Lenin on Imperialism as the Highest Stage of Capitalism

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Table of Contents

Introduction
Discussion
Conclusion
Works Cited

Introduction

What is happening in the United States and Europe today is as a result of capitalism. Such aspects as the International Monetary Fund, the World Bank and the World Trade Organization best explain the imperialism in the modern world. The following essay examines the analysis by Ilyich Lenin on imperialism as the highest stage of capitalism.

Lenin, in his most famous work on capitalism, held the view that imperialism dates back in the early twentieth century. In its economic essence, Lenin defined imperialism as the monopoly stage of capitalism. This definition provided him with an opportunity of situating imperialism historically i.e. it allowed him to determine the place of imperialism in history.

He held the view that monopoly developed as a result of free competition (Lenin 12). He was also of the opinion that free competition enhanced the transition of the capitalist system to a higher socio-economic order. According to him, imperialism acted as a tool for competing between empires by making war as part and parcel of the crucial process of capital accumulation (Lenin 119).

Discussion

The following are the five main features of imperialism according to Lenin; Lenin argues that both the capital and production has led to the creation of monopolies which bring conditions which restrict entry of new industries. These monopolies determine the manner in which economies are run.

Lenin argues that over the years, industries have enormously developed and production has been concentrated on only a few industries. He gives examples of Europe and the United States of America as regions where production and capital have been vested on only a few enterprises.In Germany, Lenin notes that more attention is directed towards production and not labor.

For instance, only a few industries are the largest consumer of electric and steam power. However, these industries employ only a few workers (Lenin 15). In the United States, industries are classified in accordance with their output. He noted that a large percentage of the total production in the United States is carried on by only a few enterprises.

Thus, concentration paved way for the development of monopolies because the giant companies have the potential of controlling the prices of goods and services. According to Lenin, monopolies play a crucial role in todays capitalist economy as they are associated with a high rate of economic growth.

He was insistent on monopoly as the most important feature of imperialism. According to him, monopoly is inherent as it enhances the efficient utilization of natural resources. He thus emphasizes that people should embrace it because it is an important phenomena.

However, he cautions people against the effects of monopolies. He argues that monopolies prevent competition in the industry by using such techniques as spreading false rumors concerning the industry and publishing anonymous warnings in the print media. Monopoly, according to him, has the effect of causing economic crisis. Lenin also argues that monopoly has the effect of dividing the world by creating imperial powers (Pauly 149).

Lenin, in his analysis on imperialism as the highest stage of capitalism, stated that the integration of bank capital with the industrial capital facilitates the creation of financial oligarchy. Lenin assumes that the increasing economic activity and banking have given rise to new kind of capitalism in which banks has assumed the role of controlling the flow of capital.

The transformation from an industrial capitalism to finance capitalism changed the role of the banks from being an intermediary to a powerful monopoly which has the ability of controlling a greater share of the societys wealth.

As the industrial sector required more capital for expansion and growth, the structural relationship between the financial and industrial sectors also changed. Industrialists were left with only a small portion of capital for their production purposes. Financial institutions such as banks, investment companies and insurance companies assumed the role of industrial capitalists and they were made to invest for their money to continue being profit producing.

Finance capital was thus a combination of industrial and money capital and therefore, banks were placed in a central position as far as the political economy was concerned. The concentration of capital over the years made the financial oligarchy to gain power.

The pivotal position of the financial oligarchy plays an important role in enabling them to have access to information regarding industrial capitalists. They in turn influence them by using such aspects as denying them financial access and thus determining their income. The financial oligarchy leads to the massive enhancement of monopolist power.

Lenin, in his analysis about imperialism as the highest form of capitalism, put much emphasis on capital export as opposed to export of goods. According to him, imperialism is largely based on export of productive capital as well as the export of money.

He however stressed that it is important to consider that the term movement of capital does not enhance imperialism but rather, the specific term export. The term export makes a clear distinction between national capital movements on one hand and international capital movements on the other hand. He held the view that export of capital was vital as compared to the export of goods.

The export of capital causes an increase in the volume of goods that are exported. In his formulation, export of capital usually occurs in a world which is divided by various states. According to him, the export of capital plays a crucial role of mediating the role of nations and the potential conflicts of the ruling class interests.

The potential conflict can exist between capitalist nations i.e. inter-capitalist conflict or it can be between a particular pre-capitalist state and a capitalist state. Lenin placed much emphasis on the inter-capitalist rivalry. He developed the opinion that accumulation in the imperialist period has the effect of causing inter-capitalist wars. It is in this context that Lenin identified the World War 1 as an imperialist war.

With regards to capitalism, Lenin argued that capital is accumulated by only a few states i.e. the developed nations such as Germany, France, England, and the United States among others. He was on the opinion that capitalism should be directed towards developing agriculture which has remained under developed as opposed to industry.

This would play an important role of raising the peoples living standards. This would also ensure that the issue of surplus of capital does not exist throughout the world. This view on capitalism was however criticized by scholars who argued that capitalism would not carry out its purpose by enhancing the living standards of people.

This is because under-developed nations are characterized with high profits, low accumulation of capital, cheap land prices and cheap labor and they therefore facilitate the export of capital (Schutz 201).

The fourth feature of imperialism according to Lenin is the creation of international monopolists which divides the world into spheres of influence. Lenin argues that the world has been divided among the capital associations such as business cartels. Capitalism has facilitated the expansion of big monopolist associations and this has brought about the emergence of such aspects as the international cartels.

The coercive power of the state determines the capitalists ultimate source of power. Lenin believes that the First World War was as a result of the imperialist conflicts among the major political powers.

He believes that the source of such conflicts was without doubt fueled by the desire to accumulate much wealth by the capitalists. He argues that capitalism always bring about a greedy and mad obsession for power. This led Lenin to wrap up by stating that imperialism represents the final stage of capitalism (OKane 6).

As a result of capitalism, the territorial division among the major imperial powers is fulfilled. Lenin terms this last stage of imperialism as moribund capitalism.

According to him, the major capitalist powers eventually end up becoming rentier states i.e. states that are characterized by parasitic and decaying capitalism. Lenin holds the view that a balance of power between the various capitalist states exists (Suneja 216).

Conclusion

Lenin believes that the imperialism forces were inherent to the capitalist system. He argues that the effects of imperialism cannot be avoided by any law and that only a socialist revolution has the capacity of eliminating it. Also, his analysis of imperialism as the highest form of capitalism can be found in the debt condition in which the developing nations find themselves.

In the modern world, imperialism exists as a neo-colonialism where imperial powers continue to benefit enormously. Imperial powers have over the years benefited directly from imperialism by exploiting their employees. They also continue to benefit from the debts that they impose on poor countries through the World Bank and the International Monetary Fund.

Works Cited

Lenin, Vladimir. Imperialism: the highest stage of capitalism. New York: Resistance Books, 1999.

OKane, Rosemary. Terror, force, and states: the path from modernity. Cheltenham: Edward Edgar Publishing, 1996.

Pauly, Louis. Global liberalism and political order: toward a new grand compromise? New York: SUNY Press, 2007.

Schutz, Eric. Inequality and Power: The Economics of Class. London: Taylor & Francis, 2010.

Suneja, Vivek. Understanding business: a multidimensional approach to the market economy. Markets. London: Routledge, 2000.

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Lenin on Imperialism as the Highest Stage of Capitalism

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