The New Cold War?

The Growing Inter-Imperialist Conflict and The Changing Crisis Of Neoliberalism

The Growing Face-Off Between East and West

On August 6, thousands of Ukrainian infantry, supported by armor and artillery, stormed over the Russian border towards the town of Sudzha in the Kursk region, launching the first genuine assault by Ukraine into Russian territory on a scale far larger than the previous cross-border raids by Ukrainian-backed Russian opposition fighters. And so German and American-made tanks are now rolling on Russian soil.

Meanwhile, 1500 miles south in Tehran, all evidence suggests that Israel was responsible for the July 31 assassination of Ismael Haniyeh, the chair of the Hamas Political Bureau. As Iran promises retaliation, the threat of a regional escalation in the Middle East has increased dramatically.

These events over the last 10 days are just the latest escalations. And so as the Russian assault on Ukraine stretches on, China organizes its largest-ever ‘war game‘ encirclement of Taiwan, and US and Iran-backed proxies fight in the increasingly unstable Middle East, it is no surprise that both leftists and the mainstream press, alongside other commentators across virtually the whole political spectrum, have declared that we are entering a ‘New Cold War.’

What this illustrates is the growing political division of the planet into two antagonistic blocs of East and West, with NATO and its sympathizers on one side, and China, Russia, Iran, and their orbiters on the other.

With Finland and Sweden joining NATO and the continuation of Russia-backed coups in central Africa, it is now possible to trace an almost uninterrupted frontline – partly cold, partly hot – from the forests of the Finnish border north of St. Petersburg down to the Middle East, and then all the way through the African Serengeti out to the dense palm forests and sandy beaches of Conakry, Guinea on the Atlantic Coast.

Moving south from Finland, Poland has just announced plans for the creation of a $2.5 billion defensive line, potentially including minefields, on its eastern border, on top of the $15-20 billion air and short-range missile defense systems already under development.

A bit further south, the hot war between Ukraine and Russia rages from Kharkiv, through the Donbass, and down to Crimea. And in the Caucasus Mountains, NATO-backed Azerbaijan just last September regained control of the Nagorno-Karabakh enclave from Russia-backed Armenia. On the other side of the Caucuses, Syrian and Russian hold positions just kilometers away from Turkey-backed proxies and Turkish forces in Northwest Syria, and across from US-backed proxies and US troops in the northeast and along the eastern border with Iraq. And in south-west Syria, as well as over the border in southern Lebanon, Iran-backed Hezbollah forces trade daily fire with Israeli forces occupying the Golan heights. Not far away, at the entrance to Africa and near the pivotal Suez Canal, Israel continues its brutal assault on Gaza, facing continued resistance from Iran-backed Hamas fighters.

And on the other side of the Sahara, Russia has had an active hand in the ‘Coup Belt.’ A contiguous line of countries – stretching from Sudan on the Red Sea, through the Sahel countries of Chad, Niger, Burkina Faso, and Mali, to Guinea on the Atlantic Coast – have experienced coups since 2020. These new governments, which have generally bucked French (read: NATO) influence in the region, have drawn on support from Wagner mercenaries, and offer Russia expanding geopolitical influence including plans for a naval base in Port Sudan, as well as new customers for military hardware, and access to rare mineral resources. These projects have the added benefit of creating new opportunities for graft and corruption for the Russian ruling class.

Yet even this 6,000-mile nearly-continuous front line does not exhaustively cover all of the significant military buildups between the two main camps. It does not include the conflict between Saudi Arabia and the Iran-backed Houthis, China’s new military base in Djibouti or economic development projects throughout much of Africa, China’s “nine-dash line” claims on the South China Sea, the US placing missiles in the Philippines, and more.

What this illustrates is the growing political division of the planet into two antagonistic blocs of East and West, with NATO and its sympathizers on one side, and China, Russia, Iran, and their orbiters on the other.

Beyond The Front Line

While the growing polarization between NATO and the East is drawn most starkly by the battle lines described above, the dynamic is not limited to military conflict alone. Rather, this great power competition is developing into a central, overarching international contradiction which weighs profoundly on the other areas of global politics, society, and economy.

The conflict between Russia and Ukraine has been reproduced in miniature in election after election across western democracies, as liberal pro-Ukraine hawks pledge increased military support for the embattled country while neo-populists from Trump to France’s Le Pen to Hungary’s Victor Orban extend olive branches to Putin and challenge pro-NATO budgets. Meanwhile, mass protests in support of the Palestinian people lay siege to the pro-Zionist, pro-imperialist status quo in the West, bringing this international conflict into union halls, college quads, and family dinner tables.

This great power competition is developing into a central, overarching international contradiction which weighs profoundly on the other areas of global politics, society, and economy.

State partisans organize aggressively to cultivate support for their camp on the foreign soil of friend and foe alike. In the United States, AIPAC spends aggressively to oust critiques of Israel like DSA’s Jamal Bowman and Cory Bush, and a neo-McCarthyism is developing as congressional hearings are once again used to launch political witch hunts of radicals on campuses. Meanwhile, Russia funds social media trolls and pays outright bribes to its Western sympathizers, China grows its network of Confucius Institutes in Africa, and NATO intelligence services lend assistance to pro-Western dissidents in the former Eastern Bloc as well as in Venezuela and the Chinese diaspora.

And if a kinetic conflict is only half-underway, the economic war between these two blocs has already been launched in full. The United States has led the West in imposing aggressive sanctions on the Russian economy and is attempting to dragoon the EU — especially Germany — into its deepening trade war against China; meanwhile, China attempts to flood the West with subsidized electric cars and solar panels in order to gain dominance in these new and strategic sectors. To slow Chinese development of advanced weapons systems — including weaponized artificial intelligence — the United States has imposed export controls on advanced processors and invested billions to subsidize domestic production of semiconductors. And even before the war, Russian intelligence was implicated at the center of the Wirecard scandal, the biggest fraud in German history.

The economic conflict is so serious that it has forced the more laissez-faire economies of Russia and the United States to move closer to Chinese-levels of state intervention, as they shift their economic policies dramatically in order to bolster their own military capabilities or deny such capabilities to their rivals.

In the West, there has been a surprising – albeit incomplete — reversal of economic orthodoxy. This entails the rejection of many of the basic neoliberal principles which have dominated public and trade policy for the last four decades. Unbridled free trade is replaced with tariffs and trade wars, while hands-off industrial policy and offshoring are replaced with mercantilist neo-Keynesianism, military Keynesianism, and investments in domestic production.

At the same time there is continued commercialization and financialization of public services in these states; and an insistence that full neoliberalism is implemented in peripheral and dependent economies — as the US-Ukraine Strategic Partnership Agreement of 2021 (see: Section IV – Economic Transformation) and the EU Accession Agreements make clear.

This economic shift in the West is also felt in the labor movement. The Democratic party pivots investments in US military capabilities into useful handouts to loyal labor leaders, enrolling them as junior partners of imperialism, and thereby reviving the ‘corporate-liberal synthesis’ strategy of the early Cold War which was largely abandoned with the neoliberal pivot of the 70’s and 80’s. But the escalating global conflict has also triggered the opposite reaction, as union workers are radicalized by the horrors of Israel’s genocide and organize to break their unions from complicitly in the crimes of Western imperialism.

The conflict even makes itself felt within the socialist movement and within DSA. A section of ultra-left ‘campists’ uncritically cheer on the military successes of Iran-backed militias from Gaza to Yemen, while some right-wing social democrats have resigned in protest of DSA’s support for Palestinian liberation, clinging to their Labor Zionist approach. Fights over our public electeds’ stances on the Israel-Palestine conflict take center stage, and become the fights on which larger questions about DSA’s strategy and structure are worked out. Unfortunately there is little such debate in relation to the globally more dangerous US-NATO proxy war against Russia in Ukraine , where deaths are about three times those in Gaza and casualties likewise are currently at approximately 500,000.

Cold War 2.0?

While the growing international tensions of the present period are geographically similar to the rivalries of the Cold War, that is largely where the parallel ends.

The reason the original 1947-1991 Cold War was called ‘cold’ was because the nuclear-armed forces arrayed in NATO and the Warsaw Pact avoided engaging each other directly in a ‘hot’ military conflict. Instead they opted to battle each other indirectly via other means – waging proxy wars in Vietnamese jungles, African grassland, and Latin American foothills – as well as intervention in each other’s domestic politics by means of espionage, misinformation, sabotage, and the sponsoring of domestic political opposition movements.

But for Marxists the primary ‘nature’ of the Cold War is not whether the armed conflict was direct or indirect, but that it had two basic and related features: it was a conflict between two fundamentally different and antagonistic economic systems – capitalism in the West and command economies in the East; and it was the mechanism for maintaining US hegemony in the context of the US-sponsored rebuilding of the destroyed economies of Europe and Japan- to ensure they did not become a competitive threat to American capitalism.

Today the situation is profoundly different. While ‘mutually assured destruction’ still imposes itself as a potentially existential obstacle to direct hot conflict, and so the conflict is largely fought indirectly in a similar way, the underlying economic basis of the antagonistic states is quite unlike the situation during the original Cold War in two fundamental ways.

But for Marxists the primary ‘nature’ of the Cold War is not whether the armed conflict was direct or indirect.

China and the states of the former Soviet Bloc have become bourgeois states: they now defend capitalist property relations — the ‘Communist’ systemic difference has gone. And the US economy is no longer as completely dominant as it was until the 1970’s: the economies of other countries in Europe and Asia have caught up — and are now significant competitors in the world economy.

The Russian state, which was once the senior power of the Warsaw Pact, is now an instrument of its domestic, kleptocratic capitalist class and even under intense Western sanctions is still a site of investment of Western capital. It was the United States itself which helped to privatize the Russian economy and enable a new crop of domestic oligarchs to simultaneously liquidate the state-owned enterprises while capturing and corrupting what remained of the state to further their self-interests.

China has also largely shed its command economy, albeit without the same chaotic political and economic upheaval as in Russia. Its Communist Party remains firmly in place, but nonetheless, since Deng Xiaoping kicked off his Reform and Opening Up campaign in 1978 the Chinese economy has pursued almost a half-century of trade liberalization and the liquidation of social benefits and many state-owned enterprises, resulting in the growing dominance of capitalist enterprises in the industrial, commercial, and financial sectors, and the growth of an industrial proletariat forced by necessity to work under harsh and draconian conditions.

The net result of these changes means that the current conflict is not between two camps with different economic systems, but rather between two groups of states that promote the same basic economic system.

The party too, has experienced this slow but sure penetration of capitalism, as party officials use their power to enrich themselves and their relatives. Some estimate that Xi Jinping’s family is worth around $1 billion, making the ‘communist’ First Family far richer than the Biden family, who have an estimated wealth of not much more than $10 million. Although the Chinese state remains Communist in name and retains a sizable hand in industrial policy, the Chinese economy has overwhelmingly transitioned to an economy based on commodity production for profit, in other words, a capitalist economy.

The net result of these changes means that the current conflict is not between two camps with different economic systems, but rather between two groups of states that promote the same basic economic system, albeit with different political regimes managing them: liberal, rules-based democracy mixed with a smattering of illiberal democracies and outright dictatorships in the West, counterposed to oligarchic illiberal democracies, single party states, dictatorships, and theocratic democracies in the East.

The now-similar economic basis of the two camps is not merely a scholastic question, but rather is fundamental to understanding the internal forces which are driving both camps into an escalating conflict.

Imperialism With Chinese Characteristics

In Imperialism: The Highest Stage of Capitalism, Lenin rejected the argument by Kautsky that imperialism was merely a policy (ie, a choice) made by capitalist governments, as opposed to a stage (ie, a structural tendency) imposed on capitalist governments by the underlying economic situation, which these governments could ultimately not avoid. Lenin’s argument was based on the build up of capital within a small handful of industrial-core countries, writing that

the need to export capital arises from the fact that in a few countries capitalism has become ‘overripe’ and… …capital cannot find a field for ‘profitable’ investment.

In other words, these core markets become oversaturated with capital and face a declining rate of profit, and so these capitalists seek foreign investments in less developed, undercapitalized markets where profits are higher. These capitalists use their investments to secure favored agreements, with ‘their’ state using mercantilist trade restrictions and military presence to bring foreign markets under their sphere of influence and keep out capital from other countries which would undermine their profits. The British Empire was the classic example.

The declining rate of profits in the core industrial countries also results in economic crises which lead to serious social unrest and political instability. Lenin pointed out that the very personification of British Imperialism, Cecil Rhodes, argued that the bounty of imperialism was an ideal tool to mitigate unrest among the domestic working classes and avoid a civil war.

When Lenin was writing, the various groups of capitalist nations had already carved up the rest of the world. Therefore, the colonial phase of capitalism was transcended by the imperialist phase, as the established capitalist blocks now sought to re-divide the world to their advantage, which required replacing their rivals’ spheres of influence with their own. Thus,

an essential feature of imperialism is the rivalry between several great powers in the striving for hegemony, i.e., for the conquest of territory, not so much directly for themselves as to weaken the adversary and undermine his hegemony.

These various tendencies towards war pitted the capitalist blocs against each other, growing inexorably until they broke out in a tragic and horrific explosion of violence.

While the First World War was the initial global military expression of inter-imperialist rivalry, and WWII resolved it for the middle of the 20th century by establishing the USA as the global hegemonic military and economic power, the Cold War and the post-war boom offered some relief from this inter-capitalist rivalry. Instead, the capitalists were largely united against the Eastern Bloc which threatened not only their spheres of influence but their very existence.

But secondly, wars between previously-belligerent imperialist states were avoided because neither the crippled economy of the British and French Empires could support a war — revealed decisively at Suez in 1956 — nor could the destroyed economies of the other belligerent European states; and because the USA maintained a controlling military presence — both in Europe through NATO and by military bases in Japan and on Pacific islands. The objective of NATO, in a phrase oft repeated, “to keep the Soviet Union out, the Americans in, and the Germans down” was made clear by its first general secretary, Baron Ismay in 1949.

So wars between the previously-belligerent imperialist states were largely avoided. Instead, wars were fought more to contain or roll back left-wing governments coming out of decolonizing movements than to secure outlets for surplus profits.

The conflict between these blocs has its sharpest current expression in the proxy war between the US-NATO and Russia in Ukraine.

However, since the fall of the Soviet Union and the re-emergence of capitalism in Russia and the related possibility of a pan-European economic bloc, and the massive growth of capitalist China, the imperialist inter-capitalist rivalries of the early 20th century have gradually re-emerged in a new form. The competition between the blocs has reached a fully inter-imperialist level as Chinese exports of commodities are joined by Chinese exports of capital.

The conflict between these blocs has its sharpest current expression in the proxy war between the US-NATO and Russia in Ukraine. The context for this war, and the social content of the war, is the US intervention into Europe since 1991 to ensure that the re-unification of Germany and collapse of the Stalinist states and Comecon did not lead to the emergence of a pan-European economic bloc that could include the states of the EU, Eastern Europe and Russia. Such a bloc could also include a new security framework and lead to the demise of the US as the dominant power in Europe because of the decline of the need for NATO.

The US-NATO intervention in Yugoslavia and Libya were carried out to establish an out-of-area military role for NATO and re-assert US leadership. Later, the continued expansion of NATO to the western Russian border – and the encirclement provocation to include Ukraine in NATO while excluding capitalist Russia from pan-European security and economic frameworks that Putin sought to join and while Russia had assisted the US invasion of Afghanistan – is the expression of US grand strategy against the emergence of a pan-European economic bloc which, in alliance with China, could be a global competitor to the USA.

The granular expression of this aspect of US strategy is the explicit opposition in the 2021 US-Ukraine Strategic Partnership Agreement to the Nord Stream gas pipeline; and the likelihood that the US was involved in blowing up the pipeline — to sever Euro-Russian energy and other trade links.

While at first the liberalization of former command economies, including the liquidation of state-owned enterprises in Eastern Europe, the opening of China, and ‘structural adjustment’ policies in the developing world, served as investment opportunities for foreign capital with parallels to the earlier colonial conquests, these economies have now all been largely consolidated into one or the other rival sphere of influence.

This rivalry is exacerbated by the declining rate of profit in the industrial-core countries with its related social and political impacts. The stabilization of capitalism in the West after the Great Recession was largely done on the basis of massive quantitative easing (central banks printing money), expansion of government debt, and cuts to social services, as well as investments in the Chinese economy which had the unintended result of strengthening the West’s rival.

Now the Chinese economy is also slowing, as it faces the collapse of its real-estate bubble, industrial overcapacity, a weak stock market, and a slowing rate of growth. The Financial Times recently noted that “across China, multiple indicators of social stress are flashing red.” Home foreclosures have increased 35 percent since last year, 10 million migrant workers have left the construction industry since 2022, and youth unemployment recently reached such a high level that the government revised its survey methodology to hide the numbers. All this has fueled a feeling of malaise, which is confirmed by social media, as well as 1,800 incidents of labor unrest over the last year, up from pre-pandemic levels.

The CCP has attempted to manage this looming economic crisis through foreign investment including the Belt and Road Initiative, extending credit to the governments of developing countries which is then used to invest in infrastructure projects, providing an outlet for both Chinese capital and Chinese industrial capacity.

But neither the West nor the East can avoid an economic crisis forever. When the next crisis does develop, resulting in increased unemployment and further deterioration of standards of living, it will only increase both the pressure to secure opportunities for profitable foreign investment, as well as the need to redirect working-class discontent away from the domestic ruling elite.

Unstable Alliances

Not only is the current conflict a fight for dominance between blocs of national capitalists classes as opposed to a fight over the existence of capitalism itself, but these blocs are far less stable than those which formed during the Cold War.

To be sure, there were some smaller and medium-sized powers that never fully committed to one or the other bloc — at one point this was even formalized into a “non-aligned movement” with official member countries — but among the major world powers there was never any question of who would be on what side. This was predetermined and cemented by virtue of the classes and systems they represented.

Today, however, there is a much thinner ideological or class basis for the Eastern and Western poles to form around. There is some alignment between capitalists which rely on a liberal and ‘rules-based’ order versus those which rely on illiberal and relational (read: corruption) order, but these are less than fundamental differences; more so the blocs are formed on political expediency.

The lack of a more fundamental basis of alliance means that these blocs are far less stable. Indeed, important caveats must be added to many of the conflicts noted in the first section. Armenia, defeated by Turkish-backed Azerbaijan, now desires closer relations with the West, while Azerbaijan is developing closer relations with Russia; in Syria, NATO-backed forces fight each other, as Turkish-backed proxies and US-backed proxies contest for control of the Northern Syrian border; and Turkey has also played an opportunist role in the developments in the Coup Belt alongside Russia.

Organize Against The ‘New Cold War’

We once again assert that the contradictions of the above described inter-imperialist conflict will not confine themselves to the realm of ‘foreign politics.’

The current conflict has not been brought about by the personal ideation of this or that dictator, but is endemic to the capitalist economic model which, since the end of the Cold War, has more or less been adopted by every major economy. The general conflict will not go away, it will only grow.

The general conflict will not go away, it will only grow.

Therefore, it is crucial that Marxists prepare now to deal with the inevitable escalation of this conflict, and recognize that we are entering a new period of history in which it will dominate. So how should Marxists relate to the growing number of inter-imperialist conflicts, and to the likely future proxy wars between the US and China?

The first necessity is that Marxists recognize the social content of conflict and war. We should remind ourselves of Clausewitz’s framework for characterizing a war, often quoted by Lenin: ‘War is the continuation of politics by any other means.’

And thus, Lenin’s approach to WWI:

“The philistine does not realize that war is ‘the continuation of policy,’ and consequently limits himself to the formula that ‘the enemy has attacked us,’ ‘the enemy has invaded my country,’ without stopping to think what issues are at stake in the war, which classes are waging it, and with what political objects.”

Lenin recognized that although several European countries were invaded and occupied in WWI, the social content of that war was not one of national liberation but was an inter-imperialist conflict between the states of the various rival capitalist classes.

This should inform our approach to the wars in Ukraine, Palestine, and to future proxy wars – taking into account not only European matters but also the world situation. Without US weapons and finance the Ukraine war and Israel’s assault on Gaza would end very quickly.

Likewise, we take the standpoint of the international working class, refusing to pick a side between one or the other imperialist bloc. We are neither for the capitalism of NATO-dominated Europe nor the capitalism of Russia and China, but for socialism. We support the right of both Palestinians and Ukrainians to sovereign self-government and to resist invasion and occupation; but we do not support either the interests of NATO or Russia in Ukraine, nor Israel or Iran in Palestine.

Taking such an independent position requires combating the intense pressures from both sides which has already made its way into our movement, and will only increase. As Marxists in the West, we face tremendous pressure from our own society to soften our critiques of our domestic imperialists, especially when we engage in mass work which requires winning over those who are exposed exclusively to Western narratives.

These forces can be especially strong in the labor movement, where the imperialist rhetoric is materially bolstered by the bribery of imperialist industry in what is effectively military Keynesianism. Conversely, within the internal life of our socialist movement, there are also pressures to accommodate ourselves to a ‘campist’ approach in which any opposition to our own imperialists should be supported. These pressures weigh especially on the activist layers.

While acknowledging our opposition to both camps in favor of an internationalist outlook, we must then take into account our own positionality within the west. Therefore, our primary strategic focus becomes opposition to our own camp – our own government and state. Without hiding our criticisms of the leaders of Russia, China, or Iran, we focus our critique on our own ruling class by opposing the supply of weapons for Western proxy efforts in Ukraine and Israel.

The actions of elected representatives who claim to speak in the name of the working class – such AOC and the other three left Members of Congress and the Labour Left around John McDonnell in Britain, who have refused to oppose the war budgets of Biden and of the British Tories — is an alignment by them with ‘our own’ ruling class and a betrayal of socialist internationalism. We cannot build movements against our capitalist oppressors at home while we support them in competition and armed conflict with their rival capitalist oppressors overseas.

To build a powerful movement against NATO imperialism and any US-led escalations of the impending inter-imperialist conflict will first require clear opposition to such war-mongering; and simultaneously helping movements develop from ‘defensive’ protests against war into ‘offensive’ mobilizations against our own system. This means connecting every instance of anti-war sentiment back towards the need to build a new socialist movement. This requires organizing among students, workers, and soldiers in favor of equality, peace, jobs, environmental protection and a socialist future.

Brandon Madsen also contributed to this article.