The Global Gamble: Washington's Faustian Bid for World Dominance [Paperback]

This book was written in 1999 and predominantly deals with the US' dominance and manipulation of the international financial system. The book's most significant contribution is the documentation of the Asian currency crisis that saw the virtual destruction of East and South East Asia's "Tiger economies." The currency crisis was sold to western audiences as the result of Asian crony capitialism and corruption. Gowan however identifies deliberate currency manipulation by US based hedge funds to create a run on the targeted currencies. These catastrophic events were followed up by intervention by the IMF and World Bank, ostensibly to stabilise the now fragile economies. However, the IMF 'assistance' packages however simply accelerated the collapse, leaving the economies of Thailand, South Korea and Indonesia in ruins and lumbered with impossible to repay debts of IMF aid. In the firesales of state assets that followed US and European banks and companies cleaned up, gaining control of these potentially threatening economies.

Gowan traces similar acts to undermine the viability of the economies of West Germany, Japan (a particularly threatening target), Russia and Latin America using the mantras of 'trade liberalisation', 'free markets' and globalisation. The aim of course is to entrench the US' global economic dominance, plunder the wealth of rich countries for US corporations, create global monopolies and expand debt (to feed to ever growing demand of the US deficit). Gowan's documentation of these processes is meticulous and backed up with reliable references and financial data. He also touches on other topical issues, such as the attack on and blockage of Iraq and the expansion of NATO, however it is the documentation of the processes of economic imperialism that makes this book such a valuable reference. Gowan is also a very concise writer who doesn't indulge in punditry, keeping the tone clear, easy to read and academic. Highly recommended.

'Globalization' - what did it mean? What was it really about? The answers one provides to those two questions constitute a litmus test of one's political affiliation. However, these questions are also valid subjects for dispassionate academic research - and Mr. Gowan's book is one of the best examples of it. Whilst it may not alter an individual's view of the globalization phenomenon, it will certainly reinforce the positions of its critics.

The 'Global Gamble' is divided into two parts. The first establishes an intellectual framework for understanding and analysing international economic developments in the quarter-century following the collapse of the Bretton Woods system. The second is a collection of articles scrutinizing some of the key political and economic topics of the 1990s, such as the Gulf War, neoliberalism in Eastern Europe and the expansion of NATO. The overarching theme of the two halves is provided in the subtitle of the book: the USA's attempt to rule (or more accurately, misrule) the planet.

The most valuable idea in 'The Global Gamble' - and in some respects, its core subject, is the 'Dollar-Wall Street Regime' (DWSR). This phrase is coined by the author to describe an international monetary system in which the American currency serves as the underlying standard of payment (akin to the role played by gold and the pound sterling in the past) and where finance capital is increasingly unfettered and thus capable of shifting on a massive scale from place to place at short notice, leaving economic and social devastation in its wake. It is the author's contention - supported by extensive reasoning in the form of 'backward mapping' - working from actual outcomes to derive the actual intentions of policymakers, that this regime has been established, managed and manipulated by American policymakers to pursue a set of élite economic interests at the expense of most of the world's population. Major targets of the regime include not just swathes of the Third World, but also wealthy commercial rivals such as South Korea, Japan and the European Union. In short, Washington's economic policy is 'global neo-mercantilism'.

The second part of the book deals extensively with Eastern Europe (which is not surprising, given that European politics is the author's specialization), but includes one of the finest articles ever written about the Gulf War and the recent political history of Iraq. Unlike other analyses of these regions that tend to emphasize indigenous inadequacies and ignore external interference, 'The Global Gamble' focuses on the challenges confronting the local governments in the face of considerable pressure from the Western powers. This atypical approach reveals the actual (as opposed to the ostensible) motivations of the occidental states.

Though an excellent work about issues which have only increased in importance in the decade since this book was published, 'The Global Gamble' is not without shortcomings. The largest lacuna is its general oversight of the two great mainland Asian powers - China and India, whose relative insulation from the DWSR would serve as an interesting case study in escaping globalization. Latin America's experience of two 'lost decades' also deserved greater coverage, although the author rightly notes that its debt crisis was the testing ground of the neoliberal program that was later inflicted on other parts of the world. Overall, however, it is the complexity of the subject - the international financial system and its political dimension - that makes 'The Global Gamble' rather ponderous: a few specific case studies in the first part would have made it easier to follow.

At the close of what future generations may well refer to as 'the dark decade', there is a tendency in the Western world to look back at the 1990s with nostalgia. 'The Global Gamble' is the necessary antidote to this specious view, and it serves to remind us that that decade (which witnessed the ruin of Eastern Europe and Russia, as well as the Asian financial crisis) was the prelude, not the opposite, of what followed. Taking a wider historical perspective, the author concludes that the postwar 'Golden Age' of welfare capitalism in Western Europe was not the norm, but the exception - an exception brought about by the Communist challenge in the East. Thus, the collapse of that challenge resulted in a reversion to the norm - namely to the plutocratic capitalism of the Victorian age and the inter-war period, characterized by low economic growth and high income inequality. This realization constitutes the last sombre lesson of a sobering read.