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Mostrando postagens com marcador Project Syndicate. Mostrar todas as postagens
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terça-feira, 12 de novembro de 2024

One Hundred Years of Fascism (2022) - Jason Stanley (Project Syndicate)

Trecho: 

Hitler drew inspiration from the US, which, following the rise of the America First movement, had adopted immigration policies that strictly favored Northern Europeans. Looking to the early American settlers’ genocide of the continent’s native peoples in the name of “Manifest Destiny,” he found a model for his own later actions in pursuit of Lebensraum (territorial expansion). And as historian Timothy Snyder shows in his 2015 book, Black Earth: The Holocaust as History and Warning, Hitler hoped to recreate the American Antebellum South’s slavery regime in Ukraine.

 

ONE HUNDRED YEARS OF FASCISM

Jason Stanley

Project Syndicate, Longer Reades, Oct 28, 2022

 

https://www.project-syndicate.org/onpoint/fascism-100-years-and-the-threat-today-by-jason-stanley-2022-10

 

For fascist parties and politicians to win elections, they usually must attract support from people who, if asked, would loudly reject the fascist label. But this need not be so difficult: voters merely have to be persuaded that democracy is no longer serving their interests.


NEW YORK – When Fascist Blackshirts marched through the streets of Rome at the end of October 1922, their leader, Benito Mussolini, had just been installed as prime minister. While Mussolini’s followers had already organized into militias and begun to terrorize the country, it was during the 1922 march, historian Robert O. Paxton writes, that they “escalated from sacking and burning local socialist headquarters, newspaper offices, labor exchanges, and socialist leaders’ homes to the violent occupation of entire cities, all without hindrance from the government.”

By this point, Mussolini and his Fascist Party had been normalized, because they had been brought into the center-right government the previous year as an antidote to the left. The government was in disarray, its institutions delegitimized, and leftist parties were squabbling among themselves. And Fascist violence had fueled disorder that Mussolini, like a racketeer, promised to resolve.

But while Mussolini presided over Fascism’s first real taste of political power, his movement was not the first of its kind. For that, one must look instead to the United States. As Paxton explains, “It may be that the earliest phenomenon that can be functionally related to fascism is American: The Ku Klux Klan … the first version of the Klan was arguably a remarkable preview of the way fascist movements were to function in interwar Europe.”


THE GREAT RACE TO THE BOTTOM

As important as these functional parallels between movements and organizations were, it is at the level of ideology that one finds the common denominator shared by American and European (especially German) variants of fascism. In 1916, the American eugenicist Madison Grant published The Passing of the Great Race, which decried the supposed replacement of whites in America by Black people and immigrants, including “Polish Jews.” According to Grant, these groups posed an existential threat to the “Nordic race” – America’s “native class.”

While Grant did not object to the presence of Black people in America, he insisted that they must be kept subordinate. His book was an exercise in scientific racism, arguing that “Nordic whites” are superior to all other races intellectually, culturally, and morally, and thus should command a dominant position in society. At the core of his worldview was a racialized version of American nationalism: Nordic whites were the only “real” Americans, but they were at risk of being “replaced” by other races. 

Grant tapped into a powerful political current of his time. In the years that followed, the “America First” movement would emerge to oppose “internationalism” and immigration. As Sarah Churchwell of the University of London notes in her brilliant 2018 book, Behold, America: The Entangled History of “America First” and “the American Dream,” in February 1921 US Vice President Calvin Coolidge “wrote an essay for Good Housekeeping called ‘Whose Country is This?’” Coolidge’s answer, as Churchwell recounts, was unambiguous: “‘Our country must cease to be regarded as a dumping ground’ and should only accept ‘the right kind of immigration.’” By that, he explicitly meant “Nordics.”

It was also in 1921, Churchwell notes, that the Second Ku Klux Klan adopted “America First” as part of its official credo. With its fevered commitment to white supremacy and traditional gender roles, the Second Klan focused its efforts on spreading paranoia about Jewish Marxists and their attempts to use labor unions to promote racial equality. Meanwhile, the American industrialist Henry Ford had been financing the publication and distribution of The International Jew, a compilation of articles that placed Jews at the center of a global conspiracy. Jews, Ford claimed, controlled American media and cultural institutions, and were bent on destroying the American nation.

One finds the same kind of racialized nationalism running through Mein Kampf, Adolf Hitler’s 1924 prison manifesto. Hitler was incensed by the presence of foreigners, and especially Jews, in Vienna, but he made clear that his hatred was not for the Jewish religion. Before arriving in Vienna, he writes, Hitler had rejected anti-Semitism, because he saw it as a form of discrimination against Germans on the basis of religion.

But Hitler came to see Jews as the ultimate enemy, portraying them as members of a foreign race who had become assimilated in Germany in order to take it over. This, he claimed, would be achieved by loosening immigration laws to “open the borders,” encouraging intermarriage to destroy the Aryan race, and using control of the media and culture industries to destroy traditional German values. According to Nazi propaganda, Jews were the force behind international communism and the source of the mythical “stab in the back” that had supposedly caused Germany to lose World War I.

Hitler drew inspiration from the US, which, following the rise of the America First movement, had adopted immigration policies that strictly favored Northern Europeans. Looking to the early American settlers’ genocide of the continent’s native peoples in the name of “Manifest Destiny,” he found a model for his own later actions in pursuit of Lebensraum (territorial expansion). And as historian Timothy Snyder shows in his 2015 book, Black Earth: The Holocaust as History and Warning, Hitler hoped to recreate the American Antebellum South’s slavery regime in Ukraine.


THE MISRULE OF LAW

The fact that American racialized nativism and German fascism embodied shared practices, not just shared beliefs, merits closer attention. As the American legal theorist Kimberlé Crenshaw has shown, legal practices historically have enforced and perpetuated unjust hierarchies of value in ways that often go unnoticed. Hence, the point of anti-discrimination laws is not to offer special protections for any specific group – say, Black women; rather, it is to ensure that the law does not reproduce discriminatory social, political, and historical hierarchies of value.

This is one of the central insights of critical race theory (CRT), which evolved from the work of Crenshaw, Derrick Bell, and other scholars who have explored how legal practices perpetuate discrimination – sometimes as a side effect of motivated reasoning by those in power, and sometimes as a policy’s explicit intent. And, because CRT has become one of the most important theoretical tools in anti-fascist practice, it is also the new bugbear of the white nationalist right.

CRT urges us to recognize law as the core manifestation of a political ideology. In the case of fascism, citizenship is based on racial identity, which in turn rests on a founding myth of hierarchy and superiority. While a race-based conception of national identity was not central to Italian Fascism, it was the driving force behind Nazism. With the 1935 Nuremberg Laws, German citizenship came to be based on Aryan superiority. Only those of “German blood” could be German citizens with political rights. Jews, by dint of being non-Aryans, were excluded from citizenship and therefore stripped of political rights.

Not by coincidence, Black Americans had long suffered similar treatment in the post-Civil War American South. As James Q. Whitman of Yale Law School documents in Hitler’s American Model: The United States and the Making of Nazi Race Law, Nazi ideology borrowed straightforwardly from the Jim Crow regime’s use of legal practice to structure the nature of citizenship. While the Allied victory eventually ended German racial fascism in 1945, America’s Jim Crow regime would survive for another generation.


FASCIST BIG TENTS

The defeat of Nazi Germany had required America to overcome the power of the isolationist America First movement at home. But the draconian immigration policies that the movement had inspired in the 1920s were still in place in the 1930s, when America infamously turned away many Jewish refugees attempting to flee Europe ahead of the Holocaust.

In a 1939 Reader’s Digest essay titled “Aviation, Geography, and Race,” the leading spokesman of America First, the aviator Charles Lindbergh, wrote: “It is time to turn from our quarrels and to build our White ramparts again. This alliance with foreign races means nothing but death to us. It is our turn to guard our heritage from Mongol and Persian and Moor, before we become engulfed in a limitless foreign sea.” Lindbergh advocated neutrality in the war between Britain and Germany, regarding both as allies against open immigration into Europe and the US by non-white peoples.

In Germany, fascists had entered government as a result of their rapidly rising popularity in electoral politics, starting in 1928. The German economy had experienced a series of terrible shocks, from hyperinflation to soaring unemployment. Hitler’s Nazis, naturally, blamed these problems on Jews, communism, and international capitalism. Like Mussolini’s Blackshirts, they violently attacked leftists and provoked open street fighting – and then presented themselves as the only force that could restore order.

Nazi ideology appealed to multiple constituencies. With its promise to strengthen the nation by supporting traditional gender roles and the creation of large Aryan families, it appealed to religious conservatives. And with its hostility toward communism and socialism, it promised to protect big business from organized workers. The Nazis opposed capitalism only as a universal doctrine – that is, as one that granted Jews the right to property – and portrayed themselves as the protectors of Aryan private property against “Judeo-Bolshevism.”

On the cultural front, it bears emphasizing that fascist parties have always been violent defenders of a strictly binary conception of gender. In the 1920s, Berlin was a cultural boomtown and a center of emerging European gay life, which Nazi ideology associated with Jews. The city was also the site of Magnus Hirschfeld’s Institut für Sexuallewissenschaft, a vast library and archive housing a wide variety of gender expression. That made him one of the Nazi Party’s main enemies. When the Nazis started burning books, Hirschfeld’s library was among the first targets.

It is no surprise that fascists have always found common cause with religious conservatives. While fascism and Christianity forged an alliance of convenience in Italy and Germany, they all but fused into a single ideology elsewhere. In Romania, for example, the Legion of the Archangel Michael was both the most Christian and the most violently anti-Semitic of the European fascist parties.

In Brazil, a Catholic integralist form of fascism was imported directly from Italy by Plínio Salgado. The role of Christianity is also obvious in the structure of the Russian fascism that is ascendant today. Russians and Russia are depicted as the last defenders of Christianity against the heathen forces of decadent Western liberalism and gender fluidity. And, of course, Christianity has always animated American fascism, with its ideological core of white Christian nationalism.


FROM PUTSCH TO PARLIAMENT

By the end of the 1920s, the Nazis had managed to appeal to multiple groups that did not regard themselves as Nazis. And owing to the widespread distrust of more mainstream political parties and institutions, they became the second-largest parliamentary party after the 1930 election, and then the leading party following the election in 1932.

Though German conservatives looked askance at the Nazis, they regarded Hitler as preferable to any option on the left. Thus, with the support of the conservative establishment, Hitler was appointed chancellor by Germany’s president in 1933. While Hitler had made his virulent opposition to democracy abundantly clear in his statements and writings, German conservatives handed him power anyway, demonstrating – at best – unforgivable naivete.

In fact, every canonical example of European fascists’ success in the twentieth century involved political parties coming to power through the normal electoral process, after having broadcast their anti-democratic sentiments and sometimes even their express intentions. Conservative leaders and voters chose fascism over democracy, believing that they would win out in the end.1

For a fascist party to triumph, it must attract support from people who, if asked, would loudly deny that they share its ideology. This need not be so difficult: voters merely have to be persuaded that democracy is no longer serving their interests.


FASCISM TODAY

If we think of fascism as a set of practices, it is immediately evident that fascism is still with us. As Toni Morrison pointed out in a 1995 speech, the US has often preferred fascist solutions to its national problems. Consider, for example, the Prison Policy Initiative’s findings on global incarceration rates in 2021: “Not only does the US have the highest incarceration rate in the world; every single US state incarcerates more people per capita than virtually any independent democracy on earth.”

This is a burden that falls disproportionately on the formerly enslaved population of the country. And unlike in many other democracies, prisoners in 48 US states cannot legally vote. In Florida, strict disenfranchisement laws strip one million people – enough to shift the state’s partisan leaning toward Republicans – with past felony records of their voting rights. And under the state’s current Republican governor, Ron DeSantis, an election police force has been created to address a nonexistent epidemic of voter fraud. In the run-up to the 2022 midterm elections, there have been highly publicized arrests of Black people with felony records who thought they could vote (and who, in some cases, had received confusing messages about the matter from the state).

We should recognize this for what it is: the return of Jim Crow tactics designed to intimidate Black voters. Unlike the Third Reich, the Jim Crow regime never suffered defeat and elimination in war. Instead, its practices have quietly persisted in varying forms, often serving as a model for laws like those in Florida. In most cases, racist laws are made to appear racially neutral. Literacy tests for voting, for example, are ostensibly neutral but discriminatory in fact.

Nor is this tactic confined to the US. In India, the Hindu nationalist ruling party has created a national registry to codify citizenship and expel “illegal immigrants,” cynically exploiting the fact that a significant number of Indian Muslims lack official documentation. Hindu nationalists can now target Indian Muslims and threaten them with deportation to Bangladesh. At the same time, the 2019 Citizenship Amendment Act gives non-Muslim migrants from Afghanistan, Bangladesh, and Pakistan a fast track to citizenship.

The manipulation of citizenship laws to privilege one group as the true representatives of the nation is a feature of all fascist movements. As Tobias Hübinette of Karlstad University has pointed out, Sweden’s far-right party, the Sweden Democrats, has “a direct organizational lineage tracing back to World War II-era Nazism.” Its platform asserts a racially homogenous Swedish national identity, and its candidates have “campaigned openly for the installation of a repatriation program with the explicit purpose of making non-Western immigrants move back to their countries of origin.” In the September 2022 election, the Sweden Democrats became the second-largest party in parliament– echoing the Nazi Party’s achievement in 1930.

Far-right leaders elsewhere in Europe have also been openly campaigning against multiracial democracy, though Muslim minorities have been substituted for the massacred Jewish population as the Fifth Column in their “Great Replacement” theory. In Hungary, Prime Minister Viktor Orbán has used the courts and the law to silence opposition media and peddle a Christian nationalist nostalgia for a lost greater Hungary. By stoking fears of sexual and religious minorities, he has shown how a leader can win elections time and again while openly campaigning against the press, universities, and democracy itself.


A NEW WAVE?

In the century since Mussolini’s March on Rome, leaders and parties who openly run against democracy all too easily prevail in elections. In Brazil, President Jair Bolsonaro has called for removing democratic institutions and repeatedly praised the country’s former military dictatorship. And despite his disastrous first term, he stands a decent chance of winning in the second-round vote on October 30. And in the US, the Republican Party has become a cult of personality beholden to a white nationalist leader who led an effort – most of which he plotted in the open – to overthrow American democracy.

Fascists can win when social conservatives decide that fascism is the lesser evil. They can win when enough citizens decide that ending democracy is a reasonable price to pay for achieving some cherished goal – like the criminalization of abortion. They can win when a dominant cohort chooses to end democracy in order to preserve its cultural, financial, and political primacy. They can win when they attract votes from those who merely want to thumb their noses at the system or lash out in resentment. And they can win when business elites decide that democracy is just a substitutable input.

Fascist parties feed a longing for national innocence, which is why they run on narratives of national glory that erase past crimes. Hence, some parents will support fascist parties – while vehemently disclaiming the label of fascism for themselves – to prevent their children from learning about the racist legacies that underpin the persistence of racist outcomes.

Today, as in the past, fascist movements often have a powerful symbolic dimension that makes them contagious internationally. In the figure of Giorgia Meloni, Italy has its first far-right leader since Mussolini. Having long promoted admiration of Mussolini’s legacy and hatred of immigrants and sexual minorities in her pursuit of party and government positions, Meloni’s ascension to the Italian premiership is a potent symbol for global fascism.

Finally, the world has its most openly fascist leader since Hitler in the figure of Russian President Vladimir Putin, who has demonstrated why we must never become complacent about this ideology and its implications. Putin’s genocidal war against Ukraine shows that he is not a pragmatic actor, but rather a fanatic seeking to recreate a lost Russian empire. In mustering such effective resistance, the Ukrainians have confirmed the ancient truth suggested in Pericles’s famous funeral oration: democracies fight better than tyrannies, because democratic citizens fight by their own choice.

When institutions have been delegitimized for presiding over enormous economic disparities, cronyism, and generational crises, massive social change becomes possible. Sometimes, that change is positive, as when the labor movement helped establish the weekend, improve workplace safety, and abolish child labor. But such moments are inherently perilous. Fascism is the dark side of liberation, and history shows that it is often what democratic polities will prefer.


Jason Stanley, Professor of Philosophy at Yale University, is the author of Erasing History: How Fascists Rewrite the Past to Control the Future (Atria/One Signal Publishers, 2024).

 

terça-feira, 23 de julho de 2024

Unlocking IMF Reform - Barry Eichengreen (Project Syndicate)

Unlocking IMF Reform

Sketching a reform agenda for the International Monetary Fund is easy; implementing reform is hard. It will require, among other things, the US to give up its veto in the institution, and China to assume more responsibility for global stability and the problems of other economies.

In July 1944, exactly 80 years ago, representatives of 44 countries met in an obscure New Hampshire village to negotiate the Bretton Woods Agreement establishing the International Monetary Fund. For many, reaching the ripe old age of 80 would be cause for celebration. For the IMF, the anniversary only highlights the urgency of reform.

Some necessary reforms are straightforward and widely agreed, raising the question of why they haven’t been adopted. First, the IMF should provide its members with regular annual allocations of its in-house financial instrument, special drawing rights. This would provide an alternative to the US dollar as a source of global liquidity while also addressing the problem of chronic global imbalances. Second, the IMF needs to do better at organizing debt restructurings for low-income countries. Its latest attempt, the rather grandly named Common Framework for Debt Treatments, has fallen short. The Fund needs to push harder for cooperation from China’s government and financial institutions, which are unfamiliar with the responsibilities of a sovereign creditor. It should support reforms to speed up restructurings and endorse initiatives to crack down on holdout creditors.

In terms of its surveillance of countries’ policies, the IMF needs to address its perceived lack of evenhandedness; whereas emerging and developing countries are held to demanding standards, high-income countries like the United States are let off the hook. It needs to reinvigorate its analysis of the cross-border spillovers of large-country policies, a process the US has managed to squelch. 

As for its lending policies, the IMF needs to decouple loan size from an anachronistic quota system and reduce the punitive interest rates charged middle-income countries. To ensure the best possible leadership, the managing director should be selected through a competitive process, where candidates submit statements and sit for interviews, after which shareholding governments vote. The victor should be the most qualified individual and not just the most qualified European, as has historically been the case.

Most of all, the IMF must acknowledge that it can’t be everything for everyone. Under recent managing directors, it has broadened its agenda from its core mandate, preserving economic and financial stability, to encompass gender equity, climate change, and other nontraditional issues. These are not topics about which the IMF’s macroeconomists have expertise. The IMF’s own internal watchdog, the Independent Evaluation Office, has rightly warned that venturing into these areas can overstretch the Fund’s human and management resources. Admittedly, the IMF can’t ignore climate change, since climate events affect economic and financial stability. Women’s education, labor force participation, and childcare arrangements belong on its agenda insofar as they have implications for economic growth and hence for debt sustainability. Fundamentally, however, gender-related policies and climate-change adaptation are economic-development issues. They require long-term investments. As such, they fall mainly within the bailiwick of the World Bank, the IMF’s sister institution across 19th Street in Washington. 

An advantage of an agenda focused on the IMF’s core mandate is that national governments are more likely to give the Fund’s management and staff the freedom of action needed to move quickly in response to developments threatening economic and financial stability. The IMF lacks the independence of national central banks. Currently, decision-making is slow by the standards of financial crises, which move fast. Decisions must be approved by an executive board of political appointees who in turn answer to their governments. But central-bank independence is viable only because central bankers have a narrow mandate focused on price stability, against which their actions can be judged. For a quarter-century, observers have argued that a more independent, fleet-footed IMF would be better. But the more the institution dilutes its agenda, the more such independence resembles a pipedream. The other factor underpinning the viability of central-bank independence is that monetary policymakers at the national level are accountable to legitimate political actors, generally parliaments and ministers. The legitimacy of IMF accountability is more dubious, owing to the institution’s governance structure. For antiquated reasons, the US – and only the US – possesses a veto over consequential IMF decisions. Europe is overrepresented in the institution, while China is underrepresented. Until these imbalances are corrected, the Fund’s governance will remain under a shadow. This not only makes the prospect of operational independence even more remote; it also stands in the way of virtually all meaningful reforms, including the straightforward changes listed above. Sketching a reform agenda for the IMF is easy. Implementing it is hard. Real reform will require the US to give up its veto in the institution. It will require China to assume more responsibility for global stability and the problems of other economies. And it will require the US and China to work together. For two countries that haven’t shown much ability to cooperate in recent years, IMF reform would be a good place to start. 

Barry Eichengreen

Writing for PS since 2003 
195 Commentaries

Barry Eichengreen, Professor of Economics and Political Science at the University of California, Berkeley, is a former senior policy adviser at the International Monetary Fund. He is the author of many books, including In Defense of Public Debt (Oxford University Press, 2021).


The Euro and Its Imperial Ancestors - Victoria Gierok (Project Syndicate)

The Euro and Its Imperial Ancestors

Medieval European and Chinese history show that while the establishment of well-functioning common currencies requires political skill and vision, their survival depends on institutions that are free from political influence. The good news for the euro is that it ticks both boxes.

Twenty-five years ago, the euro was introduced, in virtual form, as the common currency of the eurozone, which consisted of 11 countries. Banknotes and coins came three years later, in 2002, and 20 countries now use them. Despite being the youngest fiat currency in the Western world – the same age as “Gen Z” – the euro is undeniably powerful. It is the second most widely held reserve currency (accounting for 20% of official foreign reserves as of 2023), and the second most traded currency after the US dollar, which was introduced in 1792. Given that the dollar did not challenge the British pound’s global dominance until the twentieth century, the rapidity of the euro’s adoption is striking, especially considering that several powerful European countries – the United Kingdom, Denmark, and Sweden – refrained from joining. Nor was the euro spared from growing pains. Its adolescence coincided with the 2008 global financial crisis and the (related) European debt crisis of the early 2010s. The future of the euro looked shaky, and many doubted its viability. 

But then came the soundtrack that would save the struggling teenager from its downward spiral: European Central Bank President Mario Draghi’s vow in 2012 to do “whatever it takes” to save the euro. Despite major political and economic upheavals in the intervening years – including the 2015 refugee crisis, Brexit, the COVID-19 pandemic, and Russia’s invasion of Ukraine – the euro has never again been questioned in the same manner. As a young adult, however, the euro has come of age at a time when European politics is tending toward fragmentation and a renewed emphasis on national sovereignty. Maintaining a common currency across disparate economies and political environments remains a tall order. But by examining the history of earlier common currencies, we may be able to venture some conclusions about the euro’s future. 

Let a Thousand Coins Bloom

Creating a stable currency that unifies regions with different economic and political characteristics is a challenge that has tested governments and rulers for many centuries. Two recent books on the topic – one examining central Europe, the other imperial China – show that while the establishment of well-functioning currencies requires political skill and vision, their survival depends on institutions that are free from political influence. 

The Silver Empire: How Germany Created Its First Common Currency, Oliver Volckart, a historian at the London School of Economics, masterfully traces the political tug of war that unfolded in sixteenth-century “Germany” (what was then the core of the Holy Roman Empire), culminating in the successful creation of a common silver currency, the Reichsguldiner, in 1559. The Reichsguldiner was a large silver coin that solved a major problem for the empire and its rulers: the trade in bad coinage. To understand the issue at stake, Volckart takes us back to the fifteenth century, when the Holy Roman Empire was ruled by the Habsburgs, whose hereditary lands spanned most of Austria, but who shared sovereignty over much of central Europe with the princes of the empire. Unlike the French and English monarchies, which had centralized power to a greater degree, the Holy Roman Empire’s political system was complicated, and required a consensus between central and local authorities. Importantly, the emperor did not have the prerogative of minting coins, because over the centuries, this privilege had been given to princes and towns in exchange for their political support. As a result, upward of 70 distinct currencies circulated within the empire. Fostering trade, however, was not the purpose of the Reichsguldiner. The apparent currency chaos was not a major problem for merchants, because they conducted their business in the more stable high-value coins and, increasingly, through bills of exchange. As Volckart points out, sources from the period include many complaints and pamphlets from local representatives and legal scholars advocating for more “order” in the Empire’s currency. The voices of merchants, however, are largely absent. In those rare cases where merchants did comment on monetary diversity, their concern was not with the impact on trade, but with the consequences it had for the emperor’s finances. But competitive debasing and the trade in bad coinage had become a growing problem. The empire faced the dilemma described by Gresham’s Law: “bad money drives out good.” To show how this happens, Volckart recounts the biggest monetary scandal in sixteenth-century Germany.   

Show Me the Bullion

The story begins in October 1543, in Augsburg, when Hans Appenfelder, mint master of the town of Kaufbeuren, and Balthasar Hundertpfund, mint master of Augsburg, were accused of breaking down coins to extract their precious metal, or bullion. Owing to the sheer multitude of coins of similar nominal value but differing metallic content, creating “bad money” (with less bullion than officially stated on the coin) had become easy and profitable. 

Because good money was difficult to distinguish from bad, the empire’s pluralistic currency environment became a fertile breeding ground for debased coins. And soon enough, the lower bullion content of bad coins became evident, leading more people to dispose of them as payment, while hoarding good money to save or melt down for a profit. Gresham’s Law became especially problematic in sixteenth-century Germany because minting prerogatives were widely dispersed among several dozen mints. Because princes and towns with no access to gold or silver mines relied on the trade in coinage to supply their mints, they had strong incentives to create bad money in order to attract those who were selling bullion. This meant that creating bad money was not a criminal offense, but rather more of a coordination problem among the different minting authorities. The minting of Schillings in the rival duchies of Mecklenburg and Pomerania illustrates the problem perfectly. Because the duke of Pomerania’s Schillings contained more silver than the Mecklenburg Schillings,merchants in Pomerania would take them to the mint in Mecklenburg to be broken down and re-minted into Mecklenburg Schillings at the same face value, but with much lower silver content. Both dukes had the authority to mint coins, and both currencies were legal tender. But the dukes recognized that they had a problem. Even though they might receive bad coins in the form of fees and taxes from their subjects, they were still expected to pay in good coins, such as when they contributed to the emperor’s war chest or the Imperial Chamber Court. Commoners, who were less equipped to determine which coins were “good” and which were “bad,” had it worse. As Volckart shows, bad coinage had increasingly become a matter of public opinion, with many pamphlets using the stock image of evil merchants profiting from the trade. The problem was so widely recognized that when Charles V ascended to the imperial throne in 1519, he had to promise to solve the “defects and deficiencies in the coinage” to shore up the political consensus for his reign.

Politics, Politics, Politics

Within this kind of consensus-based system, politics becomes a true art, and procedural rules and ceremonial rituals acquire greater importance. Decisions were made at the Imperial Diet, where the emperor met with the princes. The establishment of the Reichsguldiner was not unlike the gathering of sovereign states that centuries later negotiated the euro’s creation. Since bad money represented a classic collective-action problem, a solution would require everyone to agree to follow the same rules. Unsurprisingly, the results were limited at first, and no real progress was made in the 20 years following Charles’s election. Though the emperor, the electors, and the princes did pass a new coinage ordinance in 1524, which called for the creation of a new currency based on gold and silver, it was never widely adopted and implemented. The most powerful princes continued to cling to outdated theories about debasement and silver prices, which forestalled any movement on the currency bill. Not until 1545, at the Imperial Diet in Worms, did experts resolve these disagreements by showing that the price of silver need not be determined in advance to create a common currency. With this theoretical issue put to rest, monetary talks began to pick up speed. In 1549, a conference was held in Speyer for the express purpose of drafting and passing a currency bill. This marked a major change, as previously only Imperial Diets could pass bills. But that is how urgent the matter had become. Nonetheless, the talks in Speyer initially broke down, owing to a disagreement over whether the new common silver currency would have to be accepted as legal tender in place of the Rhenish gold florin. Most princes were very much in favor, whereas the electors (a smaller cohort of the most powerful princes) and cities were very much opposed. The reasons for the difference in opinion concerned debts and tolls. The cities were among the empire’s largest creditors, and many princes were heavily indebted to them. Given the instability of currencies, debts were denominated in gold coins, and interest and repayment would likewise have to be rendered in gold coins. If silver coins became legal tender, princes would be able to pay back less simply by choosing whichever metal was cheaper than its official value at the time. Likewise, Rhenish electors collected their tolls along the Rhine in gold and did not want to see their revenues dwindle. In classic European fashion, the electors erected procedural roadblocks to forestall further talks. The problem remained unresolved at Speyer, and the conference ended with a draft that left the issue for the emperor to decide. Two years later, Charles, at the height of his power, followed the advice of his delegates and decided in favor of a silver currency that would become legal tender throughout the empire. But problems much larger than the currency issue soon took center stage. Martin Luther’s renunciation of Catholic doctrine was still reverberating throughout the empire, and Charles had already quashed an uprising of Protestant princes in the 1546-47 First Schmalkaldic War. By 1552, tensions were running high again as Charles attempted to centralize imperial power and suppress Protestantism. This resulted in the Second Schmalkaldic War, wherein the elector Maurice of Saxony’s army surprised Charles and drove him out of Innsbruck. This was a huge embarrassment for Charles, and it paved the way for the substantially renegotiated religious peace that was signed in Augsburg in 1555. Charles never fully recovered politically and abdicated in 1556, spending his final days in a monastery in Spain. When the crown passed to his younger brother, Ferdinand I, the common currency bill of 1551 was still hanging in the balance.

Long-Awaited, Short-Lived

Ferdinand, a better negotiator than Charles, launched a new conference in Speyer in 1557 to discuss the mistakes made in 1549 and 1551. He also recognized that Charles had erred in bypassing the Imperial Diet when he made his final decision. Several rulers, believing that their interests had not been adequately protected, did not feel obliged to commit to the final currency bill. So, Ferdinand pursued a compromise whereby the common silver currency would not have to be accepted as legal tender for debt and ancient customs denominated in gold. The new agreement eventually passed at the Imperial Diet in Augsburg in 1559. Following a final 1566 amendment to bring the Saxon elector along, the Holy Roman Empire finally had a common currency. All in all, the new currency proved to be a success. A host of new institutions ensured that no individual ruler would deviate or secretly undermine the currency by producing bad coinage. These included so-called probation diets, where batches of newly minted coins were tested for their silver content. Since this mechanism operated supra-territorially, with both minting and non-minting estates in attendance, it was effective in forestalling collusion between mint masters, assayers, and rulers. While smaller regional currencies were still allowed to vary in silver content, the currency reforms remade the empire’s financial landscape. By the 1590s, the rampant trade in bad coinage was largely contained, even if the border regions (particularly those adjacent to the Netherlands, which never joined the currency bill) still suffered from it. The success of the new common currency lay in continued cooperation and institutional support for the probation diets. When cooperation broke down, so did the currency. The Thirty Years’ War began in 1618, and already by 1619, irregular debasement and bad coinage returned, leading to a period of hyperinflation. Even though the currency was somewhat restored after this early collapse, it never regained its previous position. By 1667, Saxony and Brandenburg had openly abandoned it. Germany would have to wait until 1873 for its next successful common currency, the mark. 

The Great Divergence

The importance of institutions in creating a stable currency also emerges as a central theme of Empire of Silver: A New Monetary History of China by Jin Xu of the Financial Times Chinese. While the Chinese Empire was far more centralized than the Holy Roman Empire, it also struggled to create a stable, long-lasting currency. Contrary to what Xu’s title suggests, China relied on low-value bronze coins throughout much of its history, and it was one of the earliest civilizations to introduce paper scrip, first during the medieval Song Dynasty (ca. 960-1279) and again under the Yuan Dynasty (ca. 1279-1368). Uncoined silver served as the main medium of exchange only from the Ming Dynasty (1368-1644) onwards, when it became clear that the paper currencies had failed. Xu’s book is certainly ambitious, spanning more than a thousand years of Chinese history. But it lacks a thread to guide the reader through the myriad details of a disjointed timeline. The book suggests that before Europe and China experienced a “Great Divergence” in terms of per capita GDP in the eighteenth century, a financial divergence was already underway. Although Xu stresses throughout the book that China lacked both the economic institutions – such as banks – and the political vision to create a stable currency, she does not give a coherent account of the connections between finance, politics, and economic performance. One reason why China found itself on the losing side of the Great Divergence, she suggests, is that Chinese rulers saw money primarily as a political instrument – to finance warfare and courtly expenses – rather than as an economic tool. As a result, merchants did not attain any political power, and property rights did not develop as they did in the West. But as Volckart shows, this feature was hardly limited to China; merchants did not play a consequential role in Germany’s monetary policy, either. Still, Xu does touch on one of the biggest debates in Chinese monetary history: Was monetization driven by state-mandated taxes in silver, or by an expansion of commerce? In fact, the answer might be: “both.” Current academic scholarship emphasizes that developments like the Single Whip Reform (1580) shifted tax payments from being payable in-kind to being payable in silver, but also that the expansion of commerce, beginning under the Song Dynasty, advanced the use of silver as a currency. 

The Mandate of Silver

Still, silver was not used in the form of coins until the eighteenth century. Instead, silver ingots known as sycee were used. This, too, is attributable to weak institutions. Imperial China was precocious in many ways, the source of inventions and discoveries (printing, gunpowder, iron smelting) that Europeans would adopt only much later. While its paper currency was initially tied to a silver standard, it later became a purely fiat currency, serving the needs of the people well enough, and retaining a stable enough value, to enable commerce. But when new wars loomed large and government expenditures rose, over-issuance of paper currency led to severe inflation. The paper currency eventually failed as people reverted to bronze or copper coins and uncoined silver. For a while, China, too, experienced a period of free coinage, with private mints issuing their own currencies. China’s crucial weakness lay in its lack of checks on government. Unlike in the Holy Roman Empire, where the challenge was to solve a collective-action problem among relative equals, the Chinese Empire suffered from the opposite problem: a lack of independent institutional oversight for government finance, including the issuance of money. This shortcoming is the reason why efforts to establish a functioning imperial paper currency, and then to ban silver, proved unsuccessful in the long run. By the sixteenth century, silver was used for large transactions everywhere, and the state largely treated coinage as a source of revenue, though not as an instrument to steer the economy. Given the situation in Germany at the same time, this is not an unfamiliar political outlook. But while Europe soon benefited from the emergence of nascent central banks – such as the Bank of Amsterdam, established in 1609 – China did not. When the Ming Dynasty fell and was replaced by the Qing Dynasty in 1644, the monetary system was largely carried over: copper and bronze coins were used for everyday purchases, whereas silver was usually reserved for larger transactions. Even though governments collected taxes and recorded their spending in silver, there was no uniform standard for weighing silver monies. In fact, as in sixteenth-century Germany, there were many silver units and local currencies, and this “currency chaos” persisted, Xu argues, because of corruption: complicated exchange rates left room for bureaucrats to siphon off profits for themselves. Thus, while Western government budgets slowly coalesced into an orderly system, China’s state budgeting remained muddled. As Xu sees it, the large influx of silver that came in the eighteenth century proved to be a double-edged sword. Following the consensus in the academic literature, she suggests that the widespread use of silver boosted the Qing economy, but also made the empire susceptible to fluctuations in international silver supplies and trade networks. The opium trade continued to grow and eventually reversed the flow of silver, resulting in the Opium Wars of the nineteenth century, which delivered a near fatal blow to the Chinese Empire. Xu concludes with a chapter outlining China’s move to a modern currency system following the civil warfare of the early twentieth century. Here, too, she broadly follows the academic consensus, leaving one to wonder why the title advertises a “new history.” Worse, the book includes multiple factual mistakes, such as the claim that, “With the emergence of the silver standard, banks emerged in Europe.” In fact, as Xu herself acknowledges, early medieval banks emerged in Italy long before European countries adopted a silver standard. Stylistically, the book suffers from metaphors that are more confusing than they are illuminating. “In history,” she writes, “between the flesh and bones of politics, taxation is always a principal artery of historical change, and money its network.” Perhaps this works better in the original Chinese, but in English, such passages are more punishing than enlightening. 

A Careful Balance

Both books highlight the importance of visionary political leadership and independent institutions to support the maintenance of a stable common currency over time. Neither economic growth nor the increase in trade spurred by the opening of the Atlantic economy was sufficient to establish such a currency, nor were regional economic disparities ultimately responsible for the eventual failures of the Reichsguldiner or Imperial China’s paper money. These histories highlight the importance of involving all political actors in the decision-making process, and ensuring a role for independent institutions to support the common currency. Whatever its initial problems, the euro, at least, has both these key features.

  • Oliver Volckart, The Silver Empire: How Germany Created Its First Common Currency, Oxford University Press, 2024.
    Jin Xu, Empire of Silver: A New Monetary History of China, Yale University Press, 2021. 

  • sexta-feira, 21 de junho de 2024

    The Evolution of Empire - John Andrews (Project Syndicate)

     Acabo de escrever um trabalho, destinado a ser publicado, justamente sobre a resiliência dos impérios em todos os tempos e ainda atualmente.

    Paulo Roberto de Almeida

    The Evolution of Empire

    The trite answer to the question of why empires fall is that they become victims of their own success, growing too large, too corrupt, and too exhausted to fend off energetic newcomers. Whether this will be America's fate has become an urgent issue in today's increasingly unstable, multipolar world.

    BRIGHTON & HOVE – With the just-concluded G7 summit exposing the group’s diminished status, it is appropriate to ask where power lies in today’s world. The United Nations has 193 member states (the most recent, which joined in 2011, is benighted South Sudan), all of which are, as Secretary-General António Guterres put it in 2016, technically committed to “the values enshrined in the UN Charter: peace, justice, respect, human rights, tolerance and solidarity.” But while each gets one vote in the General Assembly, nobody would dare claim that each country carries equal weight. 

    Instead, the five permanent members of the Security Council – the United States, China, Russia, France, and the United Kingdom – reign supreme, each wielding a veto over whatever the other 192 members might want. That is why Israel, owing to US support, can blithely ignore countless UN resolutions, and why Syria, owing to Russian and Chinese support, handily escaped sanctions for its use of chemical weapons a decade ago.  Owing to the disproportionate power they wield, the “Permanent Five” share an old, decidedly British sense of empire. While the authors of two recent books on empire, Lawrence James and Nandini Das, offer no thoughts on how the UN might – or indeed should – be reformed, I suspect that they would agree. In The Lion and the Dragon, James, a prolific historian of the UK’s role in world affairs, follows Britain’s relations with China from the nineteenth-century Opium War until the return of Hong Kong and today’s tensions over Taiwan. And in Courting India, Das, a professor at the University of Oxford, concentrates on the very beginnings of the British Empire and its covetous reach into what was then the Mughal Empire in India. 

    What this history shows is that empire is still very much with us. Though Americans, proud of throwing off the rule of King George III, tend to bristle at the idea, their own military, technological, and commercial power is as imperial and pervasive as Britain’s territorial dominance ever was. As James notes, we can thank the post-World War II Pax Americanafor the mostly stable international relations that prevailed during the aptly named Cold War with the Soviets (and their own empire). A perennial question, especially during periods of geopolitical upheaval, is not just how empires emerge, but how they fade. Though Britain and France still indulge their memories of empire, they have long since accepted being “middle powers” at best. Ever since the Suez crisis of 1956, when the threat of US sanctions forced Britain, France, and Israel to withdraw from Egypt’s Suez Canal, Britain has supinely followed America’s lead in international relations. (UK Prime Minister Harold Wilson’s refusal to send troops to Vietnam in the 1960s is the exception that proves the rule.) At the same time, France has sought comfort in the collective embrace of what became the European Union. As for the other members of the Permanent Five, Vladimir Putin’s Russia is on a hopeless quest to reverse the collapse of the Soviet Union (the “greatest geopolitical catastrophe” of the twentieth century, in his estimation) and recreate the empire of Peter the Great; and China already sees itself, with some justification, as wielding global influence to rival that of the American empire. China’s pursuit of superpower status is born of not just current economic and political realities, but also its deep-seated resentment over the “century of humiliation” (1839-1949) that it suffered at the hands of European (and Japanese) imperial powers. Of course, similar sentiments also animate Putin’s revanchism, as well as Indian Prime Minister Narendra Modi’s dismissiveness of diplomatic overtures from post-Brexit Britain. In William Faulkner’s oft-quoted words, “The past is never dead. It isn’t even past.” 

    Passage to India

    The trite answer to the question of why empires fall is that they become victims of their own success, growing too large, too corrupt, too exhausted to fend off energetic newcomers. As the Arab philosopher and historian Ibn Khaldun argued in the fourteenth century, empires are like living organisms: they grow, mature, and die. 

    As Das’s wonderfully researched book shows, the Mughal Empire was almost mature when the British arrived in the 1600s. Its Muslim rulers, with their roots in Central Asia, are fascinating figures. Emperor Jahangir, a generous patron of the arts, was addicted to opium and wine, whereas his wife, Nur Jahan, wielded significant political influence. The emperor’s son, Shah Jahan, was a “king of the world,” whose love for his wife, Mumtaz Mahal, is permanently commemorated in the Taj Mahal. Mughal India was both a place of immense wealth and a bastion of religious tolerance (unlike Europe, with its centuries-long Inquisition against Muslims, Jews, and heretics). By contrast, the British Empire was barely in its infancy when its clash with Mughal India began. In Courting India, Das paints a vivid picture of the experiences – mostly endured, rather than enjoyed – of King James’s ambassador, Thomas Roe, at the Mughal court. But more than that, she also offers a rich description of Jacobean England as it was emerging from the first Elizabethan age and jostling for power with Portugal, Spain, France, and Holland.   Roe’s own journals are a major primary source, but so, too, are the cultural interpreters of the period, from William Shakespeare to the poet John Donne (a friend of Roe). Theirs was an England full of energy, seeking its fortune in the Americas and the Indies. However, it was nowhere close to as sophisticated as courtiers like Roe seemed to believe. Indeed, Roe was almost a caricature of the Englishman abroad. He refused to learn any language that might have helped his mission (be it Farsi or Turkish), and he insisted that he and his staff wear English wool and silk, even through the Indian summer. While he eventually came to admire the pragmatic tolerance of Mughal society, he remained convinced of England and Protestant Christianity’s superiority. Never would he have allowed himself to “go native.” Roe was answerable not only to King James but also to his financial backer, the East India Company, which had been granted its charter by Elizabeth I in 1600. This meant that he was constantly tussling with the miserly company for money (its traders were always jealous of him), as well as struggling to quell, or at least make excuses for, the riotous behavior of English sailors in India’s ports. 

    The Century of Humiliation

    Two centuries later, the East India Company, as it appears in James’s book, would still be clinging to the same assumptions that Roe had held. The superiority and integrity of Christian Britain went unquestioned, and still stood in stark contrast to “Asian greed and despotism.” The biggest change, in the meantime, had been the collapse of the Mughal Empire. Mughal India, the wealthiest place in the world at the end of the seventeenth century, was steadily enfeebled by internal dissent and Persian and Afghan invasions. In 1857, the East India Company formally dissolved the empire, setting the stage for Queen Victoria to establish the “British Raj” and direct rule over the Indian subcontinent the following year. To paraphrase Ibn Khaldun, nineteenth-century Britain was no longer an infant with imperial ambitions; it was now an adult with all the energy and ruthlessness needed to extend its reach around the world. As such, the British lion had no misgivings about disgracing the Chinese dragon. Looking back on this period, it is easy to see why Chinese President Xi Jinping is so determined to expunge the century of humiliation from the national memory. That century began in 1839 with the First Opium War. When China tried to block imports of East India Company opium from Bengal, Britain responded with all its (industrialized) military might. By 1842, British warships and soldiers had crushed all opposition and compelled China’s Qing emperor to sign the Nanjing Treaty. That opened China to international trade and ensured that British citizens in “treaty” ports would be subject to British, not Chinese, law. Another consequence of the war was that Britain took possession of Hong Kong, which it would hold until 1997. Whereas Das describes India principally through Roe’s eyes, James is keen to present a balance between British actions and Chinese reactions. In doing so, he stresses that China was not reacting only to British imperialism. After all, this was a time when “a spirit of predatory imperialism … pervaded the foreign ministries of Russia, France, Germany and China’s near-neighbor, the newly industrialized Japan.” Seized by their own commercial ambitions, all four “regarded China as a land mass to be partitioned and shared out in the same way as contemporary Africa.” But these other imperial projects hardly give Britain a pass. In arguing that “Britain was reluctantly sucked into the complex geopolitics of great-power empire building in the Far East,” James simply is not convincing. Britain, the world’s leading naval power and the home of the Industrial Revolution, was already adept at the game of geopolitics and quite prepared to protect its interests in China, not least because that would also protect its interests in India. By the eighteenth century, the Qing Dynasty had expanded from its Manchu roots and established an empire extending from Mongolia and Tibet to the Pacific. But by the nineteenth century, it was too exhausted to withstand the pressure not only from the other imperial powers but also from its own people. The century of humiliation always refers to foreign interventions, but equally important were domestic embarrassments such as the 1850-64 Taiping Rebellion – in which some 30 million people died – and the 1899-1901 Boxer Rebellion. The dynasty’s “Mandate of Heaven” was clearly slipping from its grasp. It finally came to an end in 1912, when the Western-educated Sun Yat-sen, following a brief revolution, established the “Republic of China.” 

    Remember Thucydides

    Today, that title applies only to the island of Taiwan, whereas Xi presides over the “People’s Republic of China,” which was established in 1949 with the victory of Mao Zedong’s Communist Party over Chiang Kai-shek’s Nationalist forces. Since the 1970s, most countries – including both rival Chinas – have embraced the fiction that the ROC and the PRC refer to a single country. But there is a constant fear that Taiwan could formally declare its independence and destroy the fiction, thus provoking an invasion from the mainland. If President Joe Biden is to be believed, the US would then come to Taiwan’s rescue and the South China Sea would witness a Sino-American war with far-reaching regional and global consequences. Given his focus on Britain and China, James understandably devotes only a handful of his final paragraphs to US analysts’ “bleak” prognosis of a future war over Taiwan. Moreover, throughout the preceding chapters, he deals deftly with other instances when conflict erupted between rival regional powers. These include the Sino-Japanese war of 1894, which led to Japanese occupation of Taiwan; the Russo-Japanese war of 1904; Japan’s bloody expansionism in the 1930s; and, of course, Japan’s attack on Pearl Harbor, which brought America into World War II. The big risk today is that China and America could end up at war as much by accident as by design. Graham Allison of Harvard University has famously warned of the “Thucydides trap,” an allusion to the Peloponnesian War, in which Sparta, the incumbent hegemon, was “destined for war” with the rising power, Athens. In a world that has created so many multilateral institutions – from the World Trade Organization to the G20 – it is tempting to dismiss Allison’s argument as alarmism. But over the past 500 years, there have been 16 instances of an incumbent power facing off with a rising power, and war was avoided in only four of them, the most famous being America’s rise to replace Britain as the leading world power in the early twentieth century. Notably, James recalls that China was “stunned” by Britain’s 2016 vote to leave the European Union. The message pushed by Chinese state-controlled media was that the UK had surrendered to “a losing mindset.” Clearly, the current Chinese leadership has no intention of showing weakness. The good news is that political and military leaders on both sides of the Pacific are aware of the risks. As Xi said in 2015, on his first state visit to America, “There is no such thing as the so-called Thucydides Trap in the world. But should major countries time and again make the mistakes of strategic miscalculation, they might create such traps for themselves.” The bad news, however, is that all countries are prone to “miscalculation.” Was it a mistake, for example, for imperial Britain to endorse Zionism with the 1917 Balfour Declaration? Given all the Middle East wars that followed the establishment of Israel, some may very well think so. But try telling that to the survivors of the anti-Semitic pogroms of the nineteenth century and the Holocaust. 

    Tick-Tock

    Almost a half-century ago, John Bagot Glubb, a British general who commanded the Jordanian army from 1939 until 1956, published a book entitled The Fate of Empires and Search for Survival. His thesis was essentially the same as Ibn Khaldun’s, only with the added claim that almost all empires rise and fall over a period of roughly 250 years. Putting aside the obvious flaws in Glubb’s arithmetic (the Ottoman Empire certainly did not “end” in 1570), the core idea should not be dismissed too casually. After all, historians now give the Qing Dynasty a lifespan of 267 years, and the Mughal Empire of Das’s book began to lose territory after only two centuries. A pessimist might point out that today’s China began with the Communist victory in 1949, and that America’s quasi-imperial power began 201 years ago with the Monroe Doctrine. Time may not be on the side of those who place their trust in America to protect democracy and “liberal Western values.” 

    John Andrews, a former editor and foreign correspondent for The Economist, is the author of The World in Conflict: Understanding the World’s Troublespots (Economist Books, 2022).


  • Nandini Das, Courting India: England, Mughal India and the Origins of Empire, Bloomsbury Publishing, 2023.
    Lawrence James, The Lion and the Dragon – Britain and China: A History of Conflict, Weidenfeld & Nicolson, 2023.