The Conspiracy is Capitalism's Reviews > The Divide: A Brief Guide to Global Inequality and its Solutions

Finally, a comprehensive intro to global inequality!

Preamble:
--It’s a relief to finally retire Chang’s Bad Samaritans: The Myth of Free Trade and the Secret History of Capitalism as my go-to recommendation introducing global inequality. That book is an infuriating mix of the brilliant (free trade = “kicking away the ladder”) and the banal (post-WWII Bretton Woods era US empire = “enlightened hegemony”). We can do better for an intro, leaving that book as an excellent supplementary book to unpack and test yourself with.
--I would like to have one single book to toss in Steven Pinker’s smug, liberal face (“liberal” = cosmopolitan capitalism). Pinker's The Better Angels of Our Nature: Why Violence Has Declined is the Atlas Shrugged for Bill Gates; I was chucking more books at Pinker than he is worth.
...However, for those already conditioned by opposing frameworks (in this case, liberalism/cosmopolitan capitalism), we cannot underestimate how much additional work is required to re-evaluate when foundational concepts have differing definitions/assumptions. Hickel's book is a better intro for those on the fence (default liberals) rather than devoted liberals (see Chomsky's Necessary Illusions: Thought Control in Democratic Societies).
...Some editions of Hickel's book (ex. ones with the subtitle Global Inequality from Conquest to Free Markets) also seem to be missing citations (publisher's fault I assume), so check that your version has citations/endnotes. I also posted feedback to a negative review in comment #18 in the comment section below.

--I delayed reading this book because I wanted to prioritize Global South scholars and I was getting into their intermediate works:
i) Vijay Prashad’s historical The Darker Nations: A People's History of the Third World and The Poorer Nations: A Possible History of the Global South.
ii) Economists Utsa and Prabhat Patnaik: the accessible The Agrarian Question in the Neoliberal Era: Primitive Accumulation and the Peasantry and the grand theory/history Capital and Imperialism: Theory, History, and the Present.
...Then, I read Hickel's sequel Less is More: How Degrowth Will Save the World and was blown away by the breadth of Hickel’s accessible synthesis (including the crucial framework of decolonization that synthesizes the exact Global South writers I was exploring!), so I immediately followed up with this.

Highlights:
--Why are some countries so poor? Once you go through the list below, you will realize the best way to obscure the answers is to systematically avoid how we got here (history) and cui bono? (“who benefits?” i.e. power relations).
…Mainstream (Neoclassical) Economics is an ideal cover (i.e. convenient, idealized thought-experiments, ex. Rostow’s “Stages of Economic Growth and Development” where development is just technical, not political), as is prejudice.

1) Colonialism:
--From 1500, several European states began massive wealth accumulations from abroad (New World colonialism i.e. Columbus 1492, Cortez 1519) and at home (Enclosures 1500-1800). The colonial loot in gold/silver enabled sustained trade with China/India (which were the centers of traded goods), while the colonial raw materials eventually fed domestic industrialization (set up by the Enclosures creating the land + labor markets).
…Note: distribution is important: rising wealth was not redistributed, thus there was actually deteriorating health for the masses due to the Enclosure’s violent dispossession. So, Asia’s life expectancy remained relatively higher into 1800s, when finally after some 350 years of struggle European organized labor won some concessions (esp. public sanitation). See: Perilous Passage: Mankind and the Global Ascendancy of Capital.
…So, if it was this bad at home despite incoming wealth, imagine the decline in the colonies! Indian/Chinese traded goods were surpassed not by “free market” competition, but by violent conquest. “Unequal treaties” imposed after wars meant no autonomy to protect domestic industries: first deindustrialization, then perpetuated by preventing “infant industry protection”; meanwhile, the industrialized West protects its own industries (US was the most protectionist country from 1860s-1930s)… thus, “kicking away the ladder” popularized in Chang's Bad Samaritans: The Myth of Free Trade and the Secret History of Capitalism (but now you know to level-up with the Patnaiks!).
…combined with devastated public/communal support set the conditions for famines: Late Victorian Holocausts: El Niño Famines and the Making of the Third World
--The famous British colonialists Cecil Rhoades sums up the logic:

I listened to the wild speeches, which were just a cry for ‘bread! bread!’ and on my way home I pondered over the scene and I became more than ever convinced of the importance of imperialism … My cherished idea is a solution for the social problem, i.e., in order to save the 40,000,000 inhabitants of the United Kingdom from a bloody civil war, we colonial statesmen must acquire new lands to settle the surplus population, to provide new markets for the goods produced in the factories and mines.

2) Coups:
--The long struggle for decolonization culminated in the 1950-70s, when the global gap from colonization finally began to narrow. Developmentalism (esp. Latin America)/African Socialism/Arab Nationalism/Non-aligned Movement (NAM)/G77 and perhaps the South’s peak New International Economic Order (NIEO) challenged “kicking away the ladder” with national sovereignty (rebuilding social services and industrialization) and South-South cooperation: The Darker Nations: A People's History of the Third World.
--Meanwhile, the new post-WWII empire (the US) was trying to establish global hegemony by responding with coups, hiding behind Cold War propaganda (a progression from direct colonialism). The CIA (a.k.a. “Capitalism’s Invisible Army”) got busy:
-accessible intro! Washington Bullets: A History of the CIA, Coups, and Assassinations
-The Jakarta Method: Washington's Anticommunist Crusade and the Mass Murder Program that Shaped Our World
-Killing Hope: U.S. Military and C.I.A. Interventions Since World War II
-The Management of Savagery: How America's National Security State Fueled the Rise of Al Qaeda, ISIS, and Donald Trump

3) Debt and SAPs:
--Geopolitically, Western capitalism (i.e. G7) looked to diffuse the South’s challenge (i.e. G77’s NIEO) with the only logical method by rulers: divide-and-rule. Unlike Western leftists (ex. Harvey’s A Brief History of Neoliberalism) citing the origins of Neoliberalism on Western stagflation (in particular Western organized labor challenging profits), Prashad (and the Patnaiks) expands the origins to the South’s challenge. Of course, there is also US losing its balance of payments surplus due to war spending (terrorizing Korea and Vietnam), leading to the dismantling of post-WWII Bretton Woods (Hudson's infamous Super Imperialism: The Origin and Fundamentals of U.S. World Dominance, as well as Varoufakis' The Global Minotaur: America, the True Origins of the Financial Crisis and the Future of the World Economy).
--The OPEC crisis, originally seen as a moment of South strength, was reversed by the US securing OPEC petrodollar recycling (OPEC can invest their surpluses in US banks). US banks then lent this to South governments (seen as safe, with stagflation at home in the West) who needed credit for industrialization and high oil prices. The Volcker Shock where US spiked interest rates made such debts unpayable (Third World Debt Crisis).
--Instead of defaults to resolve unpayable debts, banks were bailed out (surprise?) and the IMF/World Bank were re-purposed to enforce Structural Adjustment Programs (SAPs) to in effect re-colonize the debtor states to repay unpayable debts (a progression from coups). In essence, public assets and social spending were retroactively set as collateral for the unpayable loans. Dismantling the state with SAPs makes defaults less optimal, since the state is so dependent it cannot quickly recover (The Poorer Nations: A Possible History of the Global South).
...To unpack the morality of debt: Debt: The First 5,000 Years

4) Trade:
--We have seen how unequal trade (“kicking away the ladder”) has been central since colonialism. The 1995 WTO cemented the renewed systematic re-colonization of the South, much of which have through IMF/World Bank SAPs been reduced to exporting cash crops (while the West has heavily-subsidized industrial agriculture!). By controlling world food supply, Michael Hudson calls the World Bank the most evil organization in modern history.
--Intellectual property: patent monopolies (so much for free market) have been extended from 13 years (end of 19th century) to 20 years under WTO’s TRIPS Agreement, and have switched from only patenting the process to patenting the product (thus, preventing innovations in new processes, e.g. more affordable generic drugs). The author gives the murderous consequences this has had to the AIDS epidemic.
--Protests against WTO have been bypassed with bilateral trade agreements: NAFTA, for example, has escalated foreign investor protection, where foreign investors/corporations can sue States in international corporate courts for regulations that threaten anticipated profits (Shadow Courts: The Tribunals that Rule Global Trade). Thus, we have another progression of colonization, where anonymous global investors act as a “virtual Senate”.
--Just as foreign aid inflows is outweighed by outflows from unequal trade/capital flight/debt repayments/repatriations, domestic “corruption” is peanuts compared to the seemingly-benign commercial tax evasion. Hot money (speculation, since regulations like capital controls have been dismantled, so capital is as free as can be in the digital age while labour is trapped by militarized borders) and trade mis-invoicing/transfer mis-pricing (transnational corporations taking advantage of tax havens) are the latest progressions in colonialism.
-Crises in trade and finance: And the Weak Suffer What They Must? Europe's Crisis and America's Economic Future
-The Triumph of Injustice: How the Rich Dodge Taxes and How to Make Them Pay
-Treasure Islands: Uncovering the Damage of Offshore Banking and Tax Havens

5) Environment:
--This is elaborated in the sequel Less is More: How Degrowth Will Save the World (paired it with A People’s Green New Deal), which I read first and was so impressed I immediately picked up this book. Before we leave, we should point out land grabs, which escalated from speculations on food prices creating a bubble (such commodities were seen as more stable when the mortgage crisis was unfolding). Another factor is top-down protection of “environmental services”/carbon trading, and the corporations taking advantage of this.

--In conclusion, the first step towards actual change is accurately diagnosing the problem. The author concludes that the liberal charity paradigm (i.e. aid NGOs) is part of the problem because it hinders this diagnosis by hiding the power structures and actors listed. Once these are exposed, we can also see accompanying struggles that need to be popularized (justice paradigm). I highlight the decolonization framework in reviewing Less is More: How Degrowth Will Save the World.