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Chinese and Russian aggression against the democracies is likely to grow, the United States might critically weaken, and the EU seems firmly set on pursuing a middle path. Instead of worrying about looking back to the past, leaders in Ottawa, Canberra, and London should embrace the idea and propose a significant deepening of their foreign-policy coordination. This is most definitely not about “getting the band back together,” as one British Conservative member of Parliament greeted a trade talk announcement, but three middle powers building an anti-authoritarian group to resist great-power bullying in the 21st century.

A mini C-3 format would offer the best approach: a summit with follow-up that is both flexible and lightweight enough to get off the ground but with a permanent working group in foreign ministries advancing dossiers and initiatives. As the C-3 are all Commonwealth countries, summits could be timed to coincide with the biennial Commonwealth Heads of Government Meeting, where the leaders of Canada, Australia, and Britain regularly meet anyway.

Drawing both on Britain’s joint initiative with Canada to block Putin attending the G-7 and on Canada’s humiliating experience at the U.N., among this C-3’s first tasks should be to coordinate joint positions inside the U.N., G-7 and G-20. As far as major goals are concerned, this could include supporting any future attempts of Canada to win a seat on the U.N. Security Council and for Australia to formally join the G-7.

This is not about replacing working with the EU or the United States but creating a group for Canada, Australia, and Britain to jointly present tougher anti-authoritarian packages to big powers than had they tried to individually present them alone. The C-3, like the E-3 to the EU, would be complementary to existing Euro-Atlantic bodies.

deeper cooperation between Britain, Canada, and Australia has an image problem

imperial nostalgia or conservative culture politics

too anchored on ethnic fraternity

the idea needs to be decolonized

what about other middle powers? Why not include, say, Japan? This is where two critical principles of international politics come into play: Does your grouping have enough like-mindedness to be able to function and enough load-bearing capacity to get anything done? What Canada, Australia, and Britain are after is mutual geopolitical support; adding members that aren’t willing to offer that risks creating another talking shop like the Franco-German Alliance for Multilateralism. That group, which stretches from Chile to Kazakhstan, lacks the ability to agree on anything of substance—and the power to act on it.

there are simply not a lot of like-minded democracies to go around

Ottawa, Canberra, and London didn’t need each other in a U.S.-led world order or in a relatively benign world without authoritarian superpowers. But that system has decayed. Deep divisions, not just between the Europeans and Donald Trump, but with much of the U.S. national security establishment, are breaking up the old Washington-led ideological West. The common anti-authoritarian frame that once glued together Western foreign policy has come unstuck

In this world, the C-3 is a liberal international, not a nationalist, cause

polls show Britons are cooling to Brexit and are coming to realize that the ultimate irony of the slogan Johnson and other Leavers deployed during the Brexit campaign—“Take Back Control”—is that Britain has relinquished even more control to Brussels. 

Just as Trump pretended he was giving the American people a better NAFTA deal (which now has little chance of congressional passage) and pulled out of the Trans-Pacific Partnership—which had been the single most effective means of forcing China to behave better on trade and intellectual property rights—to show that he could do it better alone (he hasn’t), Johnson will take his nation through a similar charade. Egged on by Nigel Farage’s Brexit Party—which will threaten him with more Tory defections if he doesn’t keep his word—Johnson will continue to pretend to the British people that they can get better trade deals on their own, when most of the evidence is that instead he will bequeath to them international isolation, ever-rising prices, and permanent economic eclipse. And perhaps the eclipse of the Conservative Party as well.

“Trump will use his relationship to try to get the U.K. to change its views on the Iran nuclear deal,” said Heather Conley of the Center for Strategic and International Studies. Until now, the U.K. has stood with France and Germany in seeking to rescue the 2015 nuclear pact that Trump rejected last year; if it sides with the United States now, that in turn could create more fissures in the trans-Atlantic alliance. 

Trump is plainly eager to have Johnson as an ally in his great task of unmaking the international system

we will all be witnessing a bizarre backward version of the so-called special relationship, one premised on undoing a great deal of what the U.K. and the United States accomplished together after World War II, when both nations oversaw the creation of postwar institutions such as the United Nations and Bretton Woods; British Foreign Minister Ernest Bevin took the lead in creating NATO (even as an exhausted U.K. bequeathed to the United States the role of stabilizer of the West); and the United States and Britain were the primary progenitors of the global free-trading system

It is true that the rise of both Johnson and Trump was a response to a real need for redress in the U.S. and U.K.-conceived international system. Go-it-alone nationalism did not come out of nowhere; both countries staked everything on globalization and free trade—particularly in the financial sector—and the middle class in both the United States and Britain had suffered from it. Indeed, Britain did even worse than the United States after the 2008 crash, and the Brussels bureaucracy had grown irritatingly intrusive. It’s probably surprising that it took this long for a backlash like Brexit to occur. But pointing out serious flaws in the system is not an argument for junking it altogether. And that’s where the new special relationship may be headed for trouble.

It says, in effect, all options – deal, no deal, rethink – remain open, but you have three weeks to choose.

Backed by the Dutch, Irish and others, Merkel also felt it would be a terrible idea for the EU’s future relationship with Britain to begin with the UK crashing out. “We will do everything we can to ensure this does not happen,”

“No deal would be bad news for all economically, even if it would be far worse for Britain than the 27,” a Dutch official said. “But politically it would be terrible. We had to find a way that left all options open for London – that basically ensured that no deal, if it happens, is Britain’s responsibility.”

the EU27 wanted to move on because, quite simply, it has other things to deal with. Last week’s summit was once again hijacked by Brexit, which delayed a session on relations with China. Tensions with Russia, internal strains with the bloc’s nationalist governments, trade and security in the age of Trump, climate change, a slowing economy – all are more deserving of attention than Brexit.

Despite their exasperation with Brexit Britain, the EU27 recognise that the liberal postwar order now faces unprecedented challenges, and that no one in the bloc will be well served by a bitter divorce and a resentful, badly weakened UK. So a path to a reconsidered, potentially softer Brexit, entailing a relaxation of May’s red lines, should remain on the table for a little while yet.

Sukarno, like many Indonesians, including the PKI, believed the creation of a Malaysian federation was unwarranted regional interference by the British to maintain their colonial dominance.

Like its US and Australian allies, Britain feared a communist Indonesia. The PKI had three million members and was close to Mao’s China. In Washington the fall of the Indonesia “domino” into the communist camp was seen as a greater threat than the potential loss of Vietnam.

Suharto, appointed supreme army commander on 14 October, used the rebellion to undermine and eventually overthrow Sukarno, and as what historian John Roosa has called a “pretext for mass murder”: the elimination of the PKI in a series of massacres across Indonesia that resulted in the deaths of hundreds of thousands of people.

British intelligence agencies and propaganda specialists were complicit, carrying out covert operations to undermine Sukarno’s regime and eliminate the PKI by blaming them for the Untung coup.

Reddaway had served in the army during the second world war before joining the Foreign Office and playing a key role in the establishment of IRD. After the failed Untung coup he arrived to take charge of the British operation. His brief was simple. In an interview in 1996 with two of the authors, he said he’d been given a budget of £100,000 by the Foreign Office and was told “to do anything I could do to get rid of Sukarno”. Only now do we know what “anything” fully meant.

“No, we do not cry out for violence,” the IRD propagandists wrote, “but we demand in the name of all patriotic people that this communist cancer be cut out of the body of the state.” The PKI “is now a wounded snake”, they wrote: “Now is the time to kill it before it has a chance to recover.”

Detailed historical research has established that the mass killings of PKI party members and alleged supporters appear to have been triggered by local army commanders or the arrival of army special forces, about three weeks after the botched coup had been put down by Suharto.During that period the media in Indonesia was full of black propaganda against the PKI and its alleged atrocities, as the army whipped up popular anger against communists and legitimised what Roosa has described as its “already-planned moves against the PKI and President Sukarno”.

The newsletters were approved by IRD in London before dispatch. Copies sent to senior Foreign Office officials were destroyed after reading at IRD’s request.

“Anyone who was leftist was picked up. They were very systematic. They targeted all the leftist groups and not just PKI. People kept themselves to themselves and only talked in whispers.”

As the massacres progressed in the autumn of 1965, IRD’s unit in Singapore reassured their readers as to the necessity of the slaughter.In Newsletter 21 they wrote: “Unless we maintain a vigorous campaign to eradicate communism … the red menace will envelop us again.”The stakes were life and death. “We are fighting for our lives and the very existence of Indonesia and we must never forget that. THE CATS ARE WAITING TO POUNCE!”In Newsletter 23 Winchester Road’s propagandists praised “the fighting services and the police” for “doing an excellent job”. Sukarno, then trying to restrain the generals, was wrong: “Communism must be abolished in all its forms. The work started by the army must be carried on and intensified.” The authors finished by equating the PKI to Hitler and Genghis Khan.

What Gilchrist wanted and what became the unit’s mission was the production of black propaganda, apparently produced by patriotic Indonesian émigrés abroad, to stir Indonesian anti-communists into action.The influential targets of a propaganda newsletter, according to a declassified report by Wynne, would eventually include “as many personages in the hierarchy of government, army and civil service as we can find”.To disguise the British origin of the newsletter it was sent into Indonesia via Asian cities including Hong Kong, Tokyo and Manila.

In the 1996 interviews Reddaway boasted of manipulating the British and other global media to take an anti- Sukarno and PKI line but insisted IRD only passed on true facts and did not use black propaganda.As ever with IRD, Reddaway told us a partial truth. According to a memo he had written: “The bludgeon was surprisingly effective because we were able … to supply publicists with information which they could not find from other sources because of Sukarno’s censorship.”

“GCHQ could break and read Indonesian codes without difficulty. The government was among many third world countries using equipment supplied by Swiss-based company Crypto AG. For over 50 years, Crypto AG supplied secretly sabotaged cypher machines, with built-in back doors to which the CIA and GCHQ had keys.”

The newsletters remained the core work of Ed Wynne and his colleagues in Winchester Road. A key theme was to encourage their influential readers to support the army’s campaign against the communists. They urged Indonesian patriots: “The PKI and all it stands for must be eliminated for all time.”We now know that to do that they included sensationalised lies. On 5 November the pro-military Jakarta Daily Mail claimed that on the day of the Untung coup 100 women from PKI’s Gerwani women’s organisation had tortured one of the generals using razor blades and knives to slash his genitals before he was shot.The story of the torture and mutilation of the generals by the Gerwani women became part of the founding myth of Suharto’s regime, used to justify the destruction of the PKI. It was also, according to Roosa, a pretext for murder. A lie propagated by the Indonesian army, regurgitated and repurposed to incite IRD’s influential readers.

The IRD was deliberately silent on the massacres. One document from December 1965 says they should “do nothing to embarrass the generals” and the newsletter carefully itemises accounts of isolated incidents of PKI brutality but makes no explicit mention of the army’s killings.

By early 1966 the mass murders in Indonesia, if not their scale, were well known.In January Robert F Kennedy compared the massacres to “inhuman slaughters perpetrated by the Nazis and the communists” and asked when people would “speak out … against the inhuman slaughter in Indonesia, where over 100,000 alleged communists have not been perpetrators, but victims?”

Wynne regarded the operation as a success. In his 1966 annual report he proudly says his operation was “fairly successful” because all his enemies (Konfrontasi, Sukarno, Subandrio and the PKI) were “destroyed”.

According to Prof Scott Lucas of the University of Birmingham, the declassified documents show that: “Britain was prepared to engage in dirty deeds which ran contrary to its purported values.” They reveal, he says, “how important black propaganda was to give the illusion that Britain could wield global power – even if many people might be killed for that illusion”.

Without a working majority, party leaders must pay attention to their hard-liners, or, as some Conservative Party members have been known to call them, “swivel-eyed loons.”

Normally, Britain’s flexible political system could accommodate one party’s indulgence of extremism: if the Conservatives found themselves advocating something radical such as leaving the EU, this would typically open up space in the center for Labour to position itself as the defender of economically pragmatic close relations with it. However, Labour is currently led by the far-left and anti-European Jeremy Corbyn, keen to facilitate Brexit and take advantage of the economic chaos to implement a radical socialist agenda.

new, essentially sectarian political identities created by the Brexit referendum itself. Leavers and remainers move in different social circles and have different understandings of the central facts of Brexit

rampant reports of conspiratorial plots within the cabinet: remainers plotting a new referendum (and seeking legal advice on whether Britain’s decision to leave could be revoked by executive action, without consulting Parliament) and anti-Europeans threatening to resign from the government, reject the withdrawal agreement Theresa May negotiated with the EU, and leave without any sort of deal at all. (The Bank of England estimated that such a “disorderly” Brexit would cause unemployment to almost double, inflation to rise to more than 6 percent, house prices to fall by 30 percent, and the pound to fall below parity with the euro.)

There is no majority for any policy at all in Parliament

The true limits of their power now revealed, no-deal Brexiteers are now contemplating a legislative strike, which would deprive the government of its majority for everything except confidence votes, or even forming a new hard-right party. That would allow them to vote against the government in a confidence vote and provoke an election. The effect of a new party would, however, be to split the anti-Labour vote and give Jeremy Corbyn a good chance of entering Downing Street

The only certainty is that Britain’s political rewards now go to men and women who promote polarization, not compromise

David Cameron’s decision to hold this referendum about a question so fundamental to Britain’s national identity opened up this chasm in the country

the young now identify as pro-European in a way that would never have occurred to them before the 2016 vote. The weight of their increasing numbers will eventually tell. Yet the boomers’ demographic albatross will press further still if, as is in my view probable, English political chaos stimulates Scotland to choose independence and (though this is less likely) Northern Ireland to unite with the Irish Republic.

A decade of intense political conflict is a grim prospect for a country with few formal institutions and weak legal oversight of the political process. The desire to seize positions of power and hold them against equally matched enemies is more associated with countries on the descent toward civil war than mature liberal democracies like the United Kingdom

Even as an academic exercise, the details have raised alarm among EU diplomats by exposing an “absolutely huge” gap in expectations with London when there are only a few days left for talks. Theresa May, UK prime minister, has pledged to put a revised Brexit package to a House of Commons vote by March 12.

Both the EU and UK want to allay Brexiters’ fears that the backstop could become a permanent arrangement, keeping Britain in a customs union with the EU and tying Northern Ireland even more closely to the bloc’s regulatory regime. But there are fundamental differences over how such reassurances can be offered without compromising the withdrawal treaty or EU law.

proposed an arbitration process using a test of “reasonableness” to determine whether the UK acted in good faith.

After the EU’s response to his plans, Mr Cox warned Mrs May he was not yet able to change his legal advice, which concluded that the backstop could leave Britain trapped in a customs union “indefinitely”. That judgment contributed to MPs’ historic 230-vote rejection of the prime minister’s deal in January.

At best, one ambassador said he hoped the bruising talks this week had a “pedagogical effect”, bringing Mr Cox around to a more realistic departure point for negotiations.

“They are a new team who are looking for fresh ideas,” said one official handling Brexit for an EU member state. “We all know the ideas aren’t fresh and won’t fly. But we maybe have to go through the motions.”

“The only game now is out-Faraging Farage,”

Johnson’s entire gambit has been to provoke his opponents in Parliament into forcing him to delay a no-deal Brexit—allowing him to claim that his attempt to implement the 2016 Brexit referendum has been thwarted by an undemocratic, pro-EU Parliament. More, he wants to blame his opponents for forcing him to call the general election that he actually wants. And in that sense, Johnson has succeeded on both counts.

Even the usually pro-Conservative Times newspaper expressed dismay at Johnson’s ruthless bluffing. “Nothing is as it seems. Boris Johnson wanted and intended to lose his historic vote,” wrote Jenni Russell. “Johnson and his chief strategist, Dominic Cummings, deliberately planned and engineered last night’s defeat, goading the Commons into opposing him; he was lying to his party, parliament and the country when he claimed that he was being pushed into calling an election.”

The Brexit endgame, then, has become a tug of war over what election date will be maximally damaging for the Conservatives and least damaging for Labour

Labour would love to delay the public vote until after Johnson is humiliatingly forced to ask for a Brexit deal—which would be a boost for the Brexit Party and scupper Conservative chances of power.

with a mandatory delay of Brexit fast making its way into law, the only way for Britain to leave the EU now will be for Johnson to persuade a majority of voters to back his radical, no-deal version of Brexit in a general election. And the polls have been showing that public opinion is going in the opposite direction.

The acquisition would mimic the 2017 purchase of celebrated soccer star Neymar by Qatar-owned Paris St. Germain for US$277 million intended to demonstrate that the Gulf state was unaffected by the then several months-old Saudi-UAE-led economic and diplomatic boycott.

a decision by the Premier League to reject the acquisition of Newcastle would be perceived as yet another of Prince Mohammed’s self-inflicted public relations fiascos that include multiple failed attempts to position the kingdom as a powerhouse in international soccer governance

Prince Mohammed is betting that the Premier League at a time of economic crisis and with Britain needing to forge new trade relationships in the wake of its departure from the European Union may not want to slam the door on a wealthy investor and/or jeopardize British relations with the kingdom.

Saudi Arabia responded in 2018 to Canadian criticism of the kingdom’s human rights record by withdrawing its ambassador and freezing all new trade and investment transactions. German criticism of a failed Saudi attempt to force the resignation of Lebanon’s prime minister led that same year to a de facto downgrading of diplomatic relations and reduced trade.

The League has tightened its criteria to test potential club owners on their integrity and reputation. The criteria include ensuring that a potential owner has not committed an act in a foreign jurisdiction that would be a criminal offence in Britain, even if not illegal in their own country.

Supporters of the acquisition argue that it bolsters Prince Mohammed’s reforms in a soccer-crazy country and reaffirms his push to break with the kingdom’s austere, inward-looking past. They reason further that it will bolster investment in Newcastle and surroundings at a time of impending economic hardship.

Supporters only need to look at Manchester where the United Arab Emirates’ acquisition of Manchester City more than a decade ago has benefitted not only the club but the city too.

supporters of Newcastle are likely to welcome the financial injection and departure of the club’s unpopular current owner, Mike Ashley, and ignore condemnation of the deal by human rights activists, including Amnesty International, as “sportswashing, plain and simple.”

The Observer last year revealed the IRD’s major campaign in Indonesia in 1965 that helped encourage anti-communist massacres which left hundreds of thousands dead. There, the IRD prepared pamphlets purporting to be written by Indonesian patriots, but in fact were created by British propagandists, calling on Indonesians to eliminate the PKI, then the biggest communist party in the non-communist world.

“The UK did not simply invent material, as the Soviets systematically did, but they definitely intended to deceive audiences in order to get the message across.”

“reports” sent to warn other governments, selected journalists and thinktanks about “Soviet subversion” or similar threats.The reports comprised carefully selected facts and analysis often gleaned from intelligence provided by Britain’s security services, but appeared to come from ostensibly independent analysts and institutions that were in reality set up and run by the IRD. One of the first of these, set up in 1964, was the International Committee for the Investigation of Communist Front Organisations.

In early 1963, the IRD forged a statement from the World Federation of Democratic Youth, a Soviet front organisation, which denounced Africans as uncivilised, “primitive” and morally weak. The forgery received press coverage across the continent, with many newspapers reacting intemperately.

The IRD also forged literature purporting to come from the Muslim Brotherhood, a mass Islamist organisation that had a significant following across the Middle East. One pamphlet accused Moscow of encouraging the 1967 war, criticised the quality of Soviet military equipment, and called the Soviets “filthy-tongued atheists” who saw the Egyptians as little more than “peasants who lived all their lives nursing reactionary Islamic superstitions”.AdvertisementThe IRD also created an entirely fictive radical Islamist organisation called the League of Believers, which attacked the Russians as non-believers and blamed Arab defeats on a lack of religious faith, a standard trope among religious conservatives at the time.

The IRD’s leaflets echoed other claims made by radical Islamists, arguing that military misdeeds should not be blamed on “the atheists or the imperialists or the Zionist Jews” but on “Egyptians who are supposed to be believers”.

Other material highlighted the poor view that Moscow took of the Palestine Liberation Organisation and the limited aid offered by the Soviets to Palestinian armed nationalist groups. This was contrasted with the more supportive stance of the Chinese, in a bid to widen the split between the two communist powers.

One major initiative focused on undermining Ian Smith’s regime in Rhodesia, the former colony that unilaterally declared its independence from the UK in 1965 in an attempt to maintain white minority rule.The IRD set up a fake group of white Rhodesians who opposed Smith. Its leaflets attacked him for lying, creating “chaos” and crippling the economy. “The whole world is against us … We must call a halt while we can still save our country,”

Between 1965 and 1972, the IRD forged at least 11 statements from Novosti, the Soviet state-run news agency. One followed Egypt’s defeat in the 1967 six-day war against Israel and underlined Soviet anger at Egypt’s “waste” of so much of the arms and materiel Moscow had supplied to the country.

A similar forgery in 1966 underlined the “backwardness” and “political immaturity” of Africa. Another, a statement purportedly from Novosti, blamed poor academic results at an international university in Moscow on the quality of the black African students enrolled there. The IRD sent more than 1,000 copies to addresses across the developing world.

As with most such efforts, the impact of the IRD’s campaigns was often difficult to judge. On one occasion, IRD officials were able to report that a newspaper in Zanzibar printed one of their forgeries about Soviet racism, and that the publication prompted an angry response. This was seen as a major achievement. Officials were also pleased when Kenyan press used fake material about the 1967 six-day war, and when newspapers across much of the Islamic world printed a fake Novosti bulletin on the conflict. Occasionally, western newspapers unwittingly used IRD materials, too.

Though the IRD was shut down in 1977, researchers are now finding evidence that similar efforts continued for almost another decade.“The [new documents] are particularly significant as a precursor to more modern efforts of putting intelligence into the public domain.“Liz Truss has a ’government information cell’, and defence intelligence sends out daily tweets to ‘pre-but’ Russian plots and gain the upper hand in the information war, but for much of the cold war the UK used far more devious means,” Cormac said.

press freedom advocacy groups have tracked more than 125 incidents in three days of journalists facing attacks from police and protesters and other press freedom violations, including incidents with foreign journalists from Germany, Britain, and Australia.

Our analysis confirms that unequal exchange is a significant driver of global inequality, uneven development, and ecological breakdown.

Today, we are told, the world economy functions as a meritocracy: countries that have strong institutions, good markets, and a steadfast work ethic become rich and successful, while countries that lack these things, or which are hobbled by corruption and bad governance, remain poor. This assumption underpins dominant perspectives in the field of international development (Sachs, 2005, Collier, 2007, Rostow, 1990, Moyo, 2010, Calderisi, 2007, Acemoglu and Robinson, 2012), and is reinforced by the rhetoric, common among neoclassical economists, that free-trade globalization has created an “even playing field”.

Emmanuel and Amin argued that unequal exchange enables a “hidden transfer of value” from the global South to the global North, or from periphery to core, which takes place subtly and almost invisibly, without the overt coercion of the colonial apparatus and therefore without provoking moral outrage. Prices are naturalized on the grounds that they represent “utility”, or “value”, or the outcome of “market mechanisms” such as supply and demand, obscuring the extent to which they are determined by power imbalances in the global political economy. Price differentials in international trade therefore function as an effective method of maintaining the patterns of appropriation that once overtly defined the colonial economy, allowing blame for “underdevelopment” to be shifted onto the victims.

Historians have demonstrated that the rise of Western Europe depended in large part on natural resources and labour forcibly appropriated from the global South during the colonial period, on a vast scale. Spain extracted gold and silver from the Andes, Portugal extracted sugar from Brazil, France extracted fossil fuels, minerals and agricultural products from West Africa, Belgium extracted rubber from the Congo; and Britain extracted cotton, opium, grain, timber, tea and countless other commodities from its colonies around the world – all of which entailed the exploitation of Southern labour on coercive terms, including through mass enslavement and indenture. This pattern of appropriation was central to Europe’s industrial growth, and to financing the expansion and industrialization of European settler colonies, including Canada, Australia, New Zealand and the United States, which went on to develop similarly imperialist orientations toward the South (e.g., Naoroji, 1902, Pomeranz, 2000, Beckert, 2015, Moore, 2015, Bhambra, 2017, Patnaik, 2018, Davis, 2002).

for every unit of embodied resources and labour that the South imports from the North they have to export many more units to pay for it, enabling the North to achieve a net appropriation through trade. This dynamic was theorized by Emmanuel (1972) and Amin (1978) as a process of “unequal exchange”.Emmanuel and Amin argued that unequal exchange enables a “hidden transfer of value” from the global South to the global North, or from periphery to core, which takes place subtly and almost invisibly, without the overt coercion of the colonial apparatus and therefore without provoking moral outrage. Prices are naturalized on the grounds that they represent “utility”, or “value”, or the outcome of “market mechanisms” such as supply and demand, obscuring the extent to which they are determined by power imbalances in the global political economy. Price differentials in international trade therefore function as an effective method of maintaining the patterns of appropriation that once overtly defined the colonial economy, allowing blame for “underdevelopment” to be shifted onto the victims.

Following Dorninger et al. (2021), we use a “footprint” analysis of input–output data to quantify the physical scale of raw materials, land, energy and labour embodied in trade between the North and South, looking not only at traded goods themselves but also the upstream resources and labour that go into producing and transporting those goods, including the machines, factories, infrastructure, etc.

Grounding our analysis in the physical dimensions of unequal exchange is important for several reasons. First, these resources – raw materials, land, labour and energy – embody the productive potential that is required for meeting human needs (use-value) and for generating economic growth (exchange-value). Physical drain is therefore ultimately what drives global inequalities in terms of access to provisions, as well as in terms of GDP or income (see Hornborg, 2020). Second, this approach allows us to maintain sight of the ecological impacts of unequal exchange. We know that excess energy and material consumption in high-income nations, facilitated by appropriation from the rest of the world, is causing ecological breakdown on a global scale. Tracing flows of resources embodied in trade allows us to determine the extent to which Northern appropriation is responsible for ecological impacts in the South; i.e., ecological debt (Roberts and Parks, 2009, Warlenius et al., 2015, Hornborg and Martinez-Alier, 2016).

Due to the growing fragmentation of international commodity chains, monetary databases on bilateral gross trade flows have been criticised for not accurately depicting the monetary interdependencies between national economies (Johnson and Noguera, 2012), i.e., the amount of a countries’ value added that is induced by foreign final demand and international trade relations. Trade in Value Added (TiVA) indicators Johnson and Noguera, 2012, Timmer et al., 2014 are designed to take into account the complexity of the global economy. The TiVA concept is motivated by the fact that, in monetary terms, trade in intermediates accounts for approximately two-thirds of international trade. Imports (of intermediates) are used to produce exports and hence bilateral gross exports may include inputs (i.e., value added) from third party countries (Stehrer, 2012). TiVA reveals where (e.g., in which country or industry) and how (e.g. by capital or labour) value is added or captured in global commodity chains (Timmer et al., 2014).

TiVA, which is sometimes referred to as the “value footprint”, is the monetary counterpart of the MRIO-based environmental footprint because both indicators follow the same system boundaries, i.e., all supply chains between production and final consumption of two countries including all direct and indirect interlinkages. Moreover, in contrast to global bilateral monetary trade flows, TiVA is globally balanced, meaning that national exports and imports globally sum up to zero. This is an important feature of the TiVA indicator that facilitates more consistent and unambiguous assessments.

for every unit of embodied raw material equivalent that the South imports from the North, they have to export on average five units to “pay” for it

For land the average ratio is also 5:1, for energy it is 3:1, and for labour it is 13:1

Table 1. Resource drain from the South.ResourceNorth → South flows 2015South → North flows 2015Drain from South in 2015Cumulative drain from South 1990–2015Raw material equivalents [Gt]3.3715.3912.02254.40Embodied land [mn ha]527.421,349.01821.5932,987.23Embodied energy [EJ]21.5543.5121.06650.34Embodied labour [mn py-eq]31.11219.22188.125,956.62

in the year 2015 the North’s net appropriation from the South totalled 12 billion tons of raw materials, 822 million hectares of land, 21 exajoules of energy (equivalent to 3.4 billion barrels of oil), and 188 million person-years equivalents of labour (equivalent to 392 billion hours of work). By net appropriation we mean that these resources are not compensated in equivalent terms through trade; they are effectively transferred gratis. And this appropriation is not insignificant in scale; on the contrary, it comprises a large share (on average about a quarter) of the North’s total consumption.

significant consequences for the global South, in terms of lost use-value. This quantity of Southern raw materials, land, energy and labour could be used to provision for human needs and develop sovereign industrial capacity in the South, but instead it is mobilized around servicing consumption in the global North.

Eight hundred and twenty-two million hectares of land, which is twice the size of India, would in theory be enough to provide nutritious food for up to 6 billion people, depending on land productivity and diet composition

material use is tightly linked to environmental pressures. It accounts for more than 90% of variation in environmental damage indicators (Steinmann et al., 2017), and more than 90% of biodiversity loss and water stress (International Resource Panel, 2019). Moreover, as Van der Voet et al. (2004) demonstrate, while impacts vary by material, and vary as technologies change, there is a coupling between aggregate mass flows and ecological impact. Net flows of material resources from South to North mean that much of the impact of material consumption in the North (43% of it, net of trade) is suffered in the South. The damage is offshored.

Industrial ecologists hold that global extraction and use of materials should not exceed 50 billion tons per year (Bringezu, 2015). In 2015, the global economy was using 87 billion tons per year, overshooting the boundary by 74% and driving ecological breakdown. This overshoot is due almost entirely to excess resource consumption in global North countries. The North consumed 26.71 tons of materials per capita in 2015, which is roughly four times over the sustainable threshold (6.80 tons per capita in 2015). Our results indicate that most of the North’s excess consumption (58% of it) is sustained by net appropriation from the global South; without this appropriation, material use in high-income nations would be much closer to the sustainable level.

In consumption-based terms, the North is responsible for 92% of carbon dioxide emissions in excess of the planetary boundary (350 ppm atmospheric concentration of CO2) (Hickel, 2020), while the consequences harm the South disproportionately, inflicting dramatic social and economic costs (Kikstra et al., 2021b, Srinivasan et al., 2008). The South suffers 82–92% of the costs of climate change, and 98–99% of the deaths associated with climate change (DARA, 2012)

Net appropriation of land means soil depletion, water depletion, and chemical runoff are offshored; net appropriation of energy means that the health impacts of particulate pollution are offshored; net appropriation of labour means that the negative social impacts of exploitation are offshored, etc (Wiedmann and Lenzen, 2018). In the case of non-renewable resources there is also a problem of depletion: resources appropriated from the South are no longer available for future generations to use (Costanza and Daly, 1992, World Bank, 2018), which is particularly problematic given that under conditions of net appropriation economic losses are not offset by investments in capital stock (cf. Hartwick, 1977). Finally, the extractivism that underpins resource appropriation generates social dislocations and conflicts at resource frontiers (Martinez-Alier, 2021).

the value of resources and labour cannot be quantified in dollars, and there is no such thing as a “correct” price.

Prices under capitalism do not reflect value or utility in any objective way. Rather, they reflect, among other things, the (im)balance of power between market agents (capital and labour, core and periphery, lead firms and their suppliers, etc); in other words, they are a political artefact

While prices by definition do not reflect value, they do allow us to compare the scale of drain to prevailing monetary representations of production and income in the world economy.

Fig. 2 shows that drain from the South in 2015 amounted to $14.1 trillion when measured in terms of raw material equivalents, $5.1 trillion when measured in terms of land, $3.6 trillion when measured in terms of energy and $20.3 trillion when measured in terms of labour.

Over the period 1990–2015, the drain sums to $242 trillion (constant 2010 USD). This represents a significant “windfall” for the North, similar to the windfall that was derived from colonial forms of appropriation; i.e., goods that did not have to be produced on the domestic landmass or with domestic labour, and did not have to be bought on the domestic market, or paid for with exports (see Pomeranz, 2000, Patnaik, 2018). While previous studies have shown that the price distortion factor increased dramatically during the structural adjustment period in the 1980’s (Hickel et al., 2021), our data confirms that since the early- to mid-1990’s it has tended to decline slightly. This means that the increase in drain during the period 1990–2007, prior to the global financial crisis, was driven primarily by an increase in the volume of international trade rather than by an increase in price distortion.

Table 3 shows that, over the 1990–2015 period, resources appropriated from the South have been worth on average roughly a quarter of Northern GDP.

the North’s reliance on appropriation from the South has generally increased over the period (despite a significant drop after the global financial crisis), whereas the South’s losses as a share of total economic activity have generally decreased, particularly since 2003, due to an increase in South-South trading and higher domestic GDP creation or capture within the South, both driven largely by China

Aid flows create the powerful impression that rich countries give benevolently to poorer countries. But the data on drain through unequal exchange raises significant questions about this narrative.

net appropriation by DAC countries through unequal exchange from 1990 to 2015 outstripped their aid disbursements over the same period by a factor of almost 80

for every dollar of aid that donors give, they appropriate resources worth 80 dollars through unequal exchange. From the perspective of aid recipients, for every dollar they receive in aid they lose resources worth 30 dollars through drain

The dominant narrative of international development holds that poor countries are poor because of their own internal failings and are therefore in need of assistance. But the empirical evidence on unequal exchange demonstrates that poor countries are poor in large part because they are exploited within the global economy and are therefore in need of justice. These results indicate that combating the deleterious effects of unequal exchange by making the global economy fairer and more equitable would be much more effective, in terms of development, than charity.

In an equitable world, the resource trade deficit that the North sustains in relation to the South would be financed with a parallel monetary trade deficit. But in reality, the monetary trade deficit is very small, equivalent to only about 1% of global trade revenues, and fluctuates between North and South. In effect, this means that the North achieves its large net appropriation of resources and labour from the South gratis.

The question of sectoral disparities has been moot since the 1980s, however, as industrial production has shifted overwhelmingly to the South. The majority of Southern exports (70%) consist of manufactured goods (data from UNCTAD; see Smith, 2016). Of all the manufactured goods that the USA imports, 60% are produced in developing countries. For Japan it is 70%. We can see this pattern reflected also in the industrial workforce. As of 2010, at least 79% of the world’s industrial workers live in the South (data from the ILO; see Smith, 2016). This shift is due in large part to the rise of global commodity chains, which now constitute 70% of international trade. Between 1995 and 2013, there has been an increase of 157 million jobs related to global commodity chains, and an estimated 116 million of them are concentrated in the South, predominantly in the export manufacturing sector (ILO, 2015). In other words, during the period we analyse in this paper (1990–2015), the South has contributed the majority of the world’s industrial production, including high-technology production such as computers and cars. And yet price inequalities remain entrenched.

if Northern states or firms leverage monopoly power within global commodity chains to depress the prices of imports and increase the prices of final products, their labour “productivity” appears to improve, and that of their counterparts declines, even if the underlying production process remains unchanged. Indeed, empirical evidence indicates that real productivity differences between workers are minimal, and cannot explain wage inequalities (Hunter et al., 1990).

wage inequalities exist not because Southern workers are less productive but because they are more intensively exploited, and often subject to rigid systems of labour control and discipline designed to maximize extraction (Suwandi et al., 2019). Indeed, this is a major reason why Northern firms offshore production to the South in the first place: because labour is cheaper per unit of physical output (Goldman, 2012).

the terminology of “value-added” is a misnomer. In international trade, TiVA does not tell us who adds more value but rather who has more power to command prices. And in the case of global commodity chains, TiVA does not indicate where value is produced but rather where it is captured (Smith, 2016).

our analysis reveals that value in global commodity chains is disproportionately produced by the South, but disproportionately captured by the North (as GDP). Value captured in this manner is misleadingly attributed to Northern economic activities

rich countries are able to maintain price inequalities simply by virtue of being rich. This finding supports longstanding claims by political economists that, all else being equal, price inequalities are an artefact of power. Just as in a national economy wage rates are an artefact of the relative bargaining power of labour vis-à-vis capital, so too in international trade prices are an artefact of the relative bargaining power of national economies and corporate actors vis-à-vis their trading partners and suppliers. Countries that grew rich during the colonial period are now able to leverage their economic dominance to depress the costs of labour and resources extracted from the South. In other words, the North “finances” net appropriation from the South not with money, but rather by maintaining the prices of Southern resources and labour below the global average level.

Patents play a key role here: 97% of all patents are held by corporations in high-income countries (Chang, 2008:141)

In some cases, patents involve forcing people in the South to pay for access to resources they might otherwise have obtained much more affordably, or even for free (Shiva, 2001, Shiva, 2016).

In the World Bank and the IMF, Northern states hold a majority of votes (and the US holds a veto), thus giving them control over key economic policy decisions. In the World Trade Organization (which controls tariffs, subsidies, and patents), bargaining power is determined by market size, enabling high-income nations to set trade rules in their own interests.

ubsidized agricultural exports from the North undermine subsistence economies in the South and contribute to dispossession and unemployment, placing downward pressure on wages. Militarized borders preclude easy migration from South to North, thus preventing wage convergence. Moreover, structural adjustment programs (SAPs) imposed by the World Bank and IMF since the 1980s have cut public sector salaries and employment, rolled back labour rights, curtailed unions, and gutted environmental regulations (Khor, 1995, Petras and Veltmeyer, 2002).

SAPs, bilateral free trade agreements, and the World Trade Organization have forced global South governments to remove tariffs, subsidies and other protections for infant industries. This prevents governments from attempting import substitution, which would improve their export prices and drive Northern prices down. Tax evasion and illicit financial flows out of the South (which total more than $1 trillion per year) drain resources that might otherwise be reinvested domestically, or which governments might otherwise use to build national industries. This problem is compounded by external debt service obligations, which drain government revenue and require obeisance to economic policies dictated by creditors (Hickel, 2017). In addition, structural dependence on foreign investors and access to Northern markets forces Southern governments and firms to compete with one another by cutting wages and resource prices in a race to the bottom.

structural power imbalances in the world economy ensure that labour and resources in the South remain cheap and accessible to international capital, while Northern exports enjoy comparatively higher prices

Cheap labour and raw materials in the global South are not “naturally” cheap, as if their cheapness was written in the stars. They are actively cheapened

the analysis obscures class and geographic inequalities within countries and regions, which are significant when it comes to labour prices as well as resource consumption. The high levels of resource consumption that characterize Northern economies are driven disproportionately by rich individuals and affluent areas, as well as by corporations that control supply chains, and enabled by internal patterns of exploitation and unequal exchange in addition to drain through trade (Harvey, 2005). For example, there are marginalized regions of the United States that serve as an “internal periphery” (Wishart, 2014). It would also be useful to explore the gender dynamics of unequal exchange within countries. These questions cannot be answered with our data, however.

This research confirms that the “advanced economies” of the global North rely on a large net appropriation of resources and labour from the global South, extracted through induced price differentials in international trade. By combining insights from the classical literature on unequal exchange with contemporary insights about global commodity chains and new methods for quantifying the physical scale of embodied resource transfers, we are able to develop a novel approach to estimating the scale and value of resource drain from the global South. Our results show that, when measured in Northern prices, the drain amounted to $10.8 trillion in 2015, and $242 trillion over the period from 1990 to 2015 – a significant windfall for the North, equivalent to a quarter of Northern GDP. Meanwhile, the South’s losses through unequal exchange outstrip their total aid receipts over the period by a factor of 30.

support contemporary demands for reparations for ecological debt, as articulated by environmental justice movements and by the G77

True repair requires permanently ending the unequal distribution of environmental goods and burdens between the global North and global South, restoring damaged ecosystems, and shifting to a regenerative economic system.

It is clear that official development assistance is not a meaningful solution to global poverty and inequality; nor is the claim that global South countries need more economic liberalisation and export-oriented market integration. The core problem is that low- and middle-income countries are integrated into the global economy on fundamentally unequal terms. Rectifying this problem is critical to ensuring that global South countries have the financial, physical and human resources they need to improve social outcomes.

democratize the institutions of global economic governance, such as the World Bank, IMF and WTO, so that global South countries have more control over trade and finance policy.

end the North’s use of unfair subsidies for agricultural exports, and remove structural adjustment conditions on international finance, which would help mitigate downward pressure on wages and resource prices in the South while at the same time enabling Southern countries to build sovereign industrial capacity

a global living wage system, and a global system of environmental regulations, would effectively put a floor on labour and resource prices

Reducing North-South price differentials would in turn reduce the scale of the North’s net resource appropriation from the South (in other words, it would reduce ecologically unequal exchange), thus reducing excess consumption in the North and the ecological impacts that it inflicts on the South.

Structural transformation will only be achieved through political struggle from below, including by the anti-colonial and environmental justice movements that continue to fight against imperialism today