Summary Notes on Lenin's Imperialism

Lenin's Imperialism traces to stages of capitalism from the consolidation of industry to the carving up of the world and export of capital.

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1. Concentration of Production and Monopolies

Emphasizes the concentration of electrical power and labour-power in a small number of enterprises. Large scale enterprise develops the combination of production, which stabilizes rate of profit, eliminates trade, acquisition of super-profits through technical improvement of acquired pure enterprises, and strengthens combined enterprises over pure enterprises during fluctuations in prices of raw materials and manufactured goods. This combined with protective tariffs facilitated the rise of cartels. Three stages (1) 1860-70 apex of free competition (2) Crisis of 1873 and development of cartels (3) boom at the end of 19th century then a crisis 1900-03; imperialism is 03; leading to capitalism morphing into imperialism. Cartels make agreements on fixing quantities produced, prices, markets and profits. Large trusts are able to fund the invention of new processes of production to increase technical efficiency. Production and the process of technical invention and improvement are socialized, but the means of production are owned by the few. Monopolists squeeze out small enterprises using methods below; (1) cut off the supply of raw material (2) restrict supply of labour through alliances with unions (3) stop deliveries (4) close trade outlets (5) agreement with buyers (6) systematic price cutting (7) stop credit (8) boycott. Cartels do not, as some bourgeois economists claim, abolish crises, but through its rapid rate of technical development, give rise to disparities in the national economy which ultimately leads to crisis. Crisis in turn leads to the wiping out of smaller competitors and pure enterprises.  

2. Banks and their New Role

Banks originally served as middlemen, turning inactive capital into active (profit yielding) capital. Big enterprises and banks buy out smaller banks by acquiring holdings, and purchasing and exchanging shares. To the point of having banks with 1st-, 2nd- and 3rd-degree dependency (A has holdings in B, B in C and C in D) on a big bank, banks have become transnational monopolists (own holdings in foreign banks). Role of banks evolves as they take on the capital of more and more capitalists and monopolists, from a purely technical and auxiliary role to (1) ascertaining their financial position (2) control their access to income and (3) direct their capital as they see fit, thus intensifying and accelerating the process of concentration of capital. The organizing mechanism of capitalist society moves from the stock exchange to the banks and industry. Banks themselves have become monopolies (in the US, Morgan and Rockefeller) and have big industry relying heavily on them. “Personal link-ups” are carried out by banks, industrial companies and government, with bankers, industrialists and former civil servants sitting on boards of directors for both banks and companies. Division of labour among bank directors along geographical and branches of industry. A new capitalism is born, the domination of finance capital, a mix of free competition and monopoly. 

* For the difference between monopolies, cartels and trusts, read https://www.marxists.org/archive/hilferding/1910/finkap/ch12.htm

3. Financial Capital and the Financial Oligarchy

Finance capital is capital controlled by banks and employed by industrialists. Hilferding neglects to mention how it leads to monopolies. Holdings in the mother company, even if only 40% allows for complete control of daughter and grandchild companies, completely disproving the notion that shares democratize capital. In quoting a petty-bourgeois reformist, the author shows that even then, large amounts of capital were invested speculatively rather than productively. Monopolist enterprises can overvalue their capitalization in anticipation of monopoly profits. The financial oligarchy employs gigantic usury capital. During economic depressions, finance capital steps in to step in to buy or reorganize/reconstruct (through new capital) in order to control, small unsustainable businesses. Banks back then also participate in speculation in land, property and the means of communication. Finance (unproductive, rentier) capital is separated from (productive) industrial capital. Four countries (pillars of finance capital), US, Great Britain, France and Germany collect tribute from (dependent) debtor states in the rest of the world.  

4. Export of Capital

Surplus capital, that could be used to raise the standard of living of the working masses, is used for export to backward countries in which the profits are high due to cheaper wages, land and raw materials. Brits invest in their colonies, the French employ loan (usury) capital, Germans invest in Europe and America. Export of capital develops capitalism in the receiving countries. Finance capital directs loans to debtor countries and negotiates for part of the loan to be spent in the creditor country.   

5. Division of the World among Capitalist Associations

Super monopolies are produced after further concentration. Companies collude and agree to how to divide markets between themselves, and even exchange ideas and inventions. A redivision of markets can occur in spite of previous agreements, due to wars, uneven development, bankruptcy. Kautsky, among others, saw international cartels or the internationalization of capital as a sign of possible peace among nations. But capitalists do not divide the world out of malice or benevolence, they do it in proportion to their capital and strength (military or political). 

6. Division of the World among the Great Powers

The 19th century saw the almost complete partitioning of the world by capitalist power, and a few re-partitionings (WWI & WWII). Cecil Rhodes, a British businessman and politician, wrote that imperialism was necessary to settle new lands with the British unemployed or surplus population in order to avoid a civil war. Unevenness in capitalist and colonial expansion abounds. The British have the most territory, yet France has considerable financial capital. America, Germany and Japan are growing much faster than the older capitalist countries, Great Britain and France. Yet there still exists unconquered small states and semi-colonial states that are subservient to finance capital and world powers. The monopolist drives of the capitalist associations are complemented by colonial possessions which deprive rivals of raw materials. Finance capital continues to seek out new land as potential sources of profits and super-profits. Exporting capital becomes the impetus for acquiring colonies which are subject to monopolist methods. Semi-colonial countries and even small imperial states (Portugal, British protect them for commercial privileges) are formally independent yet financially and diplomatically dependent. The race for colonies have resulted in inter-imperialist conflicts and foreshadow more to come, The size of these European empires are disproportionate to their strength (military) in the European continent, This contradiction will lead to a continual re-modification of political conditions in Europe.  

7. Imperialism, as Special stage of Capitalism

Recapping, the highest stage of capitalism marked by (1) concentration of capital and displacement of free competitions for monopolies and concentration of production (2) merging of bank capital and industrial capital to form financial capital, consolidated in a small number of banks (3) export of capital overtakes export of commodities (4) international monopolist capitalist associations lead to collaboration and intensified competition (5) territorial division of the world among capitalist powers through the colonial expansion of the world is complete.

Kautsky defines imperialism as industrial capitalist nations striving to annex agrarian land. 

Critique: He emphasizes industrial, instead of financial capital. Imperialist capitalist countries want to annex all land, not just agrarian ones. Ignores inter-imperialist rivalries. Claims that economic monopolies are compatible with a non-monopolistic, non-annexationist politics. 

Kautsky posits the idea of ultra-imperialism, joint exploitation of the world by a united finance capital. Thus, ending wars and struggle among imperialists nations.

Critique: The unevenness of development of imperial nations and their disparities in economic and military power has and will continue to lead to wars. Capitalist development is more rapid in the colonies. New imperialist powers are born. War seems to be the only way to overcome these disparities. 

8. Parasitism and the Decay of Capitalism

Monopolies under imperialism, lead to stagnation and decay, creating the tendency to hinder technical progress. The export of capital has allowed for a rentier class, ‘coupon clippers’ who profit off securities, speculations and commissions from trade. The world is divided between a few creditor states and many debtor states. The empires are weakened by this ‘economic parasitism’ - which leads ruling states to enrich a ruling class while bribing its upper stratum of workers into acquiescence - and formation of armies from colonial peoples. The electoral system is designed to keep out the lower stratum of the proletariat, who are more likely unemployed. Immigration from poorer countries further creates and adds to the ranks of a detached lower stratum of proletariats. 

9. Critique of Imperialism

Lenin criticizes bourgeois thinkers and commentators for their argument for the inevitability of imperialism and peace under imperialism Kautsky argues that capital can expand without violence. He focuses on trade between imperial countries and their colonies rather than with other imperial countries, which neglects the unevenness of imperial developments. Lansburgh, a bourgeois economist, tries to show how unstable the export of capital is and how it is better to develop industries at home. These thinkers ignore the fact that finance capital loans to dependent countries (colonial and non-colonial), make profits off the loan, and also make profits from the goods these countries are made to buy from the creditor country. The export of capital gives the colonies the means and resources to liberate themselves after being shaken into national consciousness by the intruders. Capital can only maintain its hold on these people through military power. (This chapter was to thoroughly denounce Kautsky for the reformist positions.)

10. The Place of Imperialism in the history

Four manifestations of monopoly capitalism, (1) concentration of production leading to cartels, trusts and associations (2) seizure of important raw materials by monopolies (3) banks helping create these monopolies (4) the colonial policy. Leading to the rentier state, unevenness of development due to rapidity, bribing the upper stratum of workers with colonial super-profits.