Europe and the Wider World

Bernard Waites

• Publisher: Routledge
• Year: 2005
• Print ISBN: 9780415124201
• eBook ISBN: 9781134804122
• Edition: 1
• Topic: Politique et relations internationales
• Subtopic: Politique

This book examines the concept of Europe in its relations to those areas of the globe beyond its borders. In particular it is concerned with the historical evolution and contemporary setting of Europe vis-a-vis The United States of America, the developing world and the former Soviet Union. This involves drawing on the perspectives of international history, politics and economics.
A unifying feature of the analysis included here is provided by the fact that the "bi-polar world" that emerged in the aftermath of the Second World War has effectively been brought to an end with the collapse first of Soviet control in Eastern Europe, and then by the break-up of the Soviet Union itself and a prospective reduction of American influence in western Europe. What will Europe look like in an increasingly "multi-polar world"? An answer to this depends not only on the evolving external connections between Europe and other parts of the world but also on the internal development of European political and economic integration. The dynamic of this crucial dual relationship is examined here.

Essay 1

Europe and the Third World

Prepared for the Course Team by Bernard Waites Lecturer in European Humanities Studies, The Open University

Introduction

The term the ‘Third World’ was coined in 1952 when the French demographer, Alfred Sauvy, used it to refer to the ‘underdeveloped’ countries outside the orbits of the two superpowers, the USA and the USSR. The historical context which gave the expression meaning was the Cold War, which polarized the globe between two hostile ‘worlds’ based on incompatible economic systems, capitalism and socialism. In this situation, Sauvy argued, the existence of a ‘third’ world of poor neutral states was in danger of being forgotten. Like the ‘third estate’ in pre-revolutionary France, the Third World was unrepresented in international fora and now wished to stand up for itself (see Lacoste, 1980, pp. 10–18).

In subsequent years, the Third World did become an organized body in international relations in the form of the Movement of Non-aligned States, whose origins go back to the efforts of Nehru of India, Sukarno of Indonesia and Nasser of Egypt to negotiate an independent political path for the ‘emergent’ nations between the Cold War power blocs. The struggle against European colonialism had been a common experience of this first generation of ‘non-aligned’ leaders and, as decolonization swept through Asia and Africa in the 1950s and 1960s, so newly-independent countries were recruited to the non-aligned with the same ideological solidarity. The Movement was not formally constituted until the third non-aligned summit at Lusaka in 1970, by when the original concern with East-West conflict had shifted towards the threats posed by ‘imperialism, colonialism and neocolonialism’ (to quote the conference Declaration), and the unresolved crisis of white domination in southern Africa. Since then, the Non-aligned Movement has put forward a common programme of demands for more equitable exchange between the industrialized and less developed countries in its campaign for a New International Economic Order, launched at Algiers in 1973 (Lyon, 1984, pp. 229–36; Mortimer, 1980). Unfortunately, both the unity of economic interests and political solidarity of the non-aligned have proved fragile, and the Movement has been quite ineffectual in the face of international conflicts within the Third World, such as the Iran-Iraq war of 1980–1989.

Forty years on, there is no sign of Sauvy’s coinage passing into disuse—in the English-speaking world at least—even though the international context which originally made it meaningful has been transformed by the end of the Cold War and the ‘liberalization’ of formerly socialist economies throughout the world (including communist China’s). Furthermore, though it may have been valid in the early 1950s to think of the ‘underdeveloped’ societies as constituting a single bloc with a common range of economic problems, this is no longer satisfactory. Four decades of development have resulted in the marked differentiation of the ‘less developed countries’. The world demand for oil, and the quadrupling of its price by the OPEC cartel in 1973, transformed a handful of desert sheikdoms into the world’s richest societies in terms of per capita GNR A group of newly industrializing countries, of which the economies of the Pacific Rim are the most successful, has emerged to compete with the established industrial powers in international markets for consumer and capital goods. At the same time, the poorest societies of sub-Saharan Africa and south Asia have had their developmental problems exacerbated by the rising cost of energy imports, adverse movements in the terms of trade for their major exports, unmanageable demographic growth and (in much of Africa) ecological deterioration and persistent drought. In many, per capita GNP has declined since 1970. Summing up the growth trends, one economist has written:

The most significant development since 1945 is not a widening of the average gap between Third-World and OECD countries. Some widening seems to have occurred, but more significant is the sharp pulling apart of growth rates within the Third World itself.

(Reynolds, 1985, p. 392)

Despite these developmental changes, humanity remains divided by gross disparities between the material well-being of most people in the ‘developed world’ of Europe, North America and Japan, and the mass poverty which persists in Asia, Africa and Latin America. Of course, the poor are still with us in Europe, and a less developed country such as India can now boast a substantial stratum of the urban and rural population who have benefited from the economic growth in the subcontinent since 1947. But an estimated 50 per cent of India’s rural population (still the overwhelming majority) have incomes around or below a level barely sufficient to secure the minimum of food required to sustain the human body. In the subcontinent as a whole, between 250 and 300 million people are chronically undernourished. According to World Bank estimates, throughout the developing countries around a third of the population (about 730 million people) suffer under-nourishment; maybe as many as 40 million die each year from hunger and hunger-related diseases. (Raychaudhuri, 1985, p. 801; Dréze and Sen, 1989, pp. 35–6)

The ‘Third World’ is indefensible as a term of analysis (and with the disappearance of the ‘Second’ socialist world, it is frankly illogical), but it still performs a useful function because it has lodged in the public consciousness as a metaphor for humanity’s ‘have nots’, and as a constant reminder of the gross inequalities between major regions of the world. The Brandt Report popularized another metaphor, North-South, and outlined the contours of global inequality at the end of the 1970s:

• The North, including eastern Europe, had a quarter of the world’s population and four-fifths of its income.

• The South, including China, had three billion people—three quarters of the world’s population—but lived on one fifth of the world’s income.

• Over 90 per cent of the world’s manufacturing industry lay in the North which dominated the world’s economic system and monopolized its technology through multinational corporations.

(Brandt, 1980, p. 32)

These contours have not changed fundamentally since Brandt, save perhaps through the decline in real incomes in what was formerly the Soviet bloc. The ‘poverty curtain’ has turned out to be more permanently divisive of humanity than the ‘lron Curtain’.

Today’s stark inequalities between the world’s richest and poorest regions are not, as far as we know, the continuation in the present of economic disparities stretching back into the distant past. According to the economic historian Paul Bairoch, there were no such things as strikingly rich and strikingly poor states in the pre-industrial world. Around 1700, the per capita income gap between the poorest and the richest country was, he claims, certainly smaller than a ratio of 1.0 to 2.0, and probably in the order of only 1.0 to 1.5. Bairoch asserts that Europe (inclusive of Russia) did not then have a particularly privileged position in terms of its average standard of life which was, if anything, slightly lower than that of the ‘rest of the world’. This was due to the relatively high level achieved by the Chinese civilization (whose average living standard throughout the millenium before circa 1700 was certainly ahead of the most advanced in Europe) and the importance of this society in the ‘rest of the world’ and also to the low level achieved by Russia which represented a significant proportion of Europe (Bairoch, 1986, p. 194). It must be said that not all scholars endorse these speculations, and many stress the economic advances, relative to other civilizations, made by Europe in the early modern period as a result of climatic, geographic and ecological advantages (see Jones, 1981). But whether we attribute the ‘miracle’ of European development primarily to causes operative since the eighteenth-century industrial revolution or to much longer-run factors preceding it, does not alter the fact that widening global economic inequality is a major theme of modern history. How it related to the expansion of Europe, and of the capitalist ‘world system’ of which Europe was the core, is one of the questions we shall address in this essay. Were the economic development of Europe and the impoverishment of the Third World interdependent parts of a single process of global change? Is it true—as Franz Fanon claimed (1967, p. 81)—that, since its development has required the spoliation of the non-European world, ‘Europe is literally the creation of the Third World’?

An allied theme of modern history has been the unification of the globe in a society of sovereign states, a process resulting from the dominance (in some cases permanent, in others temporary) of Europeans over non-European peoples. A glance at the political map of the contemporary world shows how the European presence has been imprinted on the frontiers of Africa, the Americas, the Middle East, South-east Asia and Oceania. There are, of course, states of ancient origin, with a history of unbroken independence, and which conform politically to an indigenous tradition (examples are China, Japan and Iran). But these are a minority amongst the states represented at the United Nations.¹ The majority are modern political structures imposed by Europeans on native communities and have only become self-governing since 1945.

This essay will provide a schematic, historical analysis of the relations between Europe and the extra-European periphery within the twin contexts of global economic inequality, and global disparities in political power. The colonial and imperial relationships between western Europe and the wider world since the late fifteenth century, and the course and consequences of decolonization, form the substance of the discussion. For reasons of space, the expansion of Russia into central Asia—which certainly falls under the rubric of Europe and the Third World—will not be considered.

Before proceeding, however, we must consider some of the issues and controversies in development economics—whose modern form dates from around the time people started to talk of a Third World—since they have been important in conceptualizing the past and present relationships between the metropolitan economies of Europe and the dependent economies in the extra-European periphery. One key debate has revolved around the question as to whether the international exchange of manufactured for primary goods (which long typified trading relationships between Europe and the ‘Third World’) can be said to be ‘unequal’. In classical economics (including classical Marxism) products exchange at equal values, and the international division of labour offers a benign environment for countries to specialize in forms of production where they enjoy a ‘comparative advantage’. This theory was challenged from the early 1950s by a group of Latin American economists led by the former Argentine finance minister Raúl Prebisch. It is no accident that so much of the literature on economic ‘underdevelopment’ should have been written by Latin Americans, since their own societies had enjoyed political independence from the 1820s (and been insulated from further European imperialism by the Monroe Doctrine²) yet failed to ‘take-off’ into sustained economic growth before the 1950s. They had not been isolated from world markets; on the contrary, around 1900 a very high proportion of the GDP of countries such as Argentina and Chile had been exported, with their agricultural and mineral products (beef, wheat, copper, etc.) being traded for manufactured imports from the industrialized economies. According to Prebisch, this pattern of exchange had generated structural inequality because the prices of primary exports had declined relative to manufactured imports. The essence of his argument was that the greater productivity gains of manufacturing had led to higher wages for better-organized European (and American) workers as compared with the labour force in the export sector of the underdeveloped regions, and this disparity was reflected in prices. The validity of this argument is much disputed, and there is no convincing evidence of a long-term deterioration in the terms of trade for primary products between circa 1850 and 1929. It is, nevertheless, true that primary producers in the Third World experienced very adverse relative price movements during the world trade recessions of the 1930s and the early 1980s. World prices for their agricultural and mineral products plummeted and, while workers in industrialized economies maintained their nominal wages, primary producers’ incomes in under-developed regions were slashed.

Prebisch was largely responsible for persuading the United Nations to convene its first Conference on Trade and Development held at Geneva in 1964, when the Third World (with which Latin Americans were now beginning to identify themselves) first presented its collective demands to the industrialized economies. Its objectives were the improvement and stabilization of primary product prices, access for its own manufactures to their markets, and greater financial flows from the rich to the poor. Within Latin America itself, Prebisch’s advocacy led to policies of import substitution industrialization which were imitated in many other parts of the developing world.

The indifferent success of these policies encouraged a more radical critique of ‘dependency’ by a younger generation of scholars, of whom André Gunder Frank is the best known. It is misleading to speak—as many do—of ‘dependency’ theory since this somewhat amorphous concept has provided a perspective on economic relations between the metropolitan and peripheral economies rather than a precise theory. A leading target for the dependistas has been the model of economic development put forward by W.W.Rostow, which envisages a transition from ‘traditional society’ to self-sustained growth taking place through clearly defined stages (Rostow, 1956, 1960). The assumption of the model was that the ‘under-developed’ societies were in something akin to a ‘traditional’ state and would replicate the transition provided certain conditions were met during the critical ‘take-off’ stage (chiefly an increase in the rate of investment and improvements in labour productivity which promote rapid technical changes in production, and hence further productivity increases and further investment). Frank forcibly rejected the idea that ‘underdeveloped’ societies resembled pre-industrial Europe. He viewed ‘underdevelopment’ not as original or traditional, but as a state of affairs resulting from the world-wide expansion of the capitalist system from the sixteenth century when the European powers first created satellite economies in Latin America and the Caribbean, using slave or otherwise unfree labour to extract mineral wealth and grow plantation crops. Since manufacturing was largely forbidden in European colonies under the mercantilist system (see below, p. 19), the surplus value created in them was not invested in productive enterprises, but either repatriated or used to support the parasitic life-style of a colonial élite. According to Frank, this pattern of metropolitan powers pumping surplus value out of their satellites persisted after former colonies won their independence and was essential to the development of capitalism on a world scale (Frank, 1973, pp. 94–5). In other words, the ‘underdevelopment’ of the poor has been a necessary condition for the ‘development’ of the rich, and it is—we must conclude—only by severing relationships with the capitalist world market that balanced, autonomous growth becomes possible on the periphery.

The perspective provided by the concept of ‘dependency’ has underpinned an historical account of global inequality and remains hugely influential within the Third World to this day. But numerous critics have pointed to its imprecision and to Frank’s cavalier disregard for the discontinuities in centre-periphery relations. The historical record does not show that economic growth was consistently retarded in the Third World by the great expansion of world trade after 1850, and recent events would appear to have refuted the more pessimistic prognoses of the dependistas, for the fact is that rapid industrialization has taken place in peripheral countries such as South Korea and Mexico. If the ‘dependency’ perspective is so questionable, why introduce it here? Partly because it has figured so prominently in debates on the Third World that to ignore it would be a disservice to readers. More important, knowledge progresses by conjecture and refutation and, as a crude hypothesis, ‘dependency’ remains a useful point of departure for historical analysis.

The European encompassment of the world after 1450

In 1522, a single vessel belonging to the expedition begun three years earlier under Ferdinand Magellan returned to Cadiz, having completed the first circumnavigation of the world. It was more than an extraordinary feat of seamanship; when the Spanish crossed the Pacific and reached the Moluccas they encountered the forces of Portugal already ensconced in the Far East. Both Iberian powers had papal authority to claim title to any non-Christian lands their expeditions encountered, claims they enforced with remarkable energy and effect. So their meeting was token of a political encirclement of the world by Christian powers whose rival imperialisms were, in the following centuries, to draw distant parts of the globe into the European states system.

Why should it have fallen to Europeans—more particularly western Europeans—to encompass the world in this way? When the process began with Portuguese and Spanish maritime expansion along the African littoral and out into the Atlantic, western Europe had no obvious technological or military-political advantages over other centres of advanced civilization, nor was it motivated by any exceptional moral cohesion. The world’s most populous, economically developed and highly centralized state was the Chinese empire, and it might have seemed a more likely sponsor of global encirclement. Fifteenth-century Chinese merchants participated in long-distance trade which fostered impressive shipbuilding and maritime skills. Somewhat earlier than the Portuguese exploration of the African Atlantic coast, Chinese fleets—with larger vessels than the Iberians—pushed out into the Indian Ocean, reaching the Persian Gulf and the East African coast. But this Chinese expansion was cut short by imperial edict, when the empire had to concentrate its forces on a renewed Mongol threat from the north. Henceforth, the construction of ocean-going vessels was forbidden and long-distance trade frowned upon. One might argue that the size, political and cultural unity, technological accomplishments, and (by comparison with Europe) centralized authority of the Empire became obstacles to its territorial expansion. They enabled the Empire to ret...

Table of contents

• Cover
• Title
• Copyright
• Contents
• General preface to ‘What is Europe?’
• Introduction to Book 4
• Essay 1: Europe and the Third World
• Essay 2: Europe and Russia
• Essay 3: Europe and the United States
• Essay 4: Europe in the global economy
• Postscript, April 1994
• Acknowledgements
• Notes on contributors
• Index