Nation-state foreign policy: national or capital interest?

Foreign policy is often viewed as an international mouthpiece, acting as a product of the associated states and their shifting balance between values (social justice, democratic development etc) and national interests, both through the lens of neorealism (security, militarism, counter-terrorism action) and neoliberalism theory (trade relations, foreign investment, peacekeeping) (Copeland, 2007). As well as through a Marxist perspective which views political order primarily through an economic lens, with the economic base (global capitalism) shaping and conditioning the superstructure (foreign affairs, policymaking, culture) (Baylis, Smith and Owens, 2019, p.119). Considering these theoretical bases in the context of foreign policies surrounding the 2003 Iraq war and the bilateral invasion by Western states, the India-Pakistan interstate conflict over the Kashmir region since independence and the changing relations between the United States and China after the fall of the Soviet Union, through to China’s rise as a global hegemon. This essay will argue that states’ foreign policies are largely dictated by capitalist interest.

The United States’ (US) bilateral invasion of Iraq, alongside Britain, in 2003 following the 9/11 attacks of 2001 was one associated with the rhetoric of a ‘war on terror’ by Western media outlets (Daniel et al., 2004). With the US setting out to spread the growth of capital democracy and free market trade, ultimately to overthrow the dictatorship of Saddam Hussain and installing a representative democratic party (Scott, 2005). With many scholars, such as Noam Chomsky (2005) taking on a Morgenthauian position - claiming this act of imperialism was an attempt by the US to project their power and values. While the rhetoric was weaponised to justify these realist foreign policies, both for national (maintain the status quo) and foreign (create democratic order in Iraq) security – as the US believed Hussain was developing weapons of mass destruction and was allied with Al-Qaeda - there was mass expropriation of Iraq’s natural resources (Adu-Pipim Boaduo, 2012). The agenda was to expropriate and privatise Iraq’s oil due to the fact Iraq was believed to have over 10% of the global oil reserve, as well as the second largest conventional oil reserve (Doherty, 2004). With Secretary of the Treasury at the time Paul O’Neill stating in February 2001: ‘the national security council was already drafting a document detailing how the State would divide Iraq oil fields among the major Western oil companies after the invasion.’ The capital motive is exemplified further with the US rejecting the decision to invade Saudi Arabia, with 15 out of the 19 hijackers in the attacks coming from the region, as this would jeopardise corporate oil relations between the two states (Adu-Pipim Boaduo, 2012). With rising demand for energy post-9/11 and the fact the US imported vast amounts of oil from Canada and Latin America (around 50%, as well as 14% from Africa) (National Energy Policy, 2001), one could propose that the US seized Iraq oil not for consumption, but to further monopolise the market to regulate the world economy (Mercille, 2009). Thus, drawing upon Lenin’s development of capitalism to a stage of monopolism – with a powerful developed core state exploiting a less powerful periphery state (Baylis, Smith and Owens, 2019, p. 120). While it could be argued that this motivation behind the invasion could have been averted by purchasing Iraq’s oil on the open market (Agnew, 2003); the US economy was becoming increasingly dependent on oil importation, thus controlling oil security can be used as leverage of economic power against rising powers at the time, such as China (Harding, 2004). Considering the aforementioned, while US foreign policy in the decision to invade Iraq was legitimised by protectionism with a constructed view driven by the media, the reality was heavily influenced by capital interests, with natural resources controlled to propel their economies to further grow the nation-state as a global power and influence.

Following India’s liberation from the British empire in 1947 and the partition with Pakistan soon after, the issue around the Kashmir region has been one that shapes foreign relations and has driven inter-state conflict – with three major and two minor wars fought since gaining independence (Kuszewska, 2016). Foreign relations between China and Pakistan were centred around militarism in the 1960s, with Beijing providing military and technical support following a border war with India in 1960 (Kuszewska, 2016). As a result, India was faced with a security dilemma due to feared bilateral action from both states, and so pursued nuclear tests in 1974 (Hussain, 2019). This coupled with the Indo-Pakistan war in 1971 – whereby Pakistan lost half of its population and a quarter of its land led to a shift in Pakistan’s foreign policy with India to that of nuclear (Hussain, 2019) – adopting a realist stance of ‘more nukes are better’ to deter threat (Waltz, 1995, pp. 1-40), supporting Waltz’s notion of power, in that ‘power in international politics is a means to an end, the end being security’ (Baylis, Smith and Owens, 2019, p.137). In response to this, Delhi responded with nuclear testing in May 1998, with Pakistan pursing further nuclear policy by testing in the same month (Hussain, 2019). This ‘security dilemma’ has pursued continuously with India’s military spending increasing from $11.35B in 1988 to $47.4B in 2013; with Pakistan following a similar trend from $2.7B in 1988 to $7.65B in 2013 (Papadimitriou and Pistikou, 2015). Thus, foreign policies between the two states centred around nuclearism as a product of realism and protectionism rather than capitalist agendas.

Furthermore, aside from the nuclear threat in inter-state conflict over Kashmir, there also exists a war on water with India pursuing a dam project in the disputed line between the states to cover the ever-growing needs of its growing population, as well as the prospect of advancing their economic prowess (Papadimitriou and Pistikou, 2015). This policy was met with great anxiety on Pakistan’s end due to the state’s economic reliance on water – with agriculture accounting for 24% of national GDP, 70% of exports and 48% of their labour force (Kuszewska, 2016). The state believes that India will weaponize these projects to manipulate water flow to make Pakistan reliant on India to keep its economy stable – thus catering to any capital intentions or interests India may have (Papadimitriou and Pistikou, 2015), establishing the state as a hegemonic power within the region. While a more neoliberal relationship could, in theory, reduce tension and conflict – as well as proving economically prosperous for both states by raising living standards in multiple domains (Dash and McCleary, 2014). There appears to be interrelations between a decline in bilateral trade and each major aggression – with trade plateauing following the 1965 Indo-Pak war, as well as major declines following the attack on the Indian Parliament in 2001 (Dash and McCleary, 2004). With policymakers in both states reluctant to strengthen trade cooperation due to this rivalry and dispute over the region of Kashmir (Dash, 1996), as India’s coalition government in the 1990s often pulled scapegoat tactics against Pakistan and pursed nationalist policies, which was mirrored by the military regime in Pakistan (Dash and McCleary, 2014). Thus, the states’ foreign policies remain largely shaped by realism through security fears and protectionism; with little concern for trade cooperation to foster any capitalist intentions.

Moving from localised foreign policy between Eastern states to Western-Eastern relations between the US and China, particularly after the fall of the USSR in 1991 whereby the US were perceived as a major hegemonic superpower. With the US spending over 10 times that of China on the military – owning 95% of nuclear arms with Russia, as well as accounting for 25-30% of the global GDP; China seen the US as a security threat (Zhang, 2016). Both politically with regards to intervention in the Taiwan reunification process and the Chinese political system concerning human rights issues, as well as economically with concerns around China’s World Trade Organisation membership (Shouyuan, 1996). Conversely, China also seen great opportunity in cooperation with the US, both in terms of economic growth through trade and investment, and the stability of peace and engagement policy (Zhang, 2016). With this largely outweighing the threat of intervention in Taiwan and political instability, China opted to pursue neoliberal foreign policy with the US centring around cooperation and appeasement, with elements of capitalist interest.

With China’s continual economic development into the 21st century, the perception of the power imbalance between the two states has significantly closed, with a 2014 report from the World Bank proposing that Chinese GDP would surpass that of the US by the end of the year, in addition to being militarily sufficient to defend national interests in the event of inter-state conflict (Zhang, 2016). As a result, the foreign policy behaviour towards the US had shifted from that of submissiveness and pacificism; to that of assertiveness – with the US retaliating with often confrontational behaviour (Zhang, 2016). As there appeared to be a decline in US global hegemony which coincided with a rise in Chinese global hegemony (Layne, 2018). This confrontational behaviour was exemplified under Trumps’ presidency with regards to the ‘trade wars’ in 2019 whereby tariffs were increased to 25% on $200B worth of Chinese goods (Bryan, 2019), with China matching the policy (Boylan et al., 2020). Trump’s motivations were primarily that of economic nationalism by reducing the reliance on other states for energy supplies, prompted by the fact China accounted for 47% of the $796B trade deficit of 2017 (Vinogradov et al., 2019). In a global neoliberal context, energy independence can act as leverage to compete with other rivals through exports, paired with a reduction in the trade deficit. As well as domestic benefits from a capitalist perspective – bringing jobs in the energy industry to the US is of great benefit to corporate owners, many of whom were great supporters of the Trump presidency (Boylan et al., 2021). The shift from liberal foreign policy to that of protectionism was thus largely shaped by capital interests by protecting domestic markets and encouraging national consumption over global consumption, to counteract the growing reliance of a hegemonic state.

In conclusion, states’ foreign policies are largely dictated by capitalist interests as in the case of US-Iraq although US foreign policy was portrayed through media narratives as maintaining both national and foreign security via a constructed threat, it legitimised and justified imperial mission to expropriate and seize Iraq’s highly valuable natural resources to further monopolise the oil market, while neglecting Saudi Arabia to maintain trade relations. The interstate conflict over Kashmir between India and Pakistan has led to both states maintaining majorly realist relations due to security threat and the consistent exercise of power and nuclear prestige, which continues to discourage interstate trade. However, with time there could be some capitalist interest in India’s foreign policy towards Pakistan with the opportunity of controlling Pakistan’s water supplies from the Kashmir region, an integral part of their agricultural economy. Following the collapse of the Soviet Union with the US perceived as a major global superpower, China pursued neoliberal driven foreign relations with the US to prevent intervention in Taiwan, as well as simultaneous economic growth. With China’s rise overtime, the US turned to protectionist foreign policies via trade tariffs, catering to capitalist interests domestically by increasing national consumption and bringing about employment opportunities.

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