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<html>
<head>
<title>D.5 What causes imperialism?
</title>
</head>
<body>
<p>
<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 to exploit the exploitation
of working people in the dominated nation and can also aid the
exploitation of working people elsewhere. 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>
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 evolving needs of capitalism). 
But even in the classic 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. By 
increasing the area controlled by the state, one increased the 
wealth available. 
<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 best seen from the massive 
number of wars that have occurred in Europe over the last 500 years, 
as nation-states were created by Kings declaring lands to be their 
private property. Moreover, this conflict did not end when 
monarchies were replaced by more democratic forms of government.
As Bakunin argued:
<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' . . .
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> . . . 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]
<p></blockquote>
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 and 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, nineteenth century Germany and 
England or twentieth century (or twenty-first century)
United States. Here we will focus mainly on modern capitalist 
imperialism as it is the only one relevant in the modern 
world.
<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.
<p>
Hence capitalism is inevitably imperialistic. Regardless of 
recent claims, capital has always been global. International 
trade has always existed and, indeed, has always played a 
key role in its development (mercantilism, for example, 
manipulated international trade to enhance the accumulation 
of capital). The capitalist system is the most adaptable 
and voracious in history. From its beginning its components
(individual companies, states and capital) have been driven 
by the need to constantly expand or die; the changes that 
have occurred in recent years are an expression of this 
need. As Bakunin argued: 
<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><b>Op. Cit.</b></b>, p. 210]
</blockquote><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. The changing nature of modern imperialism can be 
roughly linked to developments within the capitalist economy
(see 
<a href="secD5.html#secd51">next section</a>). 
However, the growth of big business to
gain advantage in and survive competition is the key, as 
the size of companies ensure that they <b>have</b> to be 
international.
<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). As will be seen in 
<a href="secD5.html#secd51">section D.5.1</a>, 
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:
<p><blockquote><i>
"[C]apital 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 [i.e. British] 
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 and
Dundee."</i> [<b>Fields, Factories and Workshops</b>, p. 57]
</blockquote><p>
Therefore, capital will travel to where it can maximise
its profits -- regardless of the human or environmental
costs at home or in the foreign land. This is the economic 
base for 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, big business 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>
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>
How this is done and in what manner varies and changes, but 
the aim is always the same -- exploitation.
<p>
This exploitation can be done in many ways. For example,
allowing the import of cheaper raw materials and goods, the 
export of goods to markets sheltered from foreign competitors 
and the export of capital from capital-rich areas to 
capital-poor areas. The investing of capital in less 
industrially developed countries allows the capitalists
in question to benefit from lower wages, for example, or from 
fewer environmental and social controls and laws. 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, 
the price of land lower, wages lower, and raw materials 
cheaper. These factors all contribute to enlarging profit 
margins:
<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>
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>
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 (also see 
<a href="secD5.html#secd53">section D.5.3</a>). 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, 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 (this process played a key role 
in the rise of globalisation -- see 
<a href="secD5.html#secd53">section D.5.3</a>). 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). 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.
<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 working 
class consciousness which is often too advanced for heavy 
exploitation (i.e. huge profit margins), and finance capital 
can make easier and bigger profits by investing productive 
capital elsewhere. 
<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, reduces 
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. However, this 
process of industrialisation conducted by other 
countries had a drawback. It means that more
and more competitors can entry 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><b>Op. Cit.</b></b>, p. 32 and p. 49] Hence the 
need to stop new competitors, which was achieved
by colonialism in the late nineteenth century:
<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><b>Op. Cit.</b></b>, p. 75]
</blockquote><p>
As such, imperialism can also be considered as a means
of hindering (or controlling) industrialisation, of 
hindering the development of new competitors on the 
world market to existing big business operating on
the international market. It also 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>
Imperialism hinders industrialisation in two ways. 
The first way was direct colonisation. The second
is by indirect means -- namely the extraction of
profits by international big business.
<p>
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. This
approach has been superseded by indirect means (see
<a href="secD5.html#secd51">next section</a>).
<p>
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) 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. 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.
<p>
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>
The new attack of the capitalist class (<i>"globalisation"</i>)
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
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 these 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>
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. 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>
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). 
<p>
As Kropotkin argued, <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."</i> He stressed that <i>"[w]hen 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]
<p>
In summary, imperialism has always served the interests of 
Capital. If it did not, if imperialism was bad for business, 
the business class would have opposed 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 (see 
<a href="secD5.html#secd51">next section</a>). Moreover, we must
not forget that any change in imperialism relates to changes
in the underlying economic system. 
<p>
Obviously anarchists are opposed to imperialism and imperialistic 
wars. The Cuban anarchists spoke for all of us when they stated
that they were <i>"against all forms of imperialism and colonialism;
against the economic domination of peoples . . . against military
pressure to impose upon peoples political and economic system
foreign to their national cultures, customs and social systems
. . . We believe that among the nations of the world, the small
are as worthy as the big. Just as we remain enemies of national
states because each of them hold its own people in subjection;
so also are we opposed to the super-states that utilise their
political, economic and military power to impose their rapacious
systems of exploitation on weaker countries. As against all
forms of imperialism, we declare for revolutionary
internationalism; for the creation of great confederations
of free peoples for their mutual interests; for solidarity
and mutual aid."</i> [quoted by Sam Dolgoff, <b>The Cuban 
Revolution: A Critical Perspective</b>, p. 138]
<p>
It is impossible to be free while dependent on the power of 
another. If the capital one uses is owned by another country, 
one is in no position to resist the demands of that country. 
If you are dependent on foreign corporations and international
finance to invest in your nation, then you have to do what
they want (and so the ruling class will suppress political
and social opposition to please their backers as well as
maintain themselves in power). To be self-governing under 
capitalism, a community or nation must be economically 
independent. The centralisation of capital implied by 
imperialism means that power rests in the hands of a few
others, not with those directly affected by the decisions 
made by that power. Thus capitalism soon makes a 
decentralised economy, and so a free society, impossible. 
As such, anarchists stress decentralisation of industry 
and its integration with agriculture (see 
<a href="secI3.html#seci38">section I.3.8</a>)
within the context of socialisation of property and workers'
self-management of production. Only this can ensure that
production meets the needs of all rather than the profits
of a few.
<p>
Moreover, anarchists also recognise that economic imperialism
is the parent of cultural and social imperialism. As Takis
Fotopoulos argues, <i>"the marketisation of culture and the
recent liberalisation and deregulation of markets have
contributed significantly to the present cultural
homogenisation, with traditional communities and their
cultures disappearing all over the world and people converted
to consumers of a mass culture produced in the advanced
capitalist countries and particularly the USA."</i> [<b>Towards
an Inclusive Democracy</b>, p. 40]
<p>
This does not mean that anarchists blindly support national 
liberation movements or any form of nationalism. Anarchists 
oppose nationalism just as much as they oppose imperialism -- 
neither offer a way to a free society (see sections 
<a href="secD6.html">D.6</a> and 
<a href="secD7.html">D.7</a> for 
more details). Anarchists, therefore, are not against
globalisation or international links and ties as such. Far
from it, we have always been internationalists and are in
favour of <i>"globalisation from below,"</i> one that respects and
encourages diversity and difference while sharing the world.
However, we have no desire to live in a world turned bland
by corporate power and economic imperialism. As such, we
are opposed to capitalist trends which commodify culture
as it commodifies social relationships. We want to make
the world an interesting place to live in and that means
opposing both actual (i.e. physical, political and economic) 
imperialism as well as the cultural and social forms of it.
<p>
<a name="secd51"><h2>D.5.1 How has imperialism changed over time?</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.
<p>
However, it is useful to describe the history of capitalism
in order to fully understand the place imperialism holds
within it, how it has changed and what functions it provides.
<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>
Capitalism has always been expensive. As we noted in the 
<a href="secD5.html">last section</a>, 
this is unsurprising as it is based on "compete or
die," which becomes "grow or die." 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>
So, state intervention was used to create and ensure its 
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>
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>
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>
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). [<b>Fields, Factories and Workshops</b>,
p. 49] 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>Op. Cit.</b>, p. 32]
<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 reply 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>
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). Oligopoly marked the national economies of the most 
advanced capitalist nations as a means of creating <i>"an
amalgamation of capitalists for the purpose of <b>dominating 
the market, not for cheapening the technical process.</b>"</i> 
[Kropotkin, <b>Op. Cit.</b>, p. 354] Indeed, as 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.
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.
<p>
Faced with high tariff barriers and rising international 
competition, industry responded in two ways: export of
capital and increased concentration of capital. 
<p>
The latter was essential to gain an advantage against 
foreign competitors and dominate the international 
market as they had dominated the national one. So 
the imperialist form of capitalism sees the rise 
of big business and big finance.
<p>
In addition to the export of finished goods, capital 
(investment, venture, and finance capital) is also 
exported. 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. These two processes are both driven by the 
needs of capital to accumulate.
<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 (and often 
slavery as well). 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>, in <b>Black Flag</b> no. 210, p. 26]
<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><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>Kropotkin's Revolutionary Pamphlets</b>, pp. 55-6]
</blockquote><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 section
C.7 -- <a href="secC7.html">"What causes the capitalist business 
cycle?"</a> for more on 
these). 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, 
imperialism often allowed the working class of the invading 
country to receive improved wages and living conditions as 
the looted wealth was imported into the country and 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>
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>
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 (see <a href="secF8.html#secf83">
section F.8.3</a> for details).
<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]
<p>
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>
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 new left to expand. In the 
competition to increase sales and 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. 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>
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><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>
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> [Peter Kropotkin, <i>"Anarchism and Syndicalism"</i>, 
in <b>Black Flag</b> no. 210, p. 26] Unfortunately these 
"liberation" movements transformed mass struggle from 
a potential struggle against capitalism into movements 
aiming for independent capitalist nation states. 
<p>
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>
This process was accompanied by capital expanding 
even more <b>beyond</b> the nation-state into multinational 
corporations. The nature of imperialism and imperialistic 
wars has 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>
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>
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, 
with force resorted to only if "business interests" are 
threatened. Examples of new-style imperialistic wars 
include Vietnam, the US support for the Contras in 
Nicaragua and the Gulf War. Political and economic power 
(e.g. the threat of capital flight or sanctions) is used 
to keep markets open for corporations based in the 
advanced nations, with military intervention being 
used only when required (although the threat of it is
always there). Moreover, the competition between the
USA and the USSR also had an impact. 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 war or driving
developing nations into the hands of the other side
allowed more leeway for developing nations to pursue
policies like import substitution. However, force always
was the ultimate solution for imperialism, just as it
had been previously.
<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>
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 below). In addition, 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. 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>
So, imperialism remained intact, as Western (mostly U.S.
and its junior partner, the U.K.) governments continue 
to provide lavish funds to petty right-wing despots 
under the pseudonym, "foreign aid". The express purpose 
of this foreign aid, noble-sounding rhetoric about 
freedom and democracy aside, is to ensure that the 
existing world order remains intact. "Stability" 
has become the watchword of modern imperialists, who see 
<b>any</b> indigenous popular movements as a threat to the 
existing world order.
<p>
Foreign aid channelled public funds to the ruling 
classes in Third World countries via home based
transnational companies. 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). "Foreign aid", basically, is when 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!
<p>
(Needless to say, the owners of the companies providing 
this "aid" also do very well out of it.)
<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. Thus, the fascist regimes remain compliant 
and obedient to the West, capitalism thrives unchallenged, 
and the plight of people everywhere simply worsens. And 
if a regime becomes too "independent", military force always 
remains an option (as can be seen from the 1990 Gulf War).
<p>
Thus, imperialism changes as capitalism changes. The 
history of capitalism generally begins with mercantilism, 
the state aided destruction of petit-bourgeois commodity 
production (artisans, guilds and peasants) by capitalist 
manufacturing. Once capitalist industry has found its 
feet, free competition ("free trade") is embraced, which 
naturally progresses to a concentration of production 
(the rise of big business), which continually strive 
towards monopolies -- although it rarely reaches that 
stage (oligopolistic competition reigns). Major economic 
decisions are made by a few heads of major companies and 
corporations. Big business, while appearing to be 
contrary to the foundations of capitalism, is, in 
fact, its most developed form -- with the world 
turned more and more into one big factory, under 
one management hierarchy. Free association is 
replaced by top-down orders and industrial 
development is distorted by the need to maintain 
and extend corporate power and profits. 
<p>
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>
<a name="secd52"><h2>D.5.2 Is imperialism just a product of 
private capitalism?</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 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 presses that apply to big business will also
apply to the state capitalist nation (see 
<a href="secD5.html#secd51">last section</a>).
<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. As can be seen by Russia's ruthless policy towards her 
satellites, 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 U.S.S.R. 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> [Andy Anderson, <b>Hungary '56</b>, pp. 25-6] 
<p>
The Soviet elite also aided "anti-imperialist" movements when it
served their interests and placed them within the Soviet sphere 
of influence (along with US pressure which closed off other options). 
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>
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. Part of the difference was, of course, 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).
<p>
Just as capitalist domination saw the transformation of
the satellite's countries social relations from pre-capitalist
forms tin 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.
<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.
<p>
<a name="secd53"><h2>D.5.3 Does globalisation mean the end of 
imperialism?</h3>
<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>
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>]
<p>
Globalisation, like the forms of imperialism that came before 
it, cannot be understood unless its history is known. The 
current process of increasing international trade, investment 
and finance markets came about after 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>
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. This 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). 
<p>
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>
Internationally, another crisis played its role in promoting
globalisation. This was the Debit Crisis of the late 1970s and
early 1980s. For many countries Debt plays a central part 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, ironically, have to repay them!).
<p>
Before this, as noted in the 
<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. Instead
of military force, the governments of the west sent in the
IMF and World Bank (WB). The loans required by "developing" nations
in the face of recession and rising debt repayments 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.
<p>
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.
<p>
Thus economic factors played a key role in the process. 
Moreover, the size of corporations meant that they could 
not help working on a multinational level (and could 
swallow up local industry). The global market needed 
the global firm (and vice versa). By working on a global 
level, these companies could invest in nations which 
could ensure a favourable business climate by repressing 
workers. So while workers in the West suffered repression 
and hardship, the fate of the working class in the 
"developing" world was considerably worse.
<p>
Thus globalisation is, like the forms of imperialism that
preceded it, was a response to both objective economic forces
and the class struggle. Moreover, like the forms that came
before, it is based on 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.
<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 positive two 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>
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>
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>
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 puts 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>
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] and the 
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>
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 "economic miracle" 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>
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 the last 
business cycle (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). 
<p>
This means that such agreements such as NAFTA and the
recently shelved (but definitely not forgotten) 
Multilateral Agreement on Investment (MAI) weaken
considerably 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
corporate 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. As such, such agreements 
represent an increase in corporate power and ensure 
that states can only intervene when it suits 
corporations, not the general public.
<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 haazardous 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 the 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.
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>
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.
<p>
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 "crisis of democracy" (a term 
used by the Trilateral Commission to characterise popular 
uprisings and a politicising of the general public).
<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]
<p>
Therefore 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. For the 
foreseeable future, America seems to be the global rent-a-cop 
of choice. On a local level, 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>
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 on "developing" nations
move to less "developed" to find more compliant labour).
<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 the number of
police, police powers and in laws directed against the
labour and radical movements. As Malatesta argued:
<p><blockquote><i>
"[L]iberalism, is in theory a kind of anarchy without
socialism, and therefore is simply a lie, for freedom
is not possible without equality, and real anarchy
cannot exist without solidarity, without socialism.
The criticism liberals direct at government consists
of wanting to deprive it of some of its functions and
to call upon the capitalists to fight it out among
themselves, but it cannot attack the repressive functions
which are of its essence: for with the <b>gendarme</b> the
property owner could not exist, indeed the government's
powers of repression must perforce increase as free
competition results in more discord and inequality."</i>
[<b>Anarchy</b>, p. 46]
</blockquote><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.
<p>
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>
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-a-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 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>
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>
<a name="secd54"><h2>D.5.4 What is the relationship between imperialism and the social classes within capitalism?</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 (as befitting their
difference social positions within capitalism).
<p>
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>
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 dividends. 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>
Moreover, 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>
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>
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]
<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. Thus 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>
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 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. As we argue in more detail in 
<a href="secD7.html">section D.7</a>, while
anarchists oppose imperialism and defend the rights of
oppressed nations to resist it, we do not support national
liberation movements as these are cross class alliances
which aim to consolidate the local elites power and this
must, by necessity, mean the subjection of working people
(just as support for any nation state means). Therefore 
we never call for the victory of the dominated
country over the imperialist. Instead we call for a 
victory of the workers (and peasants) of that country
against both home and foreign exploiters (in effect,
"no war but the class war").
<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 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). 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,
help hold or drive down wages for the whole working population.
<p>
Moreover, capital export and military spending under imperialistic 
policies may lead to a higher rate of profit for capitalists and 
allow them to temporarily avoid recession, thus keeping employment
and wages higher than would be the case otherwise. So workers 
benefit in this sense as well. 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. 
<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, in fact, end
the class struggle.
<p>
Rudolf Rocker was correct to stress the contradictory 
(and self-defeating) nature of working class support for 
imperialism:
<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. 61]
</blockquote><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>, p. 60] This applies to both the imperialist and
the satellite state, of course. Moreover, as we argued in
<a href="secD5.html#secd51">section D.5.1</a>, 
imperialism needs to have a strong military
force available for it (without force, the imperialist
state could not defend the property of its citizens or
companies invested in foreign countries nor have the
means to threaten satellite nations seeking an independent
path). As such, the military machine must be strengthen
and this <i>"is not directed only against the external
enemy; it aims much more at the internal enemy. It
concerns that element of labour which has learned not
to hope for anything from our institutions, that awakened
part of the working people which has realised that
the war of classes underlies all wars among nations, 
and that if war is justified at all it is the war
against economic dependence and political slavery, the
two dominant issues involved in the struggle of the
classes."</i> In other words, the nation <i>"which is to be
protected by a huge military force is not"</i> that <i>"of the
people, but that of the privileged class; the class
which robs and exploits the masses, and controls their
lives from the cradle to the grave."</i> [Emma Goldman,
<b>Red Emma Speaks</b>, p. 306 and p. 302]
<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,
over the last twenty-five years, 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>
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>
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>
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>
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 scape-goating of minorities 
for society's problems. For this reason, the ruling class 
finds it relatively easy to recruit large sectors of the 
middle class (as well as unorganised sectors of the 
working 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." 
<p>
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. Under imperialism, like any
form of capitalism, the working class will pay the bill
required to maintain it.
<p>
Hence, in general, imperialism tends to produce a tightening
of class lines and increasingly severe social conflict 
between contending interest groups, which has a tendency 
to foster the growth of authoritarian government (see 
<a href="secD9.html">section D.9</a>).
<p>
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