Ch 1 Preface

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ABOUT THIS BOOK

Is there a crisis of world capitalism in our time, or has a truly global

economy finally begun to pay off on the original promise of the greatest

good for the greatest number Has the leader of that global realm, the

Unites States, reached the end of its hegemonic predominance, or is it in

the robust middle age of its tenure, now bereft of serious antagonists Theoutloo! of its authors is at once compelling and gloomy, a prophecy of

a coming age of turmoil and disorder" #i!e $u!uyama%s The End of

History, this boo! will pro&o!e a li&ely debate' unli!e $u!uyama, Hop!ins

and (allerstein !now that we may forget about history, but history will

not forget about us"

B)U*+ *UI-.S

John Evans Professor of International History and

Politics, Northwestern University



ABOUT TH+ AUTHO)S

IA-U+# (A##+)ST+I- is /irector of the $ernand Braudel *enter for the

Study of +conomies, Historical Systems, and *i&ili0ations, and

/istinguished 1rofessor of Sociology, at Binghamton Uni&ersity" 1resident

234456478 of the International Sociological Association, he chaired the

.ulben!ian *ommission for the )estructuring of the Social Sciences in344964:, which led to the publication of its )eport, Open the Social Sciences

2Stanford Uni&ersity 1ress 344;8" He is perhaps most well !nown for his

pioneering theoretical wor! on the world<system, notably his The Modern

WorldSyste!, 9 &olumes 2Academic 1ress 34=5, 347>, 34748" His recent

boo!s include "eopolitics and "eoc#lt#re 2*ambridge Uni&ersity 1ress 34438

and Unthin$in% Social Science& The 'i!its of Nineteenth(ent#ry Paradi%!s

21olity 34438"

T+)+-*+ K" HO1KI-S is the founder and long<time /irector of the

.raduate 1rogramme in Sociology 2world<historical change8 at

Binghamton Uni&ersity" He is also a member of the +?ecuti&e Board of

the $ernand Braudel *enter for the Study of +conomies, Historical

Systems, and *i&ili0ations" Before going to Binghamton, he taught at*olumbia Uni&ersity and the Uni&ersity of the (est Indies" He is co<

author of WorldSyste!s )nalysis*

@OH- *AS1A)IS is Associate 1rofessor of Sociology at Binghamton

Uni&ersity" .+O).I " /+)#U.IA- is Assistant 1rofessor of Sociology at

-orthwestern Uni&ersity" )I*HA)/ #++ is Scientific Secretary of the

.ulben!ian *ommission for the )estructuring of the Social Sciences" The

remaining authors < SATOSHI IK+/A, SH+I#A 1+#IO-, THOAS )+I$+) ,

@AI+ SU/#+) and $A)UK TABAK < are all )esearch Associates of the $ernand

Braudel *enter"



THE AGE OF TRANSITION

Tra+ectory of the WorldSyste!, -./010/

(oordinated 2y

Terence K" Hop!ins and

Immanuel (allerstein

with

@ohn *asparis

.eorgi " /erlugian

SatoshiI!eda

)ichard #ee

Sheila 1eli00on

Thomas )eifer

@amie Sudler

$aru! Taba!

+/ BOOKS

'ondon 3 New Jersey

1#UTO 1)+SS AUST)A#IA



The )%e of Transition was first published in 344; byed Boo!s #td, = *ynthia Street, #ondon -l 4@$, UK, and

3;: $irst A&enue, Atlantic Highlands, -ew @ersey >==3;, USA,and in Australia and -ew ealand by 1luto 1ress Australia,

1O Bo? 344, #eichhardt, -S( >5>, Australia

*opyright C $ernand Braudel *enter for the Study of+conomies, Historical Systems, and *i&ili0ations, 344;

*o&er designed by Andrew *orbett

Typeset in onotype .aramond by #ucy orton, #ondon S+3

1rinted and bound in the United Kingdom

by Biddies #td, .uildford and King%s #ynn

All rights reser&ed A catalogue record for this

boo! is a&ailable from the British #ibrary

#ibrary of *ongress *ataloging<in<1ublication Data

Hop!ins, Terence K"The age of transition D traEectory of the world<system, 345:6>:

Terence K" Hop!ins and Immanuel (allerstein with @ohn *asparis "" " Fet

al"G" p" cm"

Includes bibliographical references and inde?" ISB- 3<7:;54<594<" 6ISB- 3<7:;54<55><9 2pb!"8 3" +conomic history6345:< " *apitalism 6History6>th century" 9" +conomic forecasting" 5" *ompetition,International6 History6>th century, I" (allerstein, Immanuelaurice, 349><" II" Title" H*:4"H;95 344=99>"4%>5:6dc> 4;<3;:5;

*I1

ISB- 3 7:;54 594 HbISB- 3 7:;54 55> 9 1b

In Australia

ISB- 3 7;5>9 >9 3



*ontents

#ist of Tables and $igures &u

1reface i?

3 The (orld<SystemD Is There a *risisTerence 4* Hop$ins and I!!an#el Wallerstein

3

Part I The Institutional Vectors, 194!9"

The Interstate SystemTho!as 5eifer and Ja!ie S#dler 39

$rom 345: to 34;==9D The *reation of the *old (ar Structure ,6 $rom 34;==9 to 344>D *hanges in the Interstate

System 07

9 (orld 1roduction

Satoshi I$eda 97

+?pansion, Integration and 1olari0ation .1

The +?panding )ole of Transnational *orporations .7 The Industrial Sector SOThe Ser&ice Sector /8US Hegemony and the (orld<+conomy 96*onclusion 97

. The (orld #abour $orce :ar#$ Ta2a$

87

1a? Americana and the .lobal Spread of Taylorism -1The .lobal )each of Taylorism -9 *hanging odes of +?pansion of *apital and #abour

*ontrol 16 The +?panding /ominion of SemiproletarianHouseholds 109



(orld Human (elfareSheila Peli;;on and John (asparis 33=

$rom 345: to 34;==9D The Apogee of the (elfareState 8 $rom 34;==9 to 344>D The (elfare

State under Attac! 60

The Social *ohesion of the States

"eor%i M* <erl#%ian 14#

$rom 345: to 34;==9D The Time of Uni&ersal/eli&erance ,.8 $rom 34;==9 to 344>D The Time

of Undoing 159

Structures of Knowledge

5ichard 'ee

3=7

$rom 345: to 34;==9D The *onstruction of *onsensus 7- $rom 34;==9 to 344>D

*ontradiction andTransformation -6 )

(orld in Transition 01.

Part II O$er$ie%

7 The .lobal 1icture, 345:<4> I!!an#el Wallerstein >4

4 The .lobal 1ossibilities, 344><>: I!!an#el Wallerstein ;

Bibliography 55

Inde? =



&ist o' Ta(les an) $igures

Table 9"3 ./1 share of country groups, 9 countries ;4

Table 9" Absolute gap of per<capita ./1 =>

Table 9"9 Total go&ernment e?penditure as percentage of ./1for si? O+*/ countries =>

Table 9"5 The role of go&ernment as the supplier of ser&ices andas the employer =3

Table 9": Annual growth rate of world trade =3

Table 9"; +?port share of country groups, 9 countries =3

Table 9"= Annual a&erage $/I outflow and share of country andregion =

Table 9"7 Annual a&erage $/I inflow and share of country andregion =9

Table 9"4 Share of a&erage annual $/I inflow in grossdomestic capital formation =5

Table 9"3> -ationality brea!down of the world top :>industrial corporations =5

Table 9"33 -ationality brea!down of the world top :>>industrial corporations =:

Table 9"3 -ationality brea!down of the world top :> ban!s =;Table 9"39 The foreign manufacturing subsidiary networ!s of 93:

largest transnational corporations =;

Table 9"35 (orld industrial concentration ==

Table 9"3: /irect foreign production as a percentage of homemanufacturing ==

Table 9"3; 1roduction share of foreign<owned firms in totalmanufacturing sales ==



Table 9"3= Subsidiaryaffiliate share in total corporate

production and sales =7

Table 9"37 Subsidiary share of T-* production =7

Table 9"34 Intra<firm trade share in total trade for the USA

and @apan =4

Table 9"> $/I<related trade share in total merchandise trade =4

Table 9"3 A&erage annual growth rate of manufacturing

production =4

Table 9" Automobiles produced 7>

Table 9"9 *otton wo&en fabrics produced 73

Table 9"5 Tele&ision recei&ers 7

Table 9": 1roduction of crude steel 79

Table 9"; .rowth of ser&ice sectors measured by share in

./1 79

Table 9"= Share of ser&ice<sector $/I 75

Table 9"7 Ser&ice<sector share in total annual $/I outflow 7:

Table 9"4 Top 3> country shares in the ser&ice e?ports of the

world

7:

Table 9"9> .rowth of the top :> ban!s in the world

7;

Table 9"93 .rowth rate of assets held by top US corporations 7;

Table :"3 Adult literacy and primary<school enrolment, by

0ones of the world<economy

35:

, Table :" +nrolment in secondary school, by 0ones of theworld<economy

35;

Table :"9 +nrolment in tertiary school, by 0ones of the

world<economy

35;

Table :"5 The changing pattern of world grain trade

35=

Table :": Annual percentage growth in world grain

production, in world population, and in worldgrain production per capita

35=

Table ;"3 (orld heroin and cocaine sei0ures

3=5

$igure ;"3 Stability of the share of the &ote among the generic

political currents of twentieth<century +urope

3=:

$igure ;"a Italy, annual rate of murders and

attempted murders, 3773<344>

3=:

$igure ;"b Homicide trend in the USA, 34>><7:



3=;

$igure ;"c The common trend in crimes of theft and

&iolence in (estern societies, 379><34=>

3=;

$igure ;"9 Total $rench ta?es, 3:4=<34;;

3==



1reface

This &olume is a product of the TraEectory )esearch (or!ing .roup of

the $ernand Braudel *enter for the Study of +conomies, Historical

Systems, and *i&ili0ations of Binghamton Uni&ersity"

1articipants in the TraEectory )esearch (or!ing .roup, other than

those who are listed as co<authors of this boo!, who wrote wor!ing

papers in the course of the proEect wereD $arshad Araghi, ShuEi Hisaeda,

Ha!iem and argo -an!oe, and @ose A" ota #opes" In /ecember 344,the .roup submitted its interim findings to a group of scholars who came

to Binghamton for a three<day seminarD Bruce *unnings 2History and

1olitical Science, -orthwestern Uni&ersity8, /a&id .ordon 2+conomics,

-ew School for Social )esearch8, Otto Kreye 2Starnberger Institut,

.ermany8, Saul endlowit0 2(orld Order odels 1roEect, -ew Jor!8,

AleEandro 1ortes 2Sociology, @ohns Hop!ins Uni&ersity8, )obert (ade

2/e&elopment Studies, Uni&ersity of Susse?, UK8, and Boa&entura de Sousa

Santos 2*entro de +studos Sociais, Uni&ersity of *oimbra, 1ortugal8"

Their wise and li&ely comments forced us to reflect upon our arguments

and reorgani0e the structure of our narrati&e" (e greatly appreciate their

willingness to assist us in this way, and are not authori0ed to absol&e them

of their inability to con&ince us about all the errors in direction we may

ha&e been ta!ing" $inally, throughout the proEect, Satoshi I!eda has

ser&ed as Scientific Secretary with diligence and good humour"

The proEect was funded by the @ohn /" and *atherine T" acArthur

$oundation as one<half of a proEect entitled %Hegemony and )i&alry in the

(orld<SystemD Trends and 1rospecti&e *onseuences of .eopolitical

)ealignments, 3:>><>:%" The three principal in&estigators were

.io&anni Arrighi, Terence K" Hop!ins and Immanuel (allerstein" The



other half of this proEect concerns a comparison of the historical patterns of

different past hegemonies and transitions from one hegemonic regime to

another" (e are &ery grateful to the acArthur $oundation, and in

particular to Kennette Benedict, that they were willing to accept our thesis

that, to understand the present dilemmas of the world<system, we had to

start the story circa 3:>>"



3The (orld<SystemD Is There a *risis

Terence 4* Hop$ins and

I!!an#el Wallerstein

The 344>s is a period of great political uncertainty, intellectual unclarity,

and diffuse social fear throughout the world<system" $or some analysts,

this is merely the result of a findesiec$ psychology, compounded by our

coming not merely into another century but especially into another millennium" any other analysts, howe&er, ta!e the e&ol&ing situation as

reflecting much more serious matters" And the latter &iew finds more

resonance in world public opinion"

The first great uncertainty is how we should collecti&ely assess the

period we ha&e Eust li&ed through, 345:<4>" It was in many ways a

remar!able historical period" It was the moment of the most massi&e

e?pansion the world<economy has e?perienced in the whole of the :>><

year e?istence of the modern world<system" It was also the period of the

most massi&e decoloni0ation that has occurred since that of the

Americas in the fifty years between 3==: and 37:, and this time it was

not a decoloni0ation by (hite settlers but by the non<(hite popu<

lations of the world" It was finally the period of an e?traordinarily

intensi&e so<called *old (ar that embraced all the 0ones of the world<system and seemed to end spectacularly with the literal dissolution of

one of its two formidable protagonists"

%(ho won what% is a uestion on the minds of many" And will we

now enter into a new world order, as .eorge Bush once promised us To

Eudge by current reports, it would scarcely seem so" /aily we read a

litany in the newspapers of social disintegration in e&er more parts of the

world 6 the Bal!ans, the *aucasus, Africa, the *aribbean and #os

Angeles, to start with" The long<standing (estern faith in the ine&ita<

bility of progress, the certainty that both greater prosperity and greater

freedom would accrue to e&eryone%s children and children%s children has



The )%e of Transition

been called into serious uestion in recent years" Jet this faith underlay

the rhetoric of the USA 6 its statesmen, policy<ma!ers, and academics 6

throughout the *old (ar" It is in the name of this faith that .eorge Bush

assured us a %new world orderL"

In this &olume, we see! to assess what happened in the world<system between 345: and 344>, in order to ma!e plausible proEections about the

traEectory of the world<system in the ne?t twenty<fi&e to fifty years" The

years 345:64>, howe&er, cannot be appropriately appreciated without

understanding that they are merely the latest period in the long history of

the modern world<system, a historical social system which originated in

the si?teenth century" $or, since then a whole series of institutional

domains ha&e been constructed and reconstructed" These institutions

continued to organi0e peoples% acti&ities in the fifty years since the end of

the Second (orld (ar and, in our &iew, will continue to organi0e them,

perhaps with increasing difficulty, o&er the ne?t twenty<fi&e to fifty years"

(e call these e&ol&ing institutional domains Mectors% of the world<

system, meaning comple?es of processes that pro&ide the continually

e&ol&ing structured framewor!s within which social action has occurred"O&er its historical e?istence the modern world<system, in our &iew, has

de&eloped si? such distinguishable but not separable &ectorsD the inter<

state system, the structure of world production, the structure of the world

labour force, the patterns of world human welfare, the social cohesion of

the states, and the structures of !nowledge"

-one of the si? has 2or, in our &iew, could ha&e8 de&eloped in isolation

from the others" The &ectors are not at all to be thought of as loci of

autonomous forces" They form, rather, the minimum array of interrelated

facets of a single, imperfect, organic whole, each &ector uite dependent

on the others" Any shoc!, or bloc!age, or transformation within any one

of them or among them affects all the others, and usually soon, &isibly

and conseuently"

The interstate system is not something that has always been there" It

was a creation of, and in turn a formati&e element of, the modern world<

system" Its geographic scope and political depth ha&e e?panded in tandem

with the spatial e?pansion of the a?ial di&ision and integration of the labour

processes forming its increasingly comple? production system" It has

been constructed of many pieces, including diplomacy and the rules

go&erning e?traterritoriality, the protocols go&erning interstate treaties, and

the &arious trans<state institutions" But abo&e all, the interstate system is a

matri? of reciprocal recognitions of the 2limited8 so&ereignty of each of

the states, a framewor! that has been 2more or less8 enforced by the

stronger on the wea!er and by the strong on each



Terence 4* Hop$ins and I!!an#el Wallerstein

other" Occasionally, but repeatedly, one power has been able to gain such a

strong position that we can spea! of its e?ercising hegemony o&er the

system" (hen the interstate system is, rather briefly, in a phase of

hegemony 2as opposed to the more usual situation of a balance of power, or

great power ri&alry8, one state credibly and continuously demonstrates its%leadership% by shaping systemic structures, and ha&ing its systemic policies

almost always accepted not merely by wea!er states but by other strong

ones as well" The hegemonic power has more say than that merely ensured

by na!ed power, yet less than that which would be guaranteed to a fully

legitimate authority" It is in short a hegemonic power in a world<economy,

and not a world<empire" After 345:, the USA was in Eust such a situation of

power"

The interstate system established the framewor! within which wars ha&e

so far been fought" But e&en more importantly, it created the framewor!

that has constrained and shaped the wor!ings of the ostensibly free

2world<8mar!et through which the world production system presumably

has been operating" In the modern world<system, world production has

been carried on by the rules of the capitalist world<economy in which theinstitutionali0ed primary consideration of those who own or control the

means of production is the endless accumulation of capital" -ot all

producers ha&e necessarily been indi&idually so moti&ated, of course 2nor

ha&e they always acted in accordance with transforming wealth into capital

as their obEecti&e8' but those which were in fact so moti&ated ha&e

recurrently sur&i&ed and flourished better than those which were not" (e

call it a %world% production structure because, across the %world% in which it

occurred 2today the entire globe, but in the beginning only part of the

globe8, there has e?isted a networ! of commodity chains which lin!ed

production acti&ities across multiple political Eurisdictions, such that almost

ne&er could any single state place under its Eurisdiction all the processes of

production needed that are integral to any of the maEor economic acti&ities

located within its borders" -ecessarily, then, the interstate relations

go&erning the lin!ages affected in important ways the profitability of any

production acti&ity in that state%s domain" 1rofitability has therefore been a

function only in part of world mar!et competiti&ity 2the bu00<word of the

344>s8" It has always been at least as much a function of the degree to

which producers, with the aid of states, ha&e been able to create conditions

of relati&e monopoli0ation of factors of production" And while old

monopolies ha&e always been disintegrating under the pressure of new

entrants 2from anywhere in the world<economy8 into a 2profitable8 mar!et,

those with a combination of much accumulated capital, entrepreneurial

s!ill, and e?tensi&e political access ha&e always 2or almost



5 The )%e of Transition

always8 been able to create new monopolies, which again lasted for a

while" Such global partial monopolies are often referred to by the less

contentious name of %leading industries% and it is the repeated creation of

such industries that has accounted for the repeated great e?pansions of the

world<economy, Eust as their e?haustion has accounted for the stagnations"The process of accumulating capital on a world scale reuired the

continual de&elopment of the world%s forces and means of production" This

process was a &ery une&en one, and thereby continually reproduced and

deepened what we call the core<periphery 0onal organi0ation of world

production, the basis of the a?ial di&ision and integration of labour

processes" The construction historically of the capitalist world<economy as

world<system has entailed the establishment of commodity chains of

production e?tending bac!wards from the organi0ing centres, at first all in

(estern +urope, into what were areas 2and peoples8 initially e?ternal to the

relational processes and structures forming the growing world<system"

This systemic and ongoing peripherali0ation, within the capitalist world<

economy, of most of the world%s peoples and production processes and the

location of core processes in a few centres accounts in our &iew for themassi&e and ongoing ineualities of well<being among and within the state

Eurisdictions of the system"

Accordingly, Eust as there ha&e been stronger and wea!er states 2gauged

by military strength and political efficacy8, so there ha&e been core 0ones

that ha&e tended, by definition, to monopoli0e the high<profit monopolies

while the peripheral 0ones housed production processes operating within

truly competiti&e mar!ets and hence characteri0ed by truly low<profit

acti&ities" This relational ineuality underlay the continuing political

tensions among and within the states of the system" It is not one that can

e&er be o&ercome as long as the endless accumulation of capital remains

the primary goal, since the endless accumulation of capital reuires the

e?istence of high profit 2necessarily largely monopoli0ed8 economic

acti&ities" To the e?tent that e&eryone would see! to engage

simultaneously in these high<profit acti&ities, the boat would become

%o&erloaded% and accumulation would dry up" Hence the une&en distribution

of rewards has been the necessary pendant of capital accumulation, and is

fundamental to the system"

This reuirement of une&enness has been integral to the continuing

formation of the world labour force" If the ways in which labour was

remunerated would e&erywhere ha&e been the same, profit le&els would

ha&e been e&erywhere the same and therefore low" (hile monopolistic

loci in the e?tended commodity chains may themsel&es ha&e had relati&ely

small and highly paid wor!forces, their high le&els of profit



Terence 4* Hop$ins and I!!an#el Wallerstein

ha&e been dependent on the much lower wage le&els of those who

produced the multiple inputs, and the inputs to the inputs, that they utili0ed

in these loci" The world labour force has thus constituted a &ested

hierarchy within the multiple commodity chains"

Hence, as we loo! across the world at those segments of the commoditychains we call peripheral, we find modes of remuneration of labour where

the bargaining power of labour has been politically constrained more

strongly than in the core 0one" One maEor mechanism of such constraint

has been coerced employment 2ranging from sla&ery to debt controls to

&arious !inds of %customary% arrangements8" Another maEor mechanism,

less ob&ious and less &isible, has been the construction of forms of

householding that reuire significant inputs of unremunerated labour to

supplement wage income, thereby permitting reductions of labour costs to

the employers of wage wor!ers 2which in effect in&ol&es a transfer of

household members% surplus<&alue to the employers8"

The world labour force, howe&er, has been structured not only by the

multiple employers and the states" The wor!ers ha&e themsel&es been

in&ol&ed in structuring the labour force 6 by syndical action, bymigration, by the creation of solidarities and mutualities" O&er time, the

interacting pressures ha&e freuently led to situations in which options for

employers ha&e been limited, reduced or transformed" One maEor form this

has ta!en has been the putting forward by the wor!force of new !inds of

demands on state structures, which in turn ha&e affected the ability of the

states to operate geopolitically and, in particular, to house highly profitable

economic acti&ities" There has grown up a system of %social wages% that has

to be ta!en into account in calculating the real remuneration of wor!ers"

The three maEor fields in which such social wages ha&e been located are

education, health, and a generic field we may call redistributi&e allocations

2such as pensions, unemployment payments, euity payments8" The

uestion that is always pertinent, of course, is whether there has been real

redistribution from capital to labour, or simply a reshuffling of income

already obtained by wor!ers from one form to another"

It is only when we calculate all the forms of income that we can assess

the &ector of human welfare, but this &ector is crucial in terms of the

political stability and economic efficacy of the world<system" -ot only is

the true spectrum of human welfare a maEor e&ol&ing condition but so is

the percei&ed spectrum" The une&enness of world producti&e acti&ity has

been reflected, e&en e?aggerated, in the une&enness of world welfare

outcomes 6 which ha&e &aried geographically, cyclically and historically"

The belief in long<term welfare con&ergence has been a



; The )%e of Transition

maEor ideological underpinning of the world<system" But the perception of

con&ergence and of its con&erse, polari0ation, has been a function in large

part of what has been measured, when, and by whom" One of the secular

shifts in the world<system has been the increased collecti&e ability to

measure con&ergencepolari0ation of world welfare effecti&ely" And theresults of such a more careful loo! ha&e not always been close to what

official &iews ha&e argued"

The realities of interstate conflicts plus worldwide competition for

profits, plus the constant attempts to mould a world labour force that would

be a&ailable, efficient but not too costly, plus the increasing attenti&eness to

the di&erging uality of world welfare ha&e added up to a tumultuous

world<system, ri&en by constant &iolence and rebelliousness" (hat has

held the system together more than anything else amidst this tumult ha&e

been the historic efforts to create e&er more cohesi&e state structures and

the elaboration of structures of !nowledge that ha&e ser&ed to legitimate

the system"

The state structures ha&e been getting steadily stronger for :>> years,

their go&ernments ha&ing sought to ensure internal order by an effort tomonopoli0e the means of &iolence" They ha&e sought to strengthen control

of their borders, defining who and what may pass in either direction" To be

sure, no state has e&er achie&ed total internal or e?ternal control" And uite

ob&iously some states ha&e historically done much better in this regard

than others 6 this is one aspect of what we mean by distinguishing

between stronger and wea!er states" But almost all states ha&e been part of

the long<term secular trend of strengthening the state, albeit with many

short<term re&erses of course"

The abilities of states to enforce order has been a function of their

ability to command resources 2ta?ation8 and therefore personnel 2bureau<

cracy8, and of the acceptance of their rule because of ser&ices pro&ided

2security, infrastructure, e?pansion of human welfare le&els8" In all of this,states ha&e not of course been %neutral% arbiters 2far from it8, but all

go&ernments ha&e regularly claimed to be both effecti&e managers of

%national interests% and guarantors 2along with the go&ernments of other

states8 of the long<term stability of the world<system and its o&erall

capacity to ensure the endless accumulation of capital"

.o&ernments ha&e increasingly utili0ed the glue of social cohesion in

their efforts to achie&e these obEecti&es, and the maEor &ehicle of this

cohesion has been what we call nationalism 2or patriotism8" The basic

theme of nationalism is that no matter how di&erse the social situations and

interests of those located within the state, they are 2or should be8 unified

affecti&ely by a common 2and somewhat mythical8 consanguinity andor

ascripti&e allegiance, thereby legitimating the state%s rule"






which we ha&e Eust alluded in the discussion of the role of nationalism in

strengthening the social cohesion of the states" #iberalism%s success as a

mode of containing discontent and tumult was a direct function of the

e&idence its protagonists could present of incremental social %progress%, a

thesis they were able to support uite well in the nineteenth century, butwhich has been much more difficult to argue consistently in the twentieth

century"

-onetheless, the combination of nationalism plus scientism

uni&ersalismliberalism as the main elements in the geoculture of the

world<system ser&ed for a &ery long time to obscure the tensions of the

world<system and thereby in effect to hold them in chec!" The uestion

today isD Are these tensions still in chec! Or is there a crisis in the world<

system

To address this issue, we must first note one other feature of this

world<system, a feature it has in common with all other historical

systems" A historical system is both systemic and historical" That is to say,

it has enduring structures that define it as a system 6 enduring, but not of

course eternal" At the same time, the system is e&ol&ing second by secondsuch that it is ne&er the same at two successi&e points in time" That is to

say, the system has a history, and it is what it is at any gi&en moment not

only because of its enduring structure but because of its particular 2indeed

uniue8 historical traEectory"

Another way to describe this is to say that a system has cyclical

rhythms 2resulting from its enduring structures as they pass through their

normal fluctuations8 and secular trends 2&ectors which ha&e direction,

resulting from the constant e&olution of the structures8" Because the

modern world<system 2li!e any other historical system8 has both cycles

and trends < cycles that restore %euilibrium% and trends that mo&e %far

from euilibrium% 6 there must come a point when the trends create a

situation in which the cyclical rhythms are no longer capable of restoring

long<term 2relati&e8 euilibrium" (hen this happens, we may tal! of a

crisis, a real %crisis%, meaning a turning point so decisi&e that the system

comes to an end and is replaced by one or more alternati&e successor

systems" Such a %crisis% is not a repeated 2cyclical8 e&ent" It happens only

once in the life of any system, and signals its historical coming to an end"

And it is not a uic! e&ent but a %transition%, a long period lasting a few

generations"

In the terminology of the new science, this is the moment when the

system bifurcates' that is, when the fluctuations away from euilibrium

are so great that the cur&e flies off to form one or more new orbits" There

is always more than one possibility at this point, and there is no way of

determining in ad&ance what the outcome2s8 will be" All one can



Terence 4* Hop$ins and I!!an#el Wallerstein 4

do is assess the li!elihood that we are approaching a bifurcation 2or are

already in the midst of one8"

This is the obEect of the research design for this boo!" (hen we loo!

at the period 345:<4>, we immediately notice a few things about it" It

starts out as a period of incredible global economic e?pansion whichthen slows down" It starts out as the period of unuestioned US

hegemony in the world<system and then this hegemony begins its decline"

(e ha&e identified the moment of shift for each of these two phenomena as

34;==9"

1eriods of global economic e?pansion and contraction are sometimes

referred to as Kondratieff cycles" They typically ha&e lasted 5:6 ;> years,

and are sometimes alluded to by historians when they spea! of an era of

prosperity or one of great depression" (e belie&e that a Kondratieff

e?pansion or A<phase began circa 345: and reached its pea! in 34;==9,

whereupon it was followed by a stagnation or B<phase which is continuing

into the 344>s" If we ha&e stopped the story at 344>, it is partly because

of the geopolitical chronology and partly because we did this research as

of 344>"Hegemonic cycles are far longer than Kondratieff cycles" It ta!es a

long time for one maEor power to win a competition with another maEor

power such that it can become fully hegemonic" As soon as it does so, it

see!s to use its hegemonic position to prolong its power" -onetheless, it

is in the nature of the capitalist world<economy as a historical system that

the &ery efforts made to prolong the power themsel&es tend to undermine

the base of the power, and thus start the long process of relati&e decline

2and, of course, of relati&e rise of other powers aspiring to establish a

new hegemony8"

The erstwhile hegemonic power, .reat Britain, began its decline in

the 37=>s, and from that moment the USA and .ermany began their

long competition to become the successor world hegemonic power" After

two world wars 2really one long one with some interruptions8, the USA

won unconditionally in 345:" The real era of full hegemony began then,

but already by 34;==9 US power had begun to erode"

Hence we see 34;==9 as the pea! of two cyclical cur&esD the shorter

Kondratieff cycle running from 345: to 344, and the longer hegemonic

cycle running from 37=9<2>:>:>8" This by itself is interesting, but in

terms of the modern world<system is not unusual" )ather, it seems to

reflect the normal cyclical wor!ings of the system" The uestion we wish

to pose, howe&er, is thisD (as 34;==9 also the pea! of a still longer

cur&e, the life cur&e of this historical system, running from circa 3:>> to

some point in the relati&ely near future The life cur&e of a historical

system is not bell<shaped, li!e Kondratieff cycles




or hegemonic cycles" )ather, the cur&e of a historical system tends to

go upward monotonically until it reaches its pea!, and then to fall with

relati&e precipitousness" It is not the graph of a cyclical rhythm but that of

the combination of secular trends"

How can we !now the answer to such a uestion Our methodology,we thin!, is uite straightforward, and spea!s directly to the uestion

posed" (e ha&e studied the si? &ectors pre&iously outlined" (e ha&e

sought to describe each of these &ectors of the world<system as a whole

twice < once for the period 345:<34;==9 and once for the period

34;==9<344>" (e ha&e found considerable differences between the

two periods for each of the si? &ectors" This e?ercise constitutes *hapters <

= of this boo!"

(e ha&e then tried 2in *hapter 78 to put the pieces together into one

encompassing whole" In comparing the second or B<period findings

with those of the first or A<period, we ha&e as!ed how much of the

changes can be accounted for by what we !now of the recurrent wor!ings

of Kondratieff cycles and hegemonic cycles" Once we ha&e thereby

%eliminated% the changes attributable to these two cyclical rhythms, howlarge a residual is there (hat !inds of changes in the second period

cannot be accounted for &ia either Kondratieff or hegemonic cyclical

rhythms (e ha&e found some significant ones" And we then as! how

li!ely it is that such changes might be the sign of %crisis%, of the begin<

ning of a bifurcation

$inally, in *hapter 4, we try to proEect a middle<term future 2344><

>:8" The logic of our e?ercise is as follows" If indeed 34;==9 is also

the beginning of a systemic crisis, of the precipitate downturn, what

might we e?pect d#rin% the bifurcation < that is, in the middle run The

short answer is disorder, considerable disorder" But we try to gi&e this

proEected disorder more specific characteristics, to elaborate the picture

and to suggest what we see as some of the real historical alternati&eN before us"

If the outcome is not determined in ad&ance, and hence cannot be

predicted, that does not mean we must sit by helplessly waiting for the

hurricane to en&elop us" As in any !ind of real historical crisis, there

e?ist real choices that can be made" Those who discern them lucidly

and act on them with concerted effort are less li!ely to lose the out

come they prefer than those who put their faith in the unseen histories

hand" It is to help in this effort that this boo! is written"

Documents

Ch 1 Preface