A NEW REGIONAL AND GLOBAL ORDER

The structural crises of the capitalist system have significantly undermined the hegemony of capital. The task of reconstruction is both urgent and unavoidable, and particular sectors must assume a central role in this process.

Protesta obrera y estudiantil en Córdoba en 1969 que marcó un hito en la lucha contra la dictadura y el ajuste en Argentina.

They walked on red carpets through hallways lined with famous paintings. The weather was moderately mild, but the heating remained on year-round, regardless of the outside temperature. The attendees were elegantly dressed: tuxedos, an abundance of ties, and a few bow ties. All in black and white — it was not an era that encouraged innovation in fashion, especially under those circumstances.

Few people realized that their daily economy, social relations, and overall way of life were far more influenced by meetings held in the state of New Hampshire than by the city or country in which they were born. That small northeastern U.S. state, once one of the thirteen rebellious colonies in the War of Independence against the British Crown, contains a modest area where the Mount Washington Hotel still stands today, surrounded by lush green lawns.

Built between 1900 and 1902 by coal magnate Joseph Stickney, the grand hotel became home to hundreds of economists, politicians, and diplomats for over 20 days during the summer of 1944. That massive brick structure, coated in pristine white plaster, is now the second most visited tourist attraction in the state — following the famous ski slopes.

Delegations from 44 countries gathered at the hotel to define the future of global capitalism, while Europe, Africa, and Asia bled under the weight of gunpowder and bloodshed. Officials and technicians from the Allied countries in World War II convened to design an economic and political framework that could restore the global economic stability lost during the interwar period — a breakdown that had helped fuel the rise and consolidation of totalitarian regimes across Europe.

The general guidelines established by the Western powers (primarily the United States and Great Britain), which the remaining countries were largely expected to follow, were clear: achieve full employment and price stability in order to foster a broader environment of equilibrium and remove production and trade restrictions in the global market.

One of the most consequential clauses of the Bretton Woods Agreements was the designation of the U.S. dollar as the official currency for all international transactions. The dollar was pegged to gold: each ounce of gold was valued at 35 U.S. dollars. The U.S. Federal Reserve assumed the responsibility of issuing dollars in proportion to its gold reserves in order to maintain their value. Put simply, every 35 dollars printed had to be backed by one ounce of gold.

Those same meetings that produced the Bretton Woods agreements also gave birth to the now-infamous International Monetary Fund (IMF) and World Bank (WB). The banknotes bearing the faces of George Washington, Abraham Lincoln, or Benjamin Franklin became the world’s reference currency. Why? Simply because they could. After the war, European nations were left with their lands strewn with corpses, their homes and factories in ruins, and their gold reserves depleted. In contrast, the United States — which had suffered more deaths in its segregated Southern states than on European soil — emerged with its infrastructure intact and gold reserves expanding. It became the central player and new referee in the global economic game.

With 50% of global GDP in its hands, the United States could make decisions for everyone — and it did. At the close of World War II, the American industrial system was the only one capable of producing virtually any manufactured good. Yet it faced a serious dilemma: it had few buyers, apart from countries south of the Rio Grande and a few peripheral nations in Oceania. Both groups, having remained on the sidelines during the war and having already begun modest yet effective import-substitution strategies, were not easy markets to capture.

The Bretton Woods system quickly achieved its goals. Within a few years, the economies of the so-called “developed” nations regained their central position in a restructured global order. Industrial production quadrupled, global trade reached record highs, and the American economy controlled the lion’s share of it all.

The golden years of capitalism — from 1950 to 1970 — marked a period of extraordinary expansion and development for Fordist production, a system named after automobile manufacturer Henry Ford. It was not just a model of industrial organization implemented across nearly every sector of the economy, but a way of life that rekindled the faith of rationalists and physiocrats in the idea that with the advent of “Modernity,” progress would be continuous and boundless. But the fact that more than 100 million people perished in the wars of rational Europe showed that the illusion of endless progress was anything but stable.

“Workers received wages and complementary benefits that regularly increased, alongside a welfare state that continually expanded its coverage and became increasingly generous. Governments achieved political stability — thereby weakening communist parties (except in Italy) — and created predictable conditions for the macroeconomic management now practiced by all states.” (Hobsbawm, 2009, p. 285). White workers and the newly formed middle class never again lived under better economic conditions than during those golden years of capitalism.

WAR, PRODUCTION, AND FINANCE

By the late 1960s, just as the economy transitioned from being merely international to truly transnational, the first signs of deceleration and instability began to emerge within the global economic system. Economic and social indicators had remained relatively stable for nearly two decades, but with the simple slowdown of certain key indicators — such as the price of raw materials — problems began to surface.

The Fordist system was no longer able to maintain its previous levels of profitability, and corporations began redirecting capital away from the major industrial centers of the so-called First World toward the so-called “periphery” or Third World countries. The massive industrial complexes of the Northern Hemisphere, once symbols of productive power, became hollow orange skeletons — derelict warehouses serving no purpose other than to house the unemployed and the displaced.

Transnationalization, paired with still-functioning political and economic stability, gave business elites the opportunity to reduce production costs — including taxes, wages, and raw materials in their countries of origin — by relocating their manufacturing operations to nations with fragile economies and weak labor protections, often governed by bloody dictatorships or deeply corrupt officials. Yet even that was not enough. The true breaking point once again came in the form of a military conflict.

In its global struggle against communism, the United States decided to invade North Vietnam in 1955, seeking to prevent the country's unification under a communist government. What was intended to be a swift occupation and regime change via a puppet government soon spiraled into a quagmire. The Vietnamese resistance, through a determined and sophisticated guerrilla strategy, proved unmanageable for U.S. military commanders.

The deployment of troops, weapons, planes, and “Made in USA” helicopters more than 13,000 kilometers away, over the course of a war that lasted two full decades, further destabilized U.S. finances. Presidents Lyndon B. Johnson and Richard Nixon were forced to dramatically increase the money supply in order to finance the ongoing war effort — and to cover the growing trade deficit caused by imports vastly outpacing exports. This monetary expansion, combined with a hemorrhaging of U.S. dollars from the economy, an increasingly negative trade balance, and the gradual abandonment by European countries of the fixed parity of their currencies with the dollar, created the perfect storm. In 1973, Nixon took the decisive step of breaking the Bretton Woods Agreements, declaring the dollar inconvertible to gold in a bid to halt the outflow of U.S. reserves and rebalance the commercial deficit. Nixon also cut public spending and imposed a 10% import surcharge. Everything that had been agreed upon at the Mount Washington Hotel in New Hampshire to regulate the power of capital collapsed just 29 years later — but that was only the first blow.

The now-abundant monetary circulation spread like a plague. It was fueled by the rise in commodity prices, the expansion of credit based on U.S. dollars within the European financial system (eurodollars), the influx of Arab petrodollars that temporarily backed the dollar’s value, and the emergence of narco-dollars, which began inflating the balance sheets of companies registered in tax havens — the very engines of the emerging international financial market. This surplus of capital was then funneled into aggressive political and economic campaigns pressuring Latin American, African, and Asian countries to accept vast lines of credit — regardless of whether their economies were solvent enough to honor those debts.

Neoliberalism was not simply about the closure of factories in the historic industrial centers of Europe and the United States and their replacement with small, scattered factories across impoverished countries and continents. It also meant that workers around the globe assembled the same product using components from different origins, often under miserable wage conditions and in a context of permanent democratic degradation, the result of a political class increasingly complicit with unscrupulous business interests. It was during this time that the divorce between the real economy and the financial economy truly began.

TAX HAVENS, SOCIAL HELLS

Mainstream media and Hollywood cinema have helped shape a dominant narrative around tax havens: that they are failed states evading international oversight, that they obscure the identity of the true owners of capital, and that most accounts there belong to individuals involved in organized crime.

While those claims are partially true, they are also partial truths — and often deliberately misleading. Tax havens such as Switzerland, Panama, the Bahamas, the Virgin Islands, Hong Kong, and Uruguay do not only provide financial anonymity to the stereotypical international criminal — arms dealers, human traffickers, drug lords — but also to corrupt politicians and businessmen who declare their assets in these jurisdictions to avoid paying taxes and/or to project speculative financial operations in economically unstable countries. For example, in 2017, the Central Bank of Argentina refinanced its "BONAR 2024" bonds — totaling one billion U.S. dollars — through Credit Suisse in the Cayman Islands and ICBC in the United Arab Emirates.

The first modern tax haven was the Swiss Confederation. Popular imagination fabricated a sanitized origin story: that a country so advanced must surely have a history of solidarity and sacrifice, justifying — at least symbolically — its role in sheltering the looted wealth of other nations. In that version of events, Nazism and the Holocaust serve as the moral backdrop for Switzerland’s supposed neutrality and financial humanitarianism.

But when World War II began and Switzerland declared itself neutral, it did not do so to protect the savings of those persecuted by totalitarian regimes. The reality bears little resemblance to that philanthropic but false narrative. In fact, as early as World War I, Switzerland’s financial system had already begun offering two key services to the rising European and American bourgeoisie: anonymity and low tariffs.

Economist Gabriel Zucman has shown that the periods 1921–1922 and 1925–1927 marked the greatest measurable surge of assets deposited in Swiss banks. Yet it took another decade before the fabled “banking secrecy” laws were enacted. This happened when France — in an attempt to increase tax revenues from its wealthiest citizens — toughened its fiscal policies, prompting the grande bourgeoisie to move large portions of their capital to the orderly and “civilized” Swiss system.

With the wave of decolonization in the 1960s and 70s — driven by epochal change and the sustained pressure of revolutionary civil and armed movements — European imperial powers, before relinquishing formal control, left behind precisely engineered business structures designed to continue extracting strategic natural resources, such as oil and minerals, and to uphold their inflated financial systems.

Gabon gained independence from France in 1960 and installed Léon M'ba as its first president, with Omar Bongo as vice president. Upon M'ba’s death, Bongo assumed power and held onto it for 42 years, before passing it on to his son, Ali Bongo. The true peculiarity of this small African country is not just the dynastic grip over its fragile democracy — it is its ongoing political and economic dependence on its former colonial ruler.

As British journalist Nicholas Shaxson explains in his seminal book Treasure Islands, the young president Bongo — of the Bateke ethnic group — received technical and military support from the French government to suppress any challenge to his power. In return, Bongo handed over Gabon’s oil and mining royalties to companies aligned with France’s Third Republic.

This unilateral extraction of oil and uranium wasn’t enough. French corporations based in Gabon channeled the bulk of their profits through intermediaries, effectively paying no taxes — neither in Gabon nor in France. These profits were ultimately deposited in financial hubs such as Switzerland, Luxembourg, and other tax havens.

This colonial-financial web did not involve only corrupt African and French officials. Since the 1960s, the upper leadership of France’s main right-wing party — Rassemblement pour la République — participated in these schemes, alongside François Mitterrand himself and the ever-present and opaque French intelligence services.

Throughout the 20th century, two opposing systems — communism and capitalism — clashed in an extended, elaborate, and dangerous battle to offer the world a superior model of governance and development, aiming to increase and maximize resources and profits in response to the economic catastrophes of the earlier half of the century.

But of the two, only communism originally envisioned — with all its flaws and contradictions — a project of redistribution. In the end, its catastrophic internal failures and the material and ideological triumphs of capitalism brought that debate to a crushing halt.

UNIPOLARITY, CRISES, AND A PROMISING FUTURE

With capitalism consolidated as a cultural, economic, productive, and political system of exceptional reach, neoliberalism emerged as a new philosophical doctrine within that system — one that gained enough legitimacy to silence any dissenting voices against its central premise: that profits must be maximized first in order to be distributed later.

Overproduction and extractivism became the system’s measuring sticks — mechanisms for actors obsessively driven to increase profits while reducing their redistribution. Wars over resources, ecological devastation, and the hidden face of Toyotism — the new production model — expanded unchecked, alongside a financial capital increasingly detached from real economies and social accountability.

With the dismantling of the Bretton Woods Agreements, the industrial society’s core — which had long regulated the roles of its three main actors: workers, capitalists, and the State — began to unravel. The transformation of raw materials into goods, and the struggle over the distribution of the resulting profits, gradually shifted into a foggy terrain where neither workers nor the middle class could clearly identify who actually owned the resources or reaped the wealth.

With the transnationalization of capital and the disproportionate growth in profit margins, both citizen-based and state mechanisms became outdated and ineffective against a new, autonomous and absorbing power: financial capital — the dominant force of the 21st century.

In one of his most recent works, After the Crisis, French sociologist Alain Touraine sought to understand how various social actors interpret and navigate the ongoing cycles of crisis. He argued that there is now a profound and urgent need to reach higher-order agreements that confront the global supremacy of actors relentlessly focused on maximizing profits across all sectors.

It is imperative that we stop longing for a vanished world — one of structured, elephantine societies with disintegrated social ties. Yet this does not mean surrendering to a passive acceptance of a “liquid society.” Given enough time, any process gives way to the structuring of new societies, and with that comes opportunity.

The neoliberal project — aimed at severing the fundamental ties of mutual association and interdependence within society — has succeeded in many respects. But the collective memory of the people, and their confidence in the possibility of shared progress that once secured undeniable human rights gains, can and must be rebuilt.

The very fluidity we often use to justify our pessimism should not distract us from the essential goal: to create a new system that distributes collective wealth, protects our Common Home — a term now championed by the Catholic Church itself, which has even begun to challenge the sanctity of private property — and does not treat the Earth solely as a supplier of raw materials.

Only through the recognition of the Other can the individual Self be constituted. As Swedish scholar Göran Therborn put it, we stand at a defining crossroads. The middle class and organized labor movements must extend a hand to the excluded and rise together. These are the sectors that must lead the way in at least three critical directions: question the walls, fences, and police that divide them from their less fortunate peers. Denounce the illegality and immorality of the colossal fortunes amassed by a tiny elite that has captured almost all of the world’s circulating wealth. Help forge and participate in a new political class, grounded in both science and spirit — one that can build bridges between currently disjointed forces: labor movements (which must also reclaim their lost initiative), disaffected middle-class sectors disconnected from the meaning of production, defenders of the environment, and those committed to solidarity.