Imperialism, the Highest Stage of Capitalism, Lenin, 1916

Written during WWI & the collapse of the Second International.

Lenin saw monopoly capitalism, also called the imperialist stage of capitalism, as the first stage of transition between capitalism with its many capitals & free competition & communism based on the collective ownership of the means of production without any capitals.

Lenin demonstrated how the crisis of 1873 played a key role in kicking off the process that led to the transformation of industrial capitalism into monopoly capitalism. Lenin showed that industrial capitalism based on free competition reached its peak on the eve of the 1873 crisis. Within 30 years after the outbreak of that crisis, capitalism had been transformed into the monopoly-ridden imperialism that dominated the entire inhabited globe by the turn of the 20th century.

Lenin strongly praised Rudolf Hilferding’s “Finance Capital,” first published in 1910, because it was the first Marxist work on political economy that put monopoly at the center of its analysis.


Are workers more exploited in advanced economies than developing ones?

Some (Euro-) Marxists believe they are & quote Marx in support, “It will be found, frequently, that the daily or weekly, etc., wage in the first nation is higher than in the second, whilst the relative price of labour, i.e., the price of labour as compared both with surplus-value and with the value of the product, stands higher in the second than in the first.” Capital, Vol. I

In other words, although wages in terms of money & in terms of real wages & of value are higher in an advanced country than in a capitalistically underdeveloped country, the rate of surplus value defined as the ratio of unpaid to paid labour might well be higher in the capitalistically developed country than in the underdeveloped country.

Other Marxists support the ‘dependency theory’ & argue they are not.


The value of labour power

Like all commodities labour power has three values: use-value, value & exchange-value.
Use-values necessary for the reproduction of human labour power include food, shelter and clothing.
Labour values are measured in some unit of time.
The value of labour power has a value form, an exchange-value, a money price, called the wage.

The wage-form required to purchase the necessary use-values to sustain the life of a worker in India compared to a worker in the UK are not necessarily the same.
Workers in different parts of the world require a different basket of use-values, e.g. overcoats in cold climates.
A biological minimum exists below which the working class cannot reproduce itself.
Workers, usually through trade unions, fight in a class struggle with the capitalists for more than this biological minimum; a moral element, to participate in ‘human civilisation’.
And over time the use-values change, e.g. today access to the internet is increasingly necessary.

Labour wage differentials example:
Country A (high labour costs) – $50 variable capital costs, $50 constant capital costs = $100
Country B (low labour costs) – $25 variable capital costs, $50 constant capital costs = $75
Country A requires protectionist tariffs to compete.
New technology provides a machine that costs $60 but reduces by 30%:
Country A now has variable capital costs of $35 & constant capital costs of $60 = $95
It will adopt the new technology due to internal competitive pressures, & assuming the continuance of protectionist tariffs.
Country B gains no advantage from the new technology though:
Variable capitals costs would reduce to $17.50, but this saving will not off-set the higher constant capital costs of $60 = $77.50
Country A continues to apply new technology until eventually they have a machine that costs $70 which reduces labour costs to $2.50 = $72.50
They can now out compete Country B which has fallen so far behind technically, it cannot easily apply the new technology.
Country A no longer requires the protectionist tariffs.

This is the story of the USA replacing Britain as the leading industrial capitalist country.
They could out compete Britain although labour costs were higher.


Agriculture-based developing countries

The higher the rate of surplus value the more capitalists can negate the rise in the organic composition of capital & the falling rate of profit.
Countries with large peasant populations use to hard manual labour & a subsistance living provide the opportunity of low wages & so high rates of surplus value.
In Asia the development of the means of production has in many cases come about through global capital.
The imperialist countries, particularly the USA, have been able to extract vast quantities of surplus value from the rapidly expanding industrial proletariat of the Asian countries.

[Part 16…]

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