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Introduction

In the late summer of 2008, two events in quick succession signalled the end of the New World Order of unchallenged US global and economic power. In August, the US client state of Georgia was crushed in a brief but bloody war after it attacked Russian troops in the contested territory of South Ossetia. The former Soviet republic was a particular favourite of Washington’s neoconservatives. Its forces, armed and trained by the US and Israel, made up the third-largest contingent in the occupation of Iraq. Its authoritarian US-educated president had been lobbying hard for Georgia to join Nato, as part of the alliance’s eastward expansion up against Russia’s borders.

In an unblinking inversion of reality, US Vice-President Dick Cheney, echoed by Britain’s then foreign secretary David Miliband, denounced Russia’s response to Georgia’s onslaught as an act of ‘aggression’ that ‘must not go unanswered’. Fresh from unleashing a catastrophic war on the people of Iraq, George Bush declared Russia’s ‘invasion of a sovereign state’ to be ‘unacceptable in the twenty-first century’.

As the fighting ended, Bush warned Russia not to recognise the independence of South Ossetia and Abkhazia (as the Western powers had done in Kosovo a few months earlier). Russia ignored him and twenty-four hours later did exactly that, while US warships were reduced to sailing around the Black Sea, unable to land supplies at Georgian ports because of a risk of confrontation between US and Russian troops.¹

The short-lived Russian–Georgian conflict marked an international turning point. The US’s bluff had been called, its military sway and credibility undermined by the war on terror, Iraq and Afghanistan. After the better part of two decades during which it had been able to bestride the world like a colossus, enforcing its will in every continent, the years of uncontested US power were over. Pumped up with petrodollars, Russia had called a halt to a relentless process of US expansion and demonstrated that its writ didn’t run in every backyard. The lesson was quickly absorbed across the world.

Three weeks later, a second, still more far-reaching event threatened the very heart of the US-dominated global financial system. On 15 September, days after the US government had been forced to take over the stricken mortgage lenders Freddie Mac and Fannie Mae, the long-smouldering sub-prime-fuelled credit crisis finally erupted in the collapse of America’s fourth-largest investment bank. The bankruptcy of Lehman Brothers triggered the greatest banking crash since 1929 and engulfed the Western world in its deepest economic crisis since the 1930s.

The first decade of the twenty-first century shook the international order to its foundations, turning the received wisdom of the global elites on its head – and 2008 was its watershed. With the end of the cold war, the great political and economic questions had all been settled, we were told. Liberal democracy and free-market capitalism had triumphed, while socialism had been consigned to history. Political controversy would now be confined to arguments about culture wars and tax-and-spend trade-offs. The market would settle the rest.

In 1990, George Bush Senior inaugurated what he hailed as a New World Order, based on uncontested US military supremacy and Western economic dominance.² The end of the Soviet Union meant there would be no more second superpowers. This was to be a unipolar world without rivals. Regional powers would, and did, bend the knee to the new worldwide imperium. Force would only be deployed to police insubordinate rogue states in the name of human rights. History itself, it was even said, had come to an end.³

But between the assault on New York’s Twin Towers in 2001 and the fall of Lehman Brothers seven years later, that global order had crumbled. Two factors were crucial. By the end of a decade of continuous warfare, the US had succeeded in exposing the limits, rather than the extent, of its military power. And the neoliberal capitalist model that had reigned supreme for a generation had crashed in spectacular fashion, rejected across large parts of the world.

It was the reaction of the US to 9/11 that paradoxically ended up undermining its own international authority and the sense of invincibility of the world’s first truly global empire. As a rule, terrorism in its proper sense – as opposed to popular armed resistance – isn’t just morally indefensible. It also doesn’t work, in the sense of achieving its own objectives. But the wildly miscalculated response of the Bush administration turned the atrocities in New York and Washington into perhaps the most successful terror attack in history.⁴

Not only did Bush’s war on terror fail on its own terms, spawning terrorists across the Muslim world and beyond, while its lawless savagery and campaign of killings, torture and kidnapping comprehensively discredited Western claims to be global guardians of human rights in the process. But the US-British invasions of Afghanistan and Iraq that were its centrepiece – the latter on a flagrantly false pretext – also dramatically revealed the inability of the global behemoth to impose its will on subject peoples prepared to fight back.

That became a strategic defeat for the US and its closest allies, paid for at a cost of hundreds of thousands of lives. The demonstration of US military overreach, in Iraq in particular, strengthened the hand of those prepared to defy America’s will at both a regional and global level. Russia’s decisive response to Georgia’s assault on South Ossetia confirmed the shift and marked the end of unchecked US unilateralism.

This passing of the unipolar moment, driven home by the exposure of the limits to US power, was the first of four decisive changes that transformed the world during the first ten years of the new millennium – in some crucial ways for the better. The second was the fallout from the financial crash of 2008 and the profound crisis of the Western-dominated capitalist order it unleashed, speeding up the relative decline of the US in the process. This was a crisis that had been made in the US and deepened by the vast cost of its multiple wars. And its most devastating impact was on those economies whose elites had bought most enthusiastically into the neoliberal orthodoxy of deregulated financial markets and unfettered corporate power – including those of Britain, the US and the European Union.

A voracious model of capitalism forced down the throats of the world for a generation as the only viable way of running a modern economy, at a cost of ballooning inequality and disastrous environmental degradation, had been discredited – and only rescued from collapse by the greatest global state intervention in history.⁵ The baleful twins of neoconservatism and neoliberalism that held the world in their grip at the start of the century had been tried and tested to destruction.

The failure of both accelerated the rise of China, the third epoch-making change of the early years of the twenty-first century. Not only did the country’s dramatic growth take hundreds of millions out of poverty and more than halve the economic gap with the US in the decade, but its still state-driven investment model allowed it to ride out the first few years of the West’s slump without even a slowdown, making a mockery of neoliberal market orthodoxy.

At the same time China’s rapid expansion began to create a new centre of power in the emerging multipolar world that increased the freedom of manoeuvre for smaller states, squeezed by the absence of any alternative centre of power to the US and its allies since the end of the cold war. Carrying out more than half its trade with developing economies, China became a motor of growth for the global south, while the traditional masters of the world economy continued to be mired in crisis.⁶

That profound shift in turn widened the space for the tide of progressive social change that swept Latin America – the fourth global advance that shaped the opening of the new century. Driven by the region’s dismal early experience of neoliberalism and US absorption in the war on terror, radical socialist and social-democratic governments were propelled to power across the region, attacking economic and racial injustice, carving out a new regional independence, challenging US domination and taking back resources from corporate control. Two decades after we had been assured there could be no alternatives to neoliberal capitalism, Latin Americans were creating them in the twenty-first century.

These momentous changes and social advances came, of course, with huge costs and a heavy dose of qualifications. The US will remain the overwhelmingly dominant global military power for the foreseeable future; its partial defeat in Iraq and Afghanistan was paid for in death and destruction on a colossal scale; and multipolarity brings its own risks of new forms of conflict. The neoliberal model was discredited, but governments across the Western world continued to try to refloat it, forcing through austerity programmes that slashed jobs and living standards and spread poverty. China’s success was itself bought at a high price in inequality, abuse of civil rights and environmental destruction. And Latin America’s US-backed elites remained determined to reverse the decade’s social gains, as they succeeded in doing by a violent coup in Honduras in 2009.

Such contradictions also beset the revolutionary upheaval that engulfed the Arab world. If the transformations of the twenty-first century’s first decade really began with 9/11, they came full circle in the uprisings that erupted in Tunisia and Egypt in the winter of 2010–11, sparking another shift of global proportions. Triggered by the fallout from the West’s economic crisis, the uprisings led in turn to renewed Western military intervention and attempts to commandeer or divert them, both from within and beyond the region.

But the popular impetus to revolt drew its strength not from the legacy of the earlier US neocon campaign for Western-controlled cod democracies across the Middle East, as its discredited architects would shamelessly claim. It arose from the same Arab refusal to accept the passive role assigned to them that had driven resistance to Western-backed war, occupation and tyranny throughout the previous ten years.

For all the setbacks, crimes and catastrophes, a decade on from 9/11 the neoliberal Washington Consensus had fallen; the New World Order was no more; and space for progressive movements and states had opened up across the world. History had begun to take revenge. Those are the transformations described and analysed, as they happened, in these pages.

* * *

A decade after it was launched, Bush’s war on terror had become such an embarrassment to the US government that it had to change the official name to ‘overseas contingency operations’.⁷ The Iraq invasion was almost universally acknowledged to have been a disaster. The occupation of Afghanistan was widely accepted to be a doomed undertaking that could never bring peace to the country or the region. But such chastened realism couldn’t be further from the way these punitive campaigns were regarded in the Western mainstream when they were first unleashed by George Bush and Tony Blair. War fever and credulous cheerleading were the order of the day for the political class and the bulk of a loyalist media on both sides of the Atlantic.

To return to what was routinely said by British and American politicians and their tame pundits in the aftermath of 9/11 or the run-up to the invasion of Iraq is to be transported into a parallel universe of toxic fantasy and utter disregard for the human consequences of the cataclysms that had been set in motion. All was nevertheless reported as logical and largely reasonable by a house-trained media, while every attempt was made to discredit or marginalise those who rejected the case for invasion and occupation – and would before long be comprehensively vindicated.

It’s a lesson in the power of even the flimsiest propaganda deployed by modern Western states when vital interests of security are regarded as being at stake. In the aftermath of 9/11, the political and media reaction to anyone who linked the attacks to decades of Western intervention and support for client dictatorships in the Muslim world, or who challenged the drive to war, was savage.

Almost uniquely in the British media at the time, the Guardian published a full-spectrum debate about why the attacks had taken place and how the US and wider Western world should respond. The backlash verged on the deranged. This was treasonous ‘anti-Americanism’, it was claimed. Michael Gove, later a Conservative cabinet minister in David Cameron’s government, declared that the Guardian had become a ‘Prada-Meinhof gang’ of ‘fifth columnists’.

The novelist Robert Harris, then still a Blair intimate,⁸ denounced the paper for hosting a ‘babble of idiots’ who were unable to understand that the world was now re-fighting the war against Hitler. Rupert Murdoch’s Sun damned those warning against war as ‘anti-American propagandists of the fascist left press’. By the time the Taliban regime had been overthrown a couple of months later and Afghan women were said to be throwing off burkas to celebrate their ‘liberation’, the prime minister’s Downing Street office issued a triumphant condemnation of those (myself included) who had opposed the invasion of Afghanistan and the war on terror. We had, the statement declared, been ‘proved to be wrong’.⁹

A decade later, few could still doubt that it was Blair’s government and its media acolytes who had in fact been ‘proved to be wrong’, with catastrophic consequences – while its opponents had been shown to be grimly right. The US and its allies would fail to subdue Afghanistan, critics (mostly, it’s true, on the left) predicted in the weeks after 9/11. The war on terror would itself fuel and spread terrorism, including to Pakistan and the cities of the invading states.¹⁰ Ripping up civil rights would have dire consequences – and an invasion of Iraq would be a blood-drenched disaster.¹¹

Meanwhile the war party’s acclaimed ‘experts’, such as the former Liberal Democrat leader and ‘viceroy of Bosnia’ Paddy Ashdown, derided warnings that the US-led invasion would lead to a ‘long-drawn-out guerrilla campaign’ in Afghanistan as ‘fanciful’.¹² So did the British and US governments. The war would liberate women, they claimed, bring democracy and eradicate opium production. The then foreign secretary Jack Straw chided Labour MPs towards the end of 2001 for suggesting US and British troops might still be fighting in Afghanistan twelve months later.¹³ More than ten years on, armed resistance to Nato occupation by the Taliban and others was stronger than ever; corrupt and brutal warlords called the shots; women’s rights were going backwards; and Afghanistan had become the longest war in American history.

It was a similar story over Iraq – though opposition to the war had by then spread to the heart of the British establishment, and was given voice by a movement that put more than a million people on the streets of London in protest.¹⁴ Those who stood against the invasion were still accused by ministers and their laptop bombardiers of being 1930s-style ‘appeasers’. That was a particularly surreal charge, given that those making it had tied the country to an increasingly lawless military power openly preparing to launch an unprovoked aggression, on what was clearly a fraudulent prospectus even then, in defiance of international opinion. But it was debated with the utmost seriousness.

The US neoconservatives insisted that ‘liberating’ Iraq would be a ‘cakewalk’. The US defense secretary Donald Rumsfeld predicted the war would last six days, and Blair claimed that many fewer civilians would be killed as a result of the invasion than in any year under the rule of Saddam.¹⁵ Most of the Anglo-American media expected Iraqis to greet US and British troops with flowers and that resistance would collapse in short order. They were entirely wrong, and it was the opponents of war who were again proved correct.

A new colonial-style occupation of Iraq would, I wrote in the first week of the 2003 invasion, ‘face determined guerrilla resistance long after Saddam Hussein has gone’ – and the occupiers would ‘once again be driven out’.¹⁶ As it turned out, British troops faced unrelenting armed attacks until they were finally forced out of Basra in 2009, as did US regular troops on a far larger scale until they were withdrawn from Iraq in 2011.¹⁷

But it wasn’t just in judgments on the war on terror and the occupations of Iraq and Afghanistan that opponents of the New World Order were shown to be right and its political champions and cheerleaders to be talking calamitous nonsense. For thirty years, the West’s political and corporate elites insisted that only the elixir of deregulated markets, privatisation, free trade and low taxes on the wealthy – the catechism of the Washington Consensus – could now deliver growth and prosperity. And in the wake of the Soviet collapse and international retreat of the left, they were able to use their overriding influence and grip on international institutions to spread a globalised model of neoliberal capitalism across the world.

The long boom that followed was made possible by the integration of hundreds of millions of educated, low-waged workers from eastern Europe and Asia into the international capitalist market. Combined with the wider weakening of organised labour, deregulated expansion of international finance and a flood of cheap imports, the result was a corporate profits bonanza and global class power-grab. But for much of the world, the boom of the 1990s and early years of the new century meant stagnating real wages, far slower growth than in the postwar era, and dramatic increases in inequality and insecurity.¹⁸

Long before the crash of 2008, the ‘free market’ model and its dismal record had been under fierce attack, including from the anti-corporate globalisation movement that came to international prominence during the 1999 World Trade Organisation protests in Seattle. In grassroots campaigns and social forums across the world, the case was hammered home that the neoliberal order was handing power to unaccountable banks, private corporations and Western-controlled global institutions, fuelling poverty and social injustice, destroying communities and the environment, eviscerating democracy, undermining workers’ rights – and was both economically and ecologically unsustainable.¹⁹

In contrast to corporate-aligned New Labour politicians such as Gordon Brown, who claimed ‘boom and bust’ to be a thing of the past, critics of the free-market model dismissed the idea that the capitalist trade cycle could be abolished as absurd. In fact the argument could not have been clearer: deregulation and financialisation had made it even more unstable, and the reckless promotion of debt-fuelled financial speculation and credit and housing bubbles would lead to crisis.²⁰

It wasn’t a coincidence that the large majority of economists in the West who predicted a major debt crisis, a housing or credit crash or that the neoliberal model was heading for breakdown were broadly on the left: from Dean Baker and Steve Keen to Ann Pettifor, Paul Krugman, David Harvey and Richard Wolff.²¹ Whether Keynesians, post-Keynesians or Marxists, none accepted the market fundamentalist ideology used to legitimise the vast transfer of wealth and power from labour to capital that took place over thirty years in the name of economic liberalism. All understood that, contrary to neoliberal orthodoxy, deregulated markets don’t tend towards equilibrium but deepen capitalism’s inbuilt tendency to generate systemic crises.

So while in Britain, all three main political parties backed ‘light-touch regulation’ of the financial system²² – only disagreeing about quite how light it should be – their critics had long argued that City liberalisation would sharply raise the risk of financial breakdown and increase the damage to the rest of the economy.²³ When Alan Greenspan, the free-market US federal reserve chairman who presided over the financial deregulation that paved the way for the sub-prime crisis, later told Congress he accepted his ideology and ‘view of the world’ were ‘not right’ after all, he was catching up with what opponents of neoliberal capitalism across the world had been saying all along.²⁴ And when Adair Turner, chairman of Britain’s Financial Services Authority, acknowledged that much of the deregulated City of London’s activity was ‘socially useless’, he was echoing what critics of the finance-driven model had insisted long before it broke apart.²⁵

That case was made throughout the years of market idolatry. When Western-prescribed market shock therapy was used to restore capitalism in Russia and eastern Europe, Western elites hailed it as a dawn of freedom and prosperity. But opponents of the new order predicted it would lead to economic and social disaster. Sure enough, eastern Europe’s 1990s slump was deeper than the Great Depression of the 1930s. And the neoliberal medicine of deregulation and mass privatisation that Russia was forced to swallow ushered in the greatest peacetime collapse of an industrial economy in history, driving 130 million people into poverty and millions to premature deaths.²⁶

Whether on a local or international scale, the story everywhere followed the same pattern. Privatisation was central to the neoliberal programme to bring every part of the economy and social provision into the corporate profit system. In Britain, critics warned that the Blair government’s drive to privatise public services in the name of choice and value for money would cost more, reduce accountability and transparency, drive down workers’ pay and conditions, and increase bureaucracy and political corruption.²⁷

Which is exactly what happened. By 2011, for example, it was estimated that £53 billion-worth of private finance initiative schemes to hand over the building and running of hospitals, schools and prisons to private companies on decades-long contracts would end up costing the state up to £25 billion more than if the government had paid for them directly.²⁸ The following year, a cross-party committee of MPs found PFI to be expensive, inefficient, inflexible and unsustainable – but of course delivering ‘eye-watering profits’.²⁹

And in the European Union, where neoliberal ideology, corporate privilege and market orthodoxy were embedded ever more deeply into each treaty revision, the result was ruinous. The combination of a liberalised banking system with an undemocratic, lopsided and deflationary currency union that critics (on both left and right in this case) had always warned risked breaking apart without large-scale tax-and-spend transfers was an economic disaster waiting to happen. The crash of 2008 then provided the trigger for what would become the pulverising economic and social crisis of the eurozone.³⁰

The meltdown at the heart of the global economic system, described by Bank of England governor Mervyn King as the worst financial crisis in capitalism’s history, turned a powerful case against the neoliberal order into an unanswerable one. It was after all the deregulation of financial markets, the financialisation of every part of the economy, the pumping up of credit to fill the gap left by stagnating wages and the loss of state leverage from mass privatisation that triggered the crash and turned it into a prolonged crisis – and all these flowed from the heart of the neoliberal system and its ever more dysfunctional operation.

The governing elites who had championed it, including King, had been shown to be disastrously wrong: not only about the economic and social impact of the ‘free market’, but about how it actually functioned in reality. Critics understood well before the crisis became a crash that its failure would bring about an ideological sea change, while the political and corporate establishments would throw everything into the attempt to put back together a broken model with which their own interests were so tightly bound up.³¹

The case against neoliberal capitalism had been overwhelmingly made on the left, as had been the opposition to the US-orchestrated wars of invasion and occupation across the Muslim world. But whereas the political right had for decades not hesitated to proclaim ideological victory even on the shakiest grounds, the left was strikingly slow to capitalise on its vindication over the two central global controversies of the early twenty-first century. That’s hardly surprising, perhaps, given the loss of confidence that flowed from the defeats and retreats of the left in the late twentieth century – including confidence in its own social alternatives. But driving home the lessons of these epoch-shaping developments – the disaster of the West’s wars of intervention and the failure of its economic system – was essential if they were not to be continued, repackaged or repeated.

The Iraq and Afghanistan occupations may have been widely understood to have been bloody and calamitous failures. But the war on terror was still pursued and even expanded across the wider Middle East and Africa, in covert operations and campaigns of civilian-slaughtering drone attacks from Pakistan to Somalia. Despite Western public scepticism or hostility towards armed adventures in the Arab and Muslim world, the Nato powers intervened militarily to support rebel forces in Libya and played the decisive role in the overthrow of the Gaddafi regime. The operation was carried out in the name of protecting civilians, who then died in their thousands in a Nato-escalated civil war, while conflict-wracked Syria was threatened with Western intervention and Iran with all-out military attack by Israel or the US.

And while the free-market model had been discredited, it was very far from being abandoned. Rather the opposite. Latin America had turned against neoliberalism and China demonstrated the powerful role of publicly owned banks and enterprises in driving growth against free-market dogma. But across the Western world, governments used the fallout from the crisis, shock doctrine-style, to try to reconstruct and further entrench the neoliberal system.³² With the alibi of austerity to pay off the costs of slump and bank bailouts, not only were jobs, pay and social benefits cut as never before, but privatisation and corporate-controlled markets were extended still further into the remnants of the public realm. From Lisbon to London, the rollback of the state that had fuelled the crisis was accelerated still further.

Being right was, of course, never going to be enough to shift the entrenched vested interests that depended on rebuilding the status quo. What was needed was political and industrial organisation and social pressure strong enough to turn the tables of power. Public revulsion against a discredited elite and its failed social and economic project steadily deepened in the aftermath of the 2008 crash. And as the burden of the crisis was loaded onto the majority throughout the advanced capitalist world, and the gap between the richest and the rest grew ever wider, the spread of strikes and protests, along with electoral upheavals, demonstrated that pressure for genuine change had only just begun.

* * *

The seeds of the crisis in the economic and international system were sown in the 1990s; its unravelling in the following decade came in several distinct phases, which provide the framework for this book. The New World Order was given a liberal veneer by Bill Clinton, Tony Blair and a retinue of European post-social-democratic camp followers. The last years of the twentieth century marked the high tide of both free-market globalisation and liberal intervention, which so strikingly echoed the liberal imperialism of the late nineteenth century. Privatisation and deregulation were let loose across the globe, from Moscow to Mumbai, while corporate-tailored triangulation set tight limits on redistribution and social reform in what had once been the heartlands of Western social democracy.³³

In the aftermath of the catastrophic Western-sponsored breakup of Yugoslavia, the Anglo-American appetite to intervene militarily around the world under the banner of human rights grew steadily, while a murderous sanctions regime was enforced on Iraq over ‘weapons of mass destruction’ it no longer possessed. Liberal interventionism reached its hubristic peak in Nato’s self-proclaimed ‘humanitarian war’ against Yugoslavia over the rebellion in Kosovo in 1999. The Nato bombing campaign, without UN support, increased both the scale of ethnic cleansing and repression it was supposed to stop, and only secured Serb withdrawal through Russian pressure. But it was hailed as a great success by its architects (and created a precedent for the illegal invasion of Iraq four years later).³⁴ So was the British intervention in Sierra Leone’s civil war in 2000, which Blair insisted had saved ‘democracy’, though the decisive role in bringing the war to an end two years later was played by the UN and regional African forces.³⁵

At home, Blair and Clinton’s lurch away from ‘tax-and-spend’ social democracy, their embrace of private wealth and corporate power and refusal to act against escalating inequality laid the ground for a crisis of political representation. Even as New Labour carried out modest redistribution and boosted spending on health and education, privatisation and competition were promoted as the only route to reform, while working-class living standards stagnated. With communism officially declared dead and class politics banished from the mainstream, only the rise of the anti-corporate movement, spasms of protest against Europe’s political establishment and the first political eruptions in Latin America gave any sense that there might be a political or social alternative at all.³⁶

That was the context in which the war on terror was unleashed in 2001. Far from coming out of a clear blue sky, as claimed at the time, the 9/11 attacks were the product of decades of US and Western military intervention and support for client dictatorships in the Middle East; unwavering sponsorship of indefinite Israeli occupation; the US and British-led asphyxiation of Iraq; and the garrisoning of US troops in Saudi Arabia (as well as blowback from the anti-Soviet war in Afghanistan). Those were the grievances that attracted recruits to al-Qaida and sympathy across the region. But for the US Republican hawks, the neoconservative moment had arrived: an opportunity to give a global demonstration of US ‘full spectrum dominance’ and unilateral military power, and to impose its will on a recalcitrant Arab and Muslim world.

The invasion of Afghanistan was launched on a wave of liberal interventionist rhetoric about democracy, women’s rights and development. The ease of the Taliban’s overthrow fed Western triumphalism, while supporters of the new imperialism tried to rehabilitate the original model – from right-wing historians like Niall Ferguson to New Labour politicians such as Gordon Brown.³⁷ But the slaughter of Afghan civilians and restoration of warlord rule quickly exposed the campaign’s grim reality and fuelled al-Qaida-inspired terror around the world. So did Israel’s US-backed onslaught against the Palestinian intifada in the months that followed.³⁸

But Iraq was the real target. This was the neocons’ chance to turn an oil-rich rogue state that refused to bend the knee into a beacon of Western values and a US forward base for the transformation of the world’s most strategically sensitive region. That was the fantasy which died in the killing fields of Fallujah, Samarra, Ramadi and Basra, as both Sunni and Shia-led resistance demonstrated that Iraqis would accept neither the subjugation of their country nor the role assigned to it in Washington and London. As the crudely colonial nature of the occupation was driven home, with rampant torture, mass killing and detention without trial, armed resistance escalated in 2007 to 750 attacks a week on the occupation forces.³⁹

Instead of a beacon, the US-British invasion turned Iraq into a bloodbath, in which hundreds of thousands were killed and millions made refugees, while those who launched it were yet to be held to account a decade later. Instead of projecting US power across the region, the aggression bolstered Iran, as Iraq was flooded with the very al-Qaida jihadists the war on terror was supposed to suppress. Only by ruthlessly playing the sectarian and ethnic cards and fuelling Sunni–Shia bloodletting, in the imperial divide-and-rule tradition, was the US later able to weaken resistance and offset its strategic and political defeat.⁴⁰

By the time Bush and Blair invaded Iraq and Afghanistan, the Palestinian uprising was at the centre of an arc of resistance that matched the new arc of occupation across the Arab and Muslim world. Israel had been forced by Hizbullah’s resistance to withdraw from southern Lebanon in 2000, and pulled back from the Gaza Strip in the wake of the intifada five years later, while enforcing control through siege and punitive raids. Its devastating assaults on Lebanon in 2006 and Gaza in 2008–09 failed to break either Hizbullah or Hamas. But the refusal of the US, Europe and Israel to accept the outcome of Palestinian elections – while funding and arming the West Bank Palestinian Authority against blockaded, Hamas-controlled Gaza – deepened Palestinian divisions and sapped resistance to occupation and colonisation.⁴¹

Even as the scale of failure became clear in Iraq, Bush and Blair intensified the military campaign in Afghanistan, now hailed as ‘the good war’ and even a ‘war for civilisation’. When British troops were sent to Helmand in 2006, the defence secretary John Reid told parliament he hoped they would leave ‘without a single shot being fired’. Four million rounds later, they were being killed at a faster rate than in Iraq, while Afghan civilians were dying in their thousands from Nato air attacks and the mushrooming conflict with the Taliban. As he wound down the Iraq occupation, Barack Obama would further escalate the Afghan war, spreading it to Pakistan with unrelenting drone attacks that left thousands dead. The war on terror continued to fuel terrorism across the Muslim world and in the states that waged it, while at the same time nurturing Islamophobia in Europe and North America. Afghanistan had become nothing more than a war to save Nato’s credibility.⁴²

By then the crash of 2008 had engulfed the main occupying states, deepening popular pressure for withdrawal from exorbitant and unwinnable wars. The economic crisis not only cut the ground from under the market orthodoxy that had shaped politics for a generation, but rehabilitated state intervention overnight. By the scale of their bailouts to save the banking system, nationalisations and boosts in demand, governments gave an object lesson in what could in fact be done. After decades in which the market had been unchallenged, Keynes and Marx were back in fashion and the political and corporate elites destabilised.⁴³

But as soon as the immediate threat had passed, pressure to restore the old order and shuffle off the costs of the slump rapidly turned a crisis of the market and the banks into a crisis of the state and public debt. Economic failure paved the way for Obama’s election and brought down one incumbent government after another across Europe, as the crisis took the currency union to the brink of implosion. In Britain, it drove Brown’s government in a more recognisably social-democratic direction, but the shift was too little and too late to staunch a haemorrhage of supporters. The Conservative-led coalition that succeeded it in 2010 would then impose an austerity programme to shrink the state and reorder society in the interests of those who had triggered the crisis – as a string of corruption scandals further discredited the elites and the country erupted into protests and riots.⁴⁴

Revolt against the market orthodoxy that brought the Western world’s economies to their knees in 2008 had first emerged a decade earlier in Latin America in the wake of the financial crisis of 1998. It was Latin America’s experience of the privatisation, deregulation and pauperisation it unleashed across the region that opened the way for the election of progressive and radical governments from Venezuela to Brazil, Bolivia to Argentina in the first years of the new millennium. Not only did they begin to carve out the first truly independent South America for 500 years, but their radical social programmes, experiments in democratic participation and determination to bring resources under public control demonstrated there would be multiple economic and social alternatives in the twenty-first century.⁴⁵

Latin America’s rejection of neoliberalism would be vindicated in the crisis of 2007–08, as would China’s ability to mobilise state-owned banks and enterprises to continue the expansion that had confirmed its unquestioned emergence as a global economic power in the new century. China’s explosive rise, which led to the largest-scale reduction in poverty in history, was also bought at the cost of large-scale and corrupt privatisation, the creation of a wealthy elite and a block on democratic advance. But by 2010, its vast cheap labour industrial export zones were being swept by successful strikes, while protests multiplied across rural areas – as the government boosted employment protection and signalled a shift back towards freer health and education.⁴⁶ Which direction China and its hybrid economic model would take would evidently depend on social struggles and pressures, from above and below.⁴⁷

That was also the lesson of the uprisings that erupted across the Arab world in the winter of 2010–11, triggered by the aftershocks of the economic crash of 2008. After two of their client autocrats were overthrown in quick succession by popular revolts in Tunisia and Egypt, the Western powers and their Gulf allies moved to hijack, suppress or divert the revolutionary process. In Libya, Nato’s intervention delivered a new order founded on ethnic cleansing, torture and internment at a cost of an estimated 30,000 dead, while its leading states backed the crushing of opposition in Bahrain and other dependent dictatorships. The Saudi and other Gulf autocracies meanwhile fanned sectarianism to control or stifle revolts from Syria to Saudi Arabia, as the US and Israel ratcheted up the menace of war on Iran. In the aftermath of Iraq and Afghanistan, it was clear that the US and its allies were still ready to use military power to control the region – but also that the forces unleashed across the Arab world, including the impulse for self-determination, would not easily be turned back.⁴⁸

That was also true globally. More than a decade after 9/11 and the subsequent neoconservative onslaught, the US still maintained military forces in most countries from the heart of a global empire, waged war across the Muslim world and threatened states that defied its diktat. But its unilateral military power and credibility had been eroded, while China, Russia and Latin America had asserted their independence, expanding the political and economic options for weaker states in the process.

By the same token, Western governments and corporate interests were using the crisis to impose austerity, dismantle welfare and further extend privatisation, while insecurity and unemployment fuelled the growth of the far right. But the Washington consensus was discredited, the free market model in ruins, class politics was back and support for the radical left was growing – including in the heart of Europe. The spirit of Arab revolt had, meanwhile, inspired a global protest movement against the bailout of the richest 1 per cent, while across the globe rejection of corporate power and greed had become the common sense of the age.

The historian Eric Hobsbawm described the crash of 2008 as a ‘sort of right-wing equivalent to the fall of the Berlin wall’, whose aftermath had led the world to ‘rediscover that capitalism is not the answer, but the question’.⁴⁹ It was commonly objected that after the implosion of communism and traditional social democracy in the late twentieth century, the left had no systemic alternative to offer. But no economic and social model ever came pre-cooked. All of them, from Soviet power and the Keynesian welfare state to Thatcherite-Reaganite neoliberalism, grew out of ideologically driven improvisation in specific historical circumstances.

The same was true in the aftermath of the crisis of the neoliberal order, as the need to reconstruct a broken economy and society on a more democratic, egalitarian and rational basis began to dictate the shape of a collective and sustainable alternative. Both the economic and ecological crisis demanded social ownership, public intervention and a fundamental shift of wealth and power. Real life was pushing in the direction of progressive solutions. The upheavals of the first years of the twenty-first century opened up the possibility of a new kind of global order and of genuine social and economic change. But, as communists learned in 1989, and the champions of capitalism discovered twenty years later, nothing is ever settled.