Pacific-Asia and the Future of the World-System

By Ravi Arvind Palat | Go to book overview

5
STRATEGIES OF ECONOMIC ASCENDANTS FOR ACCESS TO RAW MATERIALS: A COMPARISON OF THE UNITED STATES AND JAPAN

Stephen G. Bunker and Denis O'Hearn

Raw materials prices determine the organic composition of capital and therefore of rates of profit and of capital accumulation. Disruptions of access to raw materials destabilize economies by provoking unemployment, causing inflation, creating bottlenecks, and threatening financial institutions with defaults and bankruptcies. Both capital and the state in industrialized nations therefore act strategically to assure continuous flows of raw materials, particularly of those that supply sectors of the national economy where there are opportunities for surplus profits or that are vital for the national defense.

Economic ascendants in the world-system elaborate especially aggressive strategies for access to raw materials. Their ascent often begins during periods of global expansion when demand approaches or surpasses existing capacity, which raises prices and limits accumulation. The rate of increase of their demand for expanded supply exceeds the global average, but previous ascendants have already captured most sources and may still dominate extractive and transport technologies. Furthermore, established core firms may be reluctant or unable to invest sufficient capital to assure the extra supplies that are needed by the new ascendant. Sustained ascent therefore requires that ascendants exploit weaknesses in the established political and economic relations that govern raw materials extraction and export in order to assure both independence of access and adequacy of supply. Their attempts to do so exacerbate the instability, subordination, dependency, and internal disarticulation of regional economies that depend on raw materials exports.

In this chapter, we examine the strategies of two rising economic powers to gain favorable access to raw materials. The first is the United States, which faced the task of displacing European imperial control of vast reserves. The United States did so by exploiting the weaknesses of the colonial powers--externally, in terms of colonial control, and internally, in terms of economic crisis and reconstruction.

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