How Financial Capitalism is Rooted in War and Fascism

Political economist Hamed Pasandideh explains the contradictions of the capitalist world system: "Liberalism is like a beautiful painting: the view is nice but it has nothing to do with reality."

Feb 15, 2025

In July 2024, we published an interview with political economist Hamed Pasandideh. He discussed the mechanism of divide and rule and explained the difference between war and revolution. Pasandideh fled from Tehran to the Netherlands in 2013 and lives and works in Sweden since 2021. In the interview, he made some comments about (neo)liberalism. In this article he further explores this theme. When a world leader is accused of human rights violations or undemocratic behavior, this causes a lot of chaos and confusion. Yet, according to him, this is only a distraction from what is actually happening.

For centuries, the system of financial capitalism used different methods to sustain its power. Strategies continuously change, improve and are further developed. Apart from the beautiful words used to distract the public, it is about who is controlling the global economy and how big capital is finding its way. For financial capitalists, and the governments they are affiliated with, all means are justified in defending their monopoly. No Western world leader has ever followed liberal values such as freedom and equality. Liberalism is like a beautiful painting: the view is nice but it has nothing to do with reality. From the very start, war and fascism were the building blocks of the financial capitalist world system.

Media Mondo, by: Hamed Pasandideh, February 12, 2025, https://media-mondo.com/en/articles/analysis/financial-capitalism-rooted-in-war-and-fascism/

Capitalism has different periods and branches. Liberalism is one of them. The latter capitalist branch emerged in the 17th century during the so-called ‘Enlightenment’. Liberals advocated individual freedom and political equality. The rights of the individual and the protection of private property were central themes. It was the beginning of industrialization in which competition was promoted. For Europeans, this meant the end of the medieval feudal system in which a handful of nobles and feudal lords, together with the church, held all the power. Of course, the principles of liberalism did not apply to the colonized peoples in the Global South. Liberalism was an integral part of colonialism.

The British philosopher John Locke (1632-1704) is considered the spiritual father of liberalism. He was affiliated with the University of Oxford. Not only did his theories on private property lay the foundation for the concept of expropriation but also provided its justification. Another important figure in the development of the liberal movement was the Scottish economist Adam Smith (1723-1790). In his most famous work The Wealth of Nations he discusses in detail the nature of a country's wealth. It is one of the first books that discusses division of labor, means of production and the free market. He considered economic laws to be natural laws and believed that governments should not interfere in the economic affairs of a society. Liberalism states that humans instinctively seek personal advantage. If humans are economically free, they will be able to generate social wealth from the sum of all their activities.

Financial capitalism and Imperialism

One of the characteristics of capitalism is the continuous necessity of development. In order to keep running, the system depends on endless renewal. Not only means of production but also financial means are subject to this constant change. Financial capitalism involves investments in the stock market. The rules of the system are the opposite of the principles of liberalism where individual freedoms are central. How this contradiction works out in practice, becomes clear when we look at imperialism.

Imperialism, the desire for more territory and the appropriation of other people's land, has been described as the monopolistic stage of capitalism. It means that all capital is in the hands of only a few large banks and industrial institutions that together hold a monopoly position. In the 16th and 17th centuries, these monopolists divided the world among themselves. After this process was completed and Western colonialists had almost the entire world in their power, in one way or another, capitalism underwent another important change. The old colonial policy that appropriated areas that were not yet occupied by competitors made way for a new colonial policy that also took financial possession of the now completely divided earth.

The ideological building blocks of financial capitalism are the opposite of liberalism. Instead of freedom, they demand domination. Financial capitalism does not tolerate competition and demands order and organization. Even the owners of capital are not valued and their obedience is demanded too. The fundamental difference between the working of financial capitalism and the liberal theories of John Locke and Adam Smith is the urgent need for a powerful and centralized government to assist the financial capitalists in removing any obstacle that is blocking their greed.

The Nation State at the Service of Financial Capitalism

Never before in history so much wealth has been concentrated in so little hands. To become President of the United States, you must either be a billionaire yourself – like Donald Trump – or have the support of billionaires, like Joe Biden. Governments and multinationals work closely together with the parliamentary democracy as a thin, sugarcoated top layer.

The role of this powerful oligarchy is to protect its domestic market by levying taxes and import duties. In bilateral relations with countries, the interests of the other are subordinate. Political agreements are used to impose its dominance on weaker countries and even on so-called allies. Since the Second World War, the US took up the dominant leadership role. Today, everywhere we can see the rise of economic nationalism, expressed by US President Donald Trump with his slogan ‘America first’, which of course means that the rest of the world comes last. For the US, it does not matter if Europe suffers as a consequence of the war against Russia.

Ultimately, the most important goal of the Ukraine war is to force European governments to break their ties with Russia and strengthen the US dominance over Europe.

Democratic freedom versus military power

Financial capitalists use words like “freedom,” “human rights,” and “democracy” to stigmatize other countries and present themselves as innocent. For the leaders of financial capitalism, military power is an essential instrument to exert financial influence everywhere in the world. It is for this reason that the American government has more than a thousand military bases around the world. This explains the close relationship between economics and politics.

While liberals are formally against the use of military force in international relations, financial capitalists believe that maximum pressure may be exerted to achieve the goal (autocracy). In this way, the most militarily powerful government in the world gets access to the most important markets by force. For them, it is all about maintaining the monopoly position in which any form of serious competition may be eliminated. Competition is interpreted as war between political powers. The financial capitalist lacks the desire for peace, instead of humanity he only knows the need for domination.

At the end of the 1980’s, with the fall of the Soviet Union, for the first time in history there was one superpower left. American policymakers believed that no other country could challenge their absolute power and if that happened, anything was allowed to force countries, or people, into submission. This way of thinking was summarized in 1992 in the so-called ‘Wolfowitz Doctrine.’[1] In 2000, the idea of ‘Full Spectrum Dominance’ was launched, which shows the same arrogant thought.[2] The principles are as limitless as the capitalist greed for more profit by conquering the entire world. With their political and military involvement they even create new borders, such as the division of South and North Korea, Yugoslavia in the nineties and Syria in our time. The financial capitalist system cannot exist without these practices, it is an economic necessity. This is why the West, led by the US, has an urgent need for one or more enemies.

No world peace under financial capitalism

The imperialistic tendency of financial capitalism to own the whole world has also changed the worldview of the middle class. As a result, liberalism has denied its core values and has nothing to do with pacifism or philanthropy. Originally, middle-class liberals were in favor of free trade and competition. Liberalism was not only considered the best economic policy, it would be the beginning of lasting world peace. In 1795, the German philosopher Immanuel Kant set out in his essay ‘Toward Perpetual Peace’ what he believed was necessary to achieve world peace.[3] Among other things, he stated that all professional armies had to be abolished. Financial capitalism has completely discarded such philosophies. The system does not even trust capital owners who tend to defend their interests based on their own, free will.

At the time when Nikolai Bukharin [4], one of the leaders of the Russian Revolution, and Vladimir Lenin were writing about imperialism, European powers still had direct control over the colonies. For example, the British ruled almost half the world. They plundered the wealth of Africa, the Middle East and the Indian subcontinent and also dominated many countries in Latin America. In order to break the British monopoly and force a global redistribution, German imperialists initiated the Berlin Colonial Conference in 1884. Less than half a century later, the First World War broke out.

All other colonial countries participated enthusiastically in this war because for all of them it was about securing their colonial plunder. The Second World War shook the power of the old imperialist states to the core. Great Britain and France returned weakened from the war, while the United States and the Soviet Union became the new superpowers.

Almost 80 years after the Second World War, the exploitation of former colonized countries is worse than ever. The only difference is that the imperialist powers, in most cases, have no longer direct military control over countries, but exercise their rule more economically through the power mechanisms of international organizations. Unequal trade terms and sky-high interest rates on loans are coordinated by institutions such as the IMF, the World Bank and the WTO. These Western-dominated organizations guarantee that profits only go to one direction. For people from the lower classes, whose income still depends on their own labor, their fate is still ignorance and routine, or worse, disease, war and slavery.

Fascism is inevitable

From the need for ideological justification, the superstructure of the capitalist system also turns to fascism. Financial capitalism twists all norms and values with regard to plundered nations. The fact that these countries can be denied the right to self-determination and independence is difficult to reconcile with the promoted principle that all people are equal.

This double standard becomes very clear in how Western media reported on the Palestinian genocide in comparison with the Ukraine war. Where Russia is consistently portrayed as the aggressor, the occupying state of ‘Israel’ is framed as a normal country that we cannot criticize.

For Western imperialists, the weapon has always the last word. In that regard, it is naive to expect some kind of coordination of interests. In a world where only military strength and superiority determine the fate of people, permanent peace is impossible. As long as this is the reality, international laws only exist on paper.

While the use of brutal force within this system is effective in oppressing weaker countries, it is different for US domestic policy. The internal state of the declining American empire shows that fascist methods are inevitable for financial capitalists to save their skins. The fact that someone like Trump could come to power has little to do with the failure of the Biden administration. An important reason is the growing poverty and social instability resulting from the massive deindustrialization that was initiated in the 1980s under neoliberal policies. Trump is popular because he points out scapegoats, although they did not cause the problem.

Just as Hitler’s Nazi regime considered its own actions to be completely normal and just, the American government considers the use of force to be its natural right. This justification is based on a nationalist narrative that attributes natural characteristics that are unique to the US. ‘American exceptionalism’ stems from racial-biological theories that present the domination of others as a completely natural phenomenon.

In terms of foreign policy, this idea is able to unite different layers of the American population, but in terms of domestic policy this does not work. In the end, the interests of the financial capitalists are also at odds with the interests of the working class. In their eternal quest for profit, they impose ever higher taxes and cut social services. When everyone starts to feel that fundamental things like health care, education and infrastructure are deteriorating, the administrators at the top will never admit that they are to blame. Instead, they point fingers at minorities, migrants and refugees. The fact that many people from the lower classes are buying into this lie is one of the reasons why a revolution is far away. In fact, the suspicion against ‘the other,’ rather than the leaders, paves the way for the greatest tragedy of humanity: war.

Now what?

We are currently living in a period that is in many ways comparable to the years before the First and Second World Wars. On social media people regularly discuss the possibility of a third world war and that certain countries or political figures are playing a role in provoking it. In his New Year’s message to his prime minister in 1906, the German Emperor Wilhelm II wrote: “We are working towards a war in which we will destroy socialism, the head of the socialist movement must be cut off and we will send the ‘masses’ to the trenches.” The historical lesson from this is that we should not be tempted to join in a war that they are planning. War destroys human lives but the system that controls all of us benefits from it.

Lenin said that under capitalism there is no end to all horrors. The violent turmoils now spreading across the world prove him right. Middle-class moralists weep and moan about these horrors, but they have no idea what the causes are, let alone what the solution is. Pacifists, environmentalists, feminists and others point to the symptoms, but not to the underlying cause: a terminally ill financial system that has long since played its historical role.

The horrors we see before us are only the outward symptoms of capitalism in agony. But they are also the birth pangs of a new society struggling to be born. It is our task to shorten the delivery and hasten the birth of a new and truly human society. It is time to realize that our enemies are not our neighbors but the leaders at the top of the system.

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Footnotes:

[1] The "Wolfowitz Doctrine" is an unofficial name given to the initial version of the Defense Planning Guidance for 1994–1999 published by U.S. Under Secretary of Defense for Policy Paul Wolfowitz. Not intended for public release, it was leaked to The New York Times on March 7, 1992. See original: https://www.archives.gov/files/declassification/iscap/pdf/2008-003-docs1-12.pdf Or:

https://en.wikipedia.org/wiki/Wolfowitz_Doctrine

[2] Joint Vision 2020 was a document released on May 30, 2000, by the United States Department of Defense proclaiming the need for "full-spectrum dominance" on the battlefield. The Joint Vision 2020 concepts have subsequently formed the basis of United States military doctrine. See: https://en.wikipedia.org/wiki/Joint_Vision_2020
PDF part 1: https://web.archive.org/web/20011108070759/http://www.dtic.mil/jv2020/jv2020a.pdf
Part 2: https://web.archive.org/web/20011107190858/http://www.dtic.mil/jv2020/jv2020b.pdf

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