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... Premise No. 1 is that all systems—from the astronomical universe to the smallest physical phenomena, and including of course historical social systems—have lives. They come into existence at some point, which needs to be explained. They have “normal” lives, the rules of which need to be explicated.
... [At a certain point, the system] begins to fluctuate wildly and repeatedly, leading to a bifurcation—that is, to a chaotic situation in which a stable equilibrium cannot be maintained. In such a chaotic situation, there are two quite divergent possibilities of recreating order out of chaos, or a new stable system. This period we may call the structural crisis of the system, and there is a system-wide battle—for historical social systems, a political battle—over which of two alternative possible outcomes will be collectively “chosen.”
... Premise No. 3 is a reading of what has happened in the modern world-system from 1945 to 2010. I divide this into two periods: ... The period 1945-circa 1970 was one of great economic expansion in the world-economy, indeed by far the most expansive Kondratieff A-period in the history of the capitalist world-economy. When the quasi-monopolies were breached, the world-system entered a Kondratieff B-downturn in which it still finds itself. Predictably, capitalists since the 1970s have shifted their focus from the production arena to the financial arena. The world-system then entered the most extensive continuous series of speculative bubbles in the history of the modern world-system, with the greatest level of multiple indebtednesses.
The period 1945 to circa 1970 was also the period of full U.S. hegemony in the world-system. Once the United States had made a deal with the only other militarily strong state, the Soviet Union (a deal rhetorically called “Yalta”), U.S. hegemony was essentially unchallenged. But then once the geopolitical quasi-monopoly was breached, the United States entered into a period of hegemonic decline, which has escalated from a slow decline into a precipitate one during the presidency of George W. Bush. U.S. hegemony was far more extensive and total than those of previous hegemonic powers, and its full decline promises to be the swiftest and most total.
There is one other element to put into the picture—the world-revolution of 1968, which occurred essentially between 1966 and 1970, and took place in all three major geopolitical zones of the world-system of the time: the pan-European world (the “West”), the Socialist bloc (the “East”), and the third world (the “South”). 
... While the actual uprisings of 1968 did not last very long, there were two main consequences in the political-ideological sphere. The first was that centrist liberalism ended its long reign (1848-1968) as the only legitimate ideological position, and both the radical left and the conservative right resumed their roles as autonomous ideological contestants in the world-system.
The second consequence, for the left, was the end of the legitimacy of the Old Left’s claim to be the prime national political actor on behalf of the left, to which all other movements had to subordinate themselves. The so-called forgotten peoples (women, ethnic/racial/religious “minorities,” “indigenous” nations, persons of non-heterosexual sexual orientations), as well as those concerned with ecological or peace issues, asserted their right to be considered prime actors on an equal level with the historical subjects of the traditional antisystemic movements. .
... Politically, what happened in the twenty-five years succeeding 1968 is that the reinvigorated world right asserted itself more effectively than the more fragmented world left. The world right, led by the Reagan Republicans and the Thatcher Conservatives, transformed world discourse and political priorities.
The buzzword “globalization” replaced the previous buzzword “development.” The so-called Washington Consensus preached privatization of state productive enterprises, reduction of state expenditures, opening of the frontiers to uncontrolled entry of commodities and capital, and the orientation to production for export. The prime objectives were to reverse all the gains of the lower strata during the Kondratieff A-period. The world right sought to reduce all the major costs of production, to destroy the welfare state in all its versions, and to slow down the decline of U.S. power in the world-system.
... Premise No. 4 is the description of what happens in a structural crisis, which the world-system is in at the present time, has been in at least since the 1970s, and shall continue to be in until probably circa 2050. The primary characteristic of a structural crisis is chaos. Chaos is not a situation of totally random happenings. It is a situation of rapid and constant fluctuations in all the parameters of the historical system. This includes not only the world-economy, the interstate system, and cultural-ideological currents, but also the availability of life resources, climatic conditions, and pandemics.
... At the household level, the degree of uncertainty pushes popular opinion both to make demands for protection and protectionism and to search for scapegoats as well as true profiteers. Popular unrest determines the behavior of the political actors, pushing them into so-called extremist positions. The rise of extremism (“The center cannot hold”) pushes both national and world political situations toward gridlock.
There can be moments of respite for particular states or for the world-system as a whole, but these moments can also be rapidly undone. One of the elements undoing the respites are sharp rises in the costs of all the basic inputs both to production and daily life—energy, food, water, breathable air. In addition, the funds to prevent or at least reduce the damages of climate change and pandemics are insufficient. ...
Davos versus Porto Alegre
... In a structural crisis, the only certainty is that the existing system—the capitalist world-economy—cannot survive. What is impossible to know is what the successor system will be. One can envisage the battle as one between two groups that I have labeled “the spirit of Davos” and “the spirit of Porto Alegre.”
The objective of the two groups is totally opposite. The proponents of “the spirit of Davos” want a different system—one that is “non-capitalist” but still retains three essential features of the present system: hierarchy, exploitation, and polarization. The proponents of “the spirit of Porto Alegre” want the kind of system that has never existed heretofore, one that is relatively democratic and relatively egalitarian. I call these two positions “spirits” because there are no central organizations on either side of this struggle, and indeed, the proponents inside each current are deeply divided as to their strategy.
The proponents of the spirit of Davos are divided between those who proffer the iron fist, seeking to crush opponents at all levels, and those who wish to co-opt the proponents of transformation by fake signs of progress (such as “green capitalism” or “poverty reduction”).
... I see a medley of tactics that might move us in the right direction.
The first is to place great emphasis on serious intellectual analysis—not in a discussion conducted merely by intellectuals, but throughout the populations of the world. It must be a discussion animated by a large openness of spirit among all those who are inspired, however they define it, by the spirit of Porto Alegre.
... A second tactic is to reject categorically the goal of economic growth and replace it with the goal of maximum decommodification—what the movements of indigenous nations in the Americas are calling buen vivir. This means not only resisting the increased drive to commodification of the last thirty years—of education, of health structures, of the body, of water and air—but decommodifying as well agricultural and industrial production. How this is done is not immediately obvious, and what it entails we shall only know by experimenting widely with it.
A third approach is an effort to create local and regional self-sufficiencies, especially in the basic elements of life such as food and shelter. The globalization we want is not a single totally integrated division of labor but an “alterglobalization” of multiple autonomies that interconnect in seeking to create a “universal universalism” composed of the multiple universalisms that exist. We must undermine the provincial claims of particular universalisms to impose themselves on the rest of us. 
... The one encouraging feature about a systemic crisis is the degree to which it increases the viability of agency, of what we call “free will.” In a normally functioning historical system, even great social effort is limited in its effects because of the efficacy of the pressures to return to equilibrium. But when the system is far from equilibrium, every little input has great effect ...
Immanuel Wallerstein (immanuel.wallerstein [at] yale.edu) is Senior Research Scholar at Yale University. Volume IV of "The Modern World-System" will appear in May 2011, along with new editions of the first three volumes.