Tuesday, 20 September 2011

Collaborate Against Imperialism

The global crisis has led a number of media pundits to declare that ‘Marx was right’.[1] Their declarations reflect a sense of foreboding about the capitalist system, but they are far from being anti-capitalist, and it would be more than generous to assume that they understood Marxist theory. We are now in an environment where friendly critics of the system can flourish, so it will be useful to pin down specific examples of how capitalism is a reactionary force holding society back, not a system that can be reformed. This will avoid getting into the debates over what policies may be adopted to rescue the system that one finds in polite company.

A Marxist analysis of capitalism explains how the ‘real barrier of capitalist production is capital itself’, and how the development of the productive forces of society ‘comes continually into conflict with the limited purpose, the self-expansion of the existing capital’.[2] In this project, I want to focus on two sets of examples to bring this out.

The first set will be ones that illustrate clearly how capitalism holds back the productive forces of society because of the confines of profit.[3] As a counterpoint to these, the second set of examples will show how many progressive developments happen quite outside the spur of private profit that capitalism’s apologists claim is necessary. The first examples would give clear signs of the barrier of capital; the second would show how social production has outgrown these barriers, and that capitalism has outlived its historical role. Implicitly, these latter examples would build an answer to the question that is asked of Marxist critics of capitalism: ‘What would you put in its place?’

In summary, the objective is to show clearly that capitalism is a moribund system. Lenin was the first to use the term ‘moribund’ to describe the imperialist stage of capitalist development, where it had become monopolistic, militaristic, parasitic and decadent.[4] He did not argue that there was no development of the forces of production; growth of productivity and output had certainly not come to a halt. His key points relevant for our purposes were that capitalism was failing to develop the whole world economy (most clearly evidenced today by the decades-long stagnation in most of Africa and parts of Asia) and that monopolised production set barriers to output as vast international combines did all they could to control markets.

There are plenty of contemporary illustrations for Lenin’s other points on the nature of imperialism - militarism, parasitism and decadence. Wars are prevalent, and the Swiss bank UBS considers a $2.3bn trading loss on equity derivatives merely as an embarrassment, though the amount is more than the annual GDP of Guyana or Sierra Leone. But the focus for this project is more specifically on imperialism’s limits to developing the productive forces of society.

This article is planned as the starting point of a collaborative project. I invite readers to contribute examples, together, hopefully, with some analysis, footnotes, references, etc, so that the arguments proposed and the evidence given can be assessed. Such contributions are best done as a ‘comment’ at the bottom of this article, perhaps of only around 100-200 words. Below, I will give a few of my own thoughts on this topic, but hope to encourage others to offer theirs. Depending on the feedback this project gets, I may be able to collate responses in a later article so that they can be more easily shared.

1. Monopoly today

The best book on monopolistic barriers to production that I have come across is, unfortunately, more than 45 years old. In this book, Estes Kefauver, a US senator, detailed the practices of corporations in a range of industries where flagrant monopoly pricing and restrictions on competition were rife.[5] The senator was protesting about the abuse of the market, in the fond hope that correcting this abuse would reinvigorate competition and democracy. This was in the days when being anti-trust was still an acceptable opinion to have in the US, although not much seems to have been done about the cases he identified. I do not claim to be very familiar with the literature on this topic, but I have not come across anything with the scope of the senator’s book in more recent times. I doubt that it exists, but would welcome information on any similar sources. The most I have come across is the occasional newspaper or Internet article on a particular case, and these are rare. Such articles can nevertheless provide valuable information and analysis.

One recent article, by Peter Lee, published by Asia Times Online earlier this month, covers the vehicle tyre production industry in the US. The value of the article is that it places developments in this industry in the context of the carving up of the world market by major corporations.[6] Following a protectionist campaign, the US placed a high tariff placed on Chinese tyre imports in 2009. This led to domestic US producers making more profit at the expense of consumers (cheap tyre prices rose by more than 10%) and to supplies being delivered by other importers instead (including US corporations with factories overseas in locations outside China). There were not even any significant extra US jobs, despite the US labour unions being the main proponents of the tariff action. The article notes China’s complaint that US producers had made a strategic decision to focus on customers ‘who paid more for brand-name, high performance tires’. This is a typical strategy of major imperialist corporations today, where more affluent consumers can be encouraged to buy the branded and supposedly premium product at even-more-premium prices. The ‘low end’ products, with lower margins, are left for the less protected producers.

Examples of monopoly are also common in the area of consumer electronics and communications technology. Anyone using modern technology is struck not only by the major advances that have been made over the past decade or so, but also by a suspicion that things are not all they could be. Yes, there are faster processors, better viewing screens, easier data transfers, mobile access to the Internet and so on. But why does all this cost so much? Why is it that Microsoft’s Vista operating system was full of bugs, when the previous system worked better? Why is MS Office so expensive to buy when the latest version is much worse to use than the previous version? Why are low-spec products from Apple and Sony priced well above any comparable gadget?

It is clear that these corporations are carving up the market to boost their profits. When high street shops can offer inter-continental telephone calls at a fraction of the price from established companies, you smell a rat. The stink has become so pronounced that in Europe the EU Commission has forced mobile telecom companies to cut the absurdly high costs of mobile phone calls when in another country. These areas of production are among many that are full of monopolistic practice, but they receive complaints from consumers rather than analytical attention. I would welcome more detailed feedback on these issues - not from the point of view of making an anti-monopoly case in a legal tribunal, but from the perspective of showing the barriers capitalism places on developing the productive forces.

2. Free gifts from society

There are many examples of discoveries, inventions and innovations that have been given to society for free, and with none of the profit-motive incentive that is usually taken for granted as being necessary. An interesting, broader illustration of this point is made by Titmuss’s famous book, the ‘gift relationship’. He showed how the quality of blood donated by people was better, and the system worked more effectively for medical welfare, when there was no payment to donors. [7] This is not to say that my objective is that everyone should work for nothing; people obviously have to make a living. My point is that people are far more socially oriented than the capitalist market system admits, and the idea of producing for society – although not for this kind of society - rather than for capitalist profit, is not a pipedream.[8]

Prominent examples of free social production are the Internet and products related to it. Tim Berners-Lee was one of the main founders of Internet technology in the early 1990s. He and his colleagues made the ideas freely available to all, applying no restrictive patent and demanding no royalties. One can only imagine what would have happened to the Internet had one of the major IT corporations come up with the ideas instead. On the back of this platform, there is also Wikipedia, a resource of impressive, if sometimes uneven, quality that has been a boon to researchers worldwide. Other examples of free, or almost-free, things that people value are Open Office and a variety of anti-virus products available on the Internet. It may be claimed that these are not as good as the branded commercial items, but when one sees the restrictive features and personal data mining scams that are common in such products, the mark of monopoly makes you draw a different conclusion.

3. Conclusion: collaborate against imperialism

My aim is to begin a collaborative project to investigate imperialism today. I welcome contributions from those who have analysed developments themselves, from those who have come across information that throws light on this topic and from people with questions that would suggest an interesting line of analysis. I have no real idea how this will work out, but hope that in the coming weeks and months there will be some useful contributions to the project. As noted before, it may be best to put a comment at the end of this article. Alternatively, send me an email. I undertake to review whatever comes in, and to present results that can be drawn from this material in a later article on this blog.

Tony Norfield, 20 September 2011

[1] See, for example. Nouriel Roubini, ‘Karl Marx was Right’, The Wall Street Journal Europe, 12 August 2011, and George Magnus, ‘Give Karl Marx a Chance to Save the World Economy’, Bloomberg News, 29 August 2011.
[2] Karl Marx, Capital, Volume III, Chapter XV Section II (p250 in the Lawrence & Wishart, London 1974 edition).
[3] These examples are to complement the more abstract exposition of how the rate of profit tends to fall with capital accumulation, producing crises, as for example in the Appendix to my article ‘Capitalist crisis, Keynesian delusions’, 7 September 2011 on this blog.
[4] See Lenin’s Imperialism, the Highest Stage of Capitalism. Available on this site:
[5] See Estes Kefauver, In a Few Hands: Monopoly Power in America, Pelican Books, 1966 (first published in the US, by Pantheon Books, in 1965). Kefauver was a Democrat Congressman from 1939 and got elected to the Senate in 1948. He was later the chairman of the Senate Subcommittee on Antitrust and Monopoly, where his investigations exposed widespread monopoly practices in a number of major US industries, including autos, pharmaceuticals, steel, defence and even bakeries!
[6] Peter Lee, ‘US drivers pay steep price for China tire tariff’, Asia Times Online, 10 September 2011.
[7] Richard Titmuss, The Gift Relationship: From Human Blood to Social Policy, 1970.
[8] Where capital does recognise that people will produce for society, for example being volunteers, then this may just be a cynical attempt at exploiting a free resource, as with the UK government’s ‘Big Society’ campaign.

1 comment:

  1. Good idea for a project Tony. I look forward to contributing some useful ideas (hopefully). But I tyhink the thing about the system that gets me at present is that *it's just plain too much trouble to keep afloat*. It's just not worth the hassle. Every week something happens and it occurs to me how ridiculous capitalism is these days, how much hassle it is, and how this, that or the other could be organised so much better if done on the basis of a collectively-worked out plan.

    Living in a city that has been hardhit by earthquakes over the past year, and seeing how inadequate insurance companies and so on are for dealing with what has happened here, brings it home more. At the same time, you see incredible community action - people organising collectively, entirely without any personal gain and without any support from the capitalist state, to help each other. The behaviour of most people in the aftermath of the big quakes and the damage they did here, is a small window into what might be possible in a society based on human solidarity rather than private profit.