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Language and Politics: The American-Soviet Cold War (Part Three)

Updated on February 12, 2015
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The first step is to know what you do not know. The second step is to ask the right questions. I reserve the right to lean on my ignorance.


Let's get right to it.

I. The concept of "national economies" is becoming more and more irrelevant these days, what with "globalization" and what is known as the "internationalization of production."

A. Corporations are increasingly multinational entities; and they make their products in an increasingly multinational way.

1. Strategic alliance between "competing" corporations

  • In the 1990s, IBM, Apple, and Motorolla formed an interfirm alliance to develop the operating system and microprocessor for the next generation of computer (1).
  • In 1991 Apple turned to Sony to manufacture the cheapest version of its PowerBook notebook computer. GM owned (still owns?) 37.5 percent of Japanese automaker, Isuzu, which produces automobiles for sale under the GM and Opel brand labels. Chrysler had (still has?) ownership stake in Mitsubishi, Maserati, and Fiat (2)
  • Ford Motor Company had (still has?) a twenty-five percent stake in Mazda. Ford and Mazda jointly owned (still jointly own?) a dealer network in Japan, cooperated in new product design, and shared production techniques (3).

2. Corporations increasingly use subsidiaries to evade national laws, directives, prohibitions, and taxes.

  • When US president Ronald Reagan ordered economic sanctions against Libya, in January 1986, Brown and Root, Inc., a Houston-based energy firm, just shifted the $100 million contract for work on Libya's Great Man-Made River project to its British subsidiary (4).
  • Honda circumvented restrictions on the importation of Japanese cars into Taiwan, South Korea, and Israel by shipping Honda vehicles to these countries from its U.S. plant in Ohio (5).
  • When Japan opened bidding on new telecommunications to U.S. manufacturers, Canada's Northern Telecom Ltd. moved many of its production facilities to the United States, so that it could win Japanese contracts as an American company (6).
  • The tax thing is an old story.
  • During the mid-1980s The Washington Times published a column by Daniel Mitchell of the Heritage Foundation, arguing that keeping companies from acquiring a Bermuda mail drop, to escape taxation, was akin to the Supreme Court's 1857 Dred Scott decision, which said that slaves did not get their freedom by fleeing into a non-slave state (7).

II. However, in 1945, when the Cold War started, the concept of "national economies" was more relevant.

III. In that regard, there are four terms I want you to remember: First World, Third World, complimentary development, competitive development.

IV. First World nations tend to want Third World nations to pursue only complimentary development, as opposed to competitive economic development. The reason for this is tha First World nations always feel like they have enough competition from other First World nations.

V. The original Third World was not the regions we think of today, in that role. In the seventeenth century, India was the largest economy in the world, with a vibrant tradition of architecture, a sophisticated medical system, and a population over 100 million. They also had a tremendous trade deficit over England, based on textiles (8).

  • In the early-18th century, India was producing close to 25 percent of world output, compared to only 3 percent for Britain. Mike Davis observed: 'When the sans culottes stormed the Bastille [in 1789], the largest manufacturing districts in the world were still the Yangzi Delta [in China] and Bengal [in India], with Lingan (modern Guangdong and Guangxi) and coastal Madroes not far behind' (9).
  • The conservative economic historian, Niall Ferguson, who wrote a history of the House of Rothschild, wrote this about India: 'In the age before steam power. India had led the world in manual spinning, weaving, and dyeing. The British had first raised tariffs against their products; then demanded free trade when their alternative industrial mode of production had been perfected' (10).
  • Noam Chomsky: "By the 19th century, India was financing more than two-fifths of Britain's trade deficit, providing a market for British manufactures as well as troops for its colonial conquests and the opium that was the staple of its trade with China" (11).

VI. Since pre-Columbian times, Eastern and Western Europe seems to have been diverging, going in opposite directions in terms of capitalist development, right down a fault line separating Germany, east from west (12).

VII. The reason for this East-West divergence are complex and beyond the scope of this paper. What is important is that the Third World, 'made its first appearance in Eastern Europe,' according to Leften Stavrianos. Eastern Europe began providing raw materials for the growing textile and metal industries of England and Holland as far back as the 14th century (13).

VIII. Noam Chomsky: "Russia itself was so vast and militarily powerful that its subordination to the economy of the West was delayed, but by the 19th century it was well on the way towards the fate of the South, with deep and widespread impoverishment and foreign control of key sectors of the economy" (14).

  • Foreign participation in the Russian economy reached 93 percent by 1907; capital for development was mostly foreign, largely French; and, of course, debt was rising. By 1914, according to Teodor Shanin, 'Russia was becoming a semi-colonial possession of European capital' (15).
  • Z.A.B. Zeman wrote: 'Many Russians, whatever their political beliefs, resented the semi-colonia status accorded to their country in the West. The Bolshevik revolution was, in a critical sense, the reaction of a developing, essentially agrarian society against the West: against its political self-absorption, economic selfishness, and military wastefulness. The present North-South divide between rich and poor countries, and the tensions it has created in the twentieth century, had its European, East-West antecendents.' Beyond Russia, itself, 'contrasts between the East and the West of Europe... became sharper than they had ever been' in the 19th and early-20th centuries (16).

In part four I'm really going to get into the ethnic element, which drove this global conflict between the United States (and the West) and the Soviet Union.

Thank you for reading.

Read part four.


1. Korten, David C. When Corporations Rule the World. Kumarian Press & Berret-Koehler Publishers, Inc., 1995. 225

2. ibid

3. ibid

4. ibid, 127

5. ibid

6. ibid

7. Johnston, David Cay. Perfectly Legal: The Covert Campaign To Rig Our Tax System To Benefit The Super Rich---And Cheat Everybody Else. Portfolio, 2003. 235

8. Hvistendahl, Mara. Unnatural Selection: Choosing Boys Over Girls And The Consequences Of A World Full Of Men. Public Affairs, 2011. 67

9. Johnson, Chalmers. Nemesis: The Last Days of The American Republic. Metropolitan Books (Henry Holt and Company, L.L.C), 2006. 78

10. ibid, 82

11. Chomsky, Noam. Year 501: The Conquest Continues. South End Press, 1993. 14

12. ibid, 65

13. ibid

14. ibid, 65-66

15. ibid, 66

16. ibid


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