Imperialism and the Great Reset Part I: Introduction and the Marxist Method

Lesezeit20 min

This is the first installment of a multi-​part series currently serialized in the MagMa. It contains the following parts:

1. Introduction & the Marxist Method

2. Classical Imperialism (1895 – 1945)

3. Late Capitalism (1945 – 1989)

4. The Expansive Phase of Neoliberal Capitalism (1989 – 2007)

5. Neoliberalism in Crisis (since 2007)

6. China’s Rise and the Decline of the West (until 2020)

7. A Fourth Imperialist Epoch?

8. Conclusions on Imperialism

The original text in German can be found here.

1.1 Introduction

The Ukrainian war raises fundamental questions about how imperialism operates today. Some communist parties, such as the Communist Party of Greece (KKE), frame it as a war between two equally imperialist powers when they write:

The decision of the Russian Federation to initially recognize the ›independence‹ of the so-​called ›Peoples’ Republics‹ in Donbas and then to proceed to a Russian military intervention, which is taking place under the pretext of Russia’s ’self-​defense‹, the ›demilitarization‹ and ›defascistization‹ of Ukraine, was not made to protect the people of the region or peace but to promote the interests of Russian monopolies in Ukrainian territory and their fierce competition with Western monopolies.[1]

De facto, the KKE thus sides with the West, branding Russia as the aggressor. At the Imperialism Congress organized by the Communist Organization KO in September 2022, some speakers, especially many young participants, argued similarly.[2] Among many of them, the willingness to embark on a new Russian campaign together with the German government is unmistakable.

How could it have come to this? At any rate, this kind of »analysis« proves the general decay of Marxist thinking. Many »Marxists« try to transfer the insights of Lenin’s work on imperialism more intuitively than scientifically… Newer Marxist literature is simply not taken into account.

Another problem is the great media credulity of today’s youth. They do not question the official narratives on CO2 and Corona at all. They likewise tend to swallow whole media narratives on China and Russia, or at best translate them into pseudo-​Marxist diction. The media, they believe, by and large report the truth and at most reveal a political bias in their commentary. Even the term »mainstream media« is frowned upon.

With the verdict of »conspiracy theory,« the media and governments have imposed thoroughgoing discourse bans on many crucial events of contemporary history, including 9/​11, MH17, the Great Reset, CO2 , Corona, and the affairs of oligarchs like Bill Gates in general. These are dutifully accepted by the KO, for example. No wonder it reaches the wrong conclusions.

In particular, the emerging latest phase of imperialism, propagated by the Western oligarchs under the »Great Reset« slogan, is completely ignored by them. On the one hand, this is understandable because of the boundless media credulity of today’s »communists.« But it is also fatal, because the monstrous plans unabashedly and openly expressed by Klaus Schwab and Co. cast a completely different light on both the Corona hysteria and the Ukraine war. From this it follows that reading Lenin’s imperialism pamphlet alone is not sufficient to understand today’s imperialism.

This text takes a different approach. Drawing on Marxist and bourgeois literature, the periods from 1895 to 1945, 1945 to 1989, 1989 to 2020, and the fourth phase emerging since 2020, are understood as specific epochs of imperialism with specific economic, social, political and military Laws.

Since today’s debate — as already mentioned — is characterized by a lack of knowledge, some basics of Marx’s method shall be discussed first.

1.2 The Marxian method

1. 2.1 The Relationship between History and the Laws of Motion of Capital According to Mandel

To understand what follows, it is important to keep in mind the main features of Marx’s method. As is well known, the laws of development of capitalism discovered by Marx are the result of a dialectical analysis ascending from the abstract to the concrete.[3]

However, the Marxian method cannot be reduced to this, because:

  • The concrete was both the »real starting point« and the final goal of knowledge, which is an active and practical process; the »reproduction of the concrete in the course of thought«
  • the ascent from the abstract to the concrete was preceded in the course of the investigation by an ascent from the concrete to the abstract, since the abstract itself is already the result of analytical work
  • there is unity between both processes, between the analytical and the synthetic
  • the successful reproduction of the concrete totality can become conclusive only by its practical application, i.e. at each step of the analysis must be confirmed by the facts or by practice.[4]

Accordingly, Marxist dialectics imply a twofold analysis, one deductive and one inductive, one logical and one historical.[5]

According to Marx, science is necessary because essence and appearance do not coincide directly. However, its task is not only to uncover the essence of the phenomena, but also to explain the phenomena themselves through the describing of the mediating intermediate links. If this does not succeed, the theory is reduced to the construction of abstract models.

The empirical appropriation of the material is prior to the analytical process of cognition, just as the empirical verification preliminarily concludes it.[6]

Marx states:

the method of presentation must differ in form from that of inquiry. The latter has to appropriate the material in detail, to analyze its different forms of development, to trace out their inner connection. Only after this work is done, can the actual movement be adequately described. If this is done successfully, if the life of the subject-​matter is ideally reflected as in a mirror, then it may appear as if we had before us a mere a priori construction.[7]

According to Mandel, applying Marx’s dialectical method to the research process should ideally look like this:

  • Acquisition of the empirical material
  • Analytical breakdown of the substance into its constitutive abstract elements
  • Research of the decisive overall connections between these elements, which are to clarify the abstract laws of motion of the substance, its essence.
  • Discovery of the middle links that make it possible to realize the mediation between essence and appearance
  • Practical-​empirical verification of the analysis on the concrete historical movement
  • Discovery of new empirically relevant data and new relationships, often even new abstract elementary determinations, thanks to the application of the results of knowledge to the complex reality.[8]

The relationship between the general laws of motion of capital and the history of the capitalist mode of production has not yet been satisfactorily clarified. However, Marx already pointed out that the world market crises must be understood as the real concentration and forcible adjustments of all contradictions of the capitalist economy.[9]

It follows that in the capitalist mode of production, conceived as a dynamic totality, the interplay of all basic laws of development must be considered.

All basic variables of the capitalist mode of production can play the role of independent variables to some extent. These basic variables are:

  • The organic composition of capital in general and in the two departments, »which also includes the volume of capital and its distribution between the departments«
  • The distribution of constant capital between fixed and circulating (in general and in the two departments, this also applies to the following points).
  • The development of the value added rate
  • The development of the rate of accumulation (ratio between productively and unproductively consumed surplus value)
  • The development of the turnover time of the capital
  • The exchange relations between the two departments (which are mostly, but not exclusively, a function of the organic composition of capital in the departments).[10]

The history of the unfolding of the internal contradictions and regularities of capitalism can only be understood as a function of the interplay of these six variables.

The fluctuations of the rate of profit is only the »seismograph« of this development. It can only be explained by the variables mentioned above.

Mandel gives some examples of this:

  • The rate of surplus value is, among other things, a function of the class struggle. Accordingly, it is wrong to see it as a mechanical function of the rate of accumulation, for instance according to the formula: Higher rate of accumulation = lower rate of unemployment = stabilization or decline of the rate of surplus value. This confuses factors which favor an outcome with the outcome itself. The history of the working class shows the many possible variations The situation of the U.S. in the 19th century, for example, contradicts another oversimplified formula: Low labor productivity = low rate of surplus value, high labor productivity = high rate of surplus value. In the U.S., high wages were the result of labor shortages and only later led to high labor productivity. The rate of surplus value, however, was low.
  • The level of the rate of surplus value is also influenced by the historical starting position of the industrial reserve army: »Depending on the size of this reserve army, a growing rate of accumulation may be accompanied by an increasing, a constant, or a declining rate of surplus value.«
  • The growth rate of the organic composition of capital cannot be defined exclusively as a function of the technical progress brought about by competition. This is because constant capital consists of two parts: fixed and circulating constant capital. If labor productivity in the commodity-​producing sector grows faster than that in the consumer goods-​producing sector, »then a relative cheapening of circulating constant capital may take place which has the effect that, despite accelerated technical progress and despite accelerated surplus-​value accumulation in fixed capital, the organic composition of capital grows more slowly than before.«[11]

This means: All basic variables of the capitalist mode of production have to be considered simultaneously as semi-​independent variables. The effect of these variables must be placed in a concrete historical framework in order to analyze and explain the successive phases of the history of capitalism. The combination of all these uneven developmental tendencies, i.e., the semi-​independent variables, makes it possible to grasp the history of the capitalist mode of production, and especially that of its imperialist phase, from the laws of motion of capital itself and not from any exogenous factors foreign to Marx’s analysis of capital.

1.2.2 The tendential fall of the rate of profit

Capitalism has existed as an independent social formation for 233 years. Imperialism for 127 years (as of 2022). The decisive question must therefore be why it did not collapsed long ago due to the law of the tendential fall of the rate of profit. Since this question is of extreme importance for the following presentation, the law discovered by Marx will be explained in detail and in a generally understandable way in the following:[12]

Every capitalist who starts a new industrial enterprise must divide his capital into two different parts. One part for the purchase of machines, buildings, raw materials, auxiliary materials and so on. The value of this part of the capital goes into the value of the final products in the course of the production process and is preserved. It is therefore called constant capital.

The second part of the capital must be used for the purchase of labor power. This part increases by the surplus value produced by the workers. It is therefore called variable capital.[13]

Only the commodity labor power is capable of creating value and surplus value. The value of constant capital, for example of machines, can in turn be traced back to the value of the commodity labor power that was used for its production.[14]

The ratio between the constant and the variable part of capital is called the organic composition of capital. The more developed a company, an industrial sector, or a country is, the higher the organic composition of capital, i.e., the share of constant capital, i.e., the capital spent on the acquisition of machinery, etc., is.

Formula:

Organic Composition of Capital = c /​v

Where: c = constant capital, v = variable capital[15]

If the average organic composition of capital increases, then — all other things being equal — the average rate of profit decreases.

Example:

The value of a country’s annual production is 300 billion c, 100 billion v and 100 billion m (surplus value). Then the rate of profit is 25 percent.

Formula:

m /​c+v = 100 /​300 + 100 = 100 /​400 =25 percent

If the value of constant capital increases from 300 to 400 value units in a decade, the following applies:

m/​c+v = 100 /​400 + 100 = 100 /​500 =20 percent

Where: c = constant capital, v = variable capital, m = surplus value

This development can indeed be observed in reality, because the increase of constant capital in relation to variable capital is a characteristic feature of capitalism. The tendency of the rate of profit to fall is thus a law of development of the capitalist mode of production.[16]

Karl Marx, however, deliberately spoke of the tendency of the rate of profit to fall, because it is slowed down by a number of counteracting factors.

  1. increase in the rate of surplus value: growth in the organic composition of capital implies growth in labor productivity, which may amount to an increase in the rate of surplus value. Example:
    m/​c+v = 125 /​400 + 100 = 125 /​500 = 25 percent

In the long run, however, it is not possible to achieve an equivalent increase in the value-​added rate and the organic composition. For the increase of the rate of surplus value encounters absolute limits. These lie in the impossibility of reducing the necessary labor to zero, while there are no limits to the increase of the organic composition of capital.[17]

  1. the decrease of the prices of the constant capital. When the general productivity of labor increases, the value of each commodity decreases. Of course, this also applies to machines and other means of production.
  2. expansion of capitalist production. When capital is invested in countries or industries where low organic composition initially prevails, the average organic composition of world capital falls and the rate of profit rises.[18]

1.2.3 The long waves in capitalism

It stands to reason that the rate of profit rises as a result of a declining organic composition, especially when two or even all of these factors coincide. In this case it can happen that profits suddenly shoot up, a lot of hitherto idle capital is invested and thus a self-​supporting phase of capitalist boom sets in for some time — until, finally the law of the tendential fall of the rate of profit reasserts itself.[19]

In fact, these phases can be traced in history. They are marked by roughly 20 year ascents as well as 20 year declines. The long waves of capitalist development exist in addition to the ordinary business cycle of 5 to 10 years with its perennial sequence of revival, boom, overproduction, crash and crisis. They prevail precisely through these »ordinary« cycles and in such a way that in an expansive phase the cyclical periods of boom are longer and more intense, the cyclical crises of overproduction shorter and less deep. Conversely, in the »long wave« phases which tend toward stagnation, the periods of boom are less frenzied and shorter, while the periods of overproduction crisis are longer and deeper.[20]

So far, the following long waves existed:

Table 2.3.1. long waves in the history of capitalism. The abbreviations of the value components mean: cf: Constant fixed capital, e.g. machinery, cc: Constant circulating capital, e.g., raw materials, v: Variable capital, i.e., wages, m/​v: Rate of surplus value.[21]

Thus, the law of the tendential fall of the rate of profit has so far caused a wave-​like movement of capitalism. Long periods of strong growth of capital accumulation were contrasted with periods of stagnant tendencies. However: as we have seen, triggers for a long wave of expansive character were geographical, geological and political factors. These have always been specific, and it is by no means guaranteed that so many factors will come together again to trigger a new long wave with an expansive tendency. The changeover to a long wave with a stagnant tendency, on the other hand, is caused by the increase in the organic composition of capital as described in the law of the tendential fall of the rate of profit.[22]

In addition, there is another factor: Capitalism is based on the extraction of living human labor. Through the increasing organic composition of capital as a result of automation, it undermines its own foundations. Here we have arrived at the absolute inner limit of the capitalist mode of production. It lies where the surplus-​value mass itself inevitably declines — because of the elimination of living labor from the production process which takes place in full automation.[23]

Capitalism is incompatible with fully automated production in the whole of industry and agriculture, because then there could be no creation of surplus value and thus no capital valorization. Accordingly, automation can never extend to the entire production sector. However, the anticipated major changes, namely Industry 4.0 and artificial intelligence, would once again radically accelerate the elimination of humans from the production process.

Karl Marx writes:

As soon as labor in the direct form has ceased to be the great well-​spring of wealth, labor time ceases and must cease to be its measure, and hence exchange value [must cease to be the measure] of use value. The surplus labor of the mass has ceased to be the condition for the development of general wealth, just as the non-​labour of the few, for the development of the general powers of the human head.[24]

It has been debated among Marxists for decades whether this point has already been reached or whether it is to be expected in the next few years.

Trotsky already recognized that imperialism has created an integrated world economy in which the great powers are engaged in a struggle for hegemony. The nation-​state economies are closely interconnected. The world economy forms a complex hierarchy of the division of labor in which even non-​capitalist modes of production are not extinguished but adapted to the needs of capital. The world market and the national economies are characterized by uneven and combined development.

According to Mandel, the long waves of capitalist development with their upswings and downswings are at the same time to be regarded as specific historical periods. They exhibit not only a specific economic constellation and specific technology, but also a specific international balance of power and class struggle constellation, and even a specific culture and mentality. In this respect, they are very different from one another.[25]

There have been five such periods in the history of capitalism so far:

  • Period of the long industrial revolution (1789 to 1848)
  • Free Competitive Capitalism (1848 to 1895)
  • Classical Imperialism (1895 to 1945)
  • Late capitalism (1945 to 1989)
  • Neoliberalism (1989 to 2020)

The period of the long industrial revolution was also the time of the great bourgeois revolutions (1789, 1830, 1848), the Napoleonic wars, and the establishment of the world market for manufactured goods.[26]

The formation of classical imperialism was the answer to the already increasing difficulties of free competitive capitalism. Late capitalism, in turn, emerged from the titanic struggle of two imperialist power groups. It was the result of, on the one hand, a great defeat for the working class by fascism and war, but also, on the other, of a great victory for the working class, organized in the form of a state in the Soviet Union, against German imperialism. This gave this period a specific character.

This fact alone illustrates that it is completely impossible to understand the present form of imperialism after reading Lenin’s treatise on imperialism. Rather, the periods must be considered in their entirety, which presupposes the study of the relevant literature and a greater scholarly effort, which, admittedly, can only be made in this text in rudimentary form. Much would already have been achieved if it could provide one or two suggestions for further research.

One more word about the periodization used: the names do not actually fit. The term late capitalism implies that it is the last period of capitalism, which was refuted in 1989. Neoliberalism was originally an economic theory developed after World War II by Karl Popper, Milton Friedman and Friedrich August von Hayek. However, it is also the name of a capitalist period whose ideology is based on neoliberal economic theory. Alternative names, such as high-​technology capitalism by Manuel Candeias, have not caught on, especially since classical imperialism and late capitalism could also be called high technology capitalism. They, too, were based to a large extent on the latest technology of the time, which they developed further.

References

[1] »Joint Statement of Communist and Workers’ Parties: No to the imperialist war in Ukraine!,« Communist Party of Greece, 24.02.2022, https://​inter​.kke​.gr/​e​n​/​a​r​t​i​c​l​e​s​/​N​o​-​t​o​-​t​h​e​-​i​m​p​e​r​i​a​l​i​s​t​-​w​a​r​-​i​n​-​U​k​r​a​i​ne/.

[2] Kommunistische Organisation, »Live-​Streams vom Kommunismus-​Kongress« (Youtube, Berlin, 22.09.2022), https://​kommunistische​.org/​a​l​l​g​e​m​e​i​n​/​l​i​v​e​-​s​t​r​e​a​m​s​-​v​o​m​-​k​o​m​m​u​n​i​s​m​u​s​-​k​o​n​g​r​e​s​s​-​2​0​22/.

[3] Ernest Mandel, Der Spätkapitalismus ( Frankfurt am Main: Suhrkamp, 1974) S. 11.

[4] Ibid. S. 12

[5] W.I. Lenin, Aus dem philosophischen Nachlass (Berlin 1949) S. 249f, as cited in Ibid.

[6] Ernest Mandel, Der Spätkapitalismus ( Frankfurt am Main: Suhrkamp, 1974) S. 13

[7] Karl Marx, Das Kapital, Vol. I (Berlin: Dietz Verlag, 1988), MEW 23, S. 2.

[8] Ernest Mandel, Der Spätkapitalismus ( Frankfurt am Main: Suhrkamp, 1974) S. 14f

[9]Karl Marx, Theories of Surplus Value, Vol. II, Stuttgart, 1919, S. 282, as cited in Ernest Mandel, Der Spätkapitalismus ( Frankfurt am Main: Suhrkamp, 1974), S. 36.

[10] Ernest Mandel, Der Spätkapitalismus ( Frankfurt am Main: Suhrkamp, 1974), S. 37

[11] Ibid. S. 37

[12]Jan Müller, »Dark Winter — Thesenpapier zur Coronakrise,« Freie Funke: Stimme Der Freien Linken, Freie Linke, 19. 02. 2021,https://backup.freielinke.net/redaktion-fl/2021/02/dark-winter-thesenpapier-zur-coronakrise.

[13] Ernest Mandel, Marxistische Wirtschaftstheorie, Vol. 1 ( Frankfurt am Main: Suhrkamp, 1972) S. 181.

[14] Karl Neelsen, Kapital und Mehrwert: Lehrhefte Politische Ökonomie des Kapitalismus (Berlin: Dietz Verlag, 1973) S. 17.

[15] Ernest Mandel, Marxistische Wirtschaftstheorie, Vol. 1 ( Frankfurt am Main: Suhrkamp, 1972) S. 182.

[16] Ernest Mandel, Marxistische Wirtschaftstheorie, Vol. 1 ( Frankfurt am Main: Suhrkamp, 1972) S. 196.

[17] Ernest Mandel, Marxistische Wirtschaftstheorie, Vol. 1 ( Frankfurt am Main: Suhrkamp, 1972) S. 198f.

[18] Ernest Mandel, Marxistische Wirtschaftstheorie, Vol. 1 ( Frankfurt am Main: Suhrkamp, 1972)S. 199f.

[19]Jan Müller, »Dark Winter — Thesenpapier zur Coronakrise,« Freie Funke: Stimme Der Freien Linken, Freie Linke, 19. 02. 2021,https://backup.freielinke.net/redaktion-fl/2021/02/dark-winter-thesenpapier-zur-coronakrise.

[20] Ernest Mandel, Der Spätkapitalismus ( Frankfurt am Main: Suhrkamp, 1974), S. 115.

[21] Ernest Mandel, Der Spätkapitalismus ( Frankfurt am Main: Suhrkamp, 1974)„ S. 122ff. Supplemented from 1975 on by the present author.

[22] Ibid., S. 106ff.

[23] Ibid. S. 191.

[24] Karl Marx, Grundrisse: Foundations of the Critique of Political Economy (Penguin Books: 1973) Notebook VII — The Chapter on Capital

[25] Ernest Mandel, Die langen Wellen im Kapitalismus, ( Frankfurt am Main: ISP-​Verlag, 1987), S. 91ff

[26] Ibid. S. 98

Works Cited

»Joint Statement of Communist and Workers’ Parties: No to the imperialist war in Ukraine!« Communist Party of Greece. 24.02.2022. https://​inter​.kke​.gr/​e​n​/​a​r​t​i​c​l​e​s​/​N​o​-​t​o​-​t​h​e​-​i​m​p​e​r​i​a​l​i​s​t​-​w​a​r​-​i​n​-​U​k​r​a​i​ne/.

Kommunistische Organisation. »Live-​Streams vom Kommunismus-​Kongress.« Youtube, Berlin, 22.09.2022), https://​kommunistische​.org/​a​l​l​g​e​m​e​i​n​/​l​i​v​e​-​s​t​r​e​a​m​s​-​v​o​m​-​k​o​m​m​u​n​i​s​m​u​s​-​k​o​n​g​r​e​s​s​-​2​0​22/.

Mandel, Ernest. Der Spätkapitalismus. Frankfurt am Main: Suhrkamp, 1974.

—- Marxistische Wirtschaftstheorie, Vol. I. Frankfurt am Main: Suhrkamp, 1972.

—-Die langen Wellen im Kapitalismus. Frankfurt am Main: ISP-​Verlag, 1987.

Marx, Karl. Das Kapital, Vol. I. Berlin: Dietz Verlag, 1988, MEW 23.

—– Grundrisse: Foundations of the Critique of Political Economy. Penguin Books: 1973. https://​www​.marxists​.org/​a​r​c​h​i​v​e​/​m​a​r​x​/​w​o​r​k​s​/​1​8​5​7​/​g​r​u​n​d​r​i​s​s​e​/​c​h​1​4​.​htm

Müller, Jan. »Dark Winter — Thesenpapier zur Coronakrise.« Freie Funke: Stimme Der Freien
Linken. Freie Linke, 19. 02. 2021. https://​backup​.freielinke​.net/​r​e​d​a​k​t​i​o​n​-​f​l​/​2​0​2​1​/​0​2​/​d​a​r​k​-​w​i​n​t​e​r​-​t​h​e​s​e​n​p​a​p​i​e​r​-​z​u​r​-​c​o​r​o​n​a​k​r​ise.

Neelsen, Karl. Kapital und Mehrwert, Lehrhefte Politische Ökonomie des Kapitalismus. Berlin: Dietz Verlag, 1973.

Lenin, VI. Aus dem philosophischen Nachlass, Berlin, 1949.

Cover image: Construction (1922) by Gustav Klutsis

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