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<title>D.5 What causes imperialism?</title>

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<h1>D.5 What causes imperialism?</h1>

<p>
In a word: power. Imperialism is the process by which one country dominates 
another directly, by political means, or indirectly, by economic means, in 
order to steal its wealth (either natural or produced). This, by necessity, 
means the exploitation of working people in the dominated nation. Moreover,
it can also aid the exploitation of working people in the imperialist nation
itself. As such, imperialism cannot be considered in isolation from the 
dominant economic and social system. Fundamentally the cause is the same 
inequality of power, which is used in the service of exploitation. 
</p><p>
While the rhetoric used for imperial adventures may be about 
self-defence, defending/exporting "democracy" and/or "humanitarian" 
interests, the reality is much more basic and grim. As Chomsky 
stresses, <i>"deeds consistently accord with interests, and conflict 
with words -- discoveries that must not, however, weaken our faith 
in the sincerity of the declarations of our leaders."</i> This is 
unsurprising as states are always <i>"pursuing the strategic and 
economic interests of dominant sectors to the accompaniment of 
rhetorical flourishes about its exceptional dedication to the 
highest values"</i> and so <i>"the evidence for . . . the proclaimed 
messianic missions reduces to routine pronouncements"</i> (faithfully 
repeated by the media) while <i>"counter-evidence is mountainous."</i> 
[<b>Failed States</b>, p. 171 and pp. 203-4]
</p><p>
We must stress that we are concentrating on the roots of imperialism here.
We do not, and cannot, provide a detailed history of the horrors associated
with it. For US imperialism, the works of Noam Chomsky are recommended. His
books <b>Turning the Tide</b> and <b>The Culture of Terrorism</b> expose the evils of
US intervention in Central America, for example, while <b>Deterring Democracy</b>,
<b>Rogue States: The Rule of Force in World Affairs</b> and <b>Failed States: The 
Abuse of Power and the Assault on Democracy</b> present a wider perspective. 
<b>Killing Hope: US Military and CIA Interventions Since World War II</b> and 
<b>Rogue State: A Guide to the World's Only Superpower</b> by William Blum are 
also worth reading. For post-1945 British imperialism, Mark Curtis's <b>Web 
of Deceit: Britain's Real Role in the World</b> and <b>Unpeople: Britain's 
Secret Human Rights Abuses</b> are recommended. 
</p><p>
As we will discuss in the following sections, imperialism has changed over 
time, particularly during the last two hundred years (where its forms and 
methods have evolved with the changing needs of capitalism). But even in 
the pre-capitalist days of empire building, imperialism was driven by 
economic forces and needs. In order to make one's state secure, in order to 
increase the wealth available to the state, its ruling bureaucracy and its 
associated ruling class, it had to be based on a strong economy and have a 
sufficient resource base for the state and ruling elite to exploit (both 
in terms of human and natural resources). By increasing the area controlled 
by the state, one increased the wealth available. 
</p><p>
States by their nature, like capital, are expansionist bodies, with those 
who run them always wanting to increase the range of their power and influence
(this can be seen from the massive number of wars that have occurred in 
Europe over the last 500 years). This process was began as nation-states 
were created by Kings declaring lands to be their private property, regardless
of the wishes of those who actually lived there. Moreover, this conflict did 
not end when monarchies were replaced by more democratic forms of government.
As Bakunin argued:
</p><p><blockquote>
<i>"we find wars of extermination, wars among races and nations; wars of 
conquest, wars to maintain equilibrium, political and religious wars, 
wars waged in the name of 'great ideas' . . . , patriotic wars for 
greater national unity . . . And what do we find beneath all that, 
beneath all the hypocritical phrases used in order to give these 
wars the appearance of humanity and right? Always the same economic
phenomenon: <b>the tendency on the part of some to live and prosper at 
the expense of others.</b> All the rest is mere humbug. The ignorant and
naive, and the fools are entrapped by it, but the strong men who direct 
the destinies of the State know only too well that underlying all those 
wars there is only one motive: pillage, the seizing of someone else's 
wealth and the enslavement of someone else's labour."</i> [<b>The Political
Philosophy of Bakunin</b>, p. 170]
</blockquote></p><p>
However, while the economic motive for expansion is generally the same, 
the economic system which a nation is based on has a definite impact on 
what drives that motive as well as the specific nature of that imperialism. 
Thus the empire building of ancient Rome or Feudal England has a different 
economic base (and so driving need) than, say, the imperialism of nineteenth 
century Germany and Britain or twentieth and twenty-first century United 
States. Here we will focus mainly on modern capitalist imperialism as it is 
the most relevant one in the modern world.
</p><p>
Capitalism, by its very nature, is growth-based and so is characterised 
by the accumulation and concentration of capital. Companies <b>must</b> expand 
in order to survive competition in the marketplace. This, inevitably, 
sees a rise in international activity and organisation as a result of 
competition over markets and resources within a given country. By 
expanding into new markets in new countries, a company can gain an 
advantage over its competitors as well as overcome limited markets 
and resources in the home nation. In Bakunin's words: 
</p><p><blockquote>
<i>"just as capitalist production and banking speculation, which in the long
run swallows up that production, must, under the threat of bankruptcy, 
ceaselessly expand at the expense of the small financial and productive
enterprises which they absorb, must become universal, monopolistic 
enterprises extending all over the world -- so this modern and necessarily 
military State is driven on by an irrepressible urge to become a universal
State. . . . Hegemony is only a modest manifestation possible under the 
circumstances, of this unrealisable urge inherent in every State. And 
the first condition of this hegemony is the relative impotence and 
subjection of all the neighbouring States."</i> [<b>Op. Cit.</b>, p. 210]
</blockquote></p><p>
Therefore, economically and politically, the imperialistic activities of 
<b>both</b> capitalist and state-capitalist (i.e. the Soviet Union and other 
"socialist" nations) comes as no surprise. Capitalism is inevitably 
imperialistic and so <i>"[w]ar, capitalism and imperialism form a veritable
trinity,"</i> to quote Dutch pacifist-syndicalist Bart de Ligt [<b>The Conquest 
of Violence</b>, p. 64] The growth of big business is such that it can no
longer function purely within the national market and so they have to
expand internationally to gain advantage in and survive. This, in turn, 
requires the home state of the corporations also to have global reach 
in order to defend them and to promote their interests. Hence the 
economic basis for modern imperialism, with <i>"the capitalistic 
interests of the various countries fight[ing] for the foreign markets 
and compete with each other there"</i> and when they <i>"get into trouble 
about concessions and sources of profit,"</i> they <i>"call upon their 
respective governments to defend their interests . . . to protect 
the privileges and dividends of some . . . capitalist in a foreign 
country."</i> [Alexander Berkman, <b>What is Anarchism?</b>, p. 31] Thus a
capitalist class needs the power of nation states not only to create
internal markets and infrastructure but also to secure and protect
international markets and opportunities in a world of rivals and 
<b>their</b> states.
</p><p>
As power depends on profits within capitalism, this means that modern 
imperialism is caused more by economic factors than purely political 
considerations (although, obviously, this factor does play a role). 
Imperialism serves capital by increasing the pool of profits available 
for the imperialistic country in the world market as well as reducing 
the number of potential competitors. As Kropotkin stressed, <i>"capital 
knows no fatherland; and if high profits can be derived from the work 
of Indian coolies whose wages are only one-half of those of English 
workmen [or women], or even less, capital will migrate to India, as 
it has gone to Russian, although its migration may mean starvation 
for Lancashire."</i> [<b>Fields, Factories and Workshops</b>, p. 57]
</p><p>
Therefore, capital will travel to where it can maximise its profits -- 
regardless of the human or environmental costs at home or abroad. This 
is the economic base for modern imperialism, to ensure that any trade 
conducted benefits the stronger party more than the weaker one. Whether
this trade is between nations or between classes is irrelevant, the aim 
of imperialism is to give business an advantage on the market. By 
travelling to where labour is cheap and the labour movement weak 
(usually thanks to dictatorial regimes), environmental laws few or 
non-existent, and little stands in the way of corporate power, capital 
can maximise its profits. Moreover, the export of capital allows a 
reduction in the competitive pressures faced by companies in the home 
markets (at least for short periods).
</p><p>
This has two effects. Firstly, the industrially developed nation (or, 
more correctly corporation based in that nation) can exploit less 
developed nations. In this way, the dominant power can maximise for 
itself the benefits created by international trade. If, as some claim, 
trade always benefits each party, then imperialism allows the benefits 
of international trade to accrue more to one side than the other. 
Secondly, it gives big business more weapons to use to weaken the 
position of labour in the imperialist nation. This, again, allows the
benefits of trade (this time the trade of workers liberty for wages) 
to accrue to more to business rather than to labour.
</p><p>
How this is done and in what manner varies and changes, but the aim is 
always the same -- exploitation.
</p><p>
This can be achieved in many ways. For example, allowing the import of 
cheaper raw materials and goods; the export of goods to markets sheltered 
from foreign competitors; the export of capital from capital-rich areas 
to capital-poor areas as the investing of capital in less industrially 
developed countries allows the capitalists in question to benefit from 
lower wages; relocating factories to countries with fewer (or no) 
social and environmental laws, controls or regulations. All these 
allow profits to be gathered at the expense of the working people of 
the oppressed nation (the rulers of these nations generally do well out 
of imperialism, as would be expected). The initial source of exported 
capital is, of course, the exploitation of labour at home but it is 
exported to less developed countries where capital is scarcer and the 
price of land, labour and raw materials cheaper. These factors all 
contribute to enlarging profit margins:
</p><p><blockquote>
<i>"The relationship of these global corporations with the poorer countries 
had long been an exploiting one . . . Whereas U.S. corporations in Europe 
between 1950 and 1965 invested $8.1 billion and made $5.5 billion in 
profits, in Latin America they invested $3.8 billion and made $11.2 
billion in profits, and in Africa they invested $5.2 billion and made
$14.3 bullion in profits."</i> [Howard Zinn, <b>A People's History of the 
United States</b>, p. 556] 
</blockquote></p><p>
Betsy Hartman, looking at the 1980s, concurs. <i>"Despite the popular Western 
image of the Third World as a bottomless begging bowl,"</i> she observes, <i>"it 
today gives more to the industrialised world than it takes. Inflows of 
official 'aid' and private loans and investments are exceeded by outflows 
in the form of repatriated profits, interest payments, and private capital 
sent abroad by Third World Elites."</i> [quoted by George Bradford, <b>Woman's 
Freedom: Key to the Population Question</b>, p. 77] 
</p><p>
In addition, imperialism allows big business to increase its strength 
with respect to its workforce in the imperialist nation by the threat of 
switching production to other countries or by using foreign investments 
to ride out strikes. This is required because, while the "home" working 
class are still exploited and oppressed, their continual attempts at 
organising and resisting their exploiters proved more and more successful. 
As such, <i>"the opposition of the white working classes to the . . . 
capitalist class continually gain[ed] strength, and the workers . . .
[won] increased wages, shorter hours, insurances, pensions, etc.,
the white exploiters found it profitable to obtain their labour from
men [,women and children] of so-called inferior race . . . Capitalists
can therefore make infinitely more out there than at home."</i> [Bart de
Ligt, <b>Op. Cit.</b>, p. 49]
</p><p>
As such, imperialism (like capitalism) is not only driven by the need to 
increase profits (important as this is, of course), it is also driven by 
the class struggle -- the need for capital to escape from the strength of 
the working class in a particular country. From this perspective, 
the export of capital can be seen in two ways. Firstly, as a means of 
disciplining rebellious workers at home by an "investment strike" 
(capital, in effect, runs away, so causing unemployment which disciplines
the rebels). Secondly, as a way to increase the 'reserve army' of the 
unemployed facing working people in the imperialist nations by creating 
new competitors for their jobs (i.e. dividing, and so ruling, workers by 
playing one set of workers against another). Both are related, of course, 
and both seek to weaken working class power by the fear of unemployment.
This process played a key role in the rise of globalisation -- see 
<a href="secD5.html#secd53">section D.5.3</a> for details. 
</p><p>
Thus imperialism, which is rooted in the search from surplus profits for 
big business, is also a response to working class power at home. The 
export of capital is done by emerging and established transnational 
companies to overcome a militant and class consciousness working class 
which is often too advanced for heavy exploitation, and finance 
capital can make easier and bigger profits by investing productive 
capital elsewhere. It aids the bargaining position of business by pitting 
the workers in one country against another, so while they are being
exploited by the same set of bosses, those bosses can use this fictional 
"competition" of foreign workers to squeeze concessions from workers at 
home.
</p><p>
Imperialism has another function, namely to hinder or control the 
industrialisation of other countries. Such industrialisation will, 
of course, mean the emergence of new capitalists, who will compete 
with the existing ones both in the "less developed" countries and in 
the world market as a whole. Imperialism, therefore, attempts to reduce 
competition on the world market. As we discuss in the 
<a href="secD5.html#secd51">next section</a>, the 
nineteenth century saw the industrialisation of many European nations as 
well as America, Japan and Russia by means of state intervention. However, 
this state-led industrialisation had a drawback, namely that it created
more and more competitors on the world market. Moreover, as Kropotkin 
noted, they has the advantage that the <i>"new manufacturers . . . begin 
where"</i> the old have <i>"arrived after a century of experiments and 
groupings"</i> and so they <i>"are built according to the newest and best 
models which have been worked out elsewhere."</i> [<b>Op. Cit.</b>, p. 32 and 
p. 49] Hence the  need to stop new competitors and secure raw materials
and markets, which was achieved by colonialism:
</p><p><blockquote>
<i>"Industries of all kinds decentralise and are scattered all over the 
globe; and everywhere a variety, an integrated variety, of trades grows,
instead of specialisation . . . each nation becomes in its turn a 
manufacturing nation . . . For each new-comer the first steps only are 
difficult . . . The fact is so well felt, if not understood, that
the race for colonies has become the distinctive feature of the last 
twenty years [Kropotkin is writing in 1912]. Each nation will have her 
own colonies. But colonies will not help."</i> [<b>Op. Cit.</b>, p. 75]
</blockquote></p><p>
Imperialism hinders industrialisation in two ways. The first way was 
direct colonisation, a system which has effectively ended. The second 
is by indirect means -- namely the extraction of profits by international 
big business. A directly dominated country can be stopped from developing 
industry and be forced to specialise as a provider of raw materials. This 
was the aim of "classic" imperialism, with its empires and colonial wars. 
By means of colonisation, the imperialist powers ensure that the 
less-developed nation stays that way -- so ensuring one less competitor 
as well as favourable access to raw materials and cheap labour. French 
anarchist Elisee Reclus rightly called this a process of creating 
<i>"colonies of exploitation."</i> [quoted by John P Clark and Camille Martin 
(eds.), <b>Anarchy, Geography, Modernity</b>, p. 92] 
</p><p>
This approach has been superseded by indirect means (see 
<a href="secD5.html#secd51">next section</a>).
Globalisation can be seen as an intensification of this process. By 
codifying into international agreements the ability of corporations to 
sue nation states for violating "free trade," the possibility of new 
competitor nations developing is weakened. Industrialisation will be 
dependent on transnational corporations and so development will be 
hindered and directed to ensure corporate profits and power. Unsurprisingly, 
those nations which <b>have</b> industrialised over the last few decades (such 
as the East Asian Tiger economies) have done so by using the state to 
protect industry and control international finance.
</p><p>
The new attack of the capitalist class ("globalisation") is a means of 
plundering local capitalists and diminish their power and area of control. 
The steady weakening and ultimate collapse of the Eastern Block (in terms 
of economic/political performance and ideological appeal) also played a 
role in this process. The end of the Cold War meant a reduction in the 
space available for local elites to manoeuvre. Before this local ruling 
classes could, if they were lucky, use the struggle between US and USSR 
imperialism to give them a breathing space in which they could exploit to 
pursue their own agenda (within limits, of course, and with the blessing 
of the imperialist power in whose orbit they were in). The Eastern Tiger 
economies were an example of this process at work. The West could use 
them to provide cheap imports for the home market as well as in the 
ideological conflict of the Cold War as an example of the benefits of 
the "free market" (not that they were) and the ruling elites, while 
maintaining a pro-west and pro-business environment (by force directed 
against their own populations, of course), could pursue their own economic 
strategies. With the end of the Cold War, this factor is no longer in 
play and the newly industrialised nations are now an obvious economic
competitor. The local elites are now "encouraged" (by economic blackmail 
via the World Bank and the IMF) to embrace US economic ideology. Just as 
neo-liberalism attacks the welfare state in the Imperialist nations, so 
it results in a lower tolerance of local capital in "less developed" 
nations.
</p><p>
However, while imperialism is driven by the needs of capitalism it cannot
end the contradictions inherent in that system. As Reclus put it in the
late nineteenth century, <i>"the theatre expands, since it now embraces the 
whole of the land and seas. But the forces that struggled against one 
another in each particularly state are precisely those that fight across 
the earth. In each country, capital seeks to subdue the workers. Similarly, 
on the level of the broadest world market, capital, which had grown
enormously, disregards all the old borders and seeks to put the entire 
mass of producers to work on behalf of its profits, and to secure all the 
consumers in the world."</i> [Reclus, quoted by Clark and Martin (eds.), 
<b>Op. Cit.</b>, p. 97]  
</p><p>
This struggle for markets and resources does, by necessity, lead 
to conflict. This may be the wars of conquest required to initially 
dominate an economically "backward" nation (such as the US invasion of 
the Philippines, the conquest of Africa by West European states, and so 
on) or maintain that dominance once it has been achieved (such as the 
Vietnam War, the Algerian War, the Gulf War and so on). Or it may be 
the wars between major imperialist powers once the competition for 
markets and colonies reaches a point when they cannot be settled 
peacefully (as in the First and Second World Wars). As Kropotkin 
argued: 
</p><p><blockquote>
<i>"men no longer fight for the pleasure of kings, they fight for the 
integrity of revenues and for the growing wealth  . . . [for the] 
benefit of the barons of high finance and industry . . . [P]olitical 
preponderance . . . is quite simply a matter of economic preponderance 
in international markets. What Germany, France, Russia, England, and 
Austria are all trying to win . . . is not military preponderance: 
it is economic domination. It is the right to impose their goods 
and their customs tariffs on their neighbours; the right to exploit 
industrially backward peoples; the privilege of building railroads 
. . . to appropriate from a neighbour either a port which will 
activate commerce, or a province where surplus merchandise can
be unloaded . . . When we fight today, it is to guarantee our great 
industrialists a profit of 30%, to assure the financial barons their 
domination at the Bourse [stock-exchange], and to provide the
shareholders of mines and railways with their incomes."</i> [<b>Words of 
a Rebel</b>, pp. 65-6]
</blockquote></p><p>
In summary, current imperialism is caused by, and always serves, the 
needs and interests of Capital. If it did not, if imperialism were 
bad for business, the business class would oppose it. This partly 
explains why the colonialism of the 19th century is no more (the 
other reasons being social resistance to foreign domination, which 
obviously helped to make imperialism bad for business as well, and 
the need for US imperialism to gain access to these markets after 
the second world war). There are now more cost-effective means 
than direct colonialism to ensure that "underdeveloped" countries 
remain open to exploitation by foreign capital. Once the costs 
exceeded the benefits, colonialist imperialism changed into the 
neo-colonialism of multinationals, political influence, and the 
threat of force. Moreover, we must not forget that any change in 
imperialism relates to changes in the underlying 
economic system and so the changing nature of modern imperialism can 
be roughly linked to developments within the capitalist economy. 
</p><p>
Imperialism, then, is basically the ability of countries to globally and 
locally dictate trade relations and investments with other countries in 
such a way as to gain an advantage over the other countries. When capital 
is invested in foreign nations, the surplus value extracted from the workers 
in those nations are not re-invested in those nations. Rather a sizeable 
part of it returns to the base nation of the corporation (in the form of 
profits for that company). Indeed, that is to be expected as the whole 
reason for the investment of capital in the first place was to get more 
out of the country than the corporation put into it. Instead of this 
surplus value being re-invested into industry in the less-developed nation 
(as would be the case with home-grown exploiters, who are dependent on 
local markets and labour) it ends up in the hands of foreign exploiters 
who take them out of the dominated country. This means that industrial 
development as less resources to draw on, making the local ruling class 
dependent on foreign capital and its whims. 
</p><p>
This can be done directly (by means of invasion and colonies) or indirectly 
(by means of economic and political power). Which method is used depends 
on the specific circumstances facing the countries in question. Moreover, 
it depends on the balance of class forces within each country as well (for 
example, a nation with a militant working class would be less likely to 
pursue a war policy due to the social costs involved). However, the 
aim of imperialism is always to enrich and empower the capitalist and 
bureaucratic classes.
</p>

<h2><a name="secd51">D.5.1 How has imperialism changed over time?</a></h2>

<p>
The development of Imperialism cannot be isolated from the general 
dynamics and tendencies of the capitalist economy. Imperialist 
capitalism, therefore, is not identical to pre-capitalist forms 
of imperialism, although there can, of course, be similarities. 
As such, it must be viewed as an advanced stage of capitalism and 
not as some kind of deviation of it. This kind of imperialism was 
attained by some nations, mostly Western European, in the late 
19th and early 20th-century. Since then it has changed and 
developed as economic and political developments occurred, but 
it is based on the same basic principles. As such, it is useful 
to describe the history of capitalism in order to fully understand 
the place imperialism holds within it, how it has changed, what 
functions it provides and, consequently, how it may change in the
future.
</p><p>
Imperialism has important economic advantages for those who run 
the economy. As the needs of the business class change, the forms 
taken by imperialism also change. We can identify three main 
phases: classic imperialism (i.e. conquest), indirect (economic) 
imperialism, and globalisation. We will consider the first two 
in this section and globalisation in 
<a href="secD5.html#secd53">section D.5.3</a>. However, for 
all the talk of globalisation in recent years, it is important to 
remember that capitalism has always been an international system, 
that the changing forms of imperialism reflect this international 
nature and that the changes within imperialism are in response to 
developments within capitalism itself.
</p><p>
Capitalism has always been expansive. Under mercantilism, for 
example, the "free" market was nationalised <b>within</b> the 
nation state while state aid was used to skew international 
trade on behalf of the home elite and favour the development 
of capitalist industry. This meant using the centralised state
(and its armed might) to break down "internal" barriers and 
customs which hindered the free flow of goods, capital and, 
ultimately, labour. We should stress this as the state has 
always played a key role in the development and protection 
of capitalism. The use of the state to, firstly, protect
infant capitalist manufacturing and, secondly, to create
a "free" market (i.e. free from the customs and interference
of society) should not be forgotten, particularly as this
second ("internal") role is repeated "externally" through
imperialism. Needless to say, this process of "internal"
imperialism within the country by the ruling class by
means of the state was accompanied by extensive violence
against the working class (also see 
<a href="secF8.html">section F.8</a>).
</p><p>
So, state intervention was used to create and ensure capital's 
dominant position at home by protecting it against foreign 
competition and the recently dispossessed working class. This 
transition from feudal to capitalist economy enjoyed the 
active promotion of the state authorities, whose increasing 
centralisation ran parallel with the growing strength and size 
of merchant capital. It also needed a powerful state to protect 
its international trade, to conquer colonies and to fight for 
control over the world market. The absolutist state was used to 
actively implant, help and develop capitalist trade and industry.
</p><p>
The first industrial nation was Britain. After building up its 
industrial base under mercantilism and crushing its rivals in 
various wars, it was in an ideal position to dominate the 
international market. It embraced free trade as its unique place 
as the only capitalist/industrialised nation in the world market 
meant that it did not have to worry about competition from other 
nations. Any free exchange between unequal traders will benefit 
the stronger party. Thus Britain, could achieve domination in 
the world market by means of free trade. This meant that goods 
were exported rather than capital. 
</p><p>
Faced with the influx of cheap, mass produced goods, existing 
industry in Europe and the Americas faced ruin. As economist
Nicholas Kaldor notes, <i>"the arrival of cheap factory-made
English goods <b>did</b> cause a loss of employment and output of 
small-scale industry (the artisanate) both in European countries 
(where it was later offset by large-scale industrialisation brought 
about by protection) and even more in India and China, where it 
was no so offset."</i> [<b>Further Essays on Applied Economics</b>, p. 238] 
The existing industrial base was crushed, industrialisation was 
aborted and unemployment rose. These countries faced two 
possibilities: turn themselves into providers of raw materials 
for Britain or violate the principles of the market and 
industrialise by protectionism.
</p><p>
In many nations of Western Europe (soon to be followed by the USA 
and Japan), the decision was simple. Faced with this competition, 
these countries utilised the means by which Britain had 
industrialised -- state protection. Tariff barriers were raised, 
state aid was provided and industry revived sufficiently to turn 
these nations into successful competitors of Britain. This process 
was termed by Kropotkin as <i>"the consecutive development of nations"</i> 
(although he underestimated the importance of state aid in this 
process). No nation, he argued, would let itself become specialised 
as the provider of raw materials or the manufacturer of a few 
commodities but would diversify into many different lines of 
production. Obviously no national ruling class would want to see 
itself be dependent on another and so industrial development 
was essential (regardless of the wishes of the general population). 
Thus a nation in such a situation <i>"tries to emancipate herself from 
her dependency . . . and rapidly begins to manufacture all those goods 
she used to import."</i> [<b>Fields, Factories and Workshops</b>, p. 49 and 
p. 32]
</p><p>
Protectionism may have violated the laws of neo-classical economics, 
but it proved essential for industrialisation. While, as Kropotkin 
argued, protectionism ensured <i>"the high profits of those manufacturers 
who do not improve their factories and chiefly rely upon cheap labour 
and long hours,"</i> it also meant that these profits would be used to 
finance industry and develop an industrial base. [<b>Op. Cit.</b>, p. 41]
Without this state aid, it is doubtful that these countries would 
have industrialised (as Kaldor notes, <i>"all the present 'developed' 
or 'industrialised' countries established their industries through 
'import substitution' by means of protective tariffs and/or 
differential subsidies."</i> [<b>Op. Cit.</b>, p. 127]).
</p><p>
Within the industrialising country, the usual process of competition 
driving out competitors continued. More and more markets became 
dominated by big business (although, as Kropotkin stressed, without 
totally eliminating smaller workshops within an industry and even 
creating more around them). Indeed, as Russian anarchist G. P.	
Maximoff stressed, the <i>"specific character of Imperialism is . . . 
the concentration and centralisation of capital in syndicates, trusts 
and cartels, which . . . have a decisive voice, not only in the 
economic and political life of their countries, but also in the 
life of the nations of the worlds a whole."</i> [<b>Program of 
Anarcho-Syndicalism</b>, p. 10] The modern multi-national and 
transnational corporations are the latest expression of this 
process.
</p><p>
Simply put, the size of big business was such that it had to expand 
internationally as their original national markets were not sufficient 
and to gain further advantages over their competitors. Faced with 
high tariff barriers and rising international competition, industry 
responded by exporting capital as well as finished goods. This 
export of capital was an essential way of beating protectionism 
(and even reap benefits from it) and gain a foothold in foreign 
markets (<i>"protective duties have no doubt contributed . . . towards 
attracting German and English manufacturers to Poland and Russia"</i> 
[Kropotkin, <b>Op. Cit.</b>, p. 41]). In addition, it allowed access to 
cheap labour and raw materials by placing capital in foreign lands
As part of this process colonies were seized to increase the 
size of "friendly" markets and, of course, allow the easy export 
of capital into areas with cheap labour and raw materials. The
increased concentration of  capital this implies was essential to 
gain an advantage against foreign competitors and dominate the 
international market as well as the national one. 
</p><p>
This form of imperialism, which arose in the late nineteenth
century, was based on the creation of larger and larger
businesses and the creation of colonies across the globe by 
the industrialised nations. Direct conquest had the advantage 
of opening up more of the planet for the capitalist market, 
thus leading to more trade and exploitation of raw materials 
and labour. This gave a massive boost to both the state and 
the industries of the invading country in terms of new profits, 
so allowing an increase in the number of capitalists and other 
social parasites that could exist in the developed nation. As 
Kropotkin noted at the time, <i>"British, French, Belgian and other 
capitalists, by means of the ease with which they exploit 
countries which themselves have no developed industry, today 
control the labour of hundreds of millions of those people in 
Eastern Europe, Asia, and Africa. The result is that the number 
of those people in the leading industrialised countries of 
Europe who live off the work of others doesn't gradually 
decrease at all. Far from it."</i> [<i>"Anarchism and Syndicalism"</i>, 
<b>Black Flag</b>, no. 210, p. 26]
</p><p>
As well as gaining access to raw materials, imperialism 
allows the dominating nation to gain access to markets 
for its goods. By having an empire, products produced 
at home can be easily dumped into foreign markets with 
less developed industry, undercutting locally produced 
goods and consequently destroying the local economy 
(and so potential competitors) along with the society 
and culture based on it. Empire building is a good way 
of creating privileged markets for one's goods. By 
eliminating foreign competition, the imperialist nation's
capitalists can charge monopoly prices in the dominated 
country, so ensuring high profit margins for capitalist 
business. This adds with the problems associated with the 
over-production of goods:
</p><p><blockquote>
<i>"The workman being unable to purchase with their wages the 
riches they are producing, industry must search for new 
markets elsewhere, amidst the middle classes of other
nations. It must find markets, in the East, in Africa, 
anywhere; it must increase, by trade, the number of its 
serfs in Egypt, in India, on the Congo. But everywhere it
finds competitors in other nations which rapidly enter 
into the same line of industrial development. And wars, 
continuous wars, must be fought for the supremacy in the
world-market -- wars for the possession of the East, wars
for getting possession of the seas, wars for the right of
imposing heavy duties on foreign merchandise."</i> [Kropotkin,
<b>Anarchism</b>, pp. 55-6]
</blockquote></p><p>
This process of expansion into non-capitalist areas also helps 
Capital to weather both the subjective and objective economic 
pressures upon it which cause the business cycle (see 
<a href="secC7.html">section C.7</a> for more details). As wealth looted from less industrially 
developed countries is exported back to the home country, profit 
levels can be protected both from working-class demands and from 
any relative decline in surplus-value production caused by 
increased capital investment (see <a href="secC2.html">section C.2</a> for more on surplus 
value). In fact, the working class of the imperialist country 
could receive improved wages and living conditions as the looted 
wealth was imported into the country and that meant that the
workers could fight for, and win, improvements that otherwise 
would have provoked intense class conflict. And as the sons 
and daughters of the poor emigrated to the colonies to make a 
living for themselves on stolen land, the wealth extracted 
from those colonies helped to overcome the reduction in the 
supply of labour at home which would increase its market price. 
This loot also helps reduce competitive pressures on the nation's 
economy. Of course, these advantages of conquest cannot totally 
<b>stop</b> the business cycle nor eliminate competition, as the 
imperialistic nations soon discovered. 
</p><p>
Therefore, the "classic" form of imperialism based on direct
conquest and the creation of colonies had numerous advantages
for the imperialist nations and the big business which their
states represented. 
</p><p>
These dominated nations were, in the main, pre-capitalist 
societies. The domination of imperialist powers meant the
importation of capitalist social relationships and institutions
into them, so provoking extensive cultural and physical 
resistance to these attempts of foreign capitalists to 
promote the growth of the free market. However, peasants',
artisans' and tribal people's desires to be "left alone" 
was never respected, and "civilisation" was forced upon 
them "for their own good." As Kropotkin realised, <i>"force 
is necessary to continually bring new 'uncivilised nations' 
under the same conditions [of wage labour]."</i> [<b>Anarchism 
and Anarchist Communism</b>, p. 53] Anarchist George Bradford 
also stresses this, arguing that we <i>"should remember that,
historically, colonialism, bringing with it an emerging
capitalist economy and wage system, destroyed the
tradition economies in most countries. By substituting
cash crops and monoculture for forms of sustainable 
agriculture, it destroyed the basic land skills of the
people whom it reduced to plantation workers."</i> [<b>How
Deep is Deep Ecology</b>, p. 40] Indeed, this process 
was in many ways similar to the development of capitalism
in the "developed" nations, with the creation of a class
of landless workers who forms the nucleus of the first
generation of people given up to the mercy of the
manufacturers.
</p><p>
However, this process had objective limitations. Firstly,
the expansion of empires had the limitation that there were 
only so many potential colonies out there. This meant that 
conflicts over markets and colonies was inevitable (as the 
states involved knew, and so they embarked on a policy of 
building larger and larger armed forces). As Kropotkin 
argued before the First World War, the real cause of war 
at the time was <i>"the competition for markets and the right 
to exploit nations backward in industry."</i> [quoted by Martin 
Miller, <b>Kropotkin</b>, p. 225] Secondly, the creation of 
trusts, the export of goods and the import of cheap raw 
materials cannot stop the business cycle nor "buy-off" the 
working class indefinitely (i.e. the excess profits of 
imperialism will never be enough to grant more and more 
reforms and improvements to the working class in the 
industrialised world). Thus the need to overcome economic 
slumps propelled business to find new ways of dominating 
the market, up to and including the use of war to grab new 
markets and destroy rivals. Moreover, war was a good way of 
side tracking class conflict at home -- which, let us not 
forget, had been reaching increasingly larger, more militant 
and more radical levels in all the imperialist nations (see 
John Zerzan's <i>"Origins and Meaning of WWI"</i> in his <b>Elements 
of Refusal</b>).
</p><p>
Thus this first phase of imperialism began as the growing 
capitalist economy started to reach the boundaries of the 
nationalised market created by the state within its own 
borders. Imperialism was then used to expand the area that 
could be colonised by the capital associated with a given 
nation-state. This stage ended, however, once the dominant 
powers had carved up the planet into different spheres of 
influence and there was nowhere left to expand into. In the 
competition for access to cheap raw materials and foreign 
markets, nation-states came into conflict with each other. 
As it was obvious that a conflict was brewing, the major 
European countries tried to organise a "balance of power." 
This meant that armies were built and navies created to 
frighten other countries and so deter war. Unfortunately, 
these measures were not enough to countermand the economic 
and power processes at play (<i>"Armies equipped to the teeth
with weapons, with highly developed instruments of murder
and backed by military interests, have their own dynamic 
interests,"</i> as Goldman put it [<b>Red Emma Speaks</b>, p. 353]). 
War did break out, a war over empires and influence, a war, 
it was claimed, that would end all wars. As we now know, of 
course, it did not because it did not fight the root cause 
of modern wars, capitalism.
</p><p>
After the First World War, the identification of nation-state 
with national capital became even more obvious, and can be 
seen in the rise of extensive state intervention to keep 
capitalism going -- for example, the rise of Fascism in Italy 
and Germany and the efforts of "national" governments in Britain 
and the USA to "solve" the economic crisis of the Great Depression. 
However, these attempts to solve the problems of capital did not 
work. The economic imperatives at work before the first world war 
had not gone away. Big business still needed markets and raw 
materials and the statification of industry under fascism only 
aided to the problems associated with imperialism. Another war 
was only a matter of time and when it came most anarchists, as 
they had during the first world war, opposed both sides and 
called for revolution:
</p><p><blockquote>
<i>"the present struggle is one between rival Imperialisms and for 
the protection of vested interests. The workers in every country, 
belonging to the oppressed class, have nothing in common with 
these interests and the political aspirations of the ruling class. 
Their immediate struggle is their <b>emancipation.</b> <b>Their</b> front 
line is the workshop and factory, not the Maginot Line where 
they will just rot and die, whilst their masters at home pile 
up their ill-gotten gains."</i> [<i>"War Commentary"</i>, quoted Mark 
Shipway, <b>Anti-Parliamentary Communism</b>, p. 170]
</blockquote></p><p>
After the Second World War, the European countries yielded to 
pressure from the USA and national liberation movements and 
grated many former countries "independence" (often after 
intense conflict). As Kropotkin predicted, such social 
movements were to be expected for with the growth of 
capitalism <i>"the number of people with an interest in the 
capitulation of the capitalist state system also increases."</i> 
[<i>"Anarchism and Syndicalism"</i>, <b>Op. Cit.</b>, p. 26] Unfortunately 
these "liberation" movements transformed mass struggle from 
a potential struggle against capitalism into movements aiming 
for independent capitalist nation states (see <a href="secD7.html">section D.7</a>).  
Not, we must stress, that the USA was being altruistic in 
its actions, independence for colonies weakened its rivals as 
well as allowing US capital access to those markets. 
</p><p>
This process reflected capital expanding even more <b>beyond</b> the 
nation-state into multinational corporations. The nature of 
imperialism and imperialistic wars changed accordingly. In 
addition, the various successful struggles for National 
Liberation ensured that imperialism had to change itself in 
face of popular resistance. These two factors ensured that 
the old form of imperialism was replaced by a new system of 
"neo-colonialism" in which newly "independent" colonies are 
forced, via political and economic pressure, to open their 
borders to foreign capital. If a state takes up a position 
which the imperial powers consider "bad for business," action 
will be taken, from sanctions to outright invasion. Keeping 
the world open and "free" for capitalist exploitation has been 
America's general policy since 1945. It springs directly from 
the expansion requirements of private capital and so cannot be 
fundamentally changed. However, it was also influenced by the 
shifting needs resulting from the new political and economic 
order and the rivalries existing between imperialist nations 
(particularly those of the Cold War). As such, which method 
of intervention and the shift from direct colonialism to 
neo-colonialism (and any "anomalies") can be explained by 
these conflicts.
</p><p>
Within this basic framework of indirect imperialism, many 
"developing" nations did manage to start the process of 
industrialising. Partly in response to the Great Depression, 
some former colonies started to apply the policies used so 
successfully by imperialist nations like Germany and America 
in the previous century. They followed a policy of "import 
substitution" which meant that they tried to manufacture 
goods like, for instance, cars that they had previously 
imported. Without suggesting this sort of policy offered a 
positive alternative (it was, after all, just local capitalism) 
it did have one big disadvantage for the imperialist powers: it 
tended to deny them both markets and cheap raw materials (the 
current turn towards globalisation was used to break these 
policies). As such, whether a nation pursued such policies 
was dependent on the costs involved to the imperialist power 
involved. 
</p><p>
So instead of direct rule over less developed nations (which 
generally proved to be too costly, both economically and
politically), indirect forms of domination were now preferred.
These are rooted in economic and political pressure rather 
than the automatic use of violence, although force is always
an option and is resorted to if "business interests" are 
threatened. This is the reality of the expression "the 
international community" -- it is code for imperialist aims
for Western governments, particularly the U.S. and its junior 
partner, the U.K. As discussed in 
<a href="secD2.html#secd21">section D.2.1</a>, economic 
power can be quite effective in pressuring governments to 
do what the capitalist class desire even in advanced industrial 
countries. This applies even more so to so-called developing 
nations. 
</p><p>
In addition to the stick of economic and political pressure, the
imperialist countries also use the carrot of foreign aid and 
investment to ensure their aims. This can best be seen when 
Western governments provide lavish funds to "developing" states,
particularly petty right-wing despots, under the pseudonym 
"foreign aid." Hence the all to common sight of US Presidents 
supporting authoritarian (indeed, dictatorial) regimes while at 
the same time mouthing nice platitudes about "liberty" and 
"progress." The purpose of this foreign aid, noble-sounding 
rhetoric about freedom and democracy aside, is to ensure that 
the existing world order remains intact and that US corporations
have access to the raw materials and markets they need. Stability 
has become the watchword of modern imperialists, who see <b>any</b> 
indigenous popular movements as a threat to the existing world 
order. The U.S. and other Western powers provide much-needed 
war material and training for the military of these governments, 
so that they may continue to keep the business climate friendly to 
foreign investors (that means tacitly and overtly supporting fascism 
around the globe).
</p><p>
Foreign aid also channels public funds to home based transnational 
companies via the ruling classes in Third World countries. It is,
in other words, is a process where the poor people of rich countries 
give their money to the rich people of poor countries to ensure that 
the investments of the rich people of rich countries is safe from 
the poor people of poor countries! Needless to say, the owners of 
the companies providing this "aid" also do very well out of it.
This has the advantage of securing markets as other countries are 
"encouraged" to buy imperialist countries' goods (often in exchange 
for "aid", typically military "aid") and open their markets to the 
dominant power's companies and their products. 
</p><p>
Thus, the Third World sags beneath the weight of well-funded 
oppression, while its countries are sucked dry of their native 
wealth, in the name of "development" and in the spirit of 
"democracy" and "freedom". The United States leads the West in 
its global responsibility (another favourite buzzword) to ensure 
that this peculiar kind of "freedom" remains unchallenged by any 
indigenous movements. The actual form of the regime supported is
irrelevant, although fascist states are often favoured due to 
their stability (i.e. lack of popular opposition movements). As 
long as the fascist regimes remain compliant and obedient to the 
West and capitalism thrives unchallenged then they can commit any 
crime against their own people while being praised for making 
progress towards "democracy." However, the moment they step out 
of line and act in ways which clash with the interests of the 
imperialist powers then their short-comings will used to justify
intervention (the example of Saddam Hussein is the most obvious
one to raise here). As for "democracy,"</i> this can be tolerated by
imperialism as long as its in <i>"the traditional sense of 'top-down'
rule by elites linked to US power, with democratic forms of little
substance -- unless they are compelled to do so, by their own 
populations in particular."</i> This applies <i>"internally"</i> as well as 
abroad, for <i>"democracy is fine as long as it . . . does not risk
popular interference with primary interests of power and wealth."</i> 
Thus the aim is to ensure <i>"an obedient client state is firmly in
place, the general perferene of conquerors, leaving just military
bases for future contingencies."</i> [<b>Failed States</b>, p. 171, p. 204
and p. 148]
</p><p>
In these ways, markets are kept open for corporations based in 
the advanced nations all without the apparent use of force or
the need for colonies. However, this does not mean that war is 
not an option and, unsurprisingly, the post-1945 period has 
been marked by imperialist conflict. These include old-fashioned 
direct war by the imperialist nation (such as the Vietnam and 
Iraq wars) as well as new-style imperialistic wars by proxy 
(such as US support for the Contras in Nicaragua or support 
for military coups against reformist or nationalist governments). 
As such, if a regime becomes too independent, military force 
always remains an option. This can be seen from the 1990 Gulf 
War, when Saddam invaded Kuwait (and all his past crimes, 
conducted with the support of the West, were dragged from 
the Memory Hole to justify war).
</p><p>
Least it be considered that we are being excessive in our
analysis, let us not forget that the US <i>"has intervened
well over a hundred times in the internal affairs of other
nations since 1945. The rhetoric has been that we have
done so largely to preserve or restore freedom and
democracy, or on behalf of human rights. The reality has
been that [they] . . . have been consistently designed
and implemented to further the interests of US (now
largely transnational) corporations, and the elites both
at home and abroad who profit from their depredations."</i>
[Henry Rosemont, Jr., <i>"U.S. Foreign Policy: the Execution
of Human Rights"</i>, pp. 13-25, <b>Social Anarchism</b>, no. 29
p. 13] This has involved the overthrow of democratically
elected governments (such as in Iran, 1953; Guatemala,
1954; Chile, 1973) and their replacement by reactionary
right-wing dictatorships (usually involving the military).
As George Bradford argues, <i>"[i]n light of [the economic] 
looting [by corporations under imperialism], it should 
become clearer . . . why nationalist regimes that cease 
to serve as simple conduits for massive U.S. corporate
exploitation come under such powerful attack -- Guatemala 
in 1954, Chile in 1973 . . . Nicaragua [in the 1980s] . . . 
[U.S.] State Department philosophy since the 1950s has been 
to rely on various police states and to hold back 
'nationalistic regimes' that might be more responsive to 
'increasing popular demand for immediate improvements in 
the low living standards of the masses,' in order to 
'protect our resources' -- in their countries!"</i> [<b>How 
Deep is Deep Ecology?</b>, p. 62]
</p><p>
This is to be expected, as imperialism is the only means of 
defending the foreign investments of a nation's capitalist class, 
and by allowing the extraction of profits and the creation of
markets, it also safeguards the future of private capital.
</p><p>
This process has not come to an end and imperialism is continuing
to evolve based on changing political and economic developments.
The most obvious political change is the end of the USSR. During
the cold war, the competition between the USA and the USSR had 
an obvious impact on how imperialism worked. On the one hand, 
acts of imperial power could be justified in fighting "Communism" 
(for the USA) or "US imperialism" (for the USSR). On the other, 
fear of provoking a nuclear war or driving developing nations 
into the hands of the other side allowed more leeway for developing 
nations to pursue policies like import substitution. With the end 
of the cold-war, these options have decreased considerably for
developing nations as US imperialism how has, effectively, no 
constraints beyond international public opinion and pressure from
below. As the invasion of Iraq in 2003 shows, this power is still
weak but sufficient to limit some of the excesses of imperial 
power (for example, the US could not carpet bomb Iraq as it had
Vietnam).
</p><p>
The most obvious economic change is the increased global nature of
capitalism. Capital investments in developing nations have increased 
steadily over the years, with profits from the exploitation of cheap 
labour flowing back into the pockets of the corporate elite in the 
imperialist nation, not to its citizens as a whole (though there are 
sometimes temporary benefits to other classes, as discussed in 
<a href="secD5.html#secd54">section D.5.4</a>). 
With the increasing globalisation of big business and markets, 
capitalism (and so imperialism) is on the threshold of a new 
transformation. Just as direct imperialism transformed into in-direct 
imperialism, so in-direct imperialism is transforming into a global
system of government which aims to codify the domination of corporations 
over governments. This process is often called "globalisation" and we 
discuss it in <a href="secD5.html#secd53">section D.5.3</a>. First, however, we need to discuss 
non-private capitalist forms of imperialism associated with the 
Stalinist regimes and we do that in the <a href="secD5.html#secd52">next section</a>.
</p>

<h2><a name="secd52">D.5.2 Is imperialism just a product of private capitalism?</a></h2>

<p>
While we are predominantly interested in <b>capitalist</b> imperialism,
we cannot avoid discussing the activities of the so-called
"socialist" nations (such as the Soviet Union, China, etc.). Given 
that modern imperialism has an economic base caused in developed
capitalism by, in part, the rise of big business organised on a 
wider and wider scale, we should not be surprised that the state 
capitalist ("socialist") nations are/were also imperialistic. As 
the state-capitalist system expresses the logical end point of 
capital concentration (the one big firm) the same imperialistic
pressures that apply to big business and its state will also apply 
to the state capitalist nation. 
</p><p>
In the words of libertarian socialist Cornelius Castoriadis:
</p><p><blockquote>
<i>"But if imperialist expansion is the necessary expression of
an economy in which the process of capital concentration has
arrived at the stage of monopoly domination, this is true a
fortiori for an economy in which this process of concentration
has arrived at its natural limit . . . In other words, imperialist
expansion is even more necessary for a totally concentrated 
economy . . . That they are realised through different modes (for 
example, capital exportation play a much more restricted role and 
acts in a different way than is the case with monopoly domination) 
is the result of the differences separating bureaucratic capitalism 
from monopoly capitalism, but at bottom this changes nothing.
</p><p>
"We must strongly emphasise that the imperialistic features of
capital are not tied to 'private' or 'State' ownership of the
means of production . . . the same process takes place if, 
instead of monopolies, there is an exploiting bureaucracy; in
other words, this bureaucracy also can <b>exploit</b>, but only on
the condition that it <b>dominates.</b>"</i> [<b>Political and Social
Writings</b>, vol. 1, p. 159] 
</blockquote></p><p>
Given this, it comes as no surprise that the state-capitalist 
countries also participated in imperialist activities, adventures 
and wars, although on a lesser scale and for slightly different 
reasons than those associated with private capitalism. However, 
regardless of the exact cause the USSR <i>"has always pursued an 
imperialist foreign policy, that it is the state and not the 
workers which owns and controls the whole life of the country."</i> 
Given this, it is unsurprising that <i>"world revolution was abandoned 
in favour of alliances with capitalist countries. Like the bourgeois
states the USSR took part in the manoeuvrings to establish a
balance of power in Europe."</i> This has its roots in its internal
class structure, as <i>"it is obvious that a state which pursues 
an imperialist foreign policy cannot itself by revolutionary"</i>
and this is shown in <i>"the internal life of the USSR"</i> where <i>"the
means of wealth production"</i> are <i>"owned by the state which 
represents, as always, a privileged class -- the bureaucracy."</i>
[<i>"USSR -- Anarchist Position,"</i> pp. 21-24, Vernon Richards (ed.), 
<b>The Left and World War II</b>, p. 22 and p. 23]
</p><p>
This process became obvious after the defeat of Nazi Germany and
the creation of Stalinist states in Eastern Europe. As anarchists
at the time noted, this was <i>"the consolidation of Russian 
imperialist power"</i> and their <i>"incorporation . . . within the
structure of the Soviet Union."</i> As such, <i>"all these countries
behind the Iron Curtain are better regarded as what they really
[were] -- satellite states of Russia."</i> [<i>"Russia's Grip Tightens"</i>,
pp. 283-5, Vernon Richards (ed.), <b>World War - Cold War</b>, p. 285 
and p. 284] Of course, the creation of these satellite states 
was based on the inter-imperialist agreements reached at the
Yalta conference of February 1945. 
</p><p>
As can be seen by Russia's ruthless policy towards her satellite
regimes, Soviet imperialism was more inclined to the defence 
of what she already had and the creation of a buffer zone between 
herself and the West. This is not to deny that the ruling elite of
the Soviet Union did not try to exploit the countries under its
influence. For example, in the years after the end of the Second
World War, the Eastern Block countries paid the USSR millions
of dollars in reparations. As in private capitalism, the <i>"satellite
states were regarded as a source of raw materials and of cheap
manufactured goods. Russia secured the satellites exports at
below world prices. And it exported to them at above world 
prices."</i> Thus trade <i>"was based on the old imperialist principle
of buying cheap and selling dear -- very, very dear!"</i> [Andy 
Anderson, <b>Hungary '56</b>, pp. 25-6 and p. 25] However, the
nature of the imperialist regime was such that it discouraged 
too much expansionism as <i>"Russian imperialism [had] to rely on 
armies of occupation, utterly subservient quisling governments, 
or a highly organised and loyal political police (or all three). 
In such circumstances considerable dilution of Russian power 
occur[red] with each acquisition of territory."</i> [<i>"Russian 
Imperialism"</i>, pp. 270-1, Vernon Richards (ed.), <b>Op. Cit.</b>, p. 270]
</p><p>
Needless to say, the form and content of the state capitalist 
domination of its satellite countries was dependent on its 
own economic and political structure and needs, just as 
traditional capitalist imperialism reflected its needs and 
structures. While direct exploitation declined over time, the 
satellite states were still expected to develop their economies 
in accordance with the needs of the Soviet Bloc as a whole 
(i.e., in the interests of the Russian elite). This meant the 
forcing down of living standards to accelerate industrialisation 
in conformity with the requirements of the Russian ruling class. 
This was because these regimes served not as outlets for excess 
Soviet products but rather as a means of <i>"plugging holes in the 
Russian economy, which [was] in a chronic state of underproduction 
in comparison to its needs."</i> As such, the <i>"form and content"</i> of 
this regimes' <i>"domination over its satellite countries are determined 
fundamentally by its own economic structure"</i> and so it would be 
<i>"completely incorrect to consider these relations identical to 
the relations of classical colonialism."</i> [Castoriadis, <b>Op. Cit.</b>, 
p. 187] So part of the difference between private and state 
capitalist was drive by the need to plunder these countries of 
commodities to make up for shortages caused by central planning 
(in contrast, capitalist imperialism tended to export goods). As 
would be expected, within this overall imperialist agenda the 
local bureaucrats and elites feathered their own nests, as with
any form of imperialism.
</p><p>
As well as physical expansionism, the state-capitalist elites also 
aided "anti-imperialist" movements when it served their interests.
The aim of this was to placed such movements and any regimes they
created within the Soviet or Chinese sphere of influence. Ironically,
this process was aided by imperialist rivalries with US imperialism as
American pressure often closed off other options in an attempt to 
demonise such movements and states as "communist" in order to justify 
supporting their repression or for intervening itself. This is <b>not</b> 
to suggest that Soviet regime was encouraging "world revolution" by 
this support. Far from it, given the Stalinist betrayals and attacks 
on genuine revolutionary movements and struggles (the example of the 
Spanish Revolution is the obvious one to mention here). Soviet aid was 
limited to those parties which were willing to subjugate themselves
and any popular movements they influenced to the needs of the Russian 
ruling class. Once the Stalinist parties had replaced the local 
ruling class, trade relations were formalised between the so-called 
"socialist" nations for the benefit of both the local and Russian 
rulers. In a similar way, and for identical needs, the Western 
Imperialist powers supported murderous local capitalist and feudal 
elites in their struggle against their own working classes, arguing 
that it was supporting "freedom" and "democracy" against Soviet 
aggression.
</p><p>
The turning of Communist Parties into conduits of Soviet elite interests 
became obvious under Stalin, when the twists and turns of the party line
were staggering. However, it actually started under Lenin and Trotsky
and <i>"almost from the beginning"</i> the Communist International (Comintern)
<i>"served primarily not as an instrument for World Revolution, but as 
an instrument of Russian Foreign Policy."</i> This explains <i>"the most 
bewildering changes of policy and political somersaults"</i> it imposed on
its member parties. Ultimately, <i>"the allegedly revolutionary aims of 
the Comintern  stood in contrast to the diplomatic relations of the 
Soviet Union with other countries."</i> [Marie-Louise Berneri, <b>Neither 
East Nor West</b>, p. 64 and p. 63] As early as 1920, the Dutch Council 
Communist Anton Pannekoek was arguing that the Comintern opposition to 
anti-parliamentarianism was rooted <i>"in the needs of the Soviet Republic"</i>
for <i>"peaceful trade with the rest of the world."</i> This meant that the
Comintern's policies were driven <i>"by the political needs of Soviet 
Russia."</i> [<i>"Afterword to World Revolution and Communist Tactics,"</i>
D.A. Smart (ed.), <b>Pannekoek and Gorter's Marxism</b>, p. 143 and p. 144] 
This is to be expected, as the regime had always been state capitalist
and so the policies of the Comintern were based on the interests of a 
(state) capitalist regime.
</p><p>
Therefore, imperialism is not limited to states based on private 
capitalism -- the state capitalist regimes have also been guilty 
of it. This is to be expected, as both are based on minority rule, 
the exploitation and oppression of labour and the need to expand 
the resources available to it. This means that anarchists oppose
all forms of capitalist imperialism and raise the slogan <i>"Neither
East nor West."</i> We <i>"cannot alter our views about Russia [or any 
other state capitalist regime] simply because, for imperialist 
reasons, American and British spokesmen now denounce Russia 
totalitarianism. We know that their indignation is hypocritical 
and that they may become friendly to Russia again if it suits 
their interests."</i> [Marie-Louise Berneri, <b>Op. Cit.</b>, p. 187] In the 
clash of imperialism, anarchists support neither side as both are 
rooted in the exploitation and oppression of the working class.
</p><p>
Finally, it is worthwhile to refute two common myths about state
capitalist imperialism. The first myth is that state-capitalist 
imperialism results in a non-capitalist regimes and that is why 
it is so opposed to by Western interests. From this position,
held by many Trotskyists, it is argued that we should support 
such regimes against the West (for example, that socialists
should have supported the Russian invasion of Afghanistan). This
position is based on a fallacy rooted in the false Trotskyist 
notion that state ownership of the means of production is 
inherently socialist.
</p><p>
Just as capitalist domination saw the transformation of the 
satellite's countries social relations from pre-capitalist forms 
in favour of capitalist ones, the domination of "socialist" nations 
meant the elimination of traditional bourgeois social relations in 
favour of state capitalist ones. As such, the nature and form of 
imperialism was fundamentally identical and served the interests 
of the appropriate ruling class in each case. This transformation 
of one kind of class system into another explains the root of the
West's very public attacks on Soviet imperialism. It had nothing 
to do with the USSR being considered a "workers' state" as Trotsky,
for example, argued. <i>"Expropriation of the capitalist class,"</i> argued
one anarchist in 1940, <i>"is naturally terrifying"</i> to the capitalist
class <i>"but that does not prove anything about a workers' state . . .
In Stalinist Russia expropriation is carried out . . . by, and 
ultimately for the benefit of, the bureaucracy, not by the workers
at all. The bourgeoisie are afraid of expropriation, of power passing
out of their hands, whoever seizes it from them. They will defend 
their property against any class or clique. The fact that they are
indignant [about Soviet imperialism] proves their fear -- it tells
us nothing at all about the agents inspiring that fear."</i> [J.H.,
<i>"The Fourth International"</i>, pp. 37-43, Vernon Richards (ed.), 
<b>Op. Cit.</b>, pp. 41-2] This elimination of tradition forms of class
rule and their replacement with new forms is required as these are
the only economic forms compatible with the needs of the state 
capitalist regimes to exploit these countries on a regular basis.
</p><p>
The second myth is the notion that opposition to state-capitalist 
imperialism by its subject peoples meant support for Western 
capitalism. In fact, the revolts and revolutions which repeatedly
flared up under Stalinism almost always raised genuine socialist
demands. For example, the 1956 Hungarian revolution <i>"was a social
revolution in the fullest sense of the term. Its object was a 
fundamental change in the relations of production, and in the 
relations between ruler  and ruled in factories, pits and on the 
land."</i> Given this, unsurprisingly Western political commentary 
<i>"was centred upon the nationalistic aspects of the Revolution, no 
matter how trivial."</i> This was unsurprising, as the West was <i>"opposed 
both to its methods and to its aims . . . What capitalist government 
could genuinely support a people demanding 'workers' management of
industry' and already beginning to implement this on an increasing
scale?"</i> The revolution <i>"showed every sign of making both them and
their bureaucratic counterparts in the East redundant."</i> The revolt
itself was rooted <i>"[n]ew organs of struggle,"</i> workers' councils
<i>"which embodied, in embryo, the new society they were seeking to
achieve."</i> [Anderson, <b>Op. Cit.</b>, p.6, p. 106 and p. 107] 
</p><p>
The ending of state capitalism in Eastern Europe in 1989 has ended
its imperialist domination of those countries. However, it has simply
opened the door for private-capitalist imperialism as the revolts 
themselves remained fundamentally at the political level. The ruling
bureaucracy was faced with both popular pressure from the streets 
and economic stagnation flowing from its state-run capitalism. Being 
unable to continue as before and unwilling, for obvious reasons, to
encourage economic and political participation, it opted for the 
top-down transformation of state to private capitalism. Representative
democracy was implemented and state assets were privatised into the
hands of a new class of capitalists (often made up of the old 
bureaucrats) rather than the workers themselves. In other words, the 
post-Stalinist regimes are still class systems and now subject to a 
different form of imperialism -- namely, globalisation.
</p>

<h2><a name="secd53">D.5.3 Does globalisation mean the end of imperialism?</a></h2>

<p>
No. While it is true that the size of multinational companies 
has increased along with the mobility of capital, the need for 
nation-states to serve corporate interests still exists. With 
the increased mobility of capital, i.e. its ability to move 
from one country and invest in another easily, and with the 
growth in international money markets, we have seen what can 
be called a "free market" in states developing. Corporations 
can ensure that governments do as they are told simply by 
threatening to move elsewhere (which they will do anyway, 
if it results in more profits).
</p><p>
Therefore, as Howard Zinn stresses, <i>"it's very important to point
out that globalisation is in fact imperialism and that there is a
disadvantage to simply using the term 'globalisation' in a way
that plays into the thinking of people at the World Bank and
journalists . . . who are agog at globalisation. They just can't
contain their joy at the spread of American economic and corporate
power all over the world. . . it would be very good to puncture 
that balloon and say 'This is imperialism.'"</i> [<b>Bush Drives us
into Bakunin's Arms</b>] Globalisation is, like the forms of 
imperialism that preceded it, a response to both objective 
economic forces and the class struggle. Moreover, like the 
forms that came before, it is rooted in the economic power of 
corporations based in a few developed nations and political 
power of the states that are the home base of these corporations.
These powers influence international institutions and individual
countries to pursue neo-liberal policies, the so-called 
"Washington Consensus" of free market reforms, associated with
globalisation.
</p><p>
Globalisation cannot be understood unless its history is known. 
The current process of increasing international trade, investment 
and finance markets started in the late 60s and early 1970s. 
Increased competition from a re-built Europe and Japan challenged 
US domination combined with working class struggle across the 
globe to leave the capitalist world feeling the strain. 
Dissatisfaction with factory and office life combined 
with other social movements (such as the women's movement, 
anti-racist struggles, anti-war movements and so on) which 
demanded more than capitalism could provide. The near 
revolution in France, 1968, is the most famous of these 
struggles but it occurred all across the globe.
</p><p>
For the ruling class, the squeeze on profits and authority
from ever-increasing wage demands, strikes, stoppages, boycotts,
squatting, protests and other struggles meant that a solution
had to be found and the working class disciplined (and profits
regained). One part of the solution was to "run away" and so
capital flooded into certain areas of the "developing" world.
This increased the trends towards globalisation. Another
solution  was the embrace of Monetarism and tight money
(i.e. credit) policies. It is a moot point whether those
who applied Monetarism actually knew it was nonsense and, 
consequently, sought an economic crisis or whether they were
simply incompetent ideologues who knew little about economics
and mismanaged the economy by imposing its recommendations, 
the outcome was the same. It resulted in increases in the
interest rate, which helped deepen the recessions of the 
early 1980s which broke the back of working class resistance 
in the U.K. and U.S.A. High unemployment helped to discipline 
a rebellious working class and the new mobility of capital 
meant a virtual "investment strike" against nations which 
had a "poor industrial record" (i.e. workers who were not 
obedient wage slaves). Moreover, as in any economic crisis, 
the "degree of monopoly" (i.e. the dominance of large firms) 
in the market increased as weaker firms went under and others 
merged to survive. This enhancing the tendencies toward 
concentration and centralisation which always exist in 
capitalism, so ensuring an extra thrust towards global 
operations as the size and position of the surviving firms 
required wider and larger markets to operate in.
</p><p>
Internationally, another crisis played its role in promoting
globalisation. This was the Debit Crisis of the late 1970s and
early 1980s. Debt plays a central role for the western powers 
in dictating how their economies should be organised. The debt 
crisis proved an ideal leverage for the western powers to force 
"free trade" on the "third world." This occurred when third 
world countries faced with falling incomes and rising interest 
rates defaulted on their loans (loans that were mainly given 
as a bribe to the ruling elites of those countries and used 
as a means to suppress the working people of those countries 
-- who now, sickenly, are expected to repay them!).
</p><p>
Before this, as noted in <a href="secD5.html#secd51">section D.5.1</a>, 
many countries had followed a policy of "import substitution." This tended to
create new competitors who could deny transnational 
corporations both markets and cheap raw materials. With the
debt crisis, the imperialist powers could end this policy
but instead of military force, the governments of the west 
sent in the International Monetary Fund (IMF) and World Bank 
(WB). The loans required by "developing" nations in the face 
of recession and rising debt repayments meant that they had little
choice but to agree to an IMF-designed economic reform programme.
If they refused, not only were they denied IMF funds, but also
WB loans. Private banks and lending agencies would also pull
out, as they lent under the cover of the IMF -- the only body
with the power to both underpin loans and squeeze repayment
from debtors. These policies meant introducing austerity 
programmes which, in turn, meant cutting public spending, 
freezing wages, restricting credit, allowing foreign multinational 
companies to cherry pick assets at bargain prices, and passing 
laws to liberalise the flow of capital into and out of the 
country. Not surprisingly, the result was disastrous for the 
working population, but the debts were repaid and both local 
and international elites did very well out of it. So while 
workers in the West suffered repression and hardship, the 
fate of the working class in the "developing" world was 
considerably worse.
</p><p>
Leading economist Joseph Stiglitz worked in the World Bank and
described some of dire consequences of these policies. He notes 
how the neo-liberalism the IMF and WB imposed has, <i>"too often, 
not been followed by the promised growth, but by increased misery"</i> 
and workers <i>"lost their jobs [being] forced into poverty"</i> or 
<i>"been hit by a heightened sense of insecurity"</i> if they remained 
in work. For many <i>"it seems closer to an unmitigated disaster."</i> 
He argues that part of the problem is that the IMF and WB have
been taken over by true believers in capitalism and apply 
market fundamentalism in all cases. Thus, they <i>"became the new
missionary institutions"</i> of <i>"free market ideology"</i> through 
which <i>"these ideas were pushed on reluctant poor countries."</i>
Their policies were <i>"based on an ideology -- market fundamentalism
-- that required little, if any, consideration of a country's
particular circumstances and immediate problems. IMF economists
could ignore the short-term effects their policies might have
on [a] country, content in the belief <b>in the long run</b> the
country would be better off"</i> -- a position which many working
class people there rejected by rioting and protest. In summary,
globalisation <i>"as it has been practised has not lived up to what
its advocates promised it would accomplish . . . In some cases
it has not even resulted in growth, but when it has, it has not
brought benefits to all; the net effect of the policies set by
the Washington Consensus had all too often been to benefit the
few at the expense of the many, the well-off at the expense of
the poor."</i> [<b>Globalisation and Its Discontents</b>, p. 17, p. 20, 
p. 13, p. 36 and p. 20]
</p><p>
While transnational companies are, perhaps, the most well-known
representatives of this process of globalisation, the power and 
mobility of modern capitalism can be seen from the following 
figures. From 1986 to 1990, foreign exchange transactions rose 
from under $300 billion to $700 billion daily and were expected 
to exceed $1.3 trillion in 1994. The World Bank estimates that 
the total resources of international financial institutions 
at about $14 trillion. To put some kind of perspective on
these figures, the Balse-based Bank for International Settlement 
estimated that the aggregate daily turnover in the foreign 
exchange markets at nearly $900 billion in April 1992, equal 
to 13 times the Gross Domestic Product of the OECD group of 
countries on an annualised basis [<b>Financial Times</b>, 23/9/93]. 
In Britain, some $200-300 billion a day flows through
London's foreign exchange markets. This is the equivalent 
of the UK's annual Gross National Product in two or three days.
Needless to say, since the early 1990s, these amounts have
grown to even higher levels (daily currency transactions
have risen from a mere $80 billion in 1980 to $1.26 billion
in 1995. In proportion to world trade, this trading in foreign
exchange rose from a ration of 10:1 to nearly 70:1 [Mark
Weisbrot, <b>Globalisation for Whom?</b>]).
</p><p>
Little wonder that a <b>Financial Times</b> special supplement on 
the IMF stated that <i>"Wise governments realise that the only 
intelligent response to the challenge of globalisation is to 
make their economies more acceptable."</i> [<b>Op. Cit.</b>] More acceptable 
to business, that is, not their populations. As Chomsky put it, 
<i>"free capital flow creates what's sometimes called a 'virtual 
parliament' of global capital, which can exercise veto power 
over government policies that it considers irrational. That 
means things like labour rights, or educational programmes, or 
health, or efforts to stimulate the economy, or, in fact, 
anything that might help people and not profits (and therefore 
irrational in the technical sense)."</i> [<b>Rogue States</b>, pp. 212-3]
</p><p>
This means that under globalisation, states will compete with 
each other to offer the best deals to investors and transnational 
companies -- such as tax breaks, union busting, no pollution 
controls, and so forth. The effects on the countries' ordinary 
people will be ignored in the name of future benefits (not so 
much pie in the sky when you die, more like pie in the future, 
maybe, if you are nice and do what you are told). For example, 
such an "acceptable" business climate was created in Britain, 
where <i>"market forces have deprived workers of rights in the name 
of competition."</i> [<b>Scotland on Sunday</b>, 9/1/95] Unsurprisingly. 
number of people with less than half the average income rose 
from 9% of the population in 1979 to 25% in 1993. The share of 
national wealth held by the poorer half of the population has 
fallen from one third to one quarter. However, as would be 
expected, the number of millionaires has increased, as has 
the welfare state for the rich, with the public's tax money 
being used to enrich the few via military Keynesianism, 
privatisation and funding for Research and Development. Like 
any religion, the free-market ideology is marked by the 
hypocrisy of those at the top and the sacrifices required 
from the majority at the bottom.
</p><p>
In addition, the globalisation of capital allows it to 
play one work force against another. For example, General 
Motors plans to close two dozen plants in the United States 
and Canada, but it has become the largest employer in Mexico. 
Why? Because an <i>"economic miracle"</i> has driven wages down. 
Labour's share of personal income in Mexico has <i>"declined 
from 36 percent in the mid-1970's to 23 percent by 1992."</i> 
Elsewhere, General Motors opened a $690 million assembly
plant in the former East Germany. Why? Because there workers
are willing to <i>"work longer hours than their pampered 
colleagues in western Germany"</i> (as the <b>Financial Times</b> 
put it) at 40% of the wage and with few benefits. 
[Noam Chomsky, <b>World Orders, Old and New</b>, p. 160]
</p><p>
This mobility is a useful tool in the class war. There
has been <i>"a significant impact of NAFTA on strikebreaking.
About half of union organising efforts are disrupted by
employer threats to transfer production abroad, for example 
. . . The threats are not idle. When such organising drives 
succeed, employers close the plant in whole or in part at 
triple the pre-NAFTA rate (about 15 percent of the time). 
Plant-closing threats are almost twice as high in more 
mobile industries (e.g. manufacturing vs. construction)."</i> 
[<b>Rogue States</b>, pp. 139-40] This process is hardly unique 
to America, and takes place all across the world (including 
in the "developing" world itself). This process has increased 
the bargaining power of employers and has helped to hold wages 
down (while productivity has increased). In the US, the share 
of national income going to corporate profits increased by 
3.2 percentage points between 1989 and 1998. This represents a 
significant redistribution of the economic pie. [Mark Weisbrot, 
<b>Op. Cit.</b>] Hence the need for <b>international</b> workers' 
organisation and solidarity (as anarchists have been arguing 
since Bakunin [<b>The Political Philosophy of Bakunin</b>, pp. 
305-8]). 
</p><p>
This means that such agreements such as NAFTA and the Multilateral 
Agreement on Investment (shelved due to popular protest and outrage 
but definitely not forgotten) considerably weaken the governments 
of nation-states -- but only in one area, the regulation of 
business. Such agreements restrict the ability of governments to
check capital flight, restrict currency trading, eliminate 
environment and labour protection laws, ease the repatriation of 
profits and anything else that might impede the flow of profits or 
reduce business power. Indeed, under NAFTA, corporations can sue 
governments if they think the government is hindering its freedom 
on the market. Disagreements are settled by unelected panels 
outside the control of democratic governments. Such agreements 
represent an increase in corporate power and ensure that states 
can only intervene when it suits corporations, not the general 
public.
</p><p>
The ability of corporations to sue governments was enshrined in 
chapter 11 of NAFTA. In a small town in the Mexican state of San 
Luis Potosi, a California firm -- Metalclad -- a commercial 
purveyor of hazardous wastes, bought an abandoned dump site 
nearby. It proposed to expand on the dumpsite and use it to 
dump toxic waste material. The people in the neighbourhood of 
the dump site protested. The municipality, using powers 
delegated to it by the state, rezoned the site and forbid 
Metalclad to extend its land holdings. Metalclad, under 
Chapter 11 of NAFTA, then sued the Mexican government for 
damage to its profit margins and balance sheet as a result of 
being treated unequally by the people of San Luis Potosi. A 
trade panel, convened in Washington, agreed with the company.
[Naomi Klein, <b>Fences and Windows</b>, pp. 56-59] In Canada, the 
Ethyl corporation sued when the government banned its gasoline 
additive as a health hazard. The government settled "out of 
court" to prevent a public spectacle of a corporation 
overruling the nation's Parliament. 
</p><p>
NAFTA and other Free Trade agreements are designed for 
corporations and corporate rule. Chapter 11 was not 
enshrined in the NAFTA in order to make a better world 
for the people of Canada, any more than for the people 
of San Luis Potosi but, instead, for the capitalist elite.
This is an inherently imperialist situation, which will 
"justify" further intervention in the "developing" nations 
by the US and other imperialist nations, either through indirect 
military aid to client regimes or through outright invasion, 
depending on the nature of the <i>"crisis of democracy"</i> (a term 
used by the Trilateral Commission to characterise popular 
uprisings and a politicising of the general public).
</p><p>
However, force is always required to protect private capital. 
Even a globalised capitalist company still requires a defender. 
After all, <i>"[a]t the international level, U.S. corporations
need the government to insure that target countries are
'safe for investment' (no movements for freedom and democracy),
that loans will be repaid, contracts kept, and international
law respected (but only when it is useful to do so)."</i> [Henry
Rosemont, Jr., <b>Op. Cit.</b>, p. 18] For the foreseeable future, 
America seems to be the global rent-a-cop of choice -- 
particularly as many of the largest corporations are based 
there.
</p><p>
It makes sense for corporations to pick and choose between 
states for the best protection, blackmailing their citizens 
to pay for the armed forces via taxes. It is, in other words,
similar to the process at work within the US when companies
moved to states which promised the most favourable laws. For
example, New Jersey repealed its anti-trust law in 1891-2 
and amended its corporation law in 1896 to allow companies
to be as large as they liked, to operate anywhere and to 
own other corporations. This drew corporations to it until 
Delaware offered even more freedoms to corporate power until
other states offered similar laws. In other words, competed 
for revenue by writing laws to sell to corporations and 
the mobility of corporations meant that they bargained from
a superior position. Globalisation is simply this process on 
a larger scale, as capital will move to countries whose 
governments supply what it demands (and punish those which 
do not). Therefore, far from ending imperialism, globalisation 
will see it continue, but with one major difference: the 
citizens in the imperialist countries will see even fewer 
benefits from imperialism than before, while, as ever, still 
having to carry the costs.
</p><p>
So, in spite of claims that governments are powerless in the 
face of global capital, we should never forget that state power 
has increased drastically in one area -- in state repression 
against its own citizens. No matter how mobile capital is, it 
still needs to take concrete form to generate surplus value. 
Without wage salves, capital would not survive. As such, it 
can never permanently escape from its own contradictions -- 
wherever it goes, it has to create workers who have a tendency 
to disobey and do problematic things like demand higher wages, 
better working conditions, go on strike and so on (indeed, this
fact has seen companies based in "developing" nations move to 
less "developed" to find more compliant labour).
</p><p>
This, of course, necessitates a strengthening of the state 
in its role as protector of property and as a defence against 
any unrest provoked by the inequalities, impoverishment and 
despair caused by globalisation (and, of course, the hope, 
solidarity and direct action generated by that unrest within 
the working class). Hence the rise of the neo-liberal 
consensus in both Britain and the USA saw an increase in 
state centralisation as well as the number of police, police 
powers and in laws directed against the labour and radical 
movements. 
</p><p>
As such, it would be a mistake (as many in the 
anti-globalisation movement do) to contrast the market to 
the state. State and capital are not opposed to each other 
-- in fact, the opposite is the case. The modern state 
exists to protect capitalist rule, just as every state 
exists to defend minority rule, and it is essential for 
nation states to attract and retain capital within their 
borders to ensure their revenue by having a suitably strong 
economy to tax. Globalisation is a state-led initiative 
whose primary aim is to keep the economically dominant happy. 
The states which are being "undermined" by globalisation are 
not horrified by this process as certain protestors are, which 
should give pause for thought. States are complicit in the 
process of globalisation -- unsurprisingly, as they represent 
the ruling elites who favour and benefit from globalisation.
Moreover, with the advent of a "global market" under GATT, 
corporations still need politicians to act for them in 
creating a "free" market which best suits their interests. 
Therefore, by backing powerful states, corporate elites 
can increase their bargaining powers and help shape the
"New World Order" in their own image.
</p><p>
Governments may be, as Malatesta put it, the property owners 
<b>gendarme</b>, but they can be influenced by their subjects, unlike 
multinationals. NAFTA was designed to reduce this influence even 
more. Changes in government policy reflect the changing needs of 
business, modified, of course, by fear of the working population 
and its strength. Which explains globalisation -- the need for 
capital to strengthen its position vis--vis labour by pitting 
one labour force against -- and our next step, namely to 
strengthen and globalise working class resistance. Only when it 
is clear that the costs of globalisation -- in terms of strikes, 
protests, boycotts, occupations, economic instability and so on -- 
is higher than potential profits will business turn away from it. 
Only international working class direct action and solidarity 
will get results. Until that happens, we will see governments 
co-operating in the process of globalisation.
</p><p>
So, for better or for worse, globalisation has become the latest 
buzz word to describe the current stage of capitalism and so 
we shall use it here. It use does have two positive side effects 
though. Firstly, it draws attention to the increased size and 
power of transnational corporations and their impact on global 
structures of governance <b>and</b> the nation state. Secondly, it 
allows anarchists and other protesters to raise the issue of
international solidarity and a globalisation from below which
respects diversity and is based on people's needs, not profit.
</p><p>
After all, as Rebecca DeWitt stresses, anarchism and the WTO
<i>"are well suited opponents and anarchism is benefiting from
this fight. The WTO is practically the epitome of an
authoritarian structure of power to be fought against. 
People came to Seattle because they knew that it was wrong
to let a secret body of officials make policies unaccountable
to anyone except themselves. A non-elected body, the WTO
is attempting to become more powerful than any national
government . . . For anarchism, the focus of global capitalism
couldn't be more ideal."</i> [<i>"An Anarchist Response to Seattle,"</i>
pp. 5-12, <b>Social Anarchism</b>, no. 29, p. 6]
</p><p>
To sum up, globalisation will see imperialism change as 
capitalism itself changes. The need for imperialism remains, 
as the interests of private capital still need to be defended 
against the dispossessed. All that changes is that the 
governments of the imperialistic nations become even 
more accountable to capital and even less to their 
populations.
</p>

<h2><a name="secd54">D.5.4 What is the relationship between imperialism and the social classes within capitalism?</a></h2>

<p>
The two main classes within capitalist society are, as we indicated 
in <a href="secB7.html">section B.7</a>, the ruling class and the working class. The grey 
area between these two classes is sometimes called the middle 
class. As would be expected, different classes have different 
positions in society and, therefore, different relationships 
with imperialism. Moreover, we have to also take into account 
the differences resulting from the relative positions of the 
nations in question in the world economic and political systems. 
The ruling class in imperialist nations will not have identical
interests as those in the dominated ones, for example. As such, 
our discussion will have indicate these differences as well.
</p><p>
The relationship between the ruling class and imperialism is 
quite simple: It is in favour of it when it supports its 
interests and when the benefits outweigh the costs. Therefore,
for imperialist countries, the ruling class will always be
in favour of expanding their influence and power as long as
it pays. If the costs outweigh the benefits, of course, 
sections of the ruling class will argue against imperialist 
adventures and wars (as, for example, elements of the US 
elite did when it was clear that they would lose both the 
Vietnam war and, perhaps, the class war at home by continuing 
it).
</p><p>
There are strong economic forces at work as well. Due to capital's 
need to grow in order to survive and compete on the market, find 
new markets and raw materials, it needs to expand (as we discussed 
in <a href="secD5.html">section D.5</a>). Consequently, it needs to conquer foreign markets 
and gain access to cheap raw materials and labour. As such, a nation 
with a powerful capitalist economy will need an aggressive and 
expansionist foreign policy, which it achieves by buying politicians, 
initiating media propaganda campaigns, funding right-wing think 
tanks, and so on, as previously described. 
</p><p>
Thus the ruling class benefits from, and so usually supports, 
imperialism -- only, we stress, when the costs out-weight the 
benefits will we see members of the elite oppose it. Which,
of course, explains the elites support for what is termed
"globalisation." Needless to say, the ruling class has done 
<b>very</b> well over the last few decades. For example, in the US, 
the gaps between rich and poor <b>and</b> between the rich and 
middle income reaching their widest point on record in 1997 
(from the <b>Congressional Budget Office</b> study on Historic 
Effective Tax Rates 1979-1997). The top 1% saw their after-tax 
incomes rise by $414,200 between 1979-97, the middle fifth by 
$3,400 and the bottom fifth fell by -$100. The benefits of 
globalisation are concentrated at the top, as is to be
expected (indeed, almost all of the income gains from 
economic growth between 1989 and 1998 accrued to the top
5% of American families).
</p><p>
Needless to say, the local ruling classes of the dominated
nations may not see it that way. While, of course, local
ruling classes do extremely well from imperialism, they
need not <b>like</b> the position of dependence and subordination
they are placed in. Moreover, the steady stream of profits
leaving the country for foreign corporations cannot be used
to enrich local elites even more. Just as the capitalist 
dislikes the state or a union limiting their power or 
taxing/reducing their profits, so the dominated nation's 
ruling class dislikes imperialist domination and will 
seek to ignore or escape it whenever possible. This is 
because <i>"every State, in so far as it wants to live not 
only on paper and not merely by sufferance of its neighbours, 
but to enjoy real independence -- inevitably must become a 
conquering State."</i> [Bakunin, <b>Op. Cit.</b>, p. 211] So the local 
ruling class, while benefiting from imperialism, may dislike 
its dependent position and, if it feels strong enough, may 
contest their position and gain more independence for 
themselves.
</p><p>
Many of the post-war imperialist conflicts were of this nature,
with local elites trying to disentangle themselves from an
imperialist power. Similarly, many conflicts (either fought
directly by imperialist powers or funded indirectly by them)
were the direct result of ensuring that a nation trying to
free itself from imperialist domination did not serve as
a positive example for other satellite nations. Which means 
that local ruling classes can come into conflict with 
imperialist ones. These can express themselves as wars of 
national liberation, for example, or just as normal conflicts 
(such as the first Gulf War). As competition is at the heart 
of capitalism, we should not be surprised that sections of 
the international ruling class disagree and fight each
other. 
</p><p>
The relationship between the working class and imperialism is 
more complex. In traditional imperialism, foreign trade and the 
export of capital often make it possible to import cheap goods 
from abroad and increase profits for the capitalist class, and 
in this sense, workers can gain because they can improve their 
standard of living without necessarily coming into system 
threatening conflict with their employers (i.e. struggle can 
win reforms which otherwise would be strongly resisted by the 
capitalist class). Thus living standard may be improved by low
wage imports while rising profits may mean rising wages for some
key workers (CEOs giving themselves higher wages because they 
control their own pay rises does not, of course, count!). 
Therefore, in imperialistic nations during economic boom times, 
one finds a tendency among the working class (particularly the 
unorganised sector) to support foreign military adventurism and 
an aggressive foreign policy. This is part of what is often 
called the "embourgeoisement" of the proletariat, or the 
co-optation of labour by capitalist ideology and "patriotic" 
propaganda.  Needless to say, those workers made redundant by 
these cheap imports may not consider this as a benefit and, by 
increasing the pool of unemployment and the threat of companies
outsourcing work and moving plants to other countries, help hold 
or drive down wages for most of the working population (as has 
happened in various degrees in Western countries since the 1970s).
</p><p>
However, as soon as international rivalry between imperialist 
powers becomes too intense, capitalists will attempt to maintain 
their profit rates by depressing wages and laying people off in 
their own country. Workers' real wages will also suffer if 
military spending goes beyond a certain point. Moreover, if 
militarism leads to actual war, the working class has much more 
to lose than to gain as they will be fighting it and making the 
necessary sacrifices on the "home front" in order to win it. In 
addition, while imperialism can improve living conditions (for 
a time), it cannot remove the hierarchical nature of capitalism 
and therefore cannot stop the class struggle, the spirit of revolt 
and the instinct for freedom. So, while workers in the developed 
nations may sometimes benefit from imperialism, such periods 
cannot last long and cannot end the class struggle.
</p><p>
Rudolf Rocker was correct to stress the contradictory (and 
self-defeating) nature of working class support for imperialism:
</p><p><blockquote>
<i>"No doubt some small comforts may sometimes fall to the 
share of the workers when the bourgeoisie of their country 
attain some advantage over that of another country; but 
this always happens at the cost of their own freedom and 
the economic oppression of other peoples. The worker . . .
participates to some extent in the profits which, without 
effort on their part, fall into the laps of the bourgeoisie 
of his country from the unrestrained exploitation of colonial 
peoples; but sooner or later there comes the time when these 
people too, wake up, and he has to pay all the more dearly 
for the small advantages he has enjoyed. . . . Small gains
arising from increased opportunity of employment and 
higher wages may accrue to the workers in a successful
state from the carving out of new markets at the cost of
others; but at the same time their brothers on the other
side of the border have to pay for them by unemployment
and the lowering of the standards of labour. The result
is an ever widening rift in the international labour
movement . . . By this rift the liberation of the workers
from the yoke of wage-slavery is pushed further and further 
into the distance. As long as the worker ties up his 
interests with those of the bourgeoisie of his country 
instead of with his class, he must logically also take 
in his stride all the results of that relationship. 
He must stand ready to fight the wars of the possessing 
classes for the retention and extension of their markets, 
and to defend any injustice they may perpetrate on other 
people . . . Only when the workers in every country shall
come to understand clearly that their interests are
everywhere the same, and out of this understanding learn
to act together, will the effective basis be laid for
the international liberation of the working class."</i> 
[<b>Anarcho-Syndicalism</b>, p. 71]
</blockquote></p><p>
Ultimately, any <i>"collaboration of workers and employers . . .
can only result in the workers being condemned to . . . eat
the crumbs that fall from the rich man's table."</i> [Rocker,
<b>Op. Cit.</b>, pp. 70-1] This applies to both the imperialist and
the satellite state, of course. Moreover, as imperialism needs 
to have a strong military force available for it and as a
consequence it required militarism at home. This has an impact 
at home in that resources which could be used to improve the 
quality of life for all are funnelled towards producing weapons
(and profits for corporations). Moreover, militarism is directed
not only at external enemies, but also against those who threaten
elite role at home. We discuss militarism in more detail in 
<a href="secD8.html">section D.8</a>.
</p><p>
However, under globalisation things are somewhat different. With 
the increase in world trade and the signing of "free trade" 
agreements like NAFTA, the position of workers in the imperialist 
nations need not improve. For example, since the 1970s, the wages 
-- adjusted for inflation -- of the typical American employee have 
actually fallen, even as the economy has grown. In other words, 
the majority of Americans are no longer sharing in the gains from 
economic growth. This is very different from the previous era, for 
example 1946-73, when the real wages of the typical worker rose by 
about 80 percent. Not that this globalisation has aided the working 
class in the "developing" nations. In Latin America, for example, GDP 
per capita grew by 75 percent from 1960-1980, whereas between 1981 
and 1998 it has only risen 6 percent. [Mark Weisbrot, Dean Baker, 
Robert Naiman, and Gila Neta, <b>Growth May Be Good for the Poor-- 
But are IMF and World Bank Policies Good for Growth?</b>] 
</p><p>
As Chomsky noted, <i>"[t]o the credit of the <b>Wall Street Journal</b>, it 
points out that there's a 'but.' Mexico has 'a stellar reputation,' 
and it's an economic miracle, but the population is being devastated. 
There's been a 40 percent drop in purchasing power since 1994. The
poverty rate is going up and is in fact rising fast. The economic 
miracle wiped out, they say, a generation of progress; most Mexicans 
are poorer than their parents. Other sources reveal that agriculture 
is being wiped out by US-subsidised agricultural imports, 
manufacturing wages have declines about 20 percent, general wages 
even more. In fact, NAFTA is a remarkable success: it's the first 
trade agreement in history that's succeeded in harming the 
populations of all three countries involved. That's quite an 
achievement."</i> In the U.S., <i>"the medium income (half above, half 
below) for families has gotten back now to what it was in 1989, 
which is below what it was in the 1970s."</i> [<b>Rogue States</b>, pp. 98-9 
and p. 213]
</p><p>
An achievement which was predicted. But, of course, while occasionally 
admitting that globalisation may harm the wages of workers in developed 
countries, it is argued that it will benefit those in the "developing" 
world. It is amazing how open to socialist arguments capitalists and 
their supporters are, as long as its not their income being redistributed! 
As can be seen from NAFTA, this did not happen. Faced with cheap imports, 
agriculture and local industry would be undermined, increasing the number 
of workers seeking work, so forcing down wages as the bargaining power of
labour is decreased. Combine this with governments which act in the 
interests of capital (as always) and force the poor to accept the costs 
of economic austerity and back business attempts to break unions and 
workers resistance then we have a situation where productivity can 
increase dramatically while wages fall behind (either relatively
or absolutely). As has been the case in both the USA and Mexico, 
for example.
</p><p>
This reversal has had much to do with changes in the global "rules of 
the game," which have greatly favoured corporations and weakened labour. 
Unsurprisingly, the North American union movement has opposed NAFTA and 
other treaties which empower business over labour. Therefore, the position 
of labour within both imperialist and dominated nations can be harmed under 
globalisation, so ensuring international solidarity and organisation have 
a stronger reason to be embraced by both sides. This should not come as 
a surprise, however, as the process towards globalisation was accelerated
by intensive class struggle across the world and was used as a tool against 
the working class (see <a href="secD5.html#secd53">last section</a>).
</p><p>
It is difficult to generalise about the effects of imperialism on the 
"middle class" (i.e. professionals, self-employed, small business people, 
peasants and so on -- <b>not</b> middle income groups, who are usually working 
class). Some groups within this strata stand to gain, others to lose (in 
particular, peasants who are impoverished by cheap imports of food). This 
lack of common interests and a common organisational base makes the middle 
class unstable and susceptible to patriotic sloganeering, vague theories 
of national or racial superiority, or fascist scapegoating of minorities 
for society's problems. For this reason, the ruling class finds it 
relatively easy to recruit large sectors of the middle class to an 
aggressive and expansionist foreign policy, through media propaganda 
campaigns. Since many in organised labour tends to perceive imperialism 
as being against its overall best interests, and thus usually opposes 
it, the ruling class is able to intensify the hostility of the middle 
class to the organised working class by portraying the latter as 
"unpatriotic" and "unwilling to sacrifice" for the "national interest." 
Sadly, the trade union bureaucracy usually accepts the "patriotic" 
message, particularly at times of war, and often collaborates with the 
state to further imperialistic interests. This eventually brings them 
into conflict with the rank-and-file, whose interests are ignored even 
more than usual when this occurs. 
</p><p>
To summarise, the ruling class is usually pro-imperialism -- as long as
it is in their interests (i.e. the benefits outweigh the costs). The
working class, regardless of any short term benefit its members may 
gain, end up paying the costs of imperialism by having to fight its 
wars and pay for the militarism it produces. So, under imperialism, 
like any form of capitalism, the working class will pay the bill 
required to maintain it. This means that we have a real interest in 
ending it -- particularly as under globalisation the few benefits 
that used to accrue to us are much less.
</p>

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