Imperialism, the Highest Stage of Capitalism

A POPULAR OUTLINE

VII. IMPERIALISM AS A SPECIAL STAGE OF CAPITALISM

We must now try to sum up, to draw together the threads of what
has been said above on the subject of imperialism. 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.

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.

But very brief definitions, although convenient, for they sum up
the main points, are nevertheless inadequate, since we have to
deduce from them some especially important features of the
phenomenon that has to be defined. And so, without forgetting
the conditional and relative value of all definitions in
general, which can never embrace all the concatenations of a
phenomenon in its full development, we must give a definition of
imperialism that will include the following five of its basic
features:

(1) the concentration of production and capital has developed to
such a high stage that it has created monopolies which play
a decisive role in economic life; (2) the merging of bank
capital with industrial capital, and the creation, on the
basis of this “finance capital,” of a financial oligarchy;
(3) the export of capital as distinguished from the export
of commodities acquires exceptional importance; (4) the
formation of international monopolist capitalist associations which share the world among themselves and
(5)
the territorial division of the whole world among the biggest capitalist powers is completed. Imperialism is
capitalism at that stage of development at which the dominance of monopolies and finance capital is established;
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 division of all
territories of the globe among the biggest capitalist powers
has been completed.

We shall see later that imperialism can and must be defined
differently if we bear in mind not only the basic, purely
economic concepts—to which the above definition is limited—but also the historical place of this stage of
capitalism in relation to capitalism in general, or the relation
between imperialism and the two main trends in the working-class
movement. The thing to be noted at this point is that imperialism, as interpreted above, undoubtedly represents a
special stage in the development of capitalism. To enable the
reader to obtain the most well-grounded idea of imperialism, I
deliberately tried to quote as extensively as possible bourgeois economists who have to admit the particularly
incontrovertible facts concerning the latest stage of capitalist
economy. With the same object in view, I have quoted detailed
statistics which enable one to see to what degree bank capital,
etc., has grown, in what precisely the transformation of
quantity into quality, of developed capitalism into imperialism,
was expressed. Needless to say, of course, all boundaries in
nature and in society are conventional and changeable, and it
would be absurd to argue, for example, about the particular year
or decade in which imperialism “definitely” became established.

In the matter of defining imperialism, however, we have to enter
into controversy, primarily, with Karl Kautsky, the principal
Marxist theoretician of the epoch of the so-called Second
International—that is, of the twenty-five years between
1889 and 1914. The fundamental ideas expressed in our definition
of imperialism were very resolutely attacked by Kautsky in 1915,
and even in November 1914, when he said that imperialism must
not be regarded as a “phase” or stage of economy, but as a
policy, a definite policy “preferred” by finance capital; that
imperialism must not be “identified” with “present-day capitalism”; that if imperialism is to be understood to mean
“all the phenomena of present-day capitalism”—cartels, protection, the domination of the financiers, and colonial
policy—then the question as to whether imperialism is necessary to capitalism becomes reduced to the “flattest
tautology”, because, in that case, “imperialism is naturally a
vital necessity for capitalism”, and so on. The best way to
present Kautsky’s idea is to quote his own definition of
imperialism, which is diametrically opposed to the substance of
the ideas which I have set forth (for the objections coming from
the camp of the German Marxists, who have been advocating
similar ideas for many years already, have been long known to
Kautsky as the objections of a definite trend in Marxism).

Kautsky’s definition is as follows:

“Imperialism is a product of highly developed industrial
capitalism. It consists in the striving of every industrial
capitalist nation to bring under its control or to annex all
large areas of agrarian [Kautsky’s italics] territory, irrespective of what nations inhabit
it.” [1]

This definition is of no use at all because it one-sidedly,
i.e., arbitrarily, singles out only the national question
(although the latter is extremely important in itself as well as
in its relation to imperialism), it arbitrarily and inaccurately connects this question only with
industrial capital in the countries which annex other nations,
and in an equally arbitrary and inaccurate manner pushes into
the forefront the annexation of agrarian regions.

Imperialism is a striving for annexations—this is what the political part of Kautsky’s definition amounts
to. It is correct, but very incomplete, for politically,
imperialism is, in general, a striving towards violence and
reaction. For the moment, however, we are interested in the
economic aspect of the question, which Kautsky himself introduced into his definition. The
inaccuracies in Kautsky’s definition are glaring. The characteristic feature of imperialism is not industrial but finance capital. It is not an accident that in France it
was precisely the extraordinarily rapid development of finance capital, and the weakening of industrial
capital, that from the eighties onwards gave rise to the extreme
intensification of annexationist (colonial) policy. The
characteristic feature of imperialism is precisely that it
strives to annex not only agrarian territories, but even most highly industrialised regions (German appetite for
Belgium; French appetite for Lorraine), because (1) the fact
that the world is already partitioned obliges those contemplating a redivision to reach out for every kind of territory, and (2) an essential feature of
imperialism is the rivalry between several great powers in the
striving for hegemony, i.e., for the conquest of territory, not
so much directly for themselves as to weaken the adversary and
undermine his hegemony. (Belgium is particularly important for Germany as a base for operations against Britain;
Britain needs Baghdad as a base for operations against Germany,
etc.)

Kautsky refers especially—and repeatedly—to
English writers who, he alleges, have given a purely political
meaning to the word “imperialism” in the sense that he, Kautsky,
understands it. We take up the work by the English writer
Hobson, Imperialism , which appeared in 1902, and there
we read:

“The new imperialism differs from the older, first, in substituting for the ambition of a single growing empire the
theory and the practice of competing empires, each motivated by
similar lusts of political aggrandisement and commercial gain;
secondly, in the dominance of financial or investing over
mercantile interests.” [2]

We see that Kautsky is absolutely wrong in referring to English
writers generally (unless he meant the vulgar English imperialists, or the avowed apologists for imperialism). We see
that Kautsky, while claiming that he continues to advocate
Marxism, as a matter of fact takes a step backward compared with
the social-liberal Hobson, who more correctly takes into account two “historically concrete” (Kautsky’s
definition is a mockery of historical concreteness!) features of
modern imperialism: (1) the competition between several imperialisms, and (2) the predominance of the financier
over the merchant. If it is chiefly a question of the annexation
of agrarian countries by industrial countries, then the role of
the merchant is put in the forefront.

Kautsky’s definition is not only wrong and un-Marxist. It serves
as a basis for a whole system of views which signify a rupture
with Marxist theory and Marxist practice all along the line. I
shall refer to this later. The argument about words which
Kautsky raises as to whether the latest stage of capitalism
should be called imperialism or the stage of finance capital is
not worth serious attention. Call it what you will, it makes no
difference. The essence of the matter is that Kautsky detaches
the politics of imperialism from its economics, speaks of
annexations as being a policy “preferred” by finance capital,
and opposes to it another bourgeois policy which, he alleges, is
possible on this very same basis of finance capital. It follows,
then, that monopolies in the economy are compatible with
non-monopolistic, non-violent, non-annexationist methods in
politics. It follows, then, that the territorial division of the
world, which was completed during this very epoch of finance
capital, and which constitutes the basis of the present peculiar
forms of rivalry between the biggest capitalist states, is
compatible with a non-imperialist policy. The result is a
slurring-over and a blunting of the most profound contradictions
of the latest stage of capitalism, instead of an exposure of
their depth; the result is bourgeois reformism instead of
Marxism.

Kautsky enters into controversy with the German apologist of
imperialism and annexations, Cunow, who clumsily and cynically
argues that imperialism is present-day capitalism; the development of capitalism is inevitable and progressive;
therefore imperialism is progressive; therefore, we should
grovel before it and glorify it! This is something like the
caricature of the Russian Marxists which the Narodniks drew in
1894-95. They argued: if the Marxists believe that capitalism is
inevitable in Russia, that it is progressive, then they ought to
open a tavern and begin to implant capitalism! Kautsky’s reply
to Cunow is as follows: imperialism is not present-day capitalism; it is only one of the forms of the policy of
present-day capitalism. This policy we can and should fight,
fight imperialism, annexations, etc.

The reply seems quite plausible, but in effect it is a more
subtle and more disguised (and therefore more dangerous)
advocacy of conciliation with imperialism, because a “fight”
against the policy of the trusts and banks that does not affect
the economic basis of the trusts and banks is mere bourgeois
reformism and pacifism, the benevolent and innocent expression
of pious wishes. Evasion of existing contradictions, forgetting
the most important of them, instead of revealing their full
depth—such is Kautsky’s theory, which has nothing in common with Marxism. Naturally, such a “theory” can only serve
the purpose of advocating unity with the Cunows!

“From the purely economic point of view,” writes Kautsky, “it is
not impossible that capitalism will yet go through a new phase,
that of the extension of the policy of the cartels to foreign
policy, the phase of ultra-imperialism,” [3] i.e., of a
superimperialism, of a union of the imperialisms of the whole
world and not struggles among them, a phase when wars shall
cease under capitalism, a phase of “the joint exploitation of
the world by internationally united finance capital.” [4]

We shall have to deal with this “theory of ultra-imperialism”
later on in order to show in detail how decisively and completely it breaks with Marxism. At present, in keeping with
the general plan of the present work, we must examine the exact
economic data on this question. “From the purely economic point
of view,” is “ultra-imperialism” possible, or is it ultra-nonsense?

If the purely economic point of view is meant to be a “pure”
abstraction, then all that can be said reduces itself to the
following proposition: development is proceeding towards
monopolies, hence, towards a single world monopoly, towards a
single world trust. This is indisputable, but it is also as
completely meaningless as is the statement that “development is
proceeding” towards the manufacture of foodstuffs in laboratories. In this sense the “theory” of ultra-imperialism is
no less absurd than a “theory of ultra-agriculture” would be.

If, however, we are discussing the “purely economic” conditions
of the epoch of finance capital as a historically concrete epoch
which began at the turn of the twentieth century, then the best
reply that one can make to the lifeless abstractions of
“ultra-imperialism” (which serve exclusively a most reactionary
aim: that of diverting attention from the depth of existing antagonisms) is to contrast them with the concrete economic
realities of the present-day world economy. Kautsky’s utterly
meaningless talk about ultra-imperialism encourages, among other
things, that profoundly mistaken idea which only brings grist to
the mill of the apologists of imperialism, i.e., that the rule
of finance capital lessens the unevenness and contradictions inherent in the world economy, whereas in reality
it increases them.

R. Calwer, in his little book, An Introduction to the World Economy , [5] made an attempt to summarise the
main, purely economic, data that enable one to obtain a concrete
picture of the internal relations of the world economy at the
turn of the twentieth century. He divides the world into five
“main economic areas”, as follows: (1) Central Europe (the whole
of Europe with the exception of Russia and Great Britain); (2)
Great Britain; (3) Russia; (4) Eastern Asia; (5) America; he
includes the colonies in the “areas” of the states to which they
belong and “leaves aside” a few countries not distributed
according to areas, such as Persia, Afghanistan, and Arabia in
Asia, Morocco and Abyssinia in Africa, etc.

Here is a brief summary of the economic data he quotes on these regions.

| Principal economic areas | Area | Pop. | Transport | Trade | Industry |
| --- | --- | --- | --- | --- | --- |
| Million sq. miles | Millions | Railways (thou. km) | Mercantile fleet (mill- ions tons) | Imports, exports (thous-million marks) | Output | |
| Of coal (mill. tons) | Of pig iron (mill. tons) | Number of cotton spindles (millions) |
| 1) Central Europe | 27.6 (23.6) | 388 (146) | 204 | 8 | 41 | 251 | 15 | 26 |
| 2) Britain | 28.9 (28.6) | 398 (355) | 140 | 11 | 25 | 249 | 9 | 51 |
| 3) Russia | 22 | 131 | 63 | 1 | 3 | 16 | 3 | 7 |
| 4) Eastern Asia | 12 | 389 | 8 | 1 | 2 | 8 | 0.02 | 2 |
| 5) America | 30 | 148 | 379 | 6 | 14 | 245 | 14 | 19 |

.

We see three areas of highly developed capitalism (high
development of means of transport, of trade and of industry):
the Central European, the British and the American areas. Among
these are three states which dominate the world: Germany, Great
Britain, and the United States. Imperialist rivalry and the
struggle between these countries have become extremely keen
because Germany has only an insignificant area and few colonies;
the creation of “Central Europe” is still a matter for the
future, it is being born in the midst of a desperate struggle. For the moment the distinctive feature of the whole of
Europe is political disunity. In the British and American areas,
on the other hand, political concentration is very highly
developed, but there is a vast disparity between the immense
colonies of the one and the insignificant colonies of the
other. In the colonies, however, capitalism is only beginning to
develop. The struggle for South America is becoming more and
more acute.

There are two areas where capitalism is little developed: Russia
and Eastern Asia. In the former, the population is extremely
sparse, in the latter it is extremely dense; in the former
political concentration is high, in the latter it does not
exist. The partitioning of China is only just beginning, and the
struggle for it between Japan, the U.S., etc., is continually
gaining in intensity.

Compare this reality—the vast diversity of economic and
political conditions, the extreme disparity in the rate of
development of the various countries, etc., and the violent
struggles among the imperialist states—with Kautsky’s silly little fable about “peaceful” ultra-imperialism. Is this
not the reactionary attempt of a frightened philistine to hide
from stern reality? Are not the international cartels which
Kautsky imagines are the embryos of “ultra-imperialism” (in the
same way as one “can” describe the manufacture of tablets in a
laboratory as ultra-agriculture in embryo) an example of the
division and the redivision of the world, the transition from peaceful division to non-peaceful division and
vice versa? Is not American and other finance capital, which
divided the whole world peacefully with Germany’s participation
in, for example, the international rail syndicate, or in the
international mercantile shipping trust, now engaged in
redividing the world on the basis of a new relation of forces that is being changed by methods anything but
peaceful?

Finance capital and the trusts do not diminish but increase the
differences in the rate of growth of the various parts of the
world economy. Once the relation of forces is changed, what
other solution of the contradictions can be found under capitalism than that of force ? Railway
statistics [6] provide remarkably exact data on the different rates of growth of
capitalism and finance capital in world economy. In the last
decades of imperialist development, the total length of railways
has changed as follows:

| | Railways (000 kilometers) |
| --- | --- |
| 1890 | 1913 | + |
| Europe | 224 | | 346 | | +122 | |
| U.S. | 268 | 411 | +143 |
| All colonies | 82 | 125 | 210 | 347 | +128 | +222 |
| Independent and semi-independent states of Asia and America | 43 | 137 | +94 |
| Total | 617 | | 1,104 | | | |

Thus, the development of railways has been most rapid in the
colonies and in the independent (and semi-independent) states of
Asia and America. Here, as we know, the finance capital of the
four or five biggest capitalist states holds undisputed
sway. Two hundred thousand kilometres of new railways in the
colonies and in the other countries of Asia and America
represent a capital of more than 40,000 million marks newly
invested on particularly advantageous terms, with special
guarantees of a good return and with profitable orders for steel
works, etc., etc.

Capitalism is growing with the greatest rapidity in the colonies
and in overseas countries. Among the latter, new imperialist
powers are emerging (e.g., Japan). The struggle among the world
imperialisms is becoming more acute. The tribute levied by
finance capital on the most profitable colonial and overseas
enterprises is increasing. In the division of this “booty,” an
exceptionally large part goes to countries which do not always
stand at the top of the list in the rapidity of the development
of their productive forces. In the case of the biggest countries, together with their colonies, the total length of
railways was as follows:

| | (000 kilometres) |
| --- | --- |
| 1890 | 1913 | |
| U.S. | 268 | 413 | +145 |
| British Empire | 107 | 208 | +101 |
| Russia | 32 | 78 | +46 |
| Germany | 43 | 68 | +25 |
| France | 41 | 63 | +22 |
| Total | 491 | 830 | +339 |

Thus, about 80 per cent of the total existing railways are
concentrated in the hands of the five biggest powers. But the
concentration of the ownership of these railways, the concentration of finance capital, is immeasurably greater since
the French and British millionaires, for example, own an
enormous amount of shares and bonds in American, Russian and
other railways.

Thanks to her colonies, Great Britain has increased the length
of “her” railways by 100,000 kilometres, four times as much as
Germany. And yet, it is well known that the development of
productive forces in Germany, and especially the development of
the coal and iron industries, has been incomparably more rapid
during this period than in Britain—not to speak of France
and Russia. In 1892, Germany produced 4,900,000 tons of pig-iron
and Great Britain produced 6,800,000 tons; in 1912, Germany
produced 17,600,000 tons and Great Britain, 9,000,000 tons. Germany, therefore, had an overwhelming superiority over
Britain in this respect. [7]

The question is: what means other than war could there be under capitalism to overcome
the disparity between the development of productive forces and
the accumulation of capital on the one side, and the division of
colonies and spheres of influence for finance capital on the
other?

---
Notes:
[1]

Die Neue Zeit , 1914, 2 (B. 32), S. 909, Sept. 11, 1914;
cf. 1915, 2, S. 107 et seq.
— Lenin

[2]

Hobson, Imperialism , London, 1902, p. 324.
— Lenin

[3]

Die Neue Zeit , 1914, 2 (B. 32), S. 921, Sept. 11,
1914. Cf. 1915, 2, S. 107 et seq.
— Lenin

[4]

Ibid ., 1915, 1, S. 144, April 30, 1915.
— Lenin

[5]

R. Calwer, Einfü hrung in die Weltwirtschaft ,
Berlin, 1906.
— Lenin

[6]

Statistisches Jahrbuch für das deutsche Reich, 1915; Archiv für Eisenbahnwesen, 1892. Minor details for the
distribution of railways among the colonies of the various
countries in 1890 had to be estimated approximately.
— Lenin

[7]

Cf. also Edgar Crammond, “The Economic Relations of the British
and German Empires” in The Journal of the Royal Statistical Society , July 1914, p. 777 et seq.
— Lenin