Marxist Theories of Marxist Theories of ImperialismImperialism

Balak, October 2001Balak, October 2001

The Terror WarsThe Terror Wars

• What is the conflict behind the war?What is the conflict behind the war?– Religious? Ethnic? Cultural?Religious? Ethnic? Cultural?– Colonial and postcolonial legacies?Colonial and postcolonial legacies?– Which causes which?Which causes which?

• Clash of civilizations in a global economy.Clash of civilizations in a global economy.

• Similar large-scale economic change: Similar large-scale economic change: Industrial Revolution.Industrial Revolution.

• Global Class Struggle?Global Class Struggle?

The Decline of FeudalismThe Decline of Feudalism

• Enclosure, 100 Years War, wool, tech., etc.Enclosure, 100 Years War, wool, tech., etc.

• New social class: ProletariatNew social class: Proletariat– Displaced serfs & yeomen, paupers, urban migrantsDisplaced serfs & yeomen, paupers, urban migrants– Have no land nor capital (nor the means to get any)Have no land nor capital (nor the means to get any)

• Accelerating rise of the commercial classes:Accelerating rise of the commercial classes:– Capitalists acquire most of the means of productionCapitalists acquire most of the means of production– Capitalists employ proletariansCapitalists employ proletarians– Unequal interdependencyUnequal interdependency

Power & Tradition in Labor MarketsPower & Tradition in Labor Markets• Industrial labor markets share characteristics of Industrial labor markets share characteristics of

the manorial economy in which they had evolvedthe manorial economy in which they had evolved– Serf: Agricultural surplus for feudal lord to “pay” for Serf: Agricultural surplus for feudal lord to “pay” for

use of landuse of land– Worker: Surplus value for employer as “payment” for Worker: Surplus value for employer as “payment” for

the privilege of employmentthe privilege of employment

• Labor theory of value: Labor theory of value: – Value (X): labor used in production of XValue (X): labor used in production of X– Value (labor): what it takes to produce it: subsistenceValue (labor): what it takes to produce it: subsistence

• Rate of Exploitation:Rate of Exploitation:– Hours employed > Hours employed >

hours necessary to generate subsistencehours necessary to generate subsistence

Commutative & Distributive JusticeCommutative & Distributive Justice• Since Aristotle (Since Aristotle (Nicomachean EthicsNicomachean Ethics, 350BCE):, 350BCE):

– Commutative justiceCommutative justice:: ““corrective in transactions between man and man”corrective in transactions between man and man”

– Distributive justiceDistributive justice: : Distributes according to a given (natural) social orderDistributes according to a given (natural) social order

• Proletariat:Proletariat:– Displaced feudal serfsDisplaced feudal serfs– Enjoy rather unfavorable “initial distribution” of status. Enjoy rather unfavorable “initial distribution” of status.

• Victorian application of distributive justice:Victorian application of distributive justice:– Laborers were employed up to the full amount of time Laborers were employed up to the full amount of time

above which they would soon die of exhaustion. above which they would soon die of exhaustion. – The poet William Blake described the “dark satanic The poet William Blake described the “dark satanic

mills” in which children were literally worked to death.mills” in which children were literally worked to death.

The evolution of capitalism (19The evolution of capitalism (19thth century) century)

• Markets expanding (multidimensionally) Markets expanding (multidimensionally) • Vigorous competition among firms: Vigorous competition among firms: ↓ pressure on profits↓ pressure on profits• Competition extends to input markets: Competition extends to input markets: ↑↑ pressure wages pressure wages • Will the proletariat escape the misery of subsistence to Will the proletariat escape the misery of subsistence to

share in the growing wealth of nations? share in the growing wealth of nations? Terribly sorry, but wages will revert back to subsistenceTerribly sorry, but wages will revert back to subsistence– Smith: workers have more children in response to wage gainsSmith: workers have more children in response to wage gains– Malthus: Malthus: Essay on the Principle of Population Essay on the Principle of Population (1798) (1798)

• ““Liable on the human race” Liable on the human race” The view that working class women instinctively bear as The view that working class women instinctively bear as many children as they can feed in the short runmany children as they can feed in the short run

Laborsaving TechnologyLaborsaving Technology• Industrial era’s solution to the capitalists’ plight:Industrial era’s solution to the capitalists’ plight:

– Workers are displaced by capitalWorkers are displaced by capital– ““industrial reserve army” (unemployment)industrial reserve army” (unemployment)– Downward pressure on wagesDownward pressure on wages

• It is It is chronic unemployment,chronic unemployment, not unbridled sexual not unbridled sexual appetite and drink that is the check on workers’ appetite and drink that is the check on workers’ welfare. welfare.

• Systematic, not individual moral failure:Systematic, not individual moral failure:– Marx’s capitalist is Marx’s capitalist is notnot simply an immoral accumulator simply an immoral accumulator

for accumulation’s sakefor accumulation’s sake– He is forced He is forced for his own survivalfor his own survival to do everything to do everything

within his power the reduce labor costswithin his power the reduce labor costs• In this sense progressive enlightenment In this sense progressive enlightenment cannotcannot

save capitalism according to Marx.save capitalism according to Marx.

… … but there’s a catch!but there’s a catch!

• Machines cannot be exploited for their surplus Machines cannot be exploited for their surplus product like politically weak social classes product like politically weak social classes

• The elite is now “cannibalizing” itself:The elite is now “cannibalizing” itself:– Capitalists must employ increasing amounts of Capitalists must employ increasing amounts of

machines machines – Machines are Machines are fellow capitalists’ capitalfellow capitalists’ capital– Capital’s rental rate fully reflects its productivity Capital’s rental rate fully reflects its productivity

• Source of profits is surplus labor valueSource of profits is surplus labor value

• Replacing workers with machines would Replacing workers with machines would eventually put a downward pressure on profitseventually put a downward pressure on profits

The Marxian business-cycleThe Marxian business-cycle

• Reduced profits cause business failuresReduced profits cause business failures– Reduce the cost of capital & laborReduce the cost of capital & labor– Mitigate the downward pressure on profitsMitigate the downward pressure on profits– Larger firms survive cycles (economies of scale) Larger firms survive cycles (economies of scale)

• Increased Increased concentrationconcentration of power of power• Monopolistic giants compete ever more Monopolistic giants compete ever more

ferociously with other giants ferociously with other giants of their classof their class• Reinforces the very conditions that forced the Reinforces the very conditions that forced the

Victorian capitalist to replace labor with capitalVictorian capitalist to replace labor with capital

Labor Enhancing TechnologyLabor Enhancing Technology

• Ludwig von Mises (Socialism, 1922):Ludwig von Mises (Socialism, 1922):– Criticized the Marxian scenarioCriticized the Marxian scenario– Specific way in which more capital is brought Specific way in which more capital is brought

to bear on the production processes:to bear on the production processes:– Labor-Labor-enhancingenhancing technology instead of labor- technology instead of labor-

replacingreplacing technology technology– Allow for an observable sustainable increase Allow for an observable sustainable increase

in wages to above subsistencein wages to above subsistence

Intermediate summaryIntermediate summary

• Capitalism replaced feudalism with a more Capitalism replaced feudalism with a more productive and efficient new mode of productionproductive and efficient new mode of production

• Same thing would happen to replace capitalism: Same thing would happen to replace capitalism: – Workers are impoverished (Workers are impoverished (∆↓∆↓ wages) wages) – ∆↑ ∆↑ uunemployment (laborsaving technology)nemployment (laborsaving technology)– Number of capitalists dwindles (concentration)Number of capitalists dwindles (concentration)

• Capitalists eventually have no one to sell their goods toCapitalists eventually have no one to sell their goods to• Nothing to do with the capital derived from profits Nothing to do with the capital derived from profits • Increasingly severe credit and banking crisesIncreasingly severe credit and banking crises

– Proletariat would tip over the whole rotten structure Proletariat would tip over the whole rotten structure

and replace it with a classless societyand replace it with a classless society

• Nominal wages Nominal wages werewere falling in the US (1865-97) falling in the US (1865-97)• But:But:

– Real wages were risingReal wages were rising– No apparent problem with over-productionNo apparent problem with over-production– No apparent shortage in capital investmentNo apparent shortage in capital investment

• Lenin (Vladimir Ulyanov, 1870-1924):Lenin (Vladimir Ulyanov, 1870-1924):

Colonialism and imperialism were relieving the Colonialism and imperialism were relieving the stress on capitalism and had temporarily stress on capitalism and had temporarily “derailed history” “derailed history” – Safety valve for excess capital and over-productionSafety valve for excess capital and over-production– Buy off the proletariat at homeBuy off the proletariat at home

• Russia was not ready for a communist revolutionRussia was not ready for a communist revolution• Stalin (Iosif Dzhugashvili, 1879-1953): Stalin (Iosif Dzhugashvili, 1879-1953):

– Russian Revolution:Russian Revolution:• Replace capitalism with socialism Replace capitalism with socialism • Industrialization without capitalist exploitationIndustrialization without capitalist exploitation

– The Soviet Union would fight against imperialism and The Soviet Union would fight against imperialism and work for de-colonization and national liberationwork for de-colonization and national liberation

– If imperialism and colonialism end:If imperialism and colonialism end:• Capitalist economies would revert to the inevitable Capitalist economies would revert to the inevitable

dynamic described by Marx dynamic described by Marx • Communism would develop in the “natural” way Communism would develop in the “natural” way

Paradox of the Russian RevolutionParadox of the Russian Revolution

Historical Determinism; The Complete Picture:Historical Determinism; The Complete Picture:

Special thanks to Kelley L. Ross (Department of Philosophy, Los Angeles Valley College, Van Nuys, California) for illustrations. Please note that professor Ross is NOT a Marxist in any sense of the word ;-)

The 30s: The Apogee of MarxismThe 30s: The Apogee of Marxism

• The Great Depression:The Great Depression:– Credit & production collapse that Marx predictedCredit & production collapse that Marx predicted– Better results in Stalin’s Soviet Union(?)Better results in Stalin’s Soviet Union(?)

• Capitalist countries joined in to defeat fascismCapitalist countries joined in to defeat fascism– Many capitalists supported fascistsMany capitalists supported fascists– Overwhelming popular rejection shapes policyOverwhelming popular rejection shapes policy

• Post-war de-colonization Post-war de-colonization – Neo-colonialismNeo-colonialism– Newly independent countries advised to: Newly independent countries advised to:

• Nationalize foreign holdingsNationalize foreign holdings

• Limit capitalist exploitation (i.e. foreign investment)Limit capitalist exploitation (i.e. foreign investment)

How globalization fits into this schemeHow globalization fits into this scheme

• Labor-enhancing technology may be Labor-enhancing technology may be reaching its limits: reaching its limits: – Since the 1970s:Since the 1970s:

• Declining productivity growthDeclining productivity growth• Slowdown (and even reversal) in sustainable Slowdown (and even reversal) in sustainable

growth in real wagesgrowth in real wages

– In the 90s:In the 90s:• Effects have been temporarily alleviated:Effects have been temporarily alleviated:

– Inventing new outlets for consumption in Inventing new outlets for consumption in cyberspacecyberspace

– Increasing availability of cheap consumption Increasing availability of cheap consumption goods for the masses goods for the masses

Post-industrial capitalism evolved an Post-industrial capitalism evolved an ingenious strategy:ingenious strategy:

• Workers can increase their Workers can increase their apparentapparent consumption not by increasing their income but consumption not by increasing their income but by consuming by consuming cheapercheaper goods: goods: – Some of these goods are the fruits of innovationSome of these goods are the fruits of innovation– Most are imported from poor countries Most are imported from poor countries

• Poor countries, as economies, metaphorically Poor countries, as economies, metaphorically resemble the proletariat in that they have little resemble the proletariat in that they have little capital and much surplus labor which the rich capital and much surplus labor which the rich world readily appropriatesworld readily appropriates

ConclusionsConclusions• The ultimate problem with capitalism is that unchecked, The ultimate problem with capitalism is that unchecked,

it eventually creates a rebellious poverty-stricken mobit eventually creates a rebellious poverty-stricken mob

• Let us Let us exportexport the poverty, and with it the angry mob the poverty, and with it the angry mob

• Globalization increases the political and social impact, as Globalization increases the political and social impact, as well as the scope, of the terms governing the exchangewell as the scope, of the terms governing the exchange

• Furthermore, this heightened impact goes both ways(!) Furthermore, this heightened impact goes both ways(!)

• Problems with immigration into rich countries should Problems with immigration into rich countries should have alerted us to thishave alerted us to this

• Postcolonial discursive regime governing the debate is Postcolonial discursive regime governing the debate is caught in 20caught in 20thth century tensions between guilt and racism century tensions between guilt and racism

• Globalization involves more than the Globalization involves more than the importation of cheap products from the importation of cheap products from the developing world:developing world:– Along with their labor surplus, some Along with their labor surplus, some

developing countries export their political and developing countries export their political and social instabilitysocial instability

• We may have blindly traded our security We may have blindly traded our security for cheap consumer goods for cheap consumer goods – The irony is further sharpened: cheap goods The irony is further sharpened: cheap goods

are a key part of the “pacifying package” with are a key part of the “pacifying package” with which the workers’ revolution was avertedwhich the workers’ revolution was averted

• Capitalism was able to “buy some extra time” Capitalism was able to “buy some extra time” – By bringing many of the working class into the By bringing many of the working class into the

virtuous circle of economic growth virtuous circle of economic growth – Facing the Facing the inevitableinevitable next stage of development, we next stage of development, we

encounter a similar situation at a global contextencounter a similar situation at a global context– Cultural heterogeneity is of another order of Cultural heterogeneity is of another order of

magnitudemagnitude– Negotiating cultural differences is a major challenge in Negotiating cultural differences is a major challenge in

the current conflict the current conflict

• If we are to escape historical determinism once If we are to escape historical determinism once again, we must negotiate a long lasting truce to again, we must negotiate a long lasting truce to this global class struggle. If we fail we may still this global class struggle. If we fail we may still win a few battles but will probably loose the war win a few battles but will probably loose the war