Critique of and Reference to the Bourgeois Theories of Imperialism

Lenin’s in-depth study of the bourgeois theories of imperialism.

From the end of the 19th century to the beginning of the 20th century, many bourgeois economists and as well as theorists of the Second International also started to pay attention to the phenomena of imperialism. There were three major trends of thought that had relatively significant influence: The first was represented by Joseph Chamberlain and Cecil Rhodes, the apologists of the British colonialist imperialism, and Jakob Riesser, Gerhart von Schulze-Gaevernitz and Robert Liefmann from Germany, who were infatuated with the future of imperialism and did everything possible to beautify it; the second was represented by petty-bourgeois reformist critics such as John A. Hobson from Britain, Victor Bérard and Paul Louis from France, G. Egelhaaf from Germany and E. Agahd, a Russian populist, who ignored the essence of imperialism and attempted to replace the reality of imperialism with petty-bourgeois fantasies; the third was represented by Hilferding and Kautsky of the Second International, who put forward the theory of “the final stage of capitalism” and the theory of “ultra-imperialism”. These studies all attracted Lenin’s attention. Learning from and criticizing the theories of Hilferding and Kautsky were an important part of Lenin’s later studies on imperialism.

The first book systematically discussing imperialism in history was Imperialism written by British economist Hobson in 1902. The book used a lot of information to explain the economic and political characteristics of imperialism, including monopoly, capital export, territorial division, etc. The value of Hobson’s theory was that Hobson found the reason for the formation of imperialism is economy, not politics or military. However, he denied that imperialism is a special stage in the development of capitalism and asserted that imperialism is merely a policy that serves a large amount of capital and seeks foreign investment channels. The policy is to open up channels for investment through aggression and expansion, thus exposing the distinct aggressiveness of imperialism. Lenin argued that the British economist “gave imperialism a much deeper definition and deeply revealed the contradictions of imperialism”.

Austrian social-democrat economist Hilferding published his master work Finance Capital in 1910. He inspected the development of monopoly organizations, put forward the concept of “finance capital”, and argued that finance capital is a huge chain of industrial capital and bank capital. He argued that these groups do not compete with each other by cutting prices. Instead, they seek the support of the state and use financial and political methods to control the entire industry. Hilferding also studied the change in the role of banks—banks control the industry, realizing the combination of bank capital and industrial capital, and finally leading to the rule of financial capital. He also found that the rule of finance capital and capital export will inevitably lead to competition among imperialists, intensifying social contradictions and arousing resistance from oppressed nations.

Kautsky, the main representative of the Second International and the German Social-Democratic Party, presented his understanding of imperialism in Imperialism published in 1914 and Nation-State, The Imperialist State and Alliance of States published in 1915. In an article entitled “On the Slogan for a United States of Europe” published in 1915, Lenin criticized and refuted Kautsky’s view.

Lenin disagreed with Kautsky’s definition of imperialism. Kautsky argued that imperialism is not characterized by finance capital, but by industrial capital and only when the agricultural areas serving industry are continuously expanding can the accumulation of capital in industry proceed unimpededly, and capital develop freely. Kautsky said: “Imperialism is a product of highly developed industrial capitalism. It consists in the striving of every industrial capitalist nation to bring under its control or to annex all the vast rural regions of the world (East), irrespective of what nations inhabit it.” Lenin argued that Kautsky’s definition of imperialism was only linked to industrial capital and only highlighted the annexation of the rural regions of the world. “The result is a slurring-over and a blunting of the most profound contradictions of the latest stage of capitalism, instead of an exposure of their depth.” Lenin did not agree with Kautsky’s analysis of the imperialist contradictions, and the causes and results of war. Kautsky argued the contradiction of imperialism lies in the sharp opposition between the agricultural countries and industrial countries it rules, which will inevitably lead to war, and will directly threaten the economic foundation of imperialism and lead it to the end. Kautsky put forward the “ultra imperialism theory” and argued that capitalism could go through another “ultra-imperialism” stage of applying cartel policy in foreign affairs. At that time, domestic monopoly would become global monopoly, and finally become global trust. The world would then enter a new era without wars and with lasting peace. Lenin pointed out that Kautsky regarded the imperialist war merely as a foreign policy and did not get the essence of imperialism. The so-called idea of pursuing peace through war was also castrated Marxism, reformism at most.

On the basis of the in-depth study of relevant imperialist theories, Lenin wrote the Draft and Explanation of a Programme for the Social-Democratic Party, War in China, Marxism and Revisionism, Growth of Capitalist Wealth and Bourgeois Financial Magnates and Politicians, and other important works. When analyzing imperialism, Lenin fully affirmed reasonable aspects of the imperialism theories of Hilferding, Hobson and others. Lenin agreed with Hilferding’s proposition that “the dominant form of capital in the modern capitalist era is finance capital”, and “the economic essence of modern capitalism is monopoly”, and his opinions on the role of monopoly organizations, changes in the role of banks, historical trend of increasing capital exports and the finance capital becoming dominant and argued these were “extremely valuable theoretical analyses”. However, Hilferding “made mistakes in the monetary theory and had a tendency to reconcile Marxism with opportunism”. His financial capital theory was actually a kind of “circulation determinism”. He studied the emergence of financial capital from the aspects of circulation and credit sphere, instead of looking for the economic and cultural foundation from the material production and productive forces development perspective, which obviously went against Marx’s theory.

Lenin has also sharply criticized the misconceptions of Kautsky and others. He pointed out that the characteristic of imperialism is not industrial capital, but finance capital. The 20th century was a turning point from old capitalism to new capitalism, and from general capital rule to financial capital rule. He argued that Kautsky’s denying that imperialism is a stage of capitalism and thinking that imperialism has relatively little interest in finance capital, is a theory advocating the reconciliation with imperialism. “It just evades and disguises the most profound and fundamental contradictions of imperialism: the contradiction between monopoly and free competition coexisting with it, the contradiction between the huge ‘business’ (and huge profits) of finance capital and the ‘honest’ trading in the free market, and the contradiction between cartels & trusts and non-cartel industries”. This theory completely separates the politics of imperialism from its economy. In response to Kautsky’s “ultra-imperialism” theory, Lenin pointed out that under the conditions of capitalism, the only way to eliminate the incompatibility between the development of productive forces and capital accumulation and the partition of colonies and striving for spheres of influence by financial capital can only be resolved through war. For Lenin, “inter-imperialist” or “super-imperialist” alliance and peace agreements under capitalism “will inevitably be merely a few breaths” between the two wars, regardless of their form, whether one imperialist alliance opposes another or all imperialist powers establish a general all-out alliance.

Lenin founded the scientific theory of imperialism on the basis of analyzing and criticizing the most representative theories of imperialism at that time. The landmark achievement was included in his book Imperialism, the Highest Stage of Capitalism completed in 1916.