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‘If it were necessary to give
the briefest possible definition of imperialism we should have to say that
imperialism is the monopoly stage of capitalism.’ Lenin, 1916
Lenin’s definition of
imperialism involves the control of the world economy by groups of
monopolistic companies, not simply monopolised production in particular
countries, and also a hierarchy of nations in the world economy, with the
biggest capitalist powers dominating. The role of the state is important
because of the inevitably uneven development of world capitalism. More
economically developed countries will tend to have more productive companies
that are larger and stronger in the world market, and a state that will tend to
have bigger resources for domination than others. Lenin’s five summary features
of imperialism were posed as the key aspects of a single imperialist reality,
not as independent factors that happen to coincide, and the monopolistic
development of the world economy was key.
Monopoly power is good for the
monopolist, but less so for the national economy in which it operates. Hence,
there is usually a state policy against local monopolies and cartels, complete
with legislation or regulatory bodies to limit the abuse of market power. This
is a rational move on the part of state authorities for the working of the
domestic capitalist system, since a stranglehold over the supply of key
commodities and services by a few companies could be damaging for all the
others. Marx had already noted in Capital that the establishment of monopolies
in certain spheres had provoked ‘state interference’.
Probably the most famous early
example of this was the Sherman Antitrust Act of 1890 in the US, although it
took other state measures to limit the power of Rockefeller’s Standard Oil, a
trust that refined 80% of the national US oil output and overwhelmingly
dominated the production, transport and markets for a range of other oil and
energy products. There have been further ‘anti-monopoly’ policies in the US in
the past century, and in other countries that have agencies to investigate and
rule on markets, such as the UK’s optimistically named Competition Commission,
a successor to its Monopolies Commission. Yet these have done little to prevent
a steady drift towards further monopoly power in most sectors of the economy. An
extreme example is in South Korea, which has been dubbed ‘the Republic of
Samsung’ by locals, since the company’s conglomerate structure, from road
construction to oil rigs, to hotels, insurance and smartphones, accounts for a
fifth of national output.
However, the concern a particular state might
have about market domination in the domestic sphere does not extend to the
operations of its companies in the international market. On the
contrary, large companies get significant backing from their states for
expanding their foreign business. The logic here is that the consequence of any
exercise of monopoly power is another country’s burden, one that might even
favour the home country via the improved profitability of the domestically
based company. Apart from any technical cost advantages that might result from
larger scale global operations, international expansion also enhances the
global market position of the company, boosting its monopolistic power.
Perhaps the only exception to this lax
international policy is where EU member states have adopted an anti-monopoly
policy within the EU area, as a means to promote a large single market
that is considered to be in member countries’ joint interests. Hence, there
have been some (limited) measures against price fixing in the EU. That has not
stopped widespread manipulation of the ‘free market’, as detailed in a study of
some 20 cartels published in 2006.
The result of the trend towards monopoly is that
the worldwide production of most of the key products and the provision of most
of the key services of modern capitalism is today dominated by a small number
of companies. Fewer than around 10 companies often control the bulk of global
activity in many areas, despite the further opening up of the world market in
the past 30 years. Here are some examples:
- Over half of global vehicle production in 2001 was attributable to just five companies, and 11 companies accounted for over 80% of output.
- In the case of beer, so to speak, just four companies provided over half the world’s consumption in 2009.
- Glencore, ahead of its merger with Xstrata in May 2013 was reported to be controlling ‘more than half the international tradable market in zinc and copper and about a third of the world's seaborne coal; was one of the world's largest grain exporters, with about nine percent of the global market; and handled three percent of daily global oil consumption’.
- In a more recently developed market, mobile phones, the degree of monopolisation is little different: in 2010, six companies accounted for just over 60% of global sales, with Nokia and Samsung having nearly half the market between them.
- Everybody knows about the domination of Apple, Microsoft and Amazon in their respective markets.
Naturally, the monopolistic corporations of the
world are not equally distributed among countries. An UNCTAD report showed that
of the top 100 international non-financial corporations in 2008, ranked by
total assets, 75 had a ‘home’ in just six: the US (18), UK (15), France (15),
Germany (13), Japan (9) and Switzerland (5).
None of this information is a
big surprise. However, I though it was worth sharing as a further illustration
of today’s imperialist world economy.
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