Ahead of Counterfire’s discussion on Lenin on Imperialism, we repost Morgan Daniels’ introduction to Lenin’s 1917 pamphlet, Imperialism: The Highest Stage of Capitalism

One of the first things to note about Lenin’s Imperialism, the Highest Stage of Capitalism is its subtitle: A Popular Outline.  Lenin conceived of this pamphlet as a short, accessible synthesis of some contemporary works on the relationship between empire building and capitalist competition, in particular J.A. Hobson’s Imperialism: A Study (1902), Rudolf Hilderding’s Finance Capital (1910), and Rosa Luxemburg’s The Accumulation of Capital (1913). The task of popularising an anti-capitalist critique of imperialism could scarcely have been more urgent: Lenin completed Imperialism in June 1916, two years deep into the First World War.

Lenin sought to demonstrate that imperialism was the ultimate expression of capitalism’s demand for new markets, for constant, never-ending growth. ‘Imperialism,’ he wrote, ‘emerged as the development and direct continuation of the fundamental characteristics of capitalism in general.’ This development had five key stages, and it goes a little something like this.

First, Lenin noted that there is a tendency towards monopoly within capitalism: ‘Today, monopoly has become a fact’. ‘Free’ competition produces winners and losers, with tremendous wealth ultimately concentrated in the hands of a select few.  Or, as Marx put it in Capital: ‘One capitalist always kills many.’ 

The second stage was the creation of finance capital.  With the concentration of capital comes a more important role for banking, argued Lenin:

‘Scattered capitalists are transformed into a single collective capitalist.  When carrying the current accounts of a few capitalists, a bank, as it were, transacts a purely technical and exclusively auxiliary operation.  When, however, this operation grows to enormous dimensions we find that a handful of monopolists subordinate to their will all the operations, both commercial and industrial, of the whole of capitalist society[.]’

Yet the bank, in turn, ‘is forced to sink an increasing share of its funds in industry’ — thus the interests of banks and industry converge as finance capital.  Lenin quotes Hilferding: ‘Finance capital is capital controlled by banks and employed by industrialists.’ 

The rise of finance capital creates a new requirement for investment — the need to export capital (this is stage three).  This is because advanced capitalist societies can become ‘overripe’. Few opportunities for profitable investment remain at home, yet elsewhere, ‘capital is scarce, the price of land is relatively low, wages are low, raw materials are cheap’. Such ‘backward countries’ are prime for investment. ‘Typical of the old capitalism, when free competition held undivided sway, was the export of goods’ wrote Lenin. ‘Typical of the latest stage of capitalism, when monopolies rule, is the export of capital.’ 

From 1870 through to the First World War, one new site for export, meaning bloody colonisation, was Africa, a continent boasting vast untapped supplies of rubber, diamonds, cocoa, tin, and palm oil, not to mention labour. Britain, France, Germany, and Belgium led a race in this period to annex African land through force and coercion. By the turn of the twentieth century, nine-tenths of Africa was in the ‘possession’ of European powers, at a considerable blood price. In the so-called Congo Free State, the personal colony of King Leopold II of Belgium, a combination of disease, torture, famine, and forced labour on rubber plantations left at least 10 million native Congolese dead. 

Lenin has often been accused of implying a sort of mono-causal economic ‘explanation’ for imperialism, with several critics noting that capital investment during the ‘Scramble for Africa’ was not as high as might be expected. Further, it is argued, the colonisation of Africa, in particular, has to be understood as a complicated mesh of trade considerations, a desire for military strongholds and naval bases, rivalry between European superpowers, white supremacy, and so on, driven only in part by the agitation of monopolists. Surely the point here is that the many interconnected dimensions to imperialist expansion describe the nature of the modern capitalist state, something which by its very definition is supercharged with militarism and competition with rival states. When bank capital and industry have a co-dependency, when the success of big private companies becomes a major question of the national interest, it is facile to tease apart the concerns of the army or navy from the concerns of capitalists. As Tony Cliff put it: ‘The productive forces determine the destructive forces.’

Lenin’s fourth stage was the formation of international monopolist capitalist associations. Just as monopolists obtained ‘more or less complete possession of the industry of their own country’, so, too, would international cartels develop with the rise of finance capital: over the winter of 1884-5, representatives of fourteen imperialist countries met in Berlin to formalise their ‘spheres of influence’ within Africa. Thus, and so, stage five, the division of the world among imperialists: imperialism, the highest stage of capitalism.

There are two important things to be said about Lenin’s analysis, the first of which being that it provides a means not just for understanding imperialist expansion, but wars between imperialist states, too. As Lenin was writing, he was witness to the first mass-produced war in history. Between 1914 and 1918, the world’s most advanced capitalist nations turned every economic effort to bloody conflict, killing 15 million in the process. Lenin’s popular outline of imperialism reveals a sick logic to the ‘Great War’: the competitive dynamics of the cartel are reproduced on the world stage, only this time the quest for profit is backed by the military might of rival states. 

The second important conclusion from Lenin’s work is that anti-imperialism is not an optional extra for socialists. It is not enough to seek peace at home and its opposite abroad, because as Imperialism makes clear, domestic and foreign policy are very obviously intimately related.  

It is true that Imperialism, the Highest Stage of Capitalism is, of course, open to criticism, particularly with regards to its historical specificity. Michael Kidron, for one, argued that Lenin’s characterisation of finance capital applied more accurately to Germany than rivals like Britain or France. Yet Lenin’s central stress on the necessary relationship between capitalist expansion, imperialist annexation, and rivalry between imperialist states remains essential to any anti-war politics. In October 2018, for instance, the Financial Times reported that the German conglomerate Siemens had lost out on a $15 billion contract to supply Iraq with power-generation equipment after the intervention of Donald Trump on behalf of General Electric, who have since secured a deal with the Iraqi Ministry of Electricity. Not for nothing did Marx call the army the slaughter industry. 

All of which implies that there can be no hope of capitalist competition acting as some perverse bringer of peace. Leon Trotsky argued as much in a piece on Lenin in February 1939, written a little over half a year before the Second World War: ‘A peace concluded by imperialists would only be a breathing spell before a new war. Only a revolutionary mass struggle against war and against imperialism which breeds war can secure a real peace.’ A century and a half on from Lenin’s birth, we do justice to his life and work by opposing war in precisely this spirit.

Join the discssion on Lenin’s theory of imperialism this Sunday 15 May at 11am on Zoom