Essay:What is imperialism?

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If there ever was in the history of humanity an enemy who was truly universal, an enemy whose acts and moves trouble the entire world, threaten the entire world, attack the entire world in any way or another, that real and really universal enemy is precisely Yankee imperialism.

— Fidel Castro

Imperialism is perhaps the most prolific reactionary force in the world, regularly finding its downfall within revolutionary programs. The masses clearly find themselves no longer under the oppressive boot of a single capitalist yolk, but strangled by a double yolk: capitalism and imperialism.[1] All communists who genuinely wish to free the global masses must probe deeply into the universal essence of imperialism, it is only by thoroughly studying and properly analysing imperialism that the modern situation can be accurately understood: how to approach it, and more importantly, how to change it. It is only through studying imperialism that the targets for our guns will make themselves clear.[2]

To negate and dismiss an adequate analysis of imperialism, is to join the camp of global reactionaries, and abandon the world Proletariat.

The birthplace is monopoly

Preface: The question of cartels was left out of this section, for while it is fundamental to understanding the monopoly stage of capitalism, it is, somewhat, not directly relevant to the discourse of imperialism

Imperialism is most commonly [and rightfully] linked to the monopoly stage of capitalism, it is as such both historically and theoretically important to explore the relationship between these 2 phenomena. Let us begin with necessarily defining terms:

Free competition= the situation in which a market is absent of large firms (firms which have a perceptual hold on a market greatly exceeding the modal average[3] within that market), and no firms can be identified as having a “leading” position in that market

Monopoly= the situation in which a market is dominated by a handful of large firms which wreck the ability of smaller firms to compete on an equal basis [with these large firms]

A market begins in a phase of free competition, there are disparities between firms, but there are no extreme outliers with an exceptionally larger than average hold. However, this does not last long, this initially competitive and free market is inevitably struck by a vicious, and inevitable, economic crisis,[4] leaving only the biggest firms surviving. These surviving firms are faced with an immense vacuum only they are left to fill, finally transforming into large firms (recall to the definitions above).

These large firms solidify their position of dominance by destroying most [smaller] competitors, this is done primarily through:

  1. Systematically forcing a  net profit[5] loss on the entire market the large firms can survive (large firms have bigger reserves they can draw on for longer during periods of negative or null profits than smaller firms)
  2. Forming cartels with suppliers and or buyers (firms not the public) which refuse to sell to /buy from competitors

Free competition phases into monopoly.

It must be made clear that the collapse of free competition into monopoly is not the “mistake” or the “unfortunate tragedy”  the liberal critique, desperate to mask the reactionary role capitalism plays today,[6] speaks of, but an inherent evolution of capitalism engrained in the fundamental laws of capitalism (the law of value + crisis of overproduction). It is ludicrous to separate monopoly from capitalism because monopoly is in the genes of capitalism, the genesis of capitalism was itself the genesis of the eventual tragedy [collapse into monopoly].

It is essential for understanding monopoly (and thus imperialism) to explore the new role the banking industry takes under the stage of monopoly. Inherently the banks need the non-banking industries and the non-baking industries need the banks (economic crisis), but due to the very nature of banks, the increased amount of capital reserves available to them (they can thus tank greater net profit losses), the relationship between the banks and the non-banking industries is not equal. However, under free competition this inherent skewed relationship is held from fully flourishing by competition among banks (banks could not expect a non-banking firm client to not leave them for another bank if they made use of their advantageous position to provide unfavourable deals to the client non-banking firm), the vast array of banks also stopping non-banking firms from getting attached/conjoining with a single specific bank. Once competition fades however, so does the safeguard: the non-baking industries have only a few banks to go to now, and those monopolistic banks are now free to engage in economic terrorism as they please. Both finally combine into the horrendous amalgamation of financial capital (with the banks in the leading position).

As capital accumulates under these monopolistic banks, the national market can no longer provide enough investment possibilities to digest the complete capital of these monopolistic banks (the amount of capital the national market can digest is capped at a certain value), an extremely dangerous condition as capitalism, for different reasons, demands constant expansion. It is in this spirit that the monopolistic banks search beyond national borders for a place to consistently dump their surplus capital (the problem of the domestic market not being able to fully absorb the capital of the monopoly banks does not disappear after one production cycle).

To carve out a place to consistently dump their surplus capital, the monopolistic banks go to a nation, fabricating a dependency on foreign capital, and crushing that nation’s ability to produce capital. Concretely, this is done through:

  1. Destroying the nation’s industries’ ability to achieve positive net profits after industry has been built eg. high public debt that must be repaid through high levels of taxation, mismanagement of tariff levels, mismanagement of minimum price laws, etc
  2. Destroying the nation’s ability to achieve positive net profits by blocking capital from accumulating in the first place,[industry forming in the first place]  eg. blocking subsidies from going to needed industries, incapacitating the banking system, etc

All these terms can be achieved by an imperialist by either attaching “structural adjustments” to loans, or corrupting the government of the victim nation.

[It must be noted: Underdevelopment is insurance for the banks. If an underdeveloped nation was to free itself from the tentacles of imperialism, it would remain underdeveloped, unable to produce its own capital, and reliant on foreign capital. A fact that might be used to attach “structural adjustments”]

Imperialism is not only profitable, but necessary for capitalism

[All this is thoroughly, and in a much more advanced manner, explored in Lenin’s classic Imperialism: The Highest Stage of Capitalism]

The birthplace was always going to be monopoly

In his work Imperialism: The Highest Stage of Capitalism, Lenin devoted an entire chapter elaborating how Imperialism was “a special stage of capitalism”, he did this because it is an important point.

As explained above, the conditions for imperialism can be reached by: A attaching strings to loans to governments or B corrupting that government. Both methods cannot be utilized before the stage of monopoly. Only once production has been sufficiently concentrated can a bank provide a loan to a national government (a national government can do nothing with a loan that is smaller than a certain value, the scopes of its programs are far too great), and only then does a single bank or coalition of banks have the necessary funds to meaningfully corrupt such a large and expansive machine as a national government. It is clear then: imperialism only appears during/after the stage of monopoly, not before.

It must be understood that this is not to say that international trade/relations cannot be observed before the stage of imperialism, international relations do not always constitute imperialism (only certain subscribers to ultra-left deviations uphold this), thus certain “fair”,[7] non-parasitic, forms of international relations appear before the era of imperialism/monopoly.

The imperialism of banks and unequal exchange

Preface: In this section “Unequal Exchange” does not refer to the question of value extraction in the case of one single global socially necessary labour time in the context of global unequal development

Unequal exchange is that process by which an imperialist renders a nation reliant on imports, using these skewed terms of trade to gauge prices (this has effects on the victim nation’s exports and wages). It is the imperialism of the monopolistic non-banking industries which cannot sell the fullness of their inventory at home, and thus demand a place to “dump” their surplus commodities[8] (both goods and services).

To carve out a place to consistently dump their surplus commodities, the monopolistic non-banking industries go to a nation, fabricating a dependency on foreign goods, and crushing that nation’s ability to produce those goods. Concretely, this is done in the same manner as the banks do their imperialism, with a few differences (such as making net profits of the nation’s industry[9] negative if that nation already has industry). Again, underdevelopment is an insurance for even if the victim nation was to escape the net of imperialism, it would still be underdeveloped and dependent on foreign commodities.

Unequal Exchange is the imperialism of the non-banking industries, and is not only profitable and an insurance, but necessary for capitalism

Hypothetically, the monopolistic banks do not require the destruction of the victim nation’s production, the monopolistic banks in their imperialist crusades require a stick between the wheels of expansion, not a retraction (forget how it is an insurance), the banks require the profits of the nation to be tarnished, not specifically their physical commodity output (these do not always coincide, one can produce and not make profit, by for example selling at production cost). What has been forgotten here, is that imperialism is the stage of monopoly, and monopoly is the stage of financial capital, thus all real, concrete, examples of imperialism are a combination of traditional bank imperialism, and non-banking Unequal Exchange imperialism.


  1. We must study New Democracy to understand how we must go about defeating this double yolk
  2. "Figurative" speech
  3. “Modal average” in this case is an interval, or set, instead of specific singular numeric value
  4. Crisis of overproduction
  5. Net profit in this piece = exchange value output - exchange value input
  6. We must make clear the distinction of capitalism being a reactionary force within modern conditions, capitalism was objectively a progressive force (a force which bettered the lives of the masses) in the context of dominant feudalism, and to is to spit straight into the face of materialism
  7. “Fair” is in this context used to denote a non-skewed relationship where both participants are benefiting, and benefiting roughly an equal amount
  8. For example Coca Cola sells roughly 1.9 Billion servings per day (including sales of daughter companies)
  9. Industry in this context is specifically referring to those industries related to the production of the commodities the imperialists want to import [to the victim nation]