Born of Crisis
Empire and Economics is a research project nearly a decade in the making. It began with research on the causes and consequences of the 2008 global financial crisis, and grew in scope with the European debt crisis that began unfolding in 2010. Through these crises, we see the centrality of economic policymakers and financial diplomats in modern world politics. The world’s finance ministers and central bankers, in particular, were at the centre of the system of global economic governance; those responsible for managing and directing political authority over the global economic system.
A combination of politicians and unelected technocrats (such as economists, central bankers, and officials of international organizations) wield political authority over the global economy. Their official and social circles are closely intertwined with that of the world’s super-rich: the bankers, billionaires, financial institutions and family dynasties who control the world’s wealth, sitting at the centre of the global economy.
The New Rulers
Empire and Economics explores these topics and follows the individuals involved over the course of many years, not simply from 2008 onward, but moving back through the 20th century to the system’s origins in the smoke and ash of World War II. The role of financial diplomats – of finance ministers, central bankers, and others – is scrutinized through this time period with a focus on their exponential rise and centrality to global politics.
The financial diplomats moved to the centre of the world political system in the 1970s, a decade of monetary and financial instability and chaos. There were dramatic changes to the world currency system, to oil and energy markets, and to the global movement of money. It was also the start of a new age of political management of the global economy. New committees of technocrats and informal groupings of financial diplomats – and their national leaders – assumed political responsibility for the global economy. The most important among them was the Group of Seven (G-7), with political and technocratic leaders from the seven richest capitalist democracies working together to manage and direct the world economy.
The New Rebels
Empire and Economics does not simply move back in time, but also forward. After the global financial crisis and the European debt crisis began, the Arab Spring and uprisings of 2011 and 2012 became major focal points of research. They brought a new dynamic to the story with the role of social movements in the unfolding of history, and in the evolution of the global economic system. And much like that system, many of its points of origin can be found in the post-War period.
In the aftermath of World War II, and in the midst of a developing Cold War between the United States and the Soviet Union, much of the world was experiencing an unprecedented revolution in the process of decolonization. In the decades that followed the war, most of Africa and Asia were liberated from the formal political control of European empires, creating new nations representing the vast majority of the world’s population. This process coincided with internal rebellions and protest movements inside many of the rich countries themselves, from the 1950s through the 1970s.
The New Colonialism
Going into the 1980s, the focus of the research is on changes in the governing economic ideology and the deregulation of finance; essentially, how banks and finance became so big and powerful. Starting in the early 1980s, a debt crisis spread across much of the ‘developing’ world of countries, many of which were only newly independent. In this crisis, the G-7 nations and the institutions they control – such as the International Monetary Fund (IMF) – used their financial power (in the form of loans) to force countries to change their economic priorities and policies.
Essentially they blackmailed countries with bailout loans, forcing them to dramatically alter their economic policies (with profound political and social consequences). And the bailout money itself was usually channeled right back to the major banks in New York, London, Paris, Frankfurt and Tokyo. In the process of recycling money from the public coffers of the rich countries to the big banks of the rich countries, the poor and developing nations (later called ’emerging markets’) served as intermediaries, and took the majority of blame for the crisis. As such, these countries were forced to undergo one of the world’s greatest social engineering projects. It led to immense wealth creation, but also a great deal of poverty, exploitation and income inequality.
This process manifested as a dramatic recolonization of the developing world, driven by economic policymakers and more to the benefit of multinational corporations and financial institutions than to any one nation or political power. The major nations – centrally organized through the G-7 – worked together to undertake this process of financial and economic expansion and colonization.
The New Players
The project of economic colonization covered much of Latin America, Africa and Asia by the end of the 1980s. When the Soviet Union collapsed in the early 1990s, the economic empire expanded into Eastern and Central Europe. The process did give rise to powerful new economic players on the scene, notably China, but also including Brazil, Turkey and South Korea, among others. Those who learned the rules of the game were in a position to gain from it. Their domestic oligarchy would stand to benefit and their international prestige would rise.
In time, the increased size of their economic weight in the world prompted the formation of new groupings to rule the world economy, most notably the Group of 20 (G-20), which includes all G-7 members plus many notable ’emerging market’ economies from Asia and Latin America. This new grouping would not step to the centre stage until the outbreak of the 2008 global financial crisis.
Empire and Economics aims to place the past decade in a broader historical context. To better understand the role of institutions and groups like the IMF and the G-7 in the financial crisis, it is best to examine the origins of these groups and their role in other events and processes. While the G20 stepped to the centre-stage in 2008, it was created in the wake of the Asian Financial Crisis in the late 1990s. Europe’s response to its own debt crisis in 2010 was a re-telling of the story of the 1980s debt crisis, but this time with Germany at the centre of the story.
The New Instability
As the last decade continued on through uprisings in the Arab world and beyond, it also witnessed the resurgence of an antagonistic Russia, once again a force seemingly opposed and actively working against the interests of Western powers. This was largely manifested in the wake of the 2014 Ukraine crisis, but its origins lie in the previous 25 years of relations with the West and in the consequences of decisions made and policies pursued in support of the economic empire.
In the latter years of the decade, many of the once-stable and seemingly secure democratic nations witnessed the rise of right-wing populists, the far-right and fascist parties preaching the politics of hate. This process is itself an outgrowth of an empire governed by economic priorities and policies that favour the interests of a small global financial oligarchy. It brought dissatisfaction with the status quo and anger toward establishment politicians, resulting in a severe lack of public trust in ‘the system.’
Into that morass came Donald Trump and all the instability he unleashed as President, acting as an accelerant to many existing problems in the world system and creating whole new ones as well. The global system that was built in the years following World War II had never been more unstable or insecure. The global economy since the financial crisis had been kept afloat by the crisis-response of finance ministers and the sustained support of central bankers for most of the decade. Tensions between nations – allies or ‘competitors’ – grew worse, particularly between the United States and much of the rest of the world. Dozens of nations experienced widespread social unrest and rebellions over the course of the 2019.
And then came 2020.
The New World
Want to know how the world came to a halt, how the economy collapsed, why our economic system – which we thought was so strong – was revealed as so frail and weak? Why are the most ‘essential’ people often left least protected, while banks and corporations are given trillions in a moment’s notice?
All the complexities of the global political and economic order, which were already in a period of great uncertainty, were suddenly thrown into the vast unknown of a global pandemic.
We face a future uncertain, but now is the time to look back at what brought us here, so that we can work to find new and better ways of moving forward. Empire and Economics attempts to contribute to this monumental task of knowing thyself on a civilizational level.
The history of the world since the global financial crisis is born of the history of empire and economics in the post-World War II-era. It is a history of empire best told as a series of stories driven by a multitude of complex characters, in a world mired by near-constant instability and surges of unrest and resistance. Like all empires, it is built on structures of control and oppression, and its consequences can be fatal. It is, however, a unique empire in human history, governed by a language and philosophy of economics rather than politics.
Empire and Economics wants to tell this story through articles and essays, a series of books, a podcast series, and eventually also to include a YouTube series. As a non-fiction multimedia storytelling project, Empire and Economics aims to reach as wide an audience as possible through multiple media, and with an effort to translate the obfuscations and inaccessibility of economic language into plain English. This is not a story written simply for those with a background in economics, political science or history; it is a story meant to be accessible to all.
If Empire and Economics interests you, please consider supporting the project through a donation of your choice. Access to resources for research – from books to newspaper subscriptions and access to academic journals – costs money. Financial support can go a long way towards supporting access to these and more resources as well as being able to dedicate more time to the process of writing.