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<nettime> Peace-for-War
Brian Holmes on Wed, 26 Jul 2006 14:14:45 +0200 (CEST)

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<nettime> Peace-for-War

[- In the summer of 2002 I wrote a post to nettime called 
"Deflation, anyone?" which observed the transformations of 
the world economy after the krach of the Internet bubble, 
and speculated about the underlying reasons for the emerging 
war regime. This led to renewed curiosity about political 
economy. However, despite a lot of reading, I was never able 
to find anything convincing on the relation between the two. 
The text below sums up the impressive theory that I recently 
have come across, and goes on to make speculations about a 
subject that re-emerged on nettime after the Montreal 
conference, namely cybernetics. The video of the lecture, 
which I just gave at the Dictionary of War event in Munich 
this weekend, is available along with some fifty others at 
the excellent website, http://dictionaryofwar.org.
Best to all, BH -]


The concept I'm going to present draws directly from the 
work of Shimshon Bichler and Jonathan Nitzan. It describes 
the economic phases of "depth" and "breadth," and correlates 
them with the first- and second-order cybernetics of 
control. It attempts to situate the functions of 
cultural-communicational labor within these economic phases. 
It questions those autonomist Marxists who thought it would 
be possible to transform a broadly expansionary phase of 
capitalism, like that of the '90s, into a qualitatively 
different society. It's not a polemic, but seeks to open up 
a field of strategic debate. It doesn't assert a future, but 
observes the unfolding of the present into the depths of 
violence, which has robbed resistance movements of their 
potential, again. The concept is Peace-for-War.

At stake here is society itself: the really existing forms 
of social cooperation. The Argentinean activist, Ezequiel 
Adamovsky, writes about exactly that: "Today, the division 
of labor is so deep, that each minute, even without 
realizing it, each of us is relying on the labor of millions 
of people from all over the world." (1) This lecture,  the 
words, the images, my voice through the microphone or over 
the Internet, is literally brought to you by the labors of 
Asia, the Americas, Africa and Europe combined. The question 
is, what guides the dynamics of our worldwide cooperation? 
How is order maintained? And why does this "order" descend 
periodically into chaos, as it's doing now in the Middle East?

Adamovsky points out that nothing encourages even asking 
such questions, much less answering them. "In the capitalist 
system, paradoxically enough, the institutions that enable 
and organize such a high level of social co-operation are 
the very same that separate us from the other, and make us 
isolated individuals without responsibility with regards to 
other people. Yes, I am talking about the market and the 
(its) state. Buying and consuming products, and voting for 
candidates in an election, involves no answerability. These 
are actions performed by isolated individuals."

Order will not provide a language to explain its chaos. The 
essence of contemporary power is to provoke crisis and to 
ride it out toward profit, without revealing strategies or 
goals. The effect of such huge unknowns is to make people 
cling to their identities and their operative routines, for 
fear that the public disruption will spread into their 
private lives. Without an interpretation of capital -- 
indeed, of power -- there can be no opposition. The first 
thing that resistance movements are lacking is a common 
language to describe, predict and oppose the maneuvers of 
the most powerful groups in the world.

Bichler and Nitzan's work -- and particularly their article, 
"Dominant Capital and the New Wars" -- tries to show 
exactlywhy peace is allowed to become war under the 
contemporary political-economic order. (2) Their starting 
point is the measurement of value. They recall that both the 
Marxist concept of abstract labor, and the notion of utility 
in classical economics, claim to designate an objective 
foundation of value. But neither of these "foundations" has 
ever been measurable. What can be observed and measured in 
capitalist society are prices, profits, losses -- in short, 
money. The fluctuation of prices, profits and losses is the 
index of shifts in power relations. In this sense, the 
economy is always political, it has no objective touchstone. 
What the fluctuations measure is the struggle for 
differential accumulation.

Capital in the singular is like the night where all 
Cadillacs are black. If power relations give value its 
measure, then what matters is beating the average, standing 
out from the others. The corporations with the highest rates 
of profit (for example, those of the Fortune 500) will be 
able to shape the environment in which they accumulate, 
either directly, with their own resources, or more 
importantly, through collaboration with the state. Such 
corporations "make the market," they impose technologies, 
laws, standards, prices. They are "dominant capital." But 
dominant capital itself is not singular. At the heart of 
Bichler and Nitzan's analysis are two different strategies 
for differential accumulation, associated with two different 
political-economic cultures: one called "breadth," and the 
other, "depth."

Think of profit as the number of employees, times the 
earnings per employee. How does a corporation beat the 
average rate? One way is to increase the number of people 
working. That can be done by building new capacity, 
so-called "greenfield investment." But too much capacity 
creates a glut, and a glut destroys a market. So the more 
common route is to buy away the competition, through mergers 
and acquisitions. Industrial sabotage, like the politics of 
the Treuhand in former East Germany, is a strategy of 
breadth. It's about destroying potential competitors in 
order to make yourself relatively bigger. It's associated 
with speculative fever, as corporations double or triple in 
market share overnight. But insofar as real capacity does in 
fact increase, breadth is also associated with 
proletarianization, or the induction of more people into the 
global labor force. Like the populations of China, Russia 
and India in the 1990s.

The other strategy, depth, means increasing the amount of 
earnings per employee. Here again, there are two basic 
avenues. One is to cut costs, to do more with less, to be 
lean and mean, which has become the watchword of capitalism 
-- everybody tries it, constantly. But the other way is to 
raise prices, even if that causes inflation, and even if 
rising prices are accompanied by stagnation of the economy 
as a whole. Depth is typically accompanied by stagflation, 
which is anathema for the majority of dominant capital. Only 
the most powerful corporations can take the first moves in a 
strategy of depth. And the only way they can legitimately 
raise their prices -- that is, the only way they can succeed 
in forcing people to pay the higher prices -- is to seize 
the occasion offered by a crisis, which is typically the 
occasion of a war.

Why does a relatively small fraction of dominant capital 
periodically succeed in launching a strategy of depth? What 
Bichler and Nitzan have done is to show that the major waves 
of corporate expansion through mergers and acquisitions have 
all reached their size limits, or filled out what could be 
conceived as their "envelopes of possibility." As they 
write, "Merger booms tend to 'hype up' investors and make 
market conditions increasingly fragile as the boom 
progresses. Eventually, negative sentiment sets in, making 
the market inhospitable for merger till the next reversal in 
mood. Furthermore, breaking each 'envelope' involves major 
legal, institutional and political realignments, and that 
takes time. The consequence is that the whole process is 
susceptible to major interruptions. It is here that 
stagflation enters the picture." (3)

A graph  on page 289 shows four great waves: the monopoly 
phase at the turn of the century, the oligopoly phase of 
vertical integration in the twenties, the conglomerate phase 
of multidivisional corporations in the 50s and 60s, or 
finally, the globalization phase of the 90s. The line itself 
is the "buy-to-build ratio," which rises as mergers and 
acquisitions outstrip construction. Another curve shows that 
from the 1940s onward, a period of stagflation inevitably 
accompanies any drop in the buy-to-build ratio. Stagflation 
is the sign of depth. Since the postwar period, the two 
divergent strategies of dominant capital, breadth and depth, 
have clearly become two distinct temporal phases in the 
rhythm of accumulation as a whole. Their curves become 
exactly symmetrical. But who are the actors of these two 
phases? And what are the relations between them?

Bichler and Nitzan don't have a lot to say about the 
high-tech companies and financial actors -- or what they 
call the "Technodollar-Mergerdollar Alliance" -- that 
dominated the speculative fevers of the nineties. What 
interests them is integrated oil and defense: the 
"Petrodollar-Weapondollar Coalition." Another graph (p. 316) 
shows how its share of global net corporate profit grew 
tremendously during the stagflation of the '70s, when the 
Middle East replaced South-East Asia as the focus of the 
global arms market and the OPEC embargoes helped Western oil 
majors extort record prices at the pump. What's at stake in 
the Middle Eastern wars is neither the rarity of oil 
resources, nor the scramble to control them, nor even the 
cost of obtaining them. What's at stake is the capacity of 
specific corporations to raise prices against a backdrop of 
crisis and uncertainty.

The implication is that at a low point, and particularly 
after a long period of decline, the crises themselves could 
be allowed to develop, maybe even encouraged, as a sure-fire 
path toward the recovery of differential profits. But this 
could only be done by actors able to influence the American 
state. The Petro-Core, according to Bichler and Nitzan, is 
composed of six Anglo-American companies, now merged to 
four: BP, Exxon-Mobil, Shell and Chevron-Texaco. A bar graph 
(p. 311) shows that since the mid-1960s, every time the 
Petro-Core's rate of return slips below the Fortune 500 
average, a conflict in the Middle East will follow. Do you 
remember them? The Arab-Israeli war in '67; then another in 
'73; the Islamic Revolution in Iran, the Soviet invasion of 
Afghanistan and the first Israeli invasion of Lebanon in 
'78; the beginning of the eight-year Iran-Iraq war in '80 
and the second invasion of Lebanon in '82; the first Gulf 
War of '90-'91; the Palestinian Intifada of 2000, the US 
invasion of Afghanistan in 2001, and finally the Iraq 
invasion in 2003. Each time, war is preceded by a drop of 
the Petro-Core's profit rate with respect to the other 
Fortune 500 companies. Of course, the oil companies do not 
start the wars, whose causes are multiple. But from 1973 
onward, each war is accompanied by a significant or even 
spectacular rise in the oil majors' rate of differential 

So what type of causality are we talking about? There's a 
difference between this argumentation and the conspiracy 
theories that have sprung up concerning the "real events" of 
September 11. Consider the film Loose Change, which claims, 
among many other things, that a Boeing 757 did not hit the 
Pentagon, and that the 16-foot diameter hole in the wall of 
the building would more likely have been caused by a cruise 
missile: a Tomahawk, fired from an A3 jet, both manufactured 
by the Raytheon corporation. (4) This do-it-yourself 
documentary has all the vital energy of popular conspiracy 
theory -- and all the mistakes of what Frederic Jameson once 
described as "the poor person's cognitive mapping in the 
post-modern age; a degraded figure of the total logic of 
late capital, a desperate attempt to represent the latter's 
system, whose failure is marked by its slippage into sheer 
theme and content." (5) Dylan Avery, the maker of Loose 
Change, is 22 years old; he came of age at the turning point 
of Peace-for-War. Raytheon is almost a hundred years old, 
and partakes of a normality that may be worse than 
conspiracy. It forms part of what Bichler and Nitzan call 
the Arma-Core, or the "Seven Archangels of Armageddon," 
which also includes Lockheed-Martin, Boeing, General 
Dynamics, Northrop-Grumman, the British manufacturer BAE 
Systems, and the Euro-consortium EADS. These companies, and 
their state allies, have a century's experience in the 
politics of depth.

Bichler and Nitzan say nothing about the 16-foot hole in the 
outer wall of the Pentagon. They focus instead on the 
threat, not just of stagnation, but of outright deflation, 
that arose after the collapse of the new economy bubble. 
They analyze a Financial Times article of April 2003, 
calling on Alan Greenspan to "go for higher inflation" -- 
which would signify the entry into a regime of depth. (6) As 
a sign of political will, they quote a famous declaration 
from the neoconservative Project for New American Century, 
written in the year 2000, which claims that the process of 
transforming the US defense budget is "likely to be a long 
one, absent some catastrophic and catalyzing event -- like a 
new Pearl Harbor." (7)  Finally, they produce a graph 
showing the decline of US defense spending after WWII, from 
15% of GDP during the Korean War, to 10% for Vietnam and 
7.5% for Reagan's Star Wars, then finally a mere 3.8% under 
Clinton. Is there any good reason these companies would 
lobby for war?

You are presented, not with allegations, but with 
statistical outlines, behind which you can see the changing 
fortunes of specific groups, juxtaposed to the chronicle of 
international events. You are given, not the proverbial 
smoking gun, but important clues as to possible motivations. 
You are asked to decide whether a fraction of American 
capital, closely allied with elements of the state and 
historically accustomed to exerting a preponderant influence 
over the forms and dynamics of social cooperation, would 
have any interest in seizing on the events of September 11 
as an excuse to re-engineer the entire pattern of 
accumulation that had been established during the merger 
boom of the '90s. You are being asked, in effect, whether 
there are steersmen influencing the global course of 

Today, in mid-July of 2006, after observing in utmost detail 
the strategies put into effect by the Bush administration, 
after examining its political-economic alliances and the 
biographies of those involved, after witnessing the extreme 
profiteering of the oil majors amidst continuing Israeli 
escalations in Lebanon and Gaza and continuing arms sales to 
Israel from the US, many people may be a little less 
inclined to doubt the existence of this kind of 
steersmanship. (8) So the more interesting question becomes 
this: Are anti-imperialists ultimately on the side of the 
"Technodollar-Mergerdollar Alliance," despite our critiques 
of figures like Gates and Soros, or of institutions like the 
WTO? Would it be possible to "do away with the old economy," 
that is, the economy of industrialized war, as some 
autonomist Marxists believe, in favor of a new and better 
one? Does the decline of the arms industry represent an 
historical chance, a "could have been" that might still be, 
with the help of another democratic or social-democratic 

These questions, I think, must be confronted with others. 
Why did the post S-11 political-economic hijacking by the 
party of war, oil and engineering meet with such ineffective 
resistance from the other fractions of dominant capital? Was 
it, as Bichler and Nitzan suggest, that their prospects for 
further accumulation were simply exhausted, by virtue of 
their very success in the preceding decades? Was fear of 
deflation enough to make them pass the baton? Did all of 
dominant capital simply acquiesce in the repetition of a 
pattern that had characterized accumulation throughout the 
twentieth century? Or would it be possible, for instance, 
where the European Union and its separate nations are 
concerned, to map out which corporations and key officials 
came down on which sides of which dividing lines? The answer 
to that question is relatively simple: no one has done the 
work, no one knows. But isn't this kind of mapping what we 
would need, to resist the strategies of the major actors who 
create the worlds we live in?

In their most comprehensive book, The Global Political 
Economy of Israel (2002), Bichler and Nitzan have traced the 
transformation of the contemporary Israeli ruling class, 
within the context of the Middle Eastern "energy conflicts" 
and of their particular role in the political economy of the 
world as a whole. (9) This kind of work can show who gains, 
and in which ways, from the transformation of the "peace 
dividend" back into "war profits." One of the weaknesses of 
the international resistance movements has been an inability 
to chart out the oscillations of War-for-Peace, 
Peace-for-War. Yet without this capacity, there is no common 
language. Each generation's experience becomes 
incomprehensible to the next, as the curves reverse and the 
pendulum of differential accumulation keeps on violently 

Capital, as we've seen in the pages above, is inseparable 
from politics. It's what Guattari called "the integral of 
power formations." (10) That means it also produces 
subjectivity -- differentially, and in diverging phases, as 
I've tried to make clear. Resistant culture, the kind that 
can cross the generations, has to be able to escape these 
oscillating phases, to steer outside the political 
subjectivity of Peace-for-War. I want to close with some 
open questions about contemporary governance, and about 
governmentality, that is to say, the rationalities whereby 
we shape our own behavior. For this, let's return to our 
departure point, the remarks of Ezequiel Adamovsky. We live 
in an age of unprecedented cooperation -- but also of 
conflict -- between isolated persons, mediated increasingly 
by computers. The governmental science for this separated 
and interconnected age is cybernetics.

The word cybernetics is based on the Greek root kybernetes, 
which means "steersman" or "governor." Its modern coinage is 
due to the scientist Norbert Wiener, in his book 
Cybernetics, or Control and Communication in the Animal and 
the Machine (1948). This concept has developed historically 
in two modes, and perhaps in two distinct phases. 
First-order cybernetics corresponds to the formula of 
"purpose controlled by feedback," as described in the early 
texts of Wiener and his colleagues. (11) The phrase refers 
to the logical structure of efforts undertaken by organisms 
to transform the environment in which they evolve, by 
gradually altering or "correcting" their own activity, on 
the basis of information gathered in the course of the 
transformative action itself. The stimulus to automate this 
kind of activity was given by nothing other than war: the 
need to automate artillery, in order to respond to the 
exceptionally fast and mobile action of enemy planes. It was 
a matter, in other words, of targeting and eliminating 
problems, by setting up circular flows of self-correcting 
information. This kind of feedback is negative: it does not 
seek to add energy to the system, but merely to correct the 
errors on the way to purpose (a pragmatic purpose whose 
singleness is elevated, by Wiener and his colleagues, to the 
status of "teleology"). The Revolution in Military Affairs, 
or even closer to us, the current frenzy over biometrics, 
bears witness to this way of thinking, what might be called 
government by self-preservation. More broadly, the entire 
logistical system of globalized industry and distribution, 
then of just-in-time production, is based on this kind of 
first-order cybernetics. It may therefore be worth exploring 
the hypothesis that as a governmental science, first-order 
cybernetics corresponds to an economic phase of depth, and 
to situations of violent conflict, where the priority is to 
look out for number 1.

Yet the more interesting question, once again, concerns the 
phases of breadth, and the varieties of so-called 
second-order cybernetics. Take for starters the "system 
dynamics" of Jay W. Forrester, developed in volumes of 
continually expanding scope: Industrial Dynamics (1961), 
Urban Dynamics (1969), World Dynamics (1973). His innovation 
was to study the feedback loops that come into play between 
distinct systems, each of which are already dynamic and 
feedback-based in their own right. In other words, it was 
the loops between loops that were to be studied; and this, 
in view of transforming the mental maps that each actor has 
of the interrelated systems. Forrester, who did his 
pioneering theoretical work in the 1950s and early 60s, was 
perfectly in tune with the phase of conglomerate capital, 
when corporations moved outside their original industries 
and faced the redoubtable challenge of inter-branch 
management. This was a phase of tremendous expansion, and 
Forrester's models integrate positive feedback, which can be 
seen as the cybernetic equivalent of growth. But despite the 
continuing use of his studies by industry, there is probably 
nothing in Forrester that can interest us philosophically 
today -- as you might guess from the failure of his project 
on World Dynamics, and of the famous Limits to Growth report 
to the Club of Rome, published by his collaborators in 1972.

The problem may be that Forrester's models can predict only 
the growth, and never succeed in staging an encounter with 
the limits. The problem, in other words, may be that there 
is no room for radical otherness in a positive feedback 
system. Yet such encounters are the necessary consequences 
of a breadth economy, when it entails the induction of 
massive numbers of new workers into the capitalist labor 
market, as it did in the '60s -- and then even more 
extensively in the '90s.

Consider where positive feedback led. In 1994 the economist 
Brian Arthur, linked to the Santa Fe Institute for 
complexity studies, published a book entitled Increasing 
Returns and Path Dependence in the Economy, in which he 
showed how positive feedback into a network can lead to 
exponential growth and monopoly positions. This turned out 
to be the key theoretical text of the new economy, which was 
predicated at once upon the exponential expansion of 
networks, and on the monopoly position of those who 
establish the technological standards. So here is another 
question: whether the expansion of a system through the 
circular reiteration of its own potentials can be correlated 
with the heavily financialized kind of breadth economy that 
was developed during the Internet boom, when dominant 
capital invented whole new digitized realms for the 
multiplication of its increasingly semiotic wealth. Could 
the political-economic agitations of the turn of the 
century, including the protest movements in which some of 
participated, have been an inevitable culmination of this 
semiotic expansion? If this were true, then the speculative 
krach of the years 2000-2001 would appear as a classic case 
of uncontrollable oscillation, exactly as Norbert Wiener 
describes it in his early work on servomechanisms, when he 
speaks of a hunting pattern that spirals out of control in a 
steering device whose excessive feedback corrections cause 
it to overshoot its own marks, worsening the situation with 
each new attempt at resolution. (12) This would seem to be 
the destiny of the long breadth phase that came to its 
culmination at the turn of the century.

With this, I can reach a provisional conclusion. The present 
disaster is its own condemnation; but we have yet to 
sufficiently map all the interests that combine to make it 
endure. Only a more precise treatment of the collusion 
between specific state and corporate actors and an increased 
understanding of the two-phase nature of differential 
accumulation can provide a common language of critique and 
resistance, able to traverse the generations. And this 
language will undoubtedly be needed. Beyond the present 
moment, perhaps a decade into the future, lies the 
possibility of another phase of breadth. If it comes, will 
be intensive this time, expanding into the micro-dimensions 
of bio- and nano-technologies, as a new envelope imploding 
the limits of the global. Such a phase would have tremendous 
subjectifying power. It seems to me that as cultural 
activists, we have to consider the relative failure of the 
attempts to overflow the preceding breadth phase by 
introducing more-or-less arbitrary information and 
unpredictable behavior into the system. I'm thinking, among 
others, of culture-jamming, carnivalesque consumption, 
corporate over-identification and the subversive insistence 
on the libertarian content of neoliberal slogans. All of 
these strategies attempt to outrace what is already a 
self-accelerating process of perpetual recombination: they 
are a kind of flight before the storm. But a system that 
expands by absorption, through fusion and acquisition, with 
the delirious ambition of integrating all obstacles into an 
infinite multiplication and diversification of the same 
basic principles, seems fated not to overflow its own 
bounds, but at the limit-point, to reverse into its mirror 
opposite: which is a targeting system that works, government 
by destruction. How do we transform our models, without 
ignoring reality? The inability to map the gyrations of the 
same, and to encounter, at their limit, the irresolvable 
equation of the other, is what keeps us inside the concept 
of Peace-for-War.

1. Ezequiel Adamovsky, "Autonomous Politics and its 
Problems: Thinking the Passage from Social to Political" 
2. Shimshon Bichler and Jonathan Nitzan, "Dominant Capital 
and the New Wars," Journal of World Systems Research, vol. X 
no. 2 (Spring 2004), available at 
http://bnarchives.yorku.ca. All the graphs reproduced here 
come from this article. Indeed, part I of this text is 
merely an abbreviated synthesis of Bichler and Nitzan's 
major theses, which deserve a wider audience.
3. Ibid., p. 276.
4. Loose Change can be viewed at 
http://www.loosechange911.com. Also see the critique, 
"Sifting through Loose Change," 
5. Frederic Jameson, "Cognitive Mapping," in Cary Nelson and 
Lawrence Grossberg, eds., Marxism and the Interpretation of 
Culture (Urbana: University of Illinois Press, 1988), p. 356.
6. Inflation plus stagnation are the earmarks of what 
Bichler and Nitzan call a depth regime. Currently, 
speculations about possible stagflation in the US economy 
abound; for the most "authoritative" (or rather, normative) 
source, see The Economist,  May 5, 2005, "Inflation, the 
The Financial Times article urging inflation can be 
consulted at 
7. The PNAC text is at 
8. Compare the remarks of Chalmers Johnson, the conservative 
critic of US empire: "In our society, we don't want to admit 
how deeply the making and selling of weaponry has become our 
way of life; that we really have no more than four major 
weapons manufacturers -- Boeing, Lockheed Martin, Northrop 
Grumman, General Dynamics -- but these companies distribute 
their huge contracts to as many states, as many 
congressional districts, as possible.... This is state 
socialism and it's keeping the economy running not in the 
way it's taught in any economics course in any American 
university. It's closer to what John Maynard Keynes 
advocated for getting out of the Great Depression -- 
counter-cyclical governmental expenditures to keep people 
employed." Interview by Tom Engelhardt, "Chalmers Johnson on 
our Military Empire," March 2006, 
9.  The book, published by Pluto Press, is available in full 
at bnarchives.yorku.ca.
10. Felix Guattari, "Capital as the Integral of Power 
Formations," in: Chaosophy: Soft Subversions (New York: 
Semiotext(e), 1996).
11. Arturo Rosenblueth, Norbert Wiener, Julian Bigelow, 
"Behavior, Purpose and Teleology," in: Philosophy of 
Science, vol. 10. no. 1 (Jan. 1943).
12. "On the other hand, under certain conditions of delay, 
etc., a feedback that is too brusque will make the rudder 
overshoot, and will be followed by a feedback in the other 
direction, which makes the rudder overshoot still more, 
until the steering mechanism goes into a wild oscillation or 
hunting, and breaks down completely." Norbert Wiener, 
Cybernetics, or Control and Communication in the Animal and 
the Machine (Cambridge, Mass.: MIT Press, 1965 [1948]), p. 7.

[All websites consulted July 25, 2006.]

An archive of my work exists at www.u-tangente.org; click 
the name on the left of the homepage.

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