A daring attempt

The book attempts to interweave the empirical problem of globalised militarism with the economic theory of Marxist tradition.

PETER CUSTERS was an activist in the Dutch peace movement in the 1980s and was subsequently associated with studies relating to women's labour in Asia. He was an activist with a theoretical bent of mind, and this book, therefore, is the product of all three - activism, empirical studies and theoretical excursions. In the Foreword, Samir Amin describes the book as "audacious and important" but adds that "it is not always easy to read". It is also rather difficult to review, mainly because the author makes a brave - `audacious' - attempt to interweave the empirical problem of globalised militarism with the economic theory of Marxist tradition.

A critical appreciation of the work calls for familiarity with the rudiments of Karl Marx's theoretical contributions, those relating to the relationship between circulation and production, on the one hand, and the treatment of the "Departments of production", on the other. I shall make use of the advantage I have of not being a theoretician, Marxist or any other, to convey the gist of the empirical aspects of the work, which I consider to be more important than the theoretical exercises, though the author maintains that his contribution is primarily in the realm of theory, Marxist theory to be specific.

The empirical problems with the theoretical overtones that Custers features are basically threefold. First, production of military hardware - weapons of mass destruction (WMD), to put it crudely - assumed alarming proportions in the 20th century and continues to increase in the present century as well. In a rapidly globalising economic environment, weapons, including nuclear weapons, constitute a major share in production and trade.

Second, governments in all parts of the world play a major part in the production and trade of weapons, as also in the research relating to weapons. The state, therefore, must be taken as an economic agent in all societies, including, importantly, capitalist societies.

Third, global trade dominated by weapons cannot be considered `free trade'. It has special features of its own. If so, trade negotiations, in and through the World Trade Organisation, for instance, cannot be premised on the principles of free trade that now underlie such negotiations.

All these three are important empirical issues, with significant theoretical implications. The theoretical dimensions may now be explored.

Production and circulation are basic economic activities, but they take different institutional features under changing social conditions. For instance, while production, in principle, is always the interaction of human beings with nature, its actual manifestation depends on a wide range of social conditions. Under the socio-economic system that has come to be known as feudalism, agriculture was the predominant productive activity, clearly demonstrating human action on land and where the social arrangement for the distribution of the produce was more crucial than ownership over land. In the social set-up commonly designated capitalism, the means of production are a wide range of items including machinery, energy and raw materials, all valued in money terms as `capital', owned and controlled by a small section in society, who uses this power to employ and control others.

Exchange is the ubiquitous economic activity of transfer of one good for another. It, too, takes different forms. Barter is one of them, in which the owner of one good exchanges it directly with the owner of another good. Exchange more often takes place through the mediation of money; those who have goods to transfer selling them first for money and then buying what they want from those who keep goods for sale. This form of exchange, therefore, is less personal and more widespread than barter. It and other forms of exchange involving money give rise to markets and market exchanges. Because these tend to change social relations as well, they lead to market societies too. It is not difficult to see that there is a close connection between the capitalist form of production and the market form of exchange although the tendency to identify the two is not correct.

Now, underlying both exchange and production is the notion of useful goods (technically `use-values'). What one produces must be of use at least to oneself and, possibly, to others. In barter, for instance, two parties come together to exchange one good that has use-value for another that also has use-value. But the process of exchange also establishes the exchange value between the two goods, that is, the quantity of one of the goods exchanging for the quantity of the other. In barter, where there is no mediation, the exchange value is just a rate or a ratio, but when money is used as a medium of exchange, the ratio can be expressed as a quantity that takes the name `price'. Thus, while use-value is subjective, exchange value, or price, is objective. Not surprisingly, in an economy where markets and market values tend to dominate, prices become a measure of values.

These are elementary lessons in economics and even those who have had no formal introduction to `critical economic theory' are familiar with them. It can be easily seen, too, that what is price to one may be viewed as cost by another.

We can now turn to the set of issues that Custers raises in his work. In what sense can WMD be said to have use-value? From a societal perspective WMD should be considered at least as waste. And if production is claimed to be human interaction with nature (resources) to generate use-value, how can the manufacture of WMD be treated as `production'? Also, if exchange, or trade, is the transaction of goods of use-value, why has global trade now come to be dominated by trade in the useless goods called `weapons', especially those meant for mass destruction?

Bring the manufacture of nuclear weapons into this discussion and the problem becomes more puzzling. For nuclear weapons are not only social waste but they also generate by-products whose radioactive contents, such as uranium 238, result in environmental and health hazards. Such by-products cannot even be sold as market ware. Hence, the production of weapons (indeed even the production of nuclear energy for civilian use, according to Custers) results in "negative value" or "non-commodity waste" being generated, which are costs the producer must bear.

In today's world, in countries dealing with nuclear power, governments are directly involved in research leading to the manufacture and disposal of waste resulting from these productive activities. Capitalist countries such as the United States are no exception. In such instances, what is the motivation of governments in generating waste that involves so much expenditure? Whatever be the motive, since the state in capitalist countries actually plays such a leading role in the economic sphere, should not the state be treated as a key agent, along with private production units, in the analysis of capitalism itself? Then, how can the notion of capitalist economies as consisting entirely of market operations be defended? Did Marx also limit his exposition of capitalism solely to the market phenomenon?

Turning to the third theme of contemporary global trade in which the sale of weapons has come to play a prominent role (with the U.S. now accounting for over 50 per cent of the supply of conventional weapons), Custers argues that the trade between goods of positive value on the one side and negative value on the other cannot be "free" in any meaningful sense. Examining the trade between the U.S. and African countries, he postulates that the U.S. has been exchanging arms with countries such as Angola, the Democratic Republic of Congo, Sudan, and many more for primary products, which are the only ones they have and which they must sell for their survival. More glaringly, the U.S. used trade with Iran in the 1970s to get oil in exchange for weapons, setting Iraq against Iran. Trade in weapons has become a convenient tool for the U.S. to get what it wants and to create tensions and conflicts in different parts of the world, which in turn leads to further trade in weapons. "Disparate exchange" is the expression that Custers has coined for such trade.

I find the issues that Custers poses, and documents to some extent, interesting and important. Custers also uses them to argue that at the theoretical level he goes far beyond Rosa Luxemburg's attempt to extend Marxist theory by pointing out that capitalism requires non-capitalist economies for its expansion; Paul Baran's and Paul Sweezy's treatment of surplus and social waste; Ernest Mandel's thesis of `permanent war economy'; Arghiri Emmanuel's much-debated `unequal exchange'; and Samir Amin's `Accumulation on a World Scale'. Custers has been more daring, trying formally to extend Marxist theory to accommodate the themes he has put forward. He says: "I have tried to restate the basic views of Marx in such a way as to hopefully promote a revival of interest in Marx's economic theory. My position vis-a-vis classical Marxism is, however, far from uncritical ... ."

For instance, he introduces (--W) to refer to non-commodity waste and uses it to modify Marx's widely used representation of the circulation-production process, M-C... P... C' (--W)-M' (--W). Similarly, he puts forward a modified three `Departments' schema to bring in production of the means of destruction (MD) into Marx's two "Departments" - the Department for the production of the means of production (MP) and the Department for the production of the means of consumption (MC). In order to bring the state into the analysis, he introduces a revenue-holding state (R) that exercises primary responsibility for and control over the MD Department. I shall leave it to theorists, Marxist theorists in particular, to discuss and decide whether these amount to a radical reformulation of Marxist theory to make it relevant to the realities of the 21st century. However, I can state without any hesitation that the text is cluttered with these and many more formula modifications that make the reading tedious.

The work has an important by-product, though. It calls for much more anthropological and historical research into the evolution of economies from the most rudimentary to the most complex. It is now a fairly well-established position that all economies have two sets of transfers, one vertical and the other horizontal, the former symbolising authority and the latter being the basis of exchange and markets. It is important to establish which of the two has primordial priority. That, in turn, can be used to trace how and when authority gets metamorphosed into `state', and the role of the `state' in different economies and at different periods. It is equally important to explicate the social embeddedness of the economy and to trace the manner in which social forces `external' to the economy, politics, `culture', and so on influence it. All these aspects will have a bearing on understanding the nature of the constantly evolving global economy and polity. These, however, are not merely a matter of reworking existing models and formulae and not a task confined to Marxist theorists, either.