On the Historical Specificity of the Marxist Theory of Imperialism

Nikolai Bukharin

Grigorii Zinoviev

.

If it were necessary to give the briefest possible definition of imperialism we should have to say that imperialism is the monopoly stage of capitalism. Such a definition would include what is most important, for, on the one hand, finance capital is the bank capital of a few very big monopolist banks, merged with the capital of the monopolist associations of industrialists; and, on the other hand, the division of the world is the transition from a colonial policy which has extended without hindrance to territories unseized by any capitalist power, to a colonial policy of monopolist possession of the territory of the world, which has been completely divided up.

— Vladimir Lenin, Imperialism, the Highest Stage of Capitalist Development, from Lenin: Collected Works, Volume 22, pg. 266 (1915)

Modern imperialism is the social-economic policy of finance capital tending toward the creation of the most comprehensive economic territorial entities and world empires possible. It is characterized by the tendency to supplant free trade decisively with the system of protective tariffs and to subordinate economic life completely to the great monopolistic combines, such as the trusts, cartels, banking consortia, etc. Imperialism signifies the highest stage in the development of capitalism, in which not only commodity exports but capital exports as well occupy a place of quintessential importance. It characterizes an epoch in which the world is partitioned among a few great capitalist powers and in which the struggle proceeds along the lines of repartitioning it and partitioning the remaining areas.

— Grigorii Zinoviev, “What is Imperialism?” (1916)

The historian or economist who places under one denominator the structure of modern capitalism, i.e., modern production relations, and the numerous types of production relations that formerly led to wars of conquest, will understand nothing in the development of modern world economy.  One must single out the specific elements which characterise our time, and analyse them.  This was Marx’s method, and this is how a Marxist must approach the analysis of imperialism.  We now understand that it is impossible to confine oneself to the analysis of the forms, in which a policy manifests itself; for instance, one cannot be satisfied with defining a policy as that of “conquest,” “expansion,” “violence,” etc.  One must analyse the basis on which it rises and which it serves to widen.  We have defined imperialism as the policy of finance capital.  Therewith we uncovered the functional significance of that policy.  It upholds the structure of finance capital; it subjugates the world to the domination of finance capital; in place of the old pre-capitalist, or the old capitalist, production relations, it put the production relations of finance capital.  Just as finance capitalism (which must not be confused with money capital, for finance capital is characterised by being simultaneously banking and industrial capital) is an historically limited epoch, confined only to the last few decades, so imperialism, as the policy of finance capital, is a specific historic category.

— Nikolai Bukharin, Imperialism and World Economy, pg. 114 (1917)

Modern imperialism is not the prelude to the expansion of capital, as in Bauer’s model; on the contrary, it is only the last chapter of its historical process of expansion: it is the period of universally sharpened world competition between the capitalist states for the last remaining non-capitalist areas on earth. In this final phase, economic and political catastrophe is just as much the intrinsic, normal mode of existence for capital as it was in the ‘primitive accumulation’ of its development phase. The discovery of America and the sea route to India were not just Promethean achievements of the human mind and civilization but also, and inseparably, a series of mass murders of primitive peoples in the New World and large-scale slave trading with the peoples of Africa and Asia. Similarly, the economic expansion of capital in its imperialist final phase is inseparable from the series of colonial conquests and World Wars which we are now experiencing. What distinguishes imperialism as the last struggle for capitalist world domination is not simply the remarkable energy and universality of expansion but — and this is the specific sign that the circle of development is beginning to close — the return of the decisive struggle for expansion from those areas which are being fought over back to its home countries. In this way, imperialism brings catastrophe as a mode of existence back from the periphery of capitalist development to its point of departure. The expansion of capital, which for four centuries had given the existence and civilization of all non-capitalist peoples in Asia, Africa, America and Australia over to ceaseless convulsions and general and complete decline, is now plunging the civilized peoples of Europe itself into a series of catastrophes whose final result can only be the decline of civilization or the transition to the socialist mode of production. Seen in this light, the position of the proletariat with regard to imperialism leads to a general confrontation with the rule of capital. The specific rules of its conduct are given by that historical alternative.

According to official ‘expert’ Marxism, the rules are quite different. The belief in the possibility of accumulation in an ‘isolated capitalist society’, the belief that capitalism is conceivable even without expansion, is the theoretical formula of a quite distinct tactical tendency. The logical conclusion of this idea is to look on the phase of imperialism not as a historical necessity, as the decisive conflict for socialism, but as the wicked invention of a small group of people who profit from it. This leads to convincing the bourgeoisie that, even from the point of view of their capitalist interests, imperialism and militarism are harmful, thus isolating the alleged small group of beneficiaries of this imperialism and forming a bloc of the proletariat with broad sections of the bourgeoisie in order to ‘moderate’ imperialism, starve it out by ‘partial disarmament’ and ‘draw its claws’! Just as liberalism in the period of its decline appeals for a well-informed as against an ill-informed monarchy, the ‘Marxist center’ appeals for the bourgeoisie it will educate as against the ill-advised one, for international disarmament treaties as against the disaster course of imperialism, for the peaceful federation of democratic nation-states as against the struggle of the great powers for armed world domination. The final confrontation between proletariat and capital to settle their world-historical contradiction is converted into the utopia of a historical compromise between proletariat and bourgeoisie to ‘moderate’ the imperialist contradictions between capitalist states.

— Rosa Luxemburg, Anti-Critique (1915)

My reason for citing the above excerpts is that I feel that the Marxist theory of imperialism — as developed by Rudolf Hilferding, Rosa Luxemburg, Vladimir Lenin, Grigorii Zinoviev, and Nikolai Bukharin — has been widely abused in recent decades in analyzing the intervention of advanced capitalist states (the U.S. or members of the European Union) into less developed countries.  While there can be no doubt that there exist some parallels and continuities between the kind of self-interested exploitation of Third World countries, typically ex-colonies, that takes place today and the imperialism of old, these theorists understood it as a specific outgrowth of monopoly or finance capitalism.  If I might be permitted to grant this phase of capitalism a periodicity, I would probably place it between 1880-1929.  Since this time, capitalism has undergone not one but two drastic reconfigurations (Fordism and neoliberalism).  For this reason, I think that the term should not be so loosely thrown around in describing current affairs, as many of these categories need to be reworked to fit the present day.

There are many fundamental differences between the phenomenon Lenin et al. described as “imperialism” and what has more recently been dubbed “imperialism” (or, perhaps more fittingly, “neo-imperialism”).

Lenin understood imperialism to entail a certain underlying logic, the bloody competition between great capitalist powers to carve up the earth according to zones of influence and direct colonial administration in pursuit of new markets, raw materials, and cheap labor.  Moreover, he believed that this competition between the great capitalist powers of the world, which were at the time mostly European but also included Japan and the United States, would escalate to the point where an inter-imperialist war, by definition a world war, was inevitable.  This was a multipolar world, in which no one great power could be said to predominate completely, and in which large-scale alliances were formed in anticipation of major conflict that everyone knew was on the horizon.  Also, imperialism constituted the logical outgrowth of the shift from liberal capitalism, where the prevailing Manchester School ideology of “free markets” dominated and liberalism (quite contrary to its historical aspirations) held the reigns of state power, from 1848-1873, to monopoly or finance capitalism, where smaller competitors were gradually pushed out as major trusts swallowed up their rivals and cut deals with the governments in order to corner the market in the aftermath of the “long crisis” of 1873.

What leftists generally understand imperialism to mean today is the more or less cooperative domination of either the single world superpower, the US, or in tandem with its various allies in NATO (another Cold War holdover) or the UN.  While military occupations clearly last over years of bloody conflict, the point is not direct colonial administration but the indirect establishment of quasi-independent regimes that will be “friendly” to US or European interests.  No one really believes that these various military interventions around the world are actually going to lead to an armed conflict between, say, the European Union and the US, or between Russia and the US, or even China and the US.  After the collapse of the Soviet Union, there has been a decidedly unipolar order.  In terms of concurrent transformations in the organic composition of capital and the corresponding historical periodicities of capitalism, we seem to have reverted to a “neoliberal” valorization of free markets and the deregulation of capital flows.  There is some debate as to whether neoliberalism is merely an ideological pretext that masks deep complicity with state powers, or whether it is a socioeconomic reality, but clearly the form of capitalism that Lenin felt specifically motivated imperialism in his time does not exist today.May

06

A Study of the Marxist (and Non-Marxist) Theory of Imperialism

The Death of Global Imperialism (1920s-1930s)

As part of my study of the spatial dialectics of capitalism, I have been reading not only the more recent Marxist literature by Henri Lefebvre on The Production of Space or David Harvey’s excellent Spaces of Capital, but also some of the more classic works on the subject.

Marx’s own account of the spatiality of capitalism can be found in the Manifesto of the Communist Party, his Grundrisse of the early 1860s, and his posthumously published Capital, Volume II.  In the Manifesto, he talks at length in the first section of the globality of capitalism, of the formation of the world-market as part of the historical mission of the bourgeoisie.  In the latter two works I mentioned, the spatial dimension of capital is raised in connection with the ever-improving means of transport and communication, in facilitating the circulation of commodities.  Marx explains the dynamic in capitalism by which it breaks through every spatial barrier that it comes across, such that it seems to embody a sort of terrestrial infinity realizing itself through time.

But I am interested in some of the later work that was done on the Marxist theory of imperialism, both before and immediately after the 1917 Revolution.  This would have an obvious bearing on the spatial extension of capitalism throughout the world.  In this connection, I have drawn up a brief reading list:

1. John Atkinson Hobson.  Imperialism: A Study (1902).  Though a pacifist and political liberal, Lenin considered his study of imperialism vastly superior to Kautsky’s, which had by then joined forces with the bourgeois apologists.
2. Rudolf Hilferding.   Finance Capital: A Study of the Latest Phase of Capitalist Development (1910).  This book was extremely influential in its time, and established a number of concepts regarding monopoly capitalism and finance capital that Lenin would later rely upon.  The two chapters on “The Export of Capital” and “The Proletariat and Imperialism” are relevant to any study on imperialism.
3. Rosa Luxemburg.  The Accumulation of Capital (1913).  This is Luxemburg’s greatest contribution to the economic theory of Marxism.  Though she and Lenin disagreed over some of its premises and conclusion, the book remains extremely important for the analysis of imperialism.  The chapter on “Foreign Loans” addresses this directly.
4. Vladimir Lenin.  Imperialism, the Highest Stage of Capitalist Development (1915-1916).  This work scarcely needs any introduction.  The entire book is a study of imperialism as a stage in capitalist development.
5. Nikolai Bukharin.  Imperialism and World Economy (1917).  This book, which includes a favorable introduction from Lenin, seems to me to perhaps be the most pertinent to my own studies, since it places the “world economy” as  a centerpiece for its analysis.

I am hoping perhaps a few of my Marxist friends will join me in reading some selections of these books.  In my understanding of the subject, the imperialism described by Hilferding, Luxemburg, Lenin, and Bukharin were very specific to the time in which they were living.  According to their theories, it involved vast capitalist trusts and cartels, gigantic monopolies, along with huge amounts of finance capital backing them through the banks.  I think that Lenin’s theory of imperialism is all too often invoked in describing present-day imperialist ventures.  It continues to be a force within the greater complex of capitalist globalization, which has been taking place ever since the social formation first emerged.  But historical conditions have changed since Lenin’s time, and in light of the neo-liberalist recalibration of capitalism, I think some of the fundamental categories we retain from Lenin’s analysis of imperialism might have to be rethought or slightly modified to accommodate present-day realities.

I personally am interested in the historical imperialism that Lenin et al. were studying, i.e. the form of imperialism that existed between 1880 and 1939.  Are there any other suggestions for reading on this subject? Ren, I’m looking to you.  But others are welcome to make suggestions as well.

thecharnelhouse.org

Lenin's Critique of Global Capitalism

Excerpt from Introduction to International Political Economy by David N. Balaam and Michael Veseth, 2nd ed., 2001, pp. 76-78


Essay



Vladimir Ilich Lenin (1870-1924) is best known for his role in the Russian Revolution of 1917 and the founding of the Soviet Union. Lenin symbolized for many people the principles and ideas of the 1917 Revolution. In fact, in many ways, Lenin turned Marx on his head by placing politics over economics when he argued that Russia had gone through its capitalist stage of history and was ready for a second, socialist revolution.

Here we focus on Lenin's ideas about imperialism more than on his revolutionary strategies. Lenin developed a perspective on IPE that took Marx's class struggle, based on the mode of production, and used it to explain capitalism's international effects as transmitted through the production and finance structures of rich industrial countries to the poorer developing regions of the world. Lenin's famous summary of his views is Imperialism: The Highest Stage of Capitalism (1917).

Marx said that capitalism, driven by its three laws, would come to revolutionary crisis and suffer internal class revolt, paving the way for the transition to socialism. Lenin observed that capitalist nations had avoided this crisis by expanding the pool of workers they exploited. Capitalism, he argued, "had escaped its three laws of motion through overseas imperialism. The acquisition of colonies had enabled the capitalist economies to dispose of their unconsumed goods, to acquire cheap resources, and to vent their surplus capital."

In short, Lenin added to Marx what Robert Gilpin has called a "fourth law" of capitalism, which we might call the law of capitalist imperialism: "As capitalist economies mature, as capital accumulates, and as profit rates fall, the capitalist economies are compelled to seize colonies and create dependencies to serve as markets, investment outlets, and sources of food and raw materials. In competition with one another, they divide up the colonial world in accordance with their relative strengths.''

To Lenin, imperialism is another portion of the capitalist epoch of history that the world must endure on the road to communism. According to Lenin, "Monopoly is the transition from capitalism to a higher system.''

The critical element fueling imperialism, according to Lenin, was the decline of national economic competition and the growth of monopolies. Based on Marx's law of concentration, what emerged was an aggregation of market power into the hands of a few "cartels, syndicates and trusts, and merging with them, the capital of a dozen or so banks manipulating thousands of millions." Lenin went on to argue that.

"Monopoly is exactly the opposite of free competition; but we have seen the latter being transformed into monopoly before our very eyes, creating large-scale industry and eliminating small industry, replacing large-scale industry by still larger-scale industry, finally leading to such a concentration of production and capital that monopoly has been and is the result."

The key for Lenin was that because monopolies concentrated capital, they could not find sufficient investment opportunities in industrial regions of the world. They therefore found it necessary to export capital around the globe to earn sufficient profits.

Lenin argued that imperialist expansion allowed capitalism to postpone its inevitable crisis and metamorphose into socialism. It also created new, serious problems for the world. Lenin viewed World War I as an imperialist war, caused by tensions that arose from the simultaneous expansion of several European empires. As nations at the core of capitalism competed to expand their exploitative sphere, their interests intersected and conflicted with one another, producing the Great War.

Lenin's role in the Revolution of 1917 was to help defeat liberal political forces that sought to keep Russia within the European capitalist system. Under Lenin's leadership, Russia essentially withdrew from Europe and its imperialist conflicts, and resolved to move quickly and on its own toward a communist system free of class conflict and imperialist wars.

Lenin's imperialist theory of capitalism has been very influential, so it is worthwhile considering briefly a few other aspects of his analysis. Lenin sought to explain how it was that capitalism shifted from internal to international exploitation, and how the inequality among classes had as its parallel the law of uneven development among nations.

For Lenin, profit-seeking capitalists could not be expected to use surplus capital to improve the living standards of the proletariat. Therefore, capitalist societies would remain unevenly developed ones, with some classes prospering as others were mired in poverty. The imperial phase of capitalism simply transferred this duality of wealth and poverty onto the world stage, as capitalists, seeking to maintain and even increase their profits, exported to what contemporaries of Lenin called "backward" regions of the world. These poor peripheral countries were now integrated into the world economy as the new "proletariat" of the world.

According to Lenin, "Monopolist capitalist combines -- cartels, syndicates, trusts -- divide among themselves, first of all, the whole internal market of a country, and impose their control, more or less completely, upon the industry of that country. But under capitalism the home market is inevitably bound up with the foreign market. Capitalism long ago created a world market."

The uneven development of society within a nation now took place on an international scale.

Lenin saw imperial capitalism spreading through two structures of the IPE: production and finance. Both of these structures were so constituted, under capitalism, as to create dependency and facilitate exploitation. Cutthroat competition among poorer nations made them easy targets for monopolies in the production structure in the capitalist core. The same forces were at work within the finance structure, where the superabundance of finance capital, controlled by monopolistic banks, was used to exploit less developed countries.

The bottom line of imperialism, for Lenin, was that the rich capitalist nations were able to delay their final crisis by keeping the poorer nations underdeveloped and deep in debt, and dependent on them for manufactured goods, jobs, and financial resources. It is not surprising, then, that Lenin's theory of imperialism has been very influential, especially among intellectuals in the less developed countries, where his views have shaped policy and attitudes toward international trade and finance generally.

We include Lenin's imperialism under the general heading of "structuralism," as we did with Marx's theories, because its analysis is based on the assumption that it is in capitalism's nature for the finance and production structures among nations to be biased in favor of the owners of capital. While, in theory, the relationship between capital-abundant nations and capital-scarce nations should be one of interdependence, since each needs the other for maximum growth, in practice the result is dependence, exploitation, and uneven development. The same forces that drive the bourgeoisie to exploit the proletariat ultimately drive the capitalist core nations to dominate and exploit less developed countries.

Copyright © 2001, 1996 by Prentice-Hall, Inc. All rights reserved.

Finance Capitalism’s Self-Destructive Nature

Finance Capitalism’s Self-Destructive Nature

By Michael  Monday, July 18, 2022 Interviews  Super Imperialism  Permalink

Transcript of Interview on The Left Lens with Danny Haiphong May 25th, 2022

DANNY HAIPHONG: Good afternoon, everyone. Happy Wednesday, May 25th, welcome to the stream, to another left lens. Today we have a very special guest so as you’re coming in make sure you are liking the stream sharing it, make sure that you are subscribing to the channel and hitting that notifications bell, and as always you know please do support this work here at this channel and all the work that I do at patreon.com/dannyhaiphong. But with that said I want to introduce our guests because we have a lot to talk about over the next hour and it is economist Michael Hudson.

He is the author of the new book, The Destiny of Civilization: Finance capitalism, Industrial Capitalism or Socialism and I’ll pull that up from his website very soon but I want to just say about Michael Hudson is that he’s been someone I’ve been following for quite some time. He has been making the rounds on various programs talking about political economy and he’s one of the foremost voices of understanding political economy today. Hi Michael, good to be with you thanks so much for joining us today

MICHAEL HUDSON: Good to meet you, Danny. 

DANNY HAIPHONG: Very very good to meet you. So I’m going to pull up your new book in a second just on your website so people know where to go and I’ll make sure to link that in the chat so people know where to get it but I want to talk about first, so I mean we’re in an economic catastrophe in a lot of ways currently and there’s a lot of talk about, inflation and money, prices are skyrocketing, and one thing I really appreciate about your work is that you really do focus on political economy and you have been talking a lot about finance capital and something called super imperialism which you’ve written a book about and that has been updated several times even just last year so I wanted to get your take on the role of finance capital uh under this imperialist arrangement and in this time of the neo-liberal era in the united states and across much of the West in the world.

What is finance capital’s role? It seems so dominant now, it seems like the dominant class at this moment that really does control the levers of economic development. Could you talk about what role it plays and how it has spurred the crises that we’re going through today and you could talk about inflation but I definitely want to just kick it to you there so our viewers can get an understanding of the economics and an analysis of this.

MICHAEL HUDSON: Well, most people think of all kinds of capitalism as being the same and the assumption is that industrial capitalism of the nineteenth century somehow was always financialized because there were always banks but financial capitalism is you just pointed out is a political system and as a political system it’s very different from the industrial capitalism dynamic. In industrial capitalism, the whole aim or the hope of the industrial capitalists in the late nineteenth century, especially in Germany and central Europe was that banking would no longer be just usury, it wouldn’t be just consumer lending to exploit labor, and it wouldn’t be lending to the government somehow.

The financial system  would recycle the economy savings and money creation and credit into industrial production and would finance the means of production to make that productive instead of predatory and parasitic as it became and that seemed to be the way that industrial capitalism was evolving up until World War I. Everything changed after that all of a sudden you had the financial system take over as a result of the crisis caused in the 1920s by the German reparations debt that couldn’t be paid and the inter-ally debt that was insisted upon to repay the United States for the arms that have supplied Europe for a century into World War I. Well, the result was a huge depression.

The allies said, well, we didn’t expect to actually have to pay the United States. If we have to pay the United States, then we have to charge reparations on Germany and for a decade there was a debate between John Maynard Keynes and Harold Moulton and others saying that these debts can’t be paid. How are you going to handle a situation where the debts can’t be paid?

The finance capitalists then were the basically the ancestors of today’s neoliberals and they said any amount of debt can be paid by any country if it just lowers the living standards and squeezes labor enough and that’s what basically the philosophy of the IMF ever since world war II when third world countries can’t pay the debt, the IMF comes in with an austerity program and say you have to lower wages, you have to break up labor unions, if necessary you have to have a democracy, and you can’t have a democracy unless you’re willing to assassinate and arrest the labor leaders and the advocates of land redistribution because a democracy means basically rule by the financial sector  centered in the united states. And so finance capitalism ever since WWI and especially WWII and especially since 1980 is the nationalistic doctrine of American banks and the American one percent, and the American financial sector that is sort of merged into a symbiotic unit with the finance insurance and real estate.

In other words, finance capitalism instead of trying to promote overall economic growth for the 99 percent, instead of financing the industrialization of an economy with rising productivity and rising living standards, is now cannibalizing the industrial sector, cannibalizing the corporate sector. As you’re seeing in the U.S., finance capitalism is the economic doctrine of deindustrialization that has occurred in America in England and is now occurring in Europe.

Well, the problem is how do you survive if you’re not industrializing, if you’re not producing your own means of subsistence and how are you going to get this from other countries? Well, the answer is you don’t go to war with them like countries used to go to war with each other to grab their money and their land, you use finance as the new means of war so finance capitalism is the tactic of economic warfare by the United States against Europe and the global south to sort of draw all of the economic surplus of these countries in the form of debt service and the debt service is supplied by basically economic rent seeking from land rent, natural resource rent,  and just plain interest charges on economy. So, none of these are really the result of industrial profits that are made by employing labor and uh selling its products at a markup.

Finance capitalism is not based on surplus value like industrial capitalism was. In fact, it destroys industry and in this cannibalizing of industrial capital, it basically dries out the economy and makes it unable to break even or even to function and in the United States today, for instance, if you look at the balance sheets of corporate revenue much of it is spent on stock buybacks. You buy back your own stock or dividend payouts. Only eight percent of corporate earnings are spent on new capital investment research and development: factories, machinery, and means of production to employ labor.

How did General Electric (GE) go broke? Basically, Jack Welch said let’s use our income not to continue to invest in making more electronic goods and services and appliances, let’s use it to buy our own stock that’ll push up our stock and essentially, we’ll just sell off our divisions and we’ll use the money of selling off our washing machine companies and stoves and sell it off and we’ll just pay it to the stockholders. That’ll push it up and by the way his salary was based on how much he could push up the stock of GE and he was paid in the form of stock options. Well, all of this is now the normal corporate behavior in the United States and corporations are no longer led by industrial engineers as they were a few centuries ago in the nineteenth and twentieth century.

They’re led by financial engineers of the chief financial officer and the ideal of these corporations is to make money financially not by industrial investment….. so on the narrow microeconomic level finance capitalism is a way of basically selling out a company and giving the proceeds to the stockholders and the bondholders but as a political system, because it is so destructive of the economy as you’ve seen in the United States and you’ve seen in Britain through de-industrializing it, it becomes belligerent in an attempt to make other countries just as equally paralyzed by making these countries pay tribute to the U.S. and England and the financialized economies by means of financial engineering, by means of debt service, by means of selling their mineral resources, their public utilities, their land, their roads all to foreign investors–basically to who borrows the money that’s just simply created in the U.S.  and to save all of their money in their central bank reserves in the forms of loans to the U.S. treasury holding treasury bonds which is how the international monetary system worked until just a few months ago when everything changed.

So if you’re England and America right now you can look at President Biden’s speeches and he said well, China is our number one enemy because it’s competing unfairly. China is actually subsidizing industrial development by having its own infrastructure. It gives free education instead of privatizing education and making its labor pay for it. It has public health instead of privatizing social medicine like we do in the United States and making employers and workers pay for it.

Well, industrial capitalism in the nineteenth century was all in favor of strong government infrastructure. The ideal of industrial capitalism was to keep the wage costs of production down not by reducing wages but having government provide a basic infrastructure to cover the basic
needs of employees. The governments would provide free education so that employers didn’t have to pay for it. The governments would provide medical care so that employees didn’t have to pay for it and employers wouldn’t have to pay employees enough money to cover the education costs and to cover the medical care costs. The government would build roads and infrastructure and everything to facilitate the overall cost of doing business by industrial capital.

Well finance capitalism is just the reverse. Finance capitalism wants to privatize and take education, medical care, roads, turn the roads into toll roads, and take all of these and privatize them and make them financial  corporations that will essentially pay out their economic rent to the bondholders and the stockholders and this economic rent adds to the cost of education and everything else that workers need to live on so the result is to make it a high cost economy and that’s why Biden has said China and Russia are America’s enemies because the only way that America can succeed given our privatized economy, given the fact that Americans have to pay up to forty three percent of their income for rent, given the fact that eighteen percent of America’s GDP is for medical care, given the heavy student loan debt–only if other countries tie themselves in the same knot, only if other countries impose the same economic overhead on their labor force and on their industry can there be equal competition. 

If other countries have a mixed economy and are more efficient because they have an active government providing basic needs, that’s “autocracy” and that’s the opposite of “democracy.” Democracy is where everything is privatized and ultimately the one percent own everything.

Autocracy is any government that’s strong enough to have its own public investment. Any government strong enough to tax or regulate the financial sector is called “autocracy” so the U.S. in the 19th century would be called an autocracy as I guess the Austrian school called it 
– civilization is basically an “autocracy.”

There never has been an unmixed economy without government regulation, without a government investment, although Rome began to get to that point at the end of its empire and we all know what happened to it. So basically, finance capitalism is a predatory international economic policy aimed at draining the rest of the world all to pay the leading one percent of wealth holders in the U.S. and their satellite oligarchy in England and a few European countries.

CONTINUE READING HERE

https://michael-hudson.com/2022/07/finance-capitalisms-self-destructive-nature/

SAME OLDE SAME OLD

Financial Imperialism – the new threat to countries

https://planningbeyondcapitalism.org/food-and-financial-imperialism-how-the-imf-and-the-world-bank-work-together/


Raunak Roy
Citi | MBA (IIMB) | Ex Asst. Manager - BPCL | Mech. Engg from JU (rank 8) | JNCASR scholar


The era of imperialism is ended or so we think. When we think of imperialism, we are reminded of how some European countries invaded foreign lands in the past and colonized them. They caused a whole lot of agony for the local people and looted all their resources for the growth of the colonial superpower.

Although imperialism might have political and social motives behind it, the main premise on which it is based on is economic gain. New territory is captured to gain control on the resources available in that region. These regions also provide a market for the goods manufactured in the colonizing countries. Also, these lands become a source of cheap labour.

The world has changed now. Now it is downright unethical and to invade a country and take over its resources. No one even fears it as a possibility. But all is not as great as it seems. New world orders and capitalism led to a new form of imperialism called financial imperialism or neo-liberalization.

Financial Imperialism is a means by which a country or a group of countries gain financial dominance over another country or a group of countries by taking advantage of the debt situation in those countries. It is a much simpler strategy compared to invading the country and is much more effective.

Let us take an example. Suppose a poorer country has a large amount of debt. The following things are advised to the country:

1. Restructuring of the economy - Devalue the currency. This will make the exports from that country cheaper compared to others. That in turn will help the country to earn dollars (in most cases that is the currency in which the country has debt in) and repay its debt.

2. Austerity drive - The government spends less in the development of domestic resources like schools, hospitals, roads etc. and increases taxes that the people have to pay. They then use the money saved to pay off debts.

3. Borrowing - Borrow from private institutions and banks. Since the rate of return in low in the developed countries, private banks and other institutions agree to lend money to these debt-ridden countries at a high interest rate.

But this is where all the problems begin. The devaluation of the currency leads to debts becoming more expensive for the government. The austerity drive adversely affects the people of the country as there is no economic development taking place and all the money is being used to repay debts. Borrowing money from private institutions increases the interest that the government has to pay.

The combined effect of all this is that the government keeps on borrowing and they fall into this trap which they can’t get out of. Another consequence of all this is that unemployment rises in the country due to the austerity drive of the government. The government is then forced to allow industries from rich countries to set up manufacturing units there. The country issues very little taxes and imposes very lenient regulations on these foreign companies. But the money that is earned by these companies go back to their origin country and not to the debt-ridden country.

This is becoming a reality in many African countries. The IMF (International Monetary Fund) considers 59 countries as low-income developing countries. 24 of these countries are now facing a high debt. That’s 40% of the poor countries who are already in this situation or are going to be in one. These include Republic of Congo, Mozambique, Zimbabwe, Sudan, Somalia, Venezuela etc. Along with the usual lenders like USA, UK and other European countries, China as a country is expanding its presence in this domain.


Greece is a recent example of how debt can spiral out of control. Greece was indebted to a number of private banks in Europe. When it was unable to pay its debt and was defaulting on its interest payments, the European Commission, European Central Bank, International Monetary Fund (known as the Troika) bailed it out in 2010. The debt was transferred to Troika balance sheet and Greece was billed for the same. What essentially happened was that Troika was just transferring money it got from Greece to the private banks. Troika was simply acting as a middleman.

Greece now has a new debt and the Eurozone recession of 2011-13 exacerbated its condition. Greece had to borrow to make payments to the Troika. Greece again turned to private investors for funds. It started an austerity drive which stopped growth in the country. Unemployment rose to 20%. Interests began to be charged on interest payments. The bankers were happy because they were getting a steady flow of funds. On top of this money was being made via financial speculation on bonds, stocks, derivative and other financial securities. Money was being made while Greece’s economy was spiraling downward.

Greece is definitely one of the forerunners but there are others in the same condition as well. Integrating world economies is paving the way for richer countries to take financial control over poorer countries. The UN and other world organizations have to step up to prevent exploitation and draw up legislations to help the poor countries while protecting them from the richer ones.

Published on June 24, 2020

Published by

Raunak Roy
Citi | MBA (IIMB) | Ex Asst. Manager - BPCL | Mech. Engg from JU (rank 8) | JNCASR scholar
4 articles
A new form of imperialism called financial imperialism has been on the rise for quite some time now. This article tries to understand what the concept is and how it is adversely affecting countries that are under a lot of debt.

Modern Imperialism, Monopoly Finance Capital, and Marx’s Law of Value

by Samir Amin

$23.00 – $95.00

Unlike such obvious forms of oppression as feudalism or slavery, capitalism has been able to survive through its genius for disguising corporate profit imperatives as opportunities for individual human equality and advancement. But it was the genius of Karl Marx, in his masterwork, Capital, to discover the converse law of surplus value: behind the illusion of the democratic, supply-and-demand marketplace, lies the workplace, where people trying to earn a living are required to work way beyond the time it takes to pay their wages. Leave it to the genius of Samir Amin to advance Marx’s theories—adding to them the work of radical economists such as Michal Kalecki, Josef Steindl, Paul Baran, and Paul Sweezy—to show how Marxian theory can be adapted to modern economic conditions.

Amin extends Marx’s analysis to describe a concept of “imperialist rent” derived from the radically unequal wages paid for the same labor done by people in both the Global North and the Global South, the rich nations and the poor ones. This is global oligopolistic capitalism, in which finance capital has come to dominate worldwide production and distribution. Amin also advances Baran and Sweezy’s notion of economic surplus to explain a globally monopolized system in which Marx’s “law of value” takes the form of a “law of globalized value,” generating a super-exploitation of workers in the Global South. Modern Imperialism, Monopoly Finance Capital, and Marx’s Law of Value offers readers, in one volume, the complete collection of Samir Amin’s work on Marxian value theory. The book includes texts from two of Amin’s recent works, Three Essays on Marx’s Value Theory and The Law of Worldwide Value, which have provoked considerable controversy and correspondence. Here, Amin answers his critics with a series of letters, clarifying and developing his ideas. This work will occupy an important place among the theoretical resources for anyone involved in the study of contemporary Marxian economic and political theory.

What is splendid in Amin’s writing…is his lucidity of expression, his clear consistency of approach, and, above all, his absolutely unwavering condemnation of the ravages of capital and of bourgeois ideology in all its forms.… Amin remains an essential point of reference, and an inspiration.

—Bill Bowring, Marx & Philosophy Review of Books

Samir Amin was born in Egypt in 1931 and received his Ph.D. in economics

Imperialism and Financialism - Finance and Society PDF

http://financeandsociety.ed.ac.uk › JCGS_5_3

PDF

by S Bichler · 2012 · Cited by 50 — imperialist scramble for colonies to which finance capital could export its 'excessive' surplus. The next version posited a neo-imperial world of monopoly ...

37 pages

Hobson Lives? Finance, Finance Capitalism, and British ...

https://oxford.universitypressscholarship.com › view

This chapter looks at Imperialism: A Study in the context of modern knowledge of the size, distribution, and ownership of foreign investment and its place ...

Hobson Lives? Finance, Finance Capitalism, and British Imperialism, 1870–1914

P. J. Cain (Contributor Webpage)

DOI:10.1093/acprof:oso/9780198203902.003.0008

This chapter looks at Imperialism: A Study in the context of modern knowledge of the size, distribution, and ownership of foreign investment and its place in the British economy. It tests the book's argument that the costs of empire were paid by the nation as a whole, but only a very small elite got the benefits. Three brief case studies are also presented. The first is concerned with the background to the occupation of Egypt in 1882, the second with the origins of the Boer War of 1899-1902, and the third investigates the British role in the scramble for China between 1895-1914. There may be more mileage in future in developing Hobson's thoughts on the rise of big business and cartels in Imperialism: A Study and in The Evolution of Modern Capitalism than in pursuing the more traditional lines of Hobsonian thinking.

Keywords:   J. A. Hobson, Imperialism: A Study, British economy, Egypt, Boer War, China, big business, cartels, The Evolution of Modern Capitalism

Oxford Scholarship Online requires a subscription or purchase to access the full text of books within the service. Public users can however freely search the site and view the abstracts and keywords for each book and chapter.

Please, subscribe or login to access full text content.

If you think you should have access to this title, please contact your librarian.

To troubleshoot, please check our FAQs , and if you can't find the answer there, please contact us .

PDF

Beyond Financialisation: The Need for a Longue Durée ... - OSF

https://osf.io › ...

Sept 25, 2020 — ... of the historical developments of finance under colonialism is key for understanding how capitalist finance works globally.

CHINESE IMPERIALI$M

Truce expires at Peru's Las Bambas copper mine without clear path forward

By Marcelo Rochabrun and Marco Aquino

© Reuters/ANGELA PONCE FILE PHOTO: 

A Peruvian indigenous community demands back its ancestral lands, on the site of one of the country's biggest copper mines owned by Chinese firm MMG

LIMA (Reuters) -Six indigenous Peruvian communities that have been protesting MMG Ltd's Las Bambas copper mine said on Thursday there has been no progress after a full month of talks, as a precarious truce came to an end without a clear next step.

© Reuters/ANGELA PONCE Peru communities camp on the property of Las Bambas copper mine

The indigenous groups earlier this year staged the most significant protests in the history of the Chinese-owned Las Bambas, forcing the mine to suspend operations for over a month before agreeing to a 30-day truce in June

.

© Reuters/ANGELA PONCE

 A Peruvian indigenous community demands back its ancestral lands, on the site of one of the country's biggest copper mines owned by Chinese firm MMG

That truce ended on Thursday.

The communities, the government and the company discussed extending the truce for another month during a meeting that stretched through Thursday night but the local groups ultimately declined to sign any agreement.

The result leaves Las Bambas, one of the world's largest copper mines, in flux and facing the possibility of renewed protests that could once again disrupt its operations.

"In my community, there is no progress," said Romualdo Ochoa, the President of the Huancuire community, which is opposing a planned expansion by Las Bambas into its territory. "This is disappointing."

The indigenous communities say Las Bambas has not fulfilled all of its commitments with them and also say that the company has failed to benefit them financially.

Las Bambas executive Ivo Zhao said at the meeting that the company is willing to continue the talks. "It is necessary to continue negotiating," Zhao said.

Keeping Las Bambas in operation is also important for Peru, which is the world's No. 2 copper producer and depends on mining for a significant percentage of its tax revenue.

The suspension of operations at Las Bambas, as well as a separate suspension at Southern Copper Corp's Cuajone mine this year have weighed on the Peruvian economy, which is already under pressure to meet growth expectations because of falling commodity prices and worries about a worldwide recession.

(Reporting by Marcelo Rochabrun and Marco Aquino; Editing by Sandra Maler and Christian Schmollinger)