The Changing Face of Imperialism

Colonialism to Contemporary Capitalism

Sunanda Sen, Maria Cristina Marcuzzo, Sunanda Sen, Maria Cristina Marcuzzo

• Publisher: Routledge India
• Year: 2018
• ISBN:
  9781351184793
• Edition: 1
• Topic: Business
• Subtopic: Business General
• Index: Business

This volume reiterates the relevance of imperialism in the present, as a continuous arrangement, from the early years of empire-colonies to the prevailing pattern of expropriation across the globe. While imperialism as an arrangement of exploitation has sustained over ages, measures deployed to achieve the goals have gone through variations, depending on the network of the prevailing power structure. Providing a historical as well as a conceptual account of imperialism in its 'classical' context, this collection brings to the fore an underlying unity which runs across the diverse pattern of imperialist order over time. Dealing with theory, the past and the contemporary, the study concludes by delving into the current conjuncture in Latin America, the United States and Asia.

The Changing Face of Imperialism will provide fresh ideas for future research into the shifting patterns of expropriation – spanning the early years of sea-borne plunder and the empire-colonies of nineteenth-century to contemporary capitalism, which is rooted in neoliberalism, globalization and free market ideology.

With contributions from major experts in the field, this book will be a significant intervention. It will be of interest to scholars and researchers of economics, politics, sociology and history, especially those dealing with imperial history and colonialism.

Part I

The conceptual basis of imperialism

1 Imperialism, the ‘old’ and the ‘new’

Departures and continuities

Satyaki Roy¹

Marx did talk about capitalism emerging as a world system and the role of foreign trade in hastening the falling tendency of the rate of profit. In Capital I, Marx refers to a process that creates a division of the world suited to centres of industries and how advanced capitalism chiefly exploits the agricultural field of production, which supplies raw materials through relative productive advantages. Marx also indicated how an international credit system helps in overcoming the barrier to circulation and sphere of exchange. These are all ingredients in brewing a theory of imperialism that Marx could not take up in detail. Setting the design for capital in Grundrisse, he expressed his intention to deal with ‘The colonies. Emigration… . The international relation of production. International division of labour. International exchange. Export and import. Rate of exchange… . The world market and crises.’² The unfinished task was taken up by later Marxists during the first half of the twentieth century, which became the springboard for diverse theories of imperialism thereafter. Imperialism conceived as intrinsic to systemic necessity of realising unconsumed surplus at the core; imperialism as modes of reproducing unequal exchange; imperialism as territorial expansion for cheap resources, markets or avenues to invest where the rates of profit are relatively higher; imperialism as the political superstructure of monopoly capital and expanding finance, and also as an outcome of a terminal phase of capitalist cycle; and so on. Hence, we do not have a single theory of imperialism which is applicable for all times in the post-competitive phase of capitalism, nor do we find an abstract rationale to favour one theory over the other. In fact, we can have an abstract theory of capitalist accumulation that Marx had offered, but the abstract theory of accumulation, expectedly, does not deal with irregularities, frictions and concrete domains of power which have always been intertwined with and overdetermined by the realities of accumulation. It is the unevenness of capitalism that creates the pretext of power-driving accumulation in a specific space and time. As a result, we come across multiple historical manifestations of imperialism which were explored and debated by scholars and activists.

The focus of this essay is to present a critical review of the major Marxian theories of imperialism by tracing out the debates and examining the development of their basic tenets. Imperialism as a category in Marxian literature is theorised as a tendency specific to the post-competitive phase of capitalism. But the modes of hegemony embedded in the complex articulation of accumulation and power do change over time. Therefore, characterisation of imperialism in different points of time focussed on concrete questions related to the specificities of the monopoly stage and its larger impact on the dynamics of capitalism, how it motivated expansion and resulted in stagnation at different points of time, how conflict between advanced capitalist countries eventually led to a worldwide conflict between developed and developing nations, and finally, in the post-colonial phase, how global hegemony entails a different architecture of power internalised through the nation state.

At the outset, I must mention that my reading of imperialism in this essay is thematic. I trace the continuities and departures that evolved in the realm of theory. Many of the ideas that emerged in a particular historical context might have seemed to be submerged in a new debate, but they again surfaced in new incarnations later. In this essay, I intend to comprehend those traits and trajectory of ideas and contextualise them in relation to the relevant debates. Two broad sets of theories are taken on board – first, theories of imperialism that comprehended global hegemony in the context of colonial domination and war, often categorised as ‘old’ and emerged mostly in the inter-war years and immediately after that. Luxemburg, Hilferding and Bukharin-Lenin are important markers in this tradition. The second set of theories, termed ‘new’, talk about imperialism in the post-colonial phase and see how, in the context of globalisation, the hegemony emerges as empire. Harvey, Arrighi and Wood are important thinkers in this phase. This comes against the backdrop of more recent attempts by some Marxists to render imperialism in the post-globalisation phase as defunct.³ Other than excavating the rich repertoire of ideas that emerged in the debates on imperialism, my critical review additionally has the underlying purpose of highlighting and defending the notion of imperialism which cannot be reduced to either neoliberalism, globalisation or capitalism, even as in the contemporary these combine into a historical conjecture.

Realisation crisis and imperialism

I begin with Luxemberg’s discussion on accumulation and the theory of imperialism that follows, because it is unique in conceiving imperialism as intrinsic to capitalism and not as related to a particular stage of capitalism, which had been the predominant notion within Marxian discourse during pre- and post-war phase of inter-capitalist rivalry. This idea of theorising imperialism as a systemic necessity has been generic in Marxian literature, but in case of Luxemberg, it was argued more as a logical conclusion rather than related to concrete moments of history. I also, however, argue that Luxemburg’s theory of imperialism, even though taking off from a critique of Marx’s reproduction scheme, is essentially rooted in particular historical conjectures and debates related to praxis.

Capitalism as a class-divided society is a demand constraint system because workers are paid less than the value of their product, and capitalists consume proportionately less than the workers of what they receive as surplus. This leads to a persistent gap in realising the produced value. Luxemburg argued that Marx’s reproduction scheme could not take care of this realisation problem; hence, the idea of conceiving capitalism as a closed system is unrealistic. In fact, Luxemberg’s idea of imperialism is derived from a systemic necessity, as capitalism always requires a non-capitalist periphery to realise the unconsumed surplus at the core.⁴ And the intrusion has to be by use of force, because she assumed pre-capitalist ‘outside’ as a natural self-contained economy that has little surplus to offer on exchange. The drive to annihilate non-capital is also to source cheap raw materials and labour for the production at the core. Luxemburg did not see either the possibility of consuming the surplus produced at the core in the form of investment in the means of production or being absorbed due to proportional increase of both consumption and investment at the core. In other words, her analyses of extended reproduction and the necessity of inside/outside dialectics of capitalism is derived from the argument of underconsumption or underinvestment and has nothing to do with the specific phase of capitalism. In spite of the fact that there would always be a possibility of underinvestment in capitalism, nevertheless, Luxemburg built her theory on the impossibility of adequate investment opportunity at the centre and the need to intrude upon the non-capitalist periphery. Luxemburg defined imperialism as

the political expression of the accumulation of capital in its competitive struggle for what remains still open of the non-capitalist environment … [which] grows in lawlessness and violence, both in aggression against the non-capitalist world and in ever more serious conflicts among the competing capitalist countries.⁵

It essentially rests upon a theory of capitalist crisis that becomes imminent as the pre-capitalist periphery shrinks and the rivalry between capitalist powers intensifies further.

The critique of Luxemburg’s theory of crisis primarily rests on the fact that while capitalism as a system is always fraught with tendencies of deficient demand, such tendencies could not be taken as inevitable. And the requirements of individual capital cannot be confused with the needs of capitalist system as a whole. Joan Robinson wrote in the introduction of Accumulation that Luxemburg’s primary emphasis was not on the possibility that capitalists might not choose to buy each other’s products and thus sustain demand, but on the absurdity (in her eyes) of supposing that they could ever do so.⁶ Otto Bauer’s critique, first of all, showed using reproduction schemes that it is incorrect to argue that realisation in expanded reproduction is impossible with rising organic composition of capital, and also, there is no point assuming that accumulation of money capital by individual capitalist should take place simultaneously. Bauer, however, acknowledged the fact that accumulation in a closed capitalist system, although possible, reaches a limit and that limit can be extended by imperialism. He contested Luxemburg’s position that capitalism would not be able to reproduce itself when all the non-capitalist realm is being internalised. Rather he argued that

Capitalism will break down, not when the last peasant and the last petit bourgeois on the entire earth are converted into wage labourers, so that no extra market is open to capitalism. It will be brought down much sooner, by the growing indignation of the working class, constantly increased, schooled, united and organised by the mechanism of the capitalist production process itself.⁷

Tugan-Baranovski, while confronting Russian populism, also made a similar theoretical point, that capitalism is not a system that is meant to satisfy human needs, but it is driven by the quest for profit. The extreme imagery of accumulation by producing machines for the production of machines while consumption being reduced was made precisely to argue that capitalism is essentially an inhuman system and the proposition to replace it by a new one could not be derived from some immutable objective laws that inevitably give rise to a breakdown of the system.

Luxemburg’s theory of imperialism as a structural inevitability was primarily driven by a political need of countering Kautsky’s revisionist position. Kautsky initially held that imperialism emerges as a result of capitalists’ compulsive quest for non-capitalist markets. He also distinguished ‘work colonies’ that were European settlements and ‘exploitation colonies’ where plunder of the native population was the rule.⁸ The former was important in absorbing exports from the imperial countries, while the latter could be conceived as the sphere of primitive accumulation of capital. This was quite similar to what Luxemburg also pointed out, but the implications drawn were contrary to each other. Kautsky assumed that capitalists of the world would unite rather than fight with each other, thereby giving rise to ultra-imperialism, which would be the regime of ‘common exploitation of the world by internationally united finance’.⁹ Luxemburg’s theory of imperialism was motivated to counter this revisionist position and to argue the imminent need of overthrowing capitalism in the midst of imperialist war. Hence, Luxemburg’s characterisation of imperialism, although emerging from an abstract critique of reproduction scheme, it was overdetermined by concrete moments of history and praxis.

Monopoly stage of capitalism

Theories of imperialism within the Marxist tradition primarily evolved during the pre-war phase and later immediately after the interwar years. The challenge was to explain the conflict and war between advanced capitalist countries in terms of class analysis. Imperialism was generally identified with the monopoly stage of capitalism and the rise of finance capital. However, theories of monopoly capitalism that evolved in different points of history address different challenges in the context of the concrete. Hobson and Hilferding explain the monopoly stage as a problem of expanding capitalism giving rise to conflicts and war between advanced capitalist countries. The later characterisation of monopoly capitalism that follows from Baran and Sweezy proposes the monopoly stage as a stage of capitalist stagnation. It actually opened up a new focus in understanding global hegemony and that of a conflict between advanced and underdeveloped nations.

J.A. Hobson,¹⁰ who was a liberal, developed a theory of imperialism based on underconsumption or excess savings occurring in the stage of monopoly that drives capital beyond the national boundaries to seek for places having potentials for higher returns. He analysed the monopoly stage of capitalism giving rise to excess savings relative to investment, the latter being constrained by the level of growth which in turn is determined by the supply of labour and fixed proportions of production. As a result of excess savings, interest rates would fall at home and the decline, when compared to higher profitability or lesser risks of investment in other countries, would drive the outflow of capital. This external move for higher profitability of investment is endemic at the monopoly stage, because excess savings pull down the returns at home. Similar to other underconsumptionist theories, Hobson’s argument pays little attention to why the possibilities of investments and capital intensive trajectories would not be able to pull the economy back from chronic lack of demand. Expanding further, Hilferding was the first Marxist to provide a comprehensive analyses of imperialism.¹¹ Hilferding’s observation and theorising of finance capital were crucial to the understanding of imperialism. The rise of finance capital as a fusion of industrial and financial capital and their mutual reinforcing nexus epitomised in the new avatar MNCs became one of defining features of the monopoly stage of capitalism. Hilferding interprets how credit helps in keeping ‘idle money’ at the minimum, and since bank credit has significant advantages over merchant capital, banks increasingly emerged to be prominent suppliers of credit to industry. The nature of credit also changes from a mere source of short-term finance which Hilferding called ‘circulating credit’ to the provision of funds for long-term investment projects as ‘investment credit’. Consequent...