Red Reviews: “Imperialism, the Highest Stage of Capitalism”

When the first World War broke out in 1914, it threw the socialist movement into disarray. Within the Second International, socialist leaders from all over the world disagreed on how to analyze the causes of the war and the way forward. According to Vladimir I. Lenin: A Political Biography by the Marx-Engels-Lenin Institute, “On the very outbreak of the war he set to work to make a profound and detailed study of the world literature on the economics, methods of production, history, geography, politics, diplomacy, the working class movement, the colonial question, and other spheres of social life in the different countries in the epoch of imperialism.” These Notebooks on Imperialism, over 600 pages of copious research, make up Volume 39 of his Collected Works. The Institute notes, “The fruit of this vast work of research was Lenin’s famous book Imperialism, the Highest Stage of Capitalism. Completed in June 1916, this book is one of the greatest works in Marxist-Leninist literature.”

Lenin’s analysis of imperialism

Let’s begin with Lenin’s definition of imperialism: 

“Imperialism is capitalism in that stage of development in which the domination of monopolies and finance capital has established itself; in which the export of capital has acquired pronounced importance; in which the division of the world among the international trusts has begun; in which the partition of all the territories of the globe among the great capitalist powers has been completed.”

Lenin notes that this process is a dialectical one. In other words, it is driven by the contradictions inherent in capitalism, as the aspects of those contradictions transform into their opposites. In economic terms, this means free competition is transformed into monopoly. Lenin puts it like this:

“Imperialism emerged as the development and direct continuation of the fundamental characteristics of capitalism in general. But capitalism only became capitalist imperialism at a definite and very high stage of its development, when certain of its fundamental characteristics began to change into their opposites, when the features of the epoch of transition from capitalism to a higher social and economic system had taken shape and revealed themselves in all spheres. Economically, the main thing in this process is the displacement of capitalist free competition by capitalist monopoly. Free competition is the basic feature of capitalism, and of commodity production generally; monopoly is the exact opposite of free competition, but we have seen the latter being transformed into monopoly before our eyes, creating large-scale industry and forcing out small industry, replacing large-scale by still larger-scale industry, and carrying concentration of production and capital to the point where out of it has grown and is growing monopoly: cartels, syndicates and trusts, and merging with them, the capital of a dozen or so banks, which manipulate thousands of millions. At the same time the monopolies, which have grown out of free competition, do not eliminate the latter, but exist above it and alongside it, and thereby give rise to a number of very acute, intense antagonisms, frictions and conflicts. Monopoly is the transition from capitalism to a higher system.”

We can trace where this happens historically. Imperialism arose as a result of the laws of motion of capitalism beginning in the late 19th century. Lenin writes,

“Thus, the principal stages in the history of monopolies are the following: (1) 1860-70, the highest stage, the apex of development of free competition; monopoly is in the barely discernible, embryonic stage. (2) After the crisis of 1873, a lengthy period of development of cartels; but they are still the exception. They are not yet durable. They are still a transitory phenomenon. (3) The boom at the end of the nineteenth century and the crisis of 1900-03. Cartels become one of the foundations of the whole of economic life. Capitalism has been transformed into imperialism.”

In the section “Imperialism and the Split in Socialism”, Lenin further explained, “Imperialism, as the highest stage of capitalism in America and Europe, and later in Asia, took final shape in the period 1898–1914. The Spanish-American War (1898), the Anglo-Boer War (1899–1902), the Russo-Japanese War (1904–05) and the economic crisis in Europe in 1900 are the chief historical landmarks in the new era of world history.” Indeed, the origin of imperialism was accompanied early on by war, in order to divide and re-divide the world. This trend has persisted, erupting in World War I and World War II, both of which began as imperialist wars for the redivision of the world among themselves. In the aftermath of World War II, the U.S. rose as the dominant imperialist power.

In the first section of Imperialism, the Highest Stage of Capitalism, Lenin addresses the how and why capitalism transitioned from its earlier stage of competitive capitalism to its new, higher stage, of monopoly capitalism. Lenin notes “Competition becomes transformed into monopoly. The result is immense progress in the socialization of production. In particular, the process of technical invention and improvement becomes socialized.” 

Lenin makes two important points here. First, the transformation from competitive capitalism to monopoly capitalism happens according to the laws of capitalism itself, not because a few particularly bad capitalists decided to steer it in that direction. Second, he points out that the imperialist stage of capitalism represents an important stage in the dialectical process driving capitalism towards revolution and socialism. Therefore, he writes, “Capitalism in its imperialist stage leads directly to the most comprehensive socialization of production; it, so to speak, drags the capitalists, against their will and consciousness, into some sort of a new social order, a transitional one from complete free competition to complete socialization.” 

Lenin also notes that, in the contradiction between free competition and monopoly, both continue to exist side by side, but that monopoly has become the dominant, determining aspect of the contradiction. “The general framework of formally recognized free competition remains,” Lenin writes, “and the yoke of a few monopolists on the rest of the population becomes a hundred times heavier, more burdensome and intolerable.” 

The result of this is that different strata among the capitalists are operating in very different ways. The petit bourgeoisie are, by and large, being crushed by the monopoly capitalist class. Simultaneously, non-monopoly capitalists continue to exist, but precariously, under immense pressure from the monopoly capitalists. The result is that these non-monopoly capitalists and petit bourgeoisie are buried unless they can achieve an extraordinarily high rate of exploitation. 

But the petit bourgeoisie cannot compete effectively with the superprofits of the monopoly capitalists. By exporting capital (namely factories) to the developing world, the imperialists are able to achieve a higher rate of exploitation than is possible with domestic labor. In other words, they can produce cheaper, and then sell for more. In this way, the imperialists use superprofits as life-support for a dying system. They are able to relieve some of the effects of the economic crises that plague capitalism by exporting capital to where labor is cheaper. 

All the while, they reinforce their superprofits with unequal trade agreements, predatory loans and other neocolonial policies meant to keep the peoples of these countries dependent and weak, and they back this up with military power. 

Meanwhile, the nature of the imperialist system drives forward and intensifies the crises within the capitalist countries. It pushes the class struggle towards its extreme limits, as the working class and oppressed nationalities are further exploited and oppressed in order to fatten the pockets of the capitalists. This cannot but lead inevitably towards a revolutionary struggle within the heart of the imperialist countries themselves.

Further, imperialism drives towards a revolutionary crisis in the colonial and semi-colonial countries. This inevitably leads towards the struggles for national liberation against imperialism on the part of the oppressed nations and peoples of the world.

And, finally, under imperialism wars cannot be averted. War is an essential and fundamental feature of the imperialist system. Because imperialism develops unevenly, the imperialist powers will seek again and again to redivide the world among themselves. Furthermore, the imperialists will inevitably resort to war to protect their interests, and the working and oppressed people of the entire world will fight to resist imperialism oppression by any means necessary. 

Imperialism today

“Leninism,” writes Stalin in The Foundations of Leninism, “is Marxism of the era of imperialism and the proletarian revolution.” The rise of monopoly capitalism has pushed to the forefront four fundamental contradictions on a world scale: the contradiction between the imperialist powers themselves, the contradiction between the imperialist powers and the oppressed nations and peoples, the contradiction between the monopoly capitalists and the proletariat in the imperialist countries, and the contradiction between the imperialist and socialist systems. 

Of these four, the principal contradiction on a world scale is the contradiction between imperialism and the oppressed nations struggling for national liberation, while, within the imperialist counties the principal contradiction is generally reflected in the class struggle between the monopoly capitalists and the proletariat. 

This means that Lenin’s analysis of imperialism is essential to guiding our understanding of the terrain of struggle, as we work to build a united front against monopoly capitalism, based on the strategic alliance between the multinational working class and the liberation movements of oppressed nationalities. 

Indeed, within the U.S. itself, the monopoly capitalist class holds whole peoples under the yoke of national oppression, in order to extract super profits. Therefore, the core of the united front against monopoly capitalism in the United States is that between the multinational working class, and the oppressed nations. Namely, these are the African American nation, which has a national territory in the Black Belt South, the Chicano Nation in the Southwest, and the Hawaiian Nation. These struggles for national liberation and self-determination are essential for the development of a revolutionary movement in the U.S.

It also means that, on an international scale, the working class here in the U.S. must ally with the national liberation struggles all over the world, from Palestine to the Philippines. The U.S. monopoly capitalist class is our mutual oppressor and enemy, and every blow struck against this class weakens them and aids our respective struggles. Solidarity is essential. 

In 1917, the Bolshevik revolution struck a major blow against imperialism, breaking the Soviet Union away from the imperialist world system and creating a counterbalance to imperialist hegemony. World War II saw further shifts in the balance. After the invasion of the USSR by Nazi Germany, the character of the war fundamentally changed from an inter-imperialist war to a war between socialism and imperialism. Blows were struck for liberation and against fascism all over the world. China and the people’s democracies of eastern Europe broke free of the imperialist system and joined the socialist bloc. And despite the turn towards revisionism in 1956, leading to the eventual restoration of capitalism in the USSR in 1991, the socialist countries, namely China, Cuba, Vietnam, DPRK and Laos, continue to be a force against imperialism hegemony throughout the world. And since the historic defeat of the U.S. in Vietnam in the 1970s, U.S. imperialism has been in a state of prolonged decline, scrambling to hold on to its ebbing power and influence. 

Today the U.S. monopoly capitalist class struggles to cling to the remnants of a fading empire. It still dominates the UN, though that domination too seems to be slipping. Likewise, it controls international financial institutions, such as the World Bank and the IMF, which it uses to leverage neocolonial policies in the developing world. Further, it intervenes militarily, both directly and indirectly, all over the world to protect its interest. Currently it is pursing two simultaneous proxy wars, propping up Ukraine in an attempt to weaken Russia, and supporting the Israeli genocide against Palestine. It is pushing with all its might to pursue a cold war policy against an ascendent socialist China. Indeed, the U.S. is stretched very thin, and is everywhere on the ropes. 

The working class here in the U.S., together with its allies, needs to make every effort to support these struggles in whatever way it can. Lenin’s analysis in Imperialism, the Highest Stage of Capitalism, is essential reading to understand the way forward. 

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