexican Revolution was the restoration of lands seized from the peasantry under Porfirio Díaz, After the resignation of Díaz in 1911, Zapata refused to demobilize his army until this demand had been met. In November he promulgated the Plan de Ayala which spelled out the demand for agrarian reform.


The lands, woods and water that have been usurped ... will be immediately restored to the villages or citizens who have title to them. ... Because the great majority of Mexicans own nothing more than the land they walk on. ... A third of these properties will be expropriated, with prior indemnification, so that the villages and citizens of Mexico may obtain ejidos, sites for town and fields. During the next chaotic and violent years Zapata remained in opposition to every head of state that emerged. In March 1919 he directed an open letter to President Venustiano Carranza denouncing his policies which turned the revolutionary struggle to your own advantage and to serve the interests of those who helped you rise, then shared the spoils. ... The old land holdings have been taken over by new landlords. ... and the people mocked in their hopes (name year: page)



Carranza devised an elaborate scheme to get rid of Zapata. A Federal Colonel, Jesus Guajardo, feigned a mutiny and offered to join Zapata with 500 men, their arms and ammunition. As proof of good faith se­­veral Zapatista defectors were tried by court-martial and executed, and the town of Jonacatepec was ‘captured’ in Zapatas’s name. A conference was set for 10 April 1919 at the Hacienda de Chinameca in Zapata’s home territory. Zapata rode into the hacienda with just ten men: the ceremonial guard turned their guns on him and he died in a hail of bullets (New Internationalist, January 1994: 21).


X.4 The US ‘Imperial Presidency’ and the World Bank’s Rural Moder­nization


Since NAFTA, small-scale producers all over Mexico have faced competition from cheap US imports of staples like maize, while government support for corn prices has been cut drastically. In other words, with other parameters used for comparison, public investment in agriculture (in the form of credit sub­si­dies, fiscal transfers and other public investments), which was 2.5 per cent of the GDP in 1982, fell down to 0.7 per cent by 1991.
What happened in Mexico in the last two decades was properly labelled by a widely read US weekly magazine as ‘Don Porfirio’s Revenge’ not only because of the World Bank’s massive privatization programme but also because of what appears to be a full-fledged agrarian counter-reform. Salinas’ modification of Article 27 of the Mexican Constitution, considered by the World Bank as one of its most important successes, formally ended agrarian reform and the process of land redistribution by eliminating the concept of ‘social property’, and it left the ejidatarios and small farmers at the mercy of ‘market forces’. As a consequence of new legal loopholes, a substantial increase in latifundia and in the holding of transnational – mostly US based – agribusiness has taken place.



The elimination of the ejido system of Mexican agriculture and the large-scale substitution of capital-intensive, export-oriented commercial farming in Mexico for the near-subsistence agriculture still prac­tised in the countryside is clear evidence of the destabilizing forces unleashed by US capitalist centri­fugation. The rapid displacement of the rural population has swelled the urban labour market, further depressing wage levels. Millions of peasants are crowding the cities or moving north, increasing immi­gration pressures. These socially disruptive policies place enormous strain on public sector services, while undermining the traditional social patterns. The social explosiveness created conditions for rural insurgencies, like those in Chiapas. This led the WB, through the Salinas, Zedillo and Fox govern­ments, to implement Procampo (now combined with a similar scheme called Conmigo) an emergency programme designed in part to address the plight of beleaguered peasants, but operated more to neutralize the electoral costs of these regressive policies to the PRI and now to the PAN.[27]
According to a confidential document prepared by economic analysts working for the US embassy in Mexico and leaked to the local press, “Procampo was designed to alleviate the pain of the peasantry in its transition to an open market. ... the privatization of the rural sector has had abrupt and catastrophic consequences for the Mexican rural population,” which, according to the Ambassador’s analysts, “has little chance to modernize in a way that would enable them to compete within the framework of NAFTA” (Domville 1994: 20). The dynamics of the imperial presidency are evident in this case, for while the document recognizes that the WB’s rural policies carried out by Salinas “have contributed to social instability and thus fostered the Zapatista guerrilla movement,” it notes that,
in an electoral year the government has an obligation to at least temporarily alleviate rural problems in order to keep the electoral advantage it traditionally enjoys in the rural areas (Saxe-Fernández/Delgado 2005).



Speaking to an assistant to Representative Richard Gephart, who visited Chiapas in late 1994, an Indian woman summarized the prevailing sense of despair among the Mexican rural population: “They never gave us anything, but now, with the Constitutional changes, they left us without hope.” This claim echoes those recorded during the regime of Porfirio Diaz. But the foreign policy of the US imperial presidency, carried out through the neoporfiriato, centres on short-run corporate and regional interests. For example, US embassy analysts point out that US grain exporters will greatly benefit from the WB’s agricultural programmes since the inability of these schemes to promote local production tends to favour “more imports of US corn and beans in the short run.” And since the limitations of the WB’s agricul­tural programmes will not enable Mexico to meet future demands for wheat, sorghum, soybeans, rice and cotton, it is estimated that “In medium and long-run terms the increased demand for such items will be greater than the national capacity to produce them, and thus imports [from the United States] will increase correspondingly” (confidential text cited in Domville 1994: 20).

The national security implications of a policy that tends to push millions of Mexican peasants into cities north and south of the US border are now being addressed by an unprecedented – in Mexican history – increase in military and police budgets, and an equally unprecedented US projection of mili­tary assistance, training and technology, appropriate for the control of the rural and the urban popu­lation. In terms of this technology, I refer, for instance, to the Textron water cannon vehicle weighing 25 thousand pounds and shooting 400 gallons of water at sufficient pressure to knock down crowds of people, and to the Cobra crowd control vehicle manufactured by Customs Armouring of Pittsfield, as well as to thousands of machine guns, helicopters, and other weapons and training used in both the war against drugs and the war against people – indisputably a class war. With the SAPs of IMF and WB an unprecedented purchase of military goods and services from the US under all categories of assistance (Foreign Military Sales/FMS, Commercial Sales, Excess Defense Sales and International Military Education and Training programme (IMET) are under way (Willson 1997). A report from the Federation of American Scientists indicates that between 1984 and 1993 Mexico obtained 10 times more US arms than it accumulated between 1950 and 1983.


Since NAFTA was formalized in 1994 there have been new demands for an increased US participa­tion in Mexico’s military dynamics. During the Zedillo and Fox administrations and now with Cal­derón, the emphasis has been to echo the Department of Defense call for a ‘secure, stable, and friendly’ ‘vecino’ who would look increasingly to the US for directions and dependency relating to military and international policies. In 1996 the Mexican press cited from a US Department of Defense report describing the intention of US military programmes to Mexico as “expanding US influence in the Mexican military” (Willson 1997: page). Thus, while the IMF-WB and neoporfiriato economic schemes further destabilize Mexican society (the centrifugal forces), an increased US role in the militarization and repression in Mexico can be observed, the centripetal side of the coin. Here we have the imperial presidency and the neoporfiriato in full operation.


Concluding remarks


In an interview published in the Mexican press in May 1994, General James R. Harding anticipated many of the scenarios regarding the ‘home land’ strategies of the ‘imperial presidency’ after the terrorist attacks of 9 September 2001 when he stated that “illegal Mexican migration to the US now ranks with drug trafficking and international terrorism as a major threat to national security.”[28]


Using the war against terrorism as an excuse, the US Justice Department, then under John Aschcroft, asked the US Immigration and Naturalization Service to dust off and enforce a 50-year-old law that requires non-citizens to report any change of address within 10 days of moving. Failure to do so could result in penalties ranging from fines to deportation. This policy applies to all non-citizens, whether they are in the US legally or illegally, implying that foreigners are more predisposed to commit terro­rism than natives are (Navarette 2002: 13). According to Navarette, the deporting of people who fail to report a change of address is a blatant overkill, and by singling out non-citizens, the policy only reinforces prejudices and pushes immigrants to the margins of society. The Bush administration insists that the new policy will ‘enhance border security’, but nobody knows how this will be accomplished by harassing people who have already crossed the border.


In the post-September 11 environment, the destabilizing of IMF and World Bank programmes com­bined to the pursuit of US vested interests in corporate and national security have profound negative implications for civil liberties and civic-military relations in both Mexico and the US. As pointed out above, President Bush’s request to Congress to abrogate the 1878 Posse Comitatus Act is an invitation of the imperial presidency to military authoritarianism and to an erosion of democratic, human, and con­stitutional rights. According to the White House team headed by President George W. Bush, “the threat of catastrophic terrorism requires a thorough review of the laws permitting the military to act within the United States” (cited in Navarette 2002).


The laws now give the ‘imperial presidency’ unprecedented powers for the establishment of uncon­stitu­tional and police-state-like ‘anti-terrorist’ structures in the US now being fostered in Canada and Mexico through the Partnership for Prosperity and Security (but in Mexico also through the refunc­tiona­lization of troops by converting them into police bodies). This policy is having profound reper­cussions in Mexico and Canada, since the US new anti-terrorist strategy claims that homeland security can only be achieved by locating US security and intelligence units in Mexican and Canadian ports, seaports, railways, and highways.
The economic and political well-being of American society is intertwined with the economic and national security trap that is generated by Washington’s covert financial and military endorsement of Mexico’s neoporfiriato. US economic policies and miscalculations are causing turmoil not in faraway lands such as Vietnam, Chile or Argentina, but next door to the US itself.


Streets in the US are the other end of a transmission belt that is eroding the structure of work and in­come, as well as the very foundations of democracy and constitutional rights in the context of the authoritarian excesses being promoted by the ‘imperial presidency’, under the excuse that the US is a nation ‘currently’ at war against ‘world terrorism’. It is a war in which anybody can be a terrorist at any time, a difficult scenario to all legitimate social and political opposition. US imperial authoritarianism and militarism occurs in a context in which there is a deepening of the structural capitalist crisis while both the World Bank and IMF insist in irresponsibly advocating the recessive deindustrialization policies that were applied in Latin America in the 1980’s with devastating consequences for produc­tivity, and the well-being of the population. These grave miscalculations ‘globalize’ the problem, by aggravating the risks of worldwide recession and in the case of Mexico turning into a time bomb that, unless immediately defused, will have devastating consequences (Saxe-Fernández 1997), a situation that is ‘already’ generating unbearable social and economic costs. In this context, strength of social mo­ve­ments against the capitalist system should increase, as they place severe limits to the capacity of the US ‘imperial presidency’ to contain social change on a global scale.
The dangers to international security are further aggravated by the increased ‘politization’ and ‘milita­rization’ of international economic exchanges, particularly in the vital energy and other strategic natu­ral resources sector. It should be noted that, in contrast to most Cold War operations, now the ‘imperial presidency’ sponsors not only political-military espionage against its enemies, but also ‘economic’ espio­nage. This trend is especially disturbing for those nations which, in the view of the US national security establishment, are perceived as “commercially, industrially or financially” hostile to the aims, purposes, and needs of US civilian and military enterprises (Saxe-Fernández 1994: 241). The extension of the US ‘national security’ structure to Mexico and Canada and subsequently throughout the hemisphere, using clandestine plans and personnel, hardly foreshadows a world of stability and in­ternational security.


The use of a ‘preventive war’ strategy to obtain control of oil and gas deposits creates unprecedented risks of general war. In Iraq, Bush’s military advisors have failed to anticipate the consequences of the unprecedented resistance to military occupation. They estimated that by 2006 ‘only’ 5 to 6 thousand troops would remain and Iraq was supposed to be run by a popular, democratic government capable of keeping order, while US oil monopolies profited from Iraq’s vast hydrocarbon resources. Now the White House is contemplating an escalation of the war into Iran, in scenarios that involve the use of tactical nuclear weapons, sowing the seeds of more wars, and consequently, transforming the United States in a principal threat to international law and security. Military analysts such as Edward Luttwak considered the ‘first’ Gulf War, with its devastating human, financial, environmental and political consequences as a ‘battle’ in World War Three. By 2007 the ‘battle’, pursued by George W. Bush, involves a human holocaust costing around one million civilian casualties in Iraq (Roberts 2007). This ‘battle’ is already, as pointed out by Zbigniew Brzezinski on 1 February 2007 before the US Senate Foreign Relations Committee, “a historical, strategic and moral calamity” (Grey 2007). But most significant was Brzezinski´s suggestion that the Bush administration might ‘manufacture’ a pretext to justify a military attack on Iran by “some provocation in Iraq or a terrorist act in the US blamed on Iran, culminating in ‘defensive’ US military action against Iran…” (emphasis added as the allusion to the attacks of 11 September against the WTC and the Pentagon is more than ‘significant’, coming from a former national security advisor) (Grey 2007; Saxe-Fernández 2006a, 2007; Delgado 2007).


The temptation to resurrect the old US and German geo-political concepts of ‘large areas’ is already apparent in ‘North America’ and in the use of the ‘blitzkrieg’ worldwide. The war in Iraq and the destabilization of the Middle East, in the midst of massive corporate corruption, and the WB and IMF scenarios of domination for the Americas by economic and coercive means, once again illustrate the tendency of monopoly capital (basically the military-industrial and oil and gas sectors) in the US to manipulate external economic, diplomatic and military factors, as well as domestic politics in order to offset their economic and geo-strategic difficulties (access to cheap oil). The centrifugal-centripetal dynamics of the ‘imperial presidency’ is already exacerbating an already critical situation in the Middle East of unprecedented proportions (Saxe-Fernández 1980, 1979, 2007; Chossudovsky 2006a; 2006b; Delgado 2007). According to Richard Falk, this is, indeed, a core region for a World War Three sce­nario:
… general wars in the past have always occurred when a great power tries to compensate for economic and po­litical decline by recourse to decisive military means. At the present time, I believe that the American leader­ship is increasingly trying to offset a reality created and expressed by the weakness of the dollar in economic terms and by the loss of control over the Third World in resource terms. The United States is … trying to offset that weakness by relying on military superiority, and it is in that contest of offsetting political and economic disadvantage with the pursuit of military advantage that the most horrible wars … have occur­red (Falk 1979: 21).



[1] Source: Hans Günther Brauch, John Grin, Úrsula Oswald, et al, (eds) Globalization and Enrivonmental Challenges. Reconceptualizing Security in the 21st Century. Berlin-Heilddelberg-New York-Hong-Kong-London-Milan-Paris-Tokio. Springer-Verlag (2007) in press. Paper Presented at eh 2007 LASA Congress, Montreal, Septiember 2007. Bibliography available upon requesto to jsaxef@gmail.com
[2] The first draft of this paper was presented to the Canadian Social Science Congress, in Toronto, Canada, 29 May –1 June 2002, and published as: Saxe-Fernández (2002). The author wishes to express his gratitude to Dr. Gian Carlo Delgado Ramos for his technical help and his substantive observations on this work.
[3] For a description of the use by the Executive of secret operations to manipulate and undermine Congressional prerogative in foreign relations see Schlesinger (1973), Zinn (1990) and LaFeber (1987).
[4] Walter LaFeber (1995: 6): Lincoln did that on 15 April 1861, in contradiction to Article I of the Constitution, and during the next 10 weeks after 4 July “acted as a de facto absolute dictator”. Giorgio Agamben (2004: 54) citing Carl Schmitt (1965) refers to Lincoln’s dictates as a classical example of ‘dictadura comisarial’.
[5] The 1878 Posse Comitatus Act indicated that “Whoever, except in cases and under circumstances expressly authorized by the Constitution or Act of Congress, willfully uses any part of the Army or Air Force as a posse comitatus or otherwise to execute the laws shall be fined under this title of imprisoned not more than two years, or both”. This is the only US criminal statute that outlaws military operations directed against the American people under the cover of “law enforcement” (Morales 2006: 2).
[6] See for details at: ; ; Jeniffer K. Elsea, Legislative Attorney (2006). A synthesis and analysis is offered by Frank Morales (2006).
[7] By multinational corporation, I refer to national (in this case, US-based) enterprises that operate internationally.
[8] Marcuse did so in a seminar devoted to ‘The Warfare State’ at Brandeis University (1964) as well as Baran/Sweezy (1968). See also: Sweezy (1978); on the ‘political sociology’ see C. Wright Mills (1957). For a critique of Mills’ work see Sweezy (1968) and Aptheker (1968). In his Power Elite Mills (1957) de-emphasizes the notion of a ‘ruling class’, remaining firmly influenced by the Machiavellian and Weberian mold – with great reliance on notions of bureaucratic elites – but the Marxian influence is undeniably there in his strong rejection of those works that do not take into account the fundamental importance of class and property and the control of and possession of property and stock. See Mills/Gerth (1942, 1965). For further theoretical integration, development and analysis see Milliband (1978).
[9] On the ‘iron triangle’ see: Adams (1977); Salomon/Siegried (1977). For a good study on the ‘iron triangle’ in the military-industrial sector, see Adams (1982), and for the same regarding oil and gas industry; see Engler’s classic (1966). The author’s description of the oil lobby’s operations and symbiotic relations with US Congress and the White House is one of the best and most systematic studies of the iron triangle’s ‘pork and barrel’ and ‘revolving door’ dynamics in the oil sector. For a well researched and politically vital study of the operations of the iron triangle in the aerospace industry see Nimroody (1988). An important recent study is offered by Briody (2003).
[10] On the imperial presidency in addition to Schlesinger (1973) and LaFeber, (1995), see: Saxe-Fernández (2005).
[11] Geared at the appropriation of surplus value.
[12] And this includes a sort of “military-industrial” populism used by politicians, presidential candidates, senators and congressmen in their efforts to obtain public support through obtaining “contracts” that favor employment and business in their districts and states.
[13] Such as in the Plan Colombia.
[14] According to the US based National Priorities Project, on 20 February 2007, US War costs in Iraq were about: 368 billion US$; for topical data see at: < option="com_wrapper&Itemid="182">.

[16] Since Cheney was appointed Vice-president of the US, Halliburton worldwide operations have multiplied. For example, just in Mexico, from January 2001 to may 2005 Pemex, the Mexican state oil enterprise, now under a World Bank “divestiture” scheme, awarded 1.22 billion to Halliburton in non-bid contracts.
[17] Professional up-dated profiles on these corporations are provided by www.corpwatch.org Design by Tumis.com 1611 Telegraphn Ave, N. 702, Oakland, Ca, 94612, USA. Current developments in the military industrial complex are provided on line, among others, by the NYT, Washington Post, San Francisco Chronicle, St. Louis Post Dispatch, Christian Science Monitor, and the Los Angeles Times.
[18] For details on how the iron triangle currently impacts transatlantic relations see Blustein, (2005)

[20] Blaine had also served as Secretary of State in 1881 during the brief presidency of James A. Garfield,
[21] The data on the Porfiriato is provided by LaFeber (1995).
[22] The World Bank and the IMF are treated in this paper as state and class instruments of US national private interests and not as international financial institutions or as financial multilateral instruments, and thus, as vital tools of Pax Americana. For a precise historical analysis, see Kolko and Kolko (1972).
[23] Neoporfiriato is a concept that defines more clearly current features of economic and political policies in contrast to the more popular label of neo-liberal. The Mexican XIX liberal tradition fostered important positive trends in vital areas such as state-church relations and in promoting the secularization of education. Thus the concept of neo-liberal is not as historically adequate as the neoporfiriato. This text is based on a previous research paper (Saxe-Fernández 1994, 2002, 2005, 2006).
[24] In 1984 the income of the lowest 10 per cent of Mexican families accounted for 1.72 per cent of the GDP. By 1989 this figure had declined to 1.58 per cent, and by 1992, to a mere 1.55 per cent. By contrast, the incomes of the richest 10 per cent of the population increased as a proportion of GDP from 32.77 per cent in 1984 to 37.93 per cent in 1989, and to 38.16 per cent in 1992 based on data from INEGI and the Banco Nacional de México. See: Elvia Gutiérrez, “Retrocesos en la distribución de la riqueza durante la actual administración”, in: El Financiero, 11 February 1994: 3. Data on the concentration of wealth by the Mexican plutocracy are from Banco de México and Bolsa Mexicana de Valores, See: La Jornada, 14 February 1994: 1.
[25] This type of inequity is also observed in the way the State of Chiapas, Mexico’s richest state in terms of water and forest resources as well as in the generation of electricity, is physically discriminated against by the Federal Government.
[26] These estimates were kindly provided by Calva as of 1 March 1994. The figures are based on official data from the Federal budgets of 1980-1992, and all estimates are made in 1980 pesos.
[27] PRI (Partido Revolucionario Institucional) is the official party that dominated Mexican politics. PAN (Partido Acción Nacional) is the opposition right-wing party that won the 2000 and 2006 Presidential elections.
[28] In an interview with Mexican reporter Dolia Estévez, General Hardin pointed to the need “to prepare the Armed Forces in Latin America to deal with any threats to [national and regional, that is, US] security”, in: El Financiero, 20 May 1994: 44.