The epoch of overt
colonialism is over. Violent exploitation of the colonies has been replaced by
interactions through the international market, often within the frame of trade
agreements. Markets and trade are the realm of ʻvalueʼ, incarnating
an ideal of freedom,
equity, and justice.
Exchange of equal values indeed is what defines a ʻfreeʼ,
ʻregularʼ and ʻundisturbedʼ market and also
what such a market is supposed to bring about thanks to its inner
characteristic mechanism. For the former colonies this should change
everything. For each Dollar leaving
there is now one Dollar coming in. The result seems to be the same, though:
poverty persists in the Global South. Additionally, poor countries suffer from
disproportional environmental degradation. Abundance of natural resources all
too often results in poverty, debt, war, and destruction of the environment.
Structural vs Local Causes
How is this possible?
Sure, there are neo-colonial practices at work today, from the working of
international institutions such as the World Bank and the International Monetary Fund to the debt mechanism to destabilization strategies in foreign policy to direct military interventions. Apart from these influences, mainstream
social sciences hint to local causes as
explanations for the poor performance of the Global South, be they economical
(“dutch disease”) or political (corrupt elites, mismanagement, misgovernment,
etc.). Behavioural economics, whose most prominent proponents were awarded the last Nobel prize in Economics, is an extreme case, focussing exclusively on individuals
and their actions. “The world’s poor are poor because they tend to make the
wrong decisions”, Berndt and Boeckler
polemically sum up this approach.
But what about
structural causes? What about the global market itself? In the late 1960s, the
French economists Arghiri Emmanuel and Charles Bettelheim at Sorbonne
University developed the idea of “unequal exchange”. Unequal exchange means
that symmetric exchanges of equal monetary values disguise asymmetric net flows
of wealth from the South to the North. The US-American sociologist Stephen G.
Bunker applied this approach in his analysis of the Amazon region (1985). The ecologist
Howard P. Odum suggested measuring fluxes of wealth under the surface of market
value in terms of embodied energy or “emergy”, which at once permitted to
integrate the ecological dimension (1988, 1991). Part of this is
also the reverse flux of waste and emissions from the North to the South. Rich
countries “offshore environmental externalities to poorer countries”. Integrating this environmental dimension resulted in the
more comprehensive approach of ecologically unequal exchange which is vividly discussed currently.
One dollar is not one dollar
The mechanism behind unequal exchange resides in the fact that, actually, one dollar is not one dollar. Spent in a poor country, one dollar can mobilize more energy, more resources, and more labour than in a rich country. The reason for this is that extractive economies and developing countries, bearing lesser degrees of inner commodification and market integration, rely more heavily on the “unpaid work” of local communities and ecosystems (see also Donatella Alessandrini’s contribution to this symposium). Goods from poor countries embody more energy, resources, and labour per dollar. Exchange of goods of equal monetary value can thus induce asymmetric fluxes of wealth.
This analysis turns the
picture upside down. The alleged competitive advantage of lower production
costs turns out to be a structural disadvantage. Poor countries simply sell out
their wealth. And also the plusses and minuses in the accounts may change,
turning debts (in monetary terms) into credits (in emergy terms), as the
sociologists Foster and Hollemann stress: “According to this analysis, Sub-Saharan countries paid off all
international debt in emergy terms by the early 1990s […]. Indeed, in emergy terms, the Sahelian
countries are shown to be net creditors, rather than debtors.”
Value, wealth, and power
Unequal exchange does
not only provide an interesting explanation of the facts, but also has relevant
consequences on the conceptual level. Indeed, it challenges the accepted
neoclassical notion of economic value. In contemporary economics, questioning
this notion has become literally unthinkable. The notion of marginal value is
much more than an ordinary hypothesis which could be replaced by a different
one in the case of contrary evidence. The notion of marginal value rather is
constitutive for economics as an autonomous discipline with a proper and
irreducible domain distinguished from that of sociology and anthropology.
Proponents of unequal exchange, on the contrary, directly attack monetary
valuation. Howard Odum states
that “the market value of products and services […] is largely
irrelevant as a measure of wealth”. The swedish anthropologist Alf Hornborg further explains that “market price [is the] ideological means [by which] unequal
exchange is represented as reciprocal exchange”.
Let us try to distil the
criticism of value implied in theories of unequal exchange. For orthodox
economics, power and value are strictly separated, even contrary notions. The
realm of value, i.e. free and voluntary exchange relations which make everyone
“better off”, implies the absence of power. Do theories of unequal exchange in
contrast reveal that exchange reduces to “nothing but” power? This is what the
sociologist Andrew Jorgenson
suggests, at least implicitly, when
he defines unequal exchange in terms of power. It might be perfectly true that
value ultimately is based on power as well. (K. William Kapp reminded us “that economic
problems are necessarily power problems”, for “power is wealth and wealth is
power”). But this does not mean
that value reduces to “nothing but” power. There is another, not less
interesting element involved here: The market disguises power relations,
and the way it does so deserves attention.
A rigged game
In order better to
understand this point one should note that there is a direct analogy between
theories of unequal change and Marx’s analysis of the wage contract in Capital.
Marx is known for having analysed wage labour in terms of “exploitation”. Less
known however is that he also insisted on the regular character of the wage
contract. The transaction between the capitalist and the worker “conforms to
the laws of the exchange of commodities”. Labour power is sold “at its real
value”, Marx stressed.
Does this mean that, according
to Marx, workers are not exploited in capitalism? Well, it means at least that
the capitalist does not cheat in the most blunt sense of the word. “The game is
not a fair one. That is clear. It is rigged.”, explains Marx’s double in Raoul
Peck’s inspiring motion picture The young Karl
Marx from 2016 (screenplay:
Pascal Bonitzer and Raoul Peck). This adaptation seems enlightening to me. The
metaphor of the “rigged game” suggests that the problem lies in the game itself
and not in the players. According to this analysis, the capitalist does not
violate the rules in order to gain an advantage. He rather succeeded to define
the rules in such a way that he will always be the winner. The rules are: Labour
is a commodity, commodities are sold at their value, and the value of labour is
determined by its production costs (housework in particular being unpaid). In
this picture of the wage contract, power disappears from the direct personal
relation between the capitalist and the worker and reduces to the objective
circumstances under which they act: the capitalist possesses means of
production, the worker does not. In the neoclassical analysis, even these
remains disappear: If the worker accepts the wage contract this is so because
it makes her or him “better off”. (The—completely tautological—proof is the
fact that she or he actually did.)
Value’s hidden violence
“Value” then is the
category which describes exploitation as a fair and voluntary exchange. It “mystifies” the real
nature of the transaction. This also holds for unequal exchange between the
Global North and the Global South. Existing inequalities force underdeveloped
countries to accept trade relations which actually make them lose wealth.
Stated in terms of value however, the problem vanishes, because “value” only
captures the monetary costs of the local production. The market and the notion
of economic value amount to the discovery that it is not necessary to exert
power in order to keep going the flux of energy, labour, and raw materials from
the Global South to the Global North, or from the periphery to the core of the
capitalist world system.
Gillo Pontocorvo’s motion
picture Queimada from 1969
provides an excellent illustration for this point. In a meeting with plantation
owners in the Portuguese colony Queimada in 1844, William Walker, an agent of
the British sugar companies (played by a marvelous Marlon Brando), argues in
favour of free labor and against slavery, but in purely economic terms.
Pontocorvo uses the intense ugliness of Walker’s monologue as a strong
“Gentlemen, let me ask you a question. Now, my metaphor might seem a trifle impertinent, but I think it’s very much to the point. Which do you prefer—or should I say, which do you find more convenient—a wife, or one of these mulatto girls? No, no, please don’t misunderstand: I am speaking strictly in terms of economics. What is the cost of the product? What is the product yield? The product, in this case, being love – uh, purely physical love, since sentiments obviously play no part in economics.
Quite. Now, a wife must be provided with a home, with food, with dresses, with medical attention, etc, etc. You’re obliged to keep her a whole lifetime even when she’s grown old and perhaps a trifle unproductive. And then, of course, if you have the bad luck to survive her, you have to pay for the funeral!
It’s true, isn’t it? Gentlemen, I know it’s amusing, but those are the facts, aren’t they? Now with a prostitute, on the other hand, it’s quite a different matter, isn’t it? You see, there’s no need to lodge her or feed her, certainly no need to dress her or to bury her, thank God. She’s yours only when you need her, you pay her only for that service, and you pay her by the hour!
Which, gentlemen, is more important – and more convenient: a slave or a paid worker?”