Customer Reviews

Super Imperialism - New Edition: The Origin and Fundamentals of U.S. World Dominanc

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Super-Imperialism is better viewed as a radical alternative to common undergraduate textbooks such as Joan Edelman Spero's, "The Politics of International Economic Relations" than as an update to the theories of Lenin or Hobson. (His background and prose style are similar to Spero's and his book covers similar ground.)

It has three sections, each which could have been a separate book.

Chapters 1-6 are a history of U.S. international economic relations from World War I through Bretton Woods.

Chapters 7-10 are a critique of the "The Institutions of the American Empire" (GATT, the World Bank, the IMF and U.S. foreign aid mechanisms). If you have ever wondered what all of the huge protests of the World Bank and IMF were all about these chapters are for you.

Chapters 11-15 are about the U.S. economic transition in the late 1960s and early 1970s from running consistent balance of payments surpluses to running consistent deficits. (We used to export more than we imported; Now we import more than we export.) At the same time the U.S. stopped backing dollars with gold, which forced other countries to lend the surplus dollars created by our trade deficit back to the U.S. government (i.e. to buy treasury notes), thereby also subsidizing our chronic budget deficits. This is the "super-imperialism" of the book's title. This situation was still new and strange when the first edition was published in 1972, and the book's reputation rests on the light Hudson was able to shed on it.

The 2003 Edition has a new introduction and two new chapters at the end. The rest of the book has occasional new material, but does not appear to have been extensively re-written.

It's a difficult and rewarding book. The difficulty lies partly in the subject matter itself, partly in Hudson's convoluted prose and partly in the numerous typographical errors that mar the 2003 Pluto Press edition.

The book is rewarding because it's honest. Readers educated in the U.S. will initially regard Hudson's account with some skepticism. We can't help it; We've been systematically miseducated by pro-U.S. polemics presented in an "objective" tone.

In contrast Hudson is a strident critic of the U.S. management of the global economy. But so is any reasonably objective person who is apprized of the facts. I much prefer an author who honestly tells you the real story as he understands it to one who conceals the awful truth behind an ostensibly impartial facade. But a "revisionist" has to work twice as hard to make his case, and that is why the book contains the detailed explication of what reviewer Myers calls the "intricacies of events and negotiations that gave rise to the present order."

I think an open-minded reader will be won over by Hudson's thoughtful use of contemporaneous sources (e.g. government publications and articles in the business press) and also biographical sources to illuminate how key decision makers understood the alternatives, and their motives for pursuing the policies that they did when forging the post-war economic order. As he places these choices in context it quickly becomes evident that the motives on the U.S. side have been consistently aggressive and that U.S. policy makers have all along viewed multilateral economic institutions as instruments of national policy--to the world's detriment.

Hudson also has a keen sense of the painfully narrow horizon of human foresight. The historical sections sometimes read like a conspiracy theory in which the conspirators are not very smart. E.g., Franklin Roosevelt's stubborn insistence that World War I debts be repaid prolonged the Great Depression; When J. M. Keynes was negotiating Bretton Woods for the newly elected Labour government, he got them a terrible deal; The U.S. transition to "super-imperialism" which is the main story of the book (chapters 11 through 14) was originally an unintended consequence of the huge budget and trade deficits caused by the Vietnam War.

If you are interested in "globalization" this book is an important piece of the puzzle, but it really only covers up through 1973, and it spends more time on the relationship between the U.S. and Europe than on "North-South" relations. Having said that, Ch. 8 "The Imperialism of U.S. Foreign Aid" is very good, esp. how foreign aid benefits the U.S. balance of payments and the harmful effects of U.S. agricultural exports. China is hardly mentioned.

If you are an economics student and you sense that they aren't telling you the whole story, or just a thoughtful citizen who wants to sharpen your conceptual tools for understanding and resisting the strategies of U.S. imperialism, this book is for you.

Hudson is a Wall Street economist who used to work at the Chase Manhattan Bank. In Part One, he describes the rise of the American empire. Part Two describes its institutions: the US-controlled World Bank, the World Trade Organization and the International Monetary Fund, which all benefit the USA. The US has the sole veto power in all three. Part Three describes what Herman Kahn called `the greatest rip-off ever achieved', the way the US's ruling class levies us all to pay for its aggressive wars, just as the Roman Empire levied tribute to pay for its constant wars. Similarly Britain, Germany and Japan all pay for the US's military bases in their countries.

In 1945, as in 1918, Britain led Europe's capitulation to the USA's debt demands. The British ruling class chose dependency on the US ruling class. The USA insisted that Britain ended the sterling bloc, accepted IMF controls, did not impose exchange controls, and did not devalue. As Hudson writes, "The Anglo-American Loan Agreement spelled the end of Britain as a Great Power."

The 1945-51 Labour government's huge spending on unnecessary imperial, counter-revolutionary wars robbed our industry of investment. This excessive military spending meant that we had constantly to borrow from the IMF, increasing our dependence on the USA. Now Britain is the USA's Trojan horse in Europe, against Britain's interests.

Hudson immodestly claims that his analysis supersedes Lenin. He says that the US national government's interests, not the private interests of the capitalist class, drive the system. He claims that the US government subordinates `the interests of its national bourgeoisie to the autonomous interests of the national government'. But is the US government really independent of the capitalist class? How `autonomous' are these interests?...

Hudson's historical argument in this book is both brilliant and sometimes a bit rough.

Hudson has always had a great talent for interpreting and sketching out for weaker minds like us what the US government's abandonment of the gold-standard really means. When Hudson came forward with his thesis in the mid 1970's, his thesis was outrageous among orthodox economists: to suggest that the US should be worried about the long-term consequences of running balance of payments deficits year after year, decade after decade was crazy leftist nonsense in the 1970s. As long as people continue to need the US markets more than the US needs any other one country's markets (and people still have faith in the good credit of the US government) there is no reason US could not run balance of payment deficits forever, according to the conventional wisdom.

What amazes me is that now, after having done exactly what Hudson warned the US government not to do in the 1970s, many otherwise relatively orthodox economists are beginning to worry about this. Hudson may be on the more "sky-is-falling" end of things, but his analysis was right on the nail in 1972 and is still there today: worst case scenario - massive recession and massive devaluation of the dollar (by massive I mean, unprecedented). Former US Treasury Secretary, Robert Rubin was quoted in March 16, 2006 WSJ as saying that "The probabilities are extremely high that if we don't address these imbalances, then at some point, and it could be years down the road, we'll pay a very big price." We are in a limbo world where no one really knows how this problem is going to play out, but Hudson should be credited for being one of the first, and longest-running, advocates for addressing this problem. Too bad it has taken so many decades for people to recognize what he has been telling us all along about balance of payments deficits.

The rest of the argument Hudson makes in this book is a bit tough to follow, though. Essentially, Hudson attempts to show how the US has, during this century but especially since WWII, systematically sought to manipulate all of the great economic institution-building opportunities following WWII to advance the interests of the US over other countries. Coming off the gold standard and running up a balance of payments deficit was just one of many ways in which this occurred. The US largely succeeded. The GATT (now WTO), World Bank, IMF, all bear American "fingerprints".

I agree that the mega-institutions of the contemporary world economic and political machine are largely the unilateral creation of the US, imposed on the other great nations at a time when the other nations were particularly vulnerable to US force of will and not particular inclined to be heterodox visionaries. I also agree that the US in general has probably used as much leverage as it could in negotiating all of the defining institutions in which it had any hand in constructing.

And yet, how could it have been any different? National governments pursue their self-interest and the interest of their citizens, often at the expense of other national governments and their citizens. The nation-state system is set up to work that way. But is the problem really one of US bad behavior, as Hudson suggests? Isn't the problem really structural? In the nation-state world, wherein the world is divided up into pseudo-autonomous political monopolies, each individually endowed with particular strengths and weaknesses, and all pitted against each other in a laissez-faire system where the only things that keep nation-states from raping and killing each other to oblivion are, good faith and the fact that the balance of power among the nation-states is enough to keep each monopoly contained in its behavior towards the other monopolies, what sort of behavior could we have expected from the US, a nation-state that, at a series of pivotal moments in 20th century history, found itself with "golden opportunities" to take advantage of other nations' weaknesses and advance its own power? Would the French, or the Brits, or the Japanese, or the Italians, or the Germans, or the Russians have behaved any different if they found themselves holding all the cards in 1945 instead of the US?
My point is, the facts Hudson lays out are correct - there clearly is a problem in the way in which our current world order has been put together and the US is at the middle of that problem. The conclusions Hudson draws from those facts do not go deep enough in understanding what those facts mean, however. It isn't that the Americans behave or behaved "bad" by the standard of good behavior implicit in the nation-state system, it is that the nation-state system itself to a certain extent reflects 19th century laissez-faire values of autonomy and individuality that pit nation-states against each other in a world where each is out to improve its lot through trade and, when possible and tolerable, violence. The system itself breaks down when one player becomes too powerful. To blame the US for the systemic problem of massive power imbalances between nationstates is simply pushing any hope for correction in the wrong direction.

In this history of the creation of the current system of global trade and finance, Hudson offers some crucial insights for dissipating the obscurantist fog that wafts out of mainstream economics departments to provide cover for neoliberal imperialism.

He details how the US emerged with its economy unscathed from the World Wars, and seized this opportunity to unseat Britain as the dominant force in global finance, leveraging control over war debt and reconstruction funds into dominance of the World Bank and IMF. He describes the way these nominally multilateral institutions were shaped by the US to perpetuate and extend its hegemony over the particulars of world trade and finance, opening foreign markets to US producers while protecting domestic industries with tariffs, ensuring ample flows of raw materials to US manufaturers and stunting the development of 3rd world nations.

In his most penetrating analysis, Hudson describes the way the US managed to turn its chronic trade deficits from the Vietnam War era onward into a mechanism of "Super-Imperialism": by unmooring the dollar from the gold standard, the US established a 'debtor imperialism' whereby nations with trade surpluses against the US were forced to buy US treasury bills in lieu of gold. The rest of the world is thus forced to finance the growing US trade deficit (and thus US military interventions) in perpetuity, or face a meltdown of the current world economic order and a collapse in the value of their own immense dollar holdings.

Hudson's presentation of the intricacies of the events and negotiations that gave rise to the present order are somewhat belabored and presume a familiarity with macro-economics. For the layperson, his basic thesis is clearly presented in the preface and introduction, and those without a special interest in economic history are advised to pass over the body of the book.

A remarkable work. It functions as both a novel theory of imperialism and a 20th century history of international finance. The two converge as Hudson shows how the former evolves from the latter, thereby elevating the US to a position economically and militarily astride the rest of the globe. Anyone who senses that behind the comforting rhetoric of Free World and Democracy, an aggressive empire lurks with contours and mechanisms unlike previous ones, should pick up the book.

This second edition updates developments through 2002 and includes a fresh Introduction and Preface. It may be helpful to note that at the rather basic text-book level Hudson doesn't fill in the blanks. A familiarity with the rudimentary mechanics of international finance is assumed from the outset. Nonetheless, the prose remains accessible and the train of thought clearly stated, no minor accomplishments for a work of this sort. Moreover, I'm glad this new updated edition dispensed with Mc Carthy's Introduction to the previous edition, which needlessly entangled Super Imperialism in the tangential Marxian tradition. (Unfortunately reviewer Saltillo has responded to the older edition which may cause unnecessary confusion to review readers.) Also, the Preface and Introduction to the new edition effectively summarize the text, such that those wishing to absorb the main points without the details can stick with these prefatory sections.

One note of caution. Super imperialism treats international financial policy as a purely governmental affair apart from private individuals, organizations, or special interests. This exclusive focus produces an impression of the state as an independent and autonomous entity, acting separately from the private interests surrounding it. Whether or not this is an accurate portrayal remains an open question. I don't fault the book for not addressing this basically Marxian issue; Hudson's correct in keeping a tight focus on governmental agency such that the contours of his theory can emerge. Nonetheless, a follow-up might profitably examine what connections there are. Be that as it may, the new edition stands as a welcome update to the older, seminal edition, and given recent dollar developments, is now timelier than ever.

I have searched hard to find a book that would help me understand today's credit crisis. Although I have found many good ones this is absolutely the best. It is a history the economic relationships between the US and the rest of the world in the 20th century, with the greatest attention given to the period between 1950 and 1974. These years laid the basis for the current form of economic domination of the world by the US, by establishing the principle that the US would not pay its debts except by selling more treasury bonds to its debtors. This has eventually led to the present 9 trillion dollar US debt, much of it held by foreign countries, including my own. The unsolved mystery is why the world allows this situation to continue, but Hudson hints at some answers. It is in these hints that I have found the most interesting ideas about how to understand the present situation.
The book is difficult to read and poorly edited, but well worth the effort. Don't hope to read it in a hurry, because it is dense. I have read it twice already and will read it some more before I can feel I have squeezed all the juice out of it.

This is an excellent book studying the role US debt and the dollar plays in international economics and how it explains the role the US enjoys as world superpower. It is especially relevent today during times of US economic crisis and a collapsing dollar, which is explained and also predicted by Hudson in his book! A must for understanding the historical development of US super power, and how this power may end due to economic polices which are untenable in the long run.

Michael Hudson has been a voice in the wind since the first Edition of Super Imperialism in 1973.. He has been blackballed, ridiculed & ostracized by mainstream economists. Why? Because he challenged conventional wisdom that Balance of Payments deficits were an anomaly & then later in history as "natural" .. Pure garbage. Wall street has gained the upper hand by maintaining the dollar as the world reserve currency. Hudson emphasizes the military nature of propping up the dollar. What he means by "Super" in Super Imperialism is the fact that Central Banks & Sovereign Wealth funds have absorbed inflationary US Treasury bonds/bills i.e., tribute has been paid by foreigners for the US to maintain global hegemon status while artificially propping up the domestic economy. Interestingly, the "09" August/September Issue of Foreign Affairs frankly discusses issues which Hudson has been writing about for 40 years.

A whole subsection of economic thought could be based on Hudson's research. I highly recommend MH's website.... view his curriculum vitae/working papers etc to gain further insights.

Dr. Michael Hudson is the greatest economist alive. This is coming from someone who has studied many-including many of the lesser known economists in history.

This is a must read for anyone wanting to understand how the global economy has operated for the last century.

The book arrived on time and in excellent shape.
The price was right as well. Michael Hudson offers one of the most incisive analyses of U.S. world domination via the exercise of economic, poltical and military power.