Shadow Sovereigns

Linked with Carolyn Nordstrom – USA, and with Kroc Institute of International Peace Studies.

Shadow Sovereigns, by Carolyn Nordstrom, Kroc Institute of International Peace Studies, the 28 pdf-pages study is not dated:

Excerpts: page 3: … it is not rebel groups seeking sovereignty that comprises the shadow powers I am speaking of here, but the vast international extra-state politico-economic networks that, among other things, supplies such movements. I have come to this study through years of research at the frontlines of wars (citations removed for review), where extra-state transactions are perhaps most developed and visible. But, as this study will show, the vast extra-state networks expand across war and peace, and across all the world’s countries. This trade—from armaments to everyday supplies, from precious mineral resources to international ‘advisors’—often crosses various divides between legal, quasi-legal, gray markets, and downright illegal blackmarkets. Following these threads of supply and demand, I have charted a multi-billion-trillion dollar a year series of (often interlinked) economic exchanges and the power politics that keep them afloat. Some of these networks wield more influence than a number of the formal nation-states of the world. This article will be devoted to exploring and defining these grids of economic and political power that circulate apart from formal state systems …

page 13: … Conventional wisdom tends to view development as a progress toward increasing state involvement. As countries become stable, the theory goes, extra-state exchanges and politics decrease, replaced by formalized systems. Data does not seem to support this conclusion. Statistics place Italy’s black economy at up to 50% of gross in informal economic activities (23). The Russian Federation Ministry of Labor in 1995 estimated 4 domestic product (24) and the United States as high as 30% in total (25); one-third of Canada’s population participates 0% of the country’s economic activities were in the shadows, another 40% is generated through the visible economy but hidden form taxes, and another 6% is unknown (26) …

Page 18: … how many shadow sovereigns are there? How many networks operate at any given time around the globe? Pat answers are, obviously, impossible. But several key observations are possible. Informal economies (small scale susbsistence), large scale gray and blackmarkets (from arms through luxury items to oil and freon), and state industries and personnel (from sanctions-breaking technology to corrupt customs officials) are more interrelated than the predominance of the literature, and certainly neoclassical theories, suggest. I have sought to show in the examples such as Angola and of the businesspeople commandeering aid flights and setting international currency exchange rates how running gems, for example, links within larger international exchange networks ranging from armaments through high-tech computers and industrial equipment to basic foods and medicines. The lines between state and extra-state power can easily blur here: blackmarketeers commandeering INGO relief planes may carry sanctioned telecommunication equipment, VCRs and stolen cars, but they also have the clout to set international currency exchange rates– and by day these blackmarekteers are often upstanding members and officials of the country. In fact, the returns on such “enterprises” can supply the wealth, industrial base, and influence to gain political office.
At the same time these networks are not all-inclusive: the gem runners in Angola may have nothing to do with the drug runners in Colombia or the non-state banking ventures in Asia. Neoclassical theory tends to postulate non-state networks as quite discrete: there are smugglers, there is official corruption, and there are informal subsistence economies, and essentially never the twain shall these meet. Having noted that no single overarching “network mentality or reality” exists, I want to stress again that these networks are more complex, interrelated, and governed by shared norms of conduct than traditional theory holds… (full 28 pdf-pages).

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