Dhalgren
06-24-2017, 10:05 AM
This thread is intended to explore the development of imperialism over the hundred years since the publishing, in 1916, of V. I. Lenin’s seminal work, Imperialism, the Highest Stage of Capitalism, and to discuss imperialism’s current status in the second decade of the 21st century.
A primary issue will be if, and if so how, the current imperialism has changed from the imperialism described and defined by Lenin in 1916. That Lenin’s great work needs updating with the developments in imperialism over the last century is obvious, whether his theory needs amending is another, and primary, question. Hopefully, this thread will address and shed light on these and a range of other questions; after all, threads usually take on a life of their own and go where they please.
This thread should be one of commentary and not one of “simple” news. If a news story dealing with imperialism is posted, it should be accompanied by commentary tying it to one of the issues being developed in the thread.
Enough preamble!
We must arrive at a definition of imperialism.
The first paragraph in the Wikipedia entry for the term imperialism is as follows:
Imperialism is an action that involves a country (usually an empire or kingdom) extending its power by the acquisition of territories. It may also include the exploitation of these territories, an action that is linked to colonialism. Colonialism is generally regarded as an expression of imperialism.
https://en.wikipedia.org/wiki/Imperialism
Dictionary.com has this usage:
the policy of extending the rule or authority of an empire or nation over foreign countries, or of acquiring and holding colonies and dependencies.
http://www.dictionary.com/browse/imperialism
And just to round out the mainstream definition for imperialism we go to Merriam-Webster:
the policy, practice, or advocacy of extending the power and dominion of a nation especially by direct territorial acquisitions or by gaining indirect control over the political or economic life of other areas.
https://www.merriam-webster.com/dictionary/imperialism
(My emphases in each passage above.)
Whenever the subject of imperialism comes up, even in discussions with leftists and Marxists, almost invariably imperialism is taken to mean “a policy”, “a practice”, “an action decided upon”. It is as though some nefarious group of evildoers, a star chamber of megalomaniacs, simply met and chose to become imperialists; decided to enact a policy of imperialism for their own benefits. This is not historical materialism – this is idealism. The idea is that the US could just stop its imperialist behavior, or that Britain, France, or Germany could just vote to quit their imperialist activities. This idea is without merit and works to the benefit of imperialists everywhere. It blunts any criticism of imperialism before the criticism even begins.
We cannot simply look at what imperialist powers do and the effects world consuming imperialism has on nations and peoples, we must have a materialist understanding of imperialism, its origins, its development, and its reasons for being. We cannot hope to effectively stand against imperialism in the 21st century if we have no accurate understanding of what it actually is and how it actually operates. Fortunately, we have a clear and concise, materialist breakdown of imperialism at our disposal: V. I. Lenin’s Imperialism, the Highest Stage of Capitalism.
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. p.88 (All citations are from Imperialism, The Highest Stage of Capitalism, by V. I. Lenin, 1939 ed. International Publishers Co., Inc.)
(My emphases.)
According to Lenin, imperialism is the monopoly stage of capitalism. This materialist definition of imperialism automatically places those who are anti-imperialism, but who are not anti-capitalism, into a quandary. If imperialism is capitalism, then working for the end of one is working for the end of both. More on this later.
Imperialism, as the highest stage of capitalism began, in earnest, at the very beginning of the 20th century. Monopolies, which ended “free” competition, had been developing in various sectors of industry and raw materials production for nearly thirty years and early in the first decade of the new century had supplanted “free” competition across the board.
Thus, the principal stages in the history of monopolies are the following: (1) 1860-70, the highest stage, the apex of development of free competition; monopoly is in the barely discernible, embryonic stage. (2) After the crisis of 1873, a wide zone of development of cartels; but they are still the exception. They are not yet durable. They are still a transitory phenomenon. (3) The boom at the end of the nineteenth century and the crisis of 1900-03. Cartels become one of the foundations of the whole of economic life. Capitalism has been transformed into imperialism. pp. 21-22
We see clearly here that imperialism is fundamentally the development of capitalism into a new form of social relations. Instead of individual capitalists struggling against one another in “free” competition, groups or conglomerates of capitalists, working together as monopolies, effectively eliminated competition, and were able to capture larger market shares and more and more resources.
The transition to this new stage of capitalism was relatively smooth. As one commentator quoted by Lenin says:
And while at that time it appeared to be something novel, now the general public takes it for granted that large spheres of economic life have been, as a general rule, systematically removed from the realm of free competition. p. 21
The same can be said today. While most individuals would say capitalism is based on “free” markets and “free” competition, there seems to be no outward recognition that this has not been true for more than a hundred years.
With the solidification of the industrial and raw materials monopolies the banks were not far behind. And with the rise of the banking monopolies, imperialism came into its own.
The principal and primary function of banks is to serve an intermediary in the making of payments. In doing so they transform inactive money capital into active capital, that is, into capital producing a profit; they collect all kinds of money revenues and place them at the disposal of the capitalist class.
As banking develops and becomes concentrated in a small number of establishments the banks become transformed, and instead of being modest intermediaries they become powerful monopolies having at their command almost the whole of the money capital of all the capitalists and small businessmen and also a large part of the means of production and of the sources of raw materials of the given country and in a number of countries. This transformation of numerous modest intermediaries into a handful of monopolists represents one of the fundamental processes in the transformation of capitalism into capitalist imperialism.p. 31
Once capitalism transformed into imperialism the stage was set for the division of the planet.
The capitalists divide the world, not out of any particular malice, but because the degree of concentration which has been reached forces them to adopt this method in order to obtain profits. And they divide it “in proportion to capital”, “in proportion to strength”, because there cannot be any other method of division under commodity production and capitalism. But strength varies with the degree of economic and political development. In order to understand what is taking place, it is necessary to know what questions are settled by the changes in strength. The question as to whether these changes are “purely” economic or non-economic (e.g., military) is a secondary one, which cannot in the least affect fundamental views on the latest epoch of capitalism. To substitute the question of the form of the struggle and agreements (today peaceful, tomorrow warlike, the next day warlike again) for the question of the substance of the struggle and agreements between capitalist associations is to sink to the role of a sophist. p. 75
(My underlining.)
Between 1914 and 1945 the capitalist world was wracked by imperialist conflict and crises of biblical proportions. By the summer of 1945 half the world lay in ruins hundreds of millions of humans were dead and trillions in capital had been incinerated. Atop this ash heap stood the United States and the Soviet Union. Since this this a discussion of imperialism, the Soviet Union will not enter into it directly, but its presence was seminal and conditioned the development of US imperialism and still does to this day.
In July 1944, US imperial hegemony was established and codified at the Bretton Woods conference in New Hampshire. Here is the US Federal Reserve’s account of the US taking over the capitalist world:
Creation of the Bretton Woods System
July 1944
A new international monetary system was forged by delegates from forty-four nations in Bretton Woods, New Hampshire, in July 1944. Delegates to the conference agreed to establish the International Monetary Fund and what became the World Bank Group. The system of currency convertibility that emerged from Bretton Woods lasted until 1971.
U.N. Monetary Conference (Photo: Associated Press; Photographer: Abe Fox)
by Sandra Kollen Ghizoni, Federal Reserve Bank of Atlanta
The United Nations Monetary and Financial Conference was held in July 1944 at the Mount Washington Hotel in Bretton Woods, New Hampshire, where delegates from forty-four nations created a new international monetary system known as the Bretton Woods system. These countries saw the opportunity for a new international system after World War II that would draw on the lessons of the previous gold standards and the experience of the Great Depression and provide for postwar reconstruction. It was an unprecedented cooperative effort for nations that had been setting up barriers between their economies for more than a decade.
They sought to create a system that would not only avoid the rigidity of previous international monetary systems, but would also address the lack of cooperation among the countries on those systems. The classic gold standard had been abandoned after World War I. In the interwar period, governments not only undertook competitive devaluations but also set up restrictive trade policies that worsened the Great Depression.
Those at Bretton Woods envisioned an international monetary system that would ensure exchange rate stability, prevent competitive devaluations, and promote economic growth. Although all participants agreed on the goals of the new system, plans to implement them differed. To reach a collective agreement was an enormous international undertaking. Preparation began more than two years before the conference, and financial experts held countless bilateral and multilateral meetings to arrive at a common approach. While the principal responsibility for international economic policy lies with the Treasury Department in the United States, the Federal Reserve participated by offering advice and counsel on the new system.1 The primary designers of the new system were John Maynard Keynes, adviser to the British Treasury, and Harry Dexter White, the chief international economist at the Treasury Department.
Keynes, one of the most influential economists of the time (and arguably still today), called for the creation of a large institution with the resources and authority to step in when imbalances occur. This approach was consistent with his belief that public institutions should be able to intervene in times of crises. The Keynes plan envisioned a global central bank called the Clearing Union. This bank would issue a new international currency, the “bancor,” which would be used to settle international imbalances. Keynes proposed raising funds of $26 million for the Clearing Union. Each country would receive a limited line of credit that would prevent it from running a balance of payments deficit, but each country would also be discouraged from running surpluses by having to remit excess bancor to the Clearing Union. The plan reflected Keynes’s concerns about the global postwar economy. He assumed the United States would experience another depression, causing other countries to run a balance-of-payments deficit and forcing them to choose between domestic stability and exchange rate stability.
White’s plan for a new institution was one of more limited powers and resources. It reflected the concerns that much of the financial resources of the Clearing Union envisioned by Keynes would be used to buy American goods, resulting in the United States holding the majority of bancor. White proposed a new monetary institution called the Stabilization Fund. Rather than issue a new currency, it would be funded with a finite pool of national currencies and gold of $5 million that would effectively limit the supply of reserve credit.
The plan adopted at Bretton Woods resembled the White plan with some concessions in response to Keynes’s concerns. A clause was added in case a country ran a balance of payments surplus and its currency became scarce in world trade. The fund could ration that currency and authorize limited imports from the surplus country. In addition, the total resources for the fund were raised from $5 million to $8.5 million.
The Mount Washington Hotel, White Mts., N.H. (Photo: Library of Congress, Prints & Photographs Division, Detroit Publishing Company Collection, LC-D4-19762)
The 730 delegates at Bretton Woods agreed to establish two new institutions. The International Monetary Fund (IMF) would monitor exchange rates and lend reserve currencies to nations with balance-of-payments deficits. The International Bank for Reconstruction and Development, now known as the World Bank Group, was responsible for providing financial assistance for the reconstruction after World War II and the economic development of less developed countries.
The IMF came into formal existence in December 1945, when its first twenty-nine member countries signed its Articles of Agreement. The countries agreed to keep their currencies fixed but adjustable (within a 1 percent band) to the dollar, and the dollar was fixed to gold at $35 an ounce. To this day, when a country joins the IMF, it receives a quota based on its relative position in the world economy, which determines how much it contributes to the fund.
In 1958, the Bretton Woods system became fully functional as currencies became convertible. Countries settled international balances in dollars, and US dollars were convertible to gold at a fixed exchange rate of $35 an ounce. The United States had the responsibility of keeping the price of gold fixed and had to adjust the supply of dollars to maintain confidence in future gold convertibility. The Bretton Woods system was in place until persistent US balance-of-payments deficits led to foreign-held dollars exceeding the US gold stock, implying that the United States could not fulfill its obligation to redeem dollars for gold at the official price. In 1971, President Richard Nixon ended the dollar’s convertibility to gold.
Endnotes
1You can see some of the documents that resulted from those meetings here, and other archival material is available here and here.
Bibliography
Bernstein, Edward. “Reflections on Bretton Woods.” In The International Monetary System: Forty Years After Bretton Woods, 15-20. Boston: Federal Reserve Bank of Boston, May 1984.
Bordo, Michael D. "Gold Standard." In The Concise Encyclopedia of Economics. Library of Economics and Liberty. Article published 2008.
Bordo, Michael, Owen Humpage, and Anna J. Schwartz, "U.S. Intervention during the Bretton Wood Era: 1962-1973," Working Paper 11-08, Federal Reserve Bank of Cleveland, Cleveland, Ohio, April 2011.
Eichengreen, Barry. Exorbitant Privilege: The Rise and Fall of the Dollar and the Future of the International Monetary System. New York: Oxford University Press, 2011.
Kenen, Peter. “Bretton Woods System.” In The New Palgrave Dictionary of Economics, Second Edition, edited by Steven N. Durlauf and Lawrence E. Blume. Palgrave Macmillan, 2008.
Meltzer, Allan H. “U.S. Policy in the Bretton Woods Era.” Federal Reserve Bank of St. Louis Review 73, no. 3 (May/June 1991): 54-83.
Patinkin, Don. “Keynes, John Maynard (1883–1946).” In The New Palgrave Dictionary of Economics, Second Edition, edited by Steven N. Durlauf and Lawrence E. Blume. Palgrave Macmillan, 2008.
Written as of November 22, 2013. See disclaimer.
https://www.federalreservehistory.org/essays/bretton_woods_created
“The United Nations Monetary and Financial Conference was held in July 1944 at the Mount Washington Hotel in Bretton Woods, New Hampshire, where delegates from forty-four nations created a new international monetary system known as the Bretton Woods system. These countries saw the opportunity for a new international system after World War II” Indeed.
“It was an unprecedented cooperative effort for nations that had been setting up barriers between their economies for more than a decade.” Cooperation between nations either destroyed by war, economic crises, or nations who were already dependent upon one or another of the imperialist powers (or what remained of them) and the US colossus.
The Fed’s history is, of course, couched in bourgeois apologia, but the procedures and reasonings are easy to discern. The conference established the US dollar os the world’s currency, created the IMF and the World Bank and named the US as Imperial Hegemon. All under US guidance, of course. The US made the capitalist world ‘an offer it could not refuse’, so to speak.
Here is “the IMF at a Glance” - from the IMF, itself:
Full Text
The IMF at a Glance
April 20, 2017
The International Monetary Fund, or IMF, promotes international financial stability and monetary cooperation. It also facilitates international trade, promotes employment and sustainable economic growth, and helps to reduce global poverty. The IMF is governed by and accountable to its 189 member countries.
Founding and mission: The IMF was conceived in July 1944 at the United Nations Bretton Woods Conference in New Hampshire, United States. The 44 countries in attendance sought to build a framework for international economic cooperation in order to avoid repeating the competitive currency devaluations that contributed to the Great Depression of the 1930s. The IMF's primary mission is to ensure the stability of the international monetary system—the system of exchange rates and international payments that enables countries and their citizens to transact with each other.
Surveillance: In order to maintain stability and prevent crises in the international monetary system, the IMF monitors member country policies as well as national, regional, and global economic and financial developments through a formal system known as surveillance. The IMF provides advice to member countries and promotes policies designed to foster economic stability, reduce vulnerability to economic and financial crises, and raise living standards. It also provides periodic assessments of global prospects in its World Economic Outlook, of financial markets in its Global Financial Stability Report, of public finance developments in its Fiscal Monitor, and of external positions of largest economies in its External Sector Report, in addition to a series of regional economic outlooks.
Financial assistance: Providing loans to member countries that are experiencing actual or potential balance-of-payments problems is a core responsibility of the IMF. Individual country adjustment programs are designed in close cooperation with the IMF and are supported by IMF financing, and ongoing financial support is dependent on effective implementation of these adjustments. In response to the global economic crisis, in April 2009 the IMF strengthened its lending capacity and approved a major overhaul of its financial support mechanisms, with additional reforms adopted in 2010 and 2011. These changes enhanced the IMF’s crisis-prevention toolkit, bolstering its ability to mitigate contagion during systemic crises and allowing it to better tailor instruments to meet the needs of individual member countries.
Loan resources available to low-income countries were sharply increased in 2009, while average limits under the IMF’s concessional loan facilities were doubled. Under a new agreement that went into effect in January 2016, members’ financial commitments to the IMF, also known as their quotas, were significantly increased (see below), and access limits under the IMF’s non-concessional lending facilities were reviewed and increased. In addition, zero interest rates on concessional loans were extended through the end of 2018, and the interest rate on emergency financing is permanently set at zero. Finally, efforts are currently under way to secure additional loan resources of about SDR 11 billion (about $15 billion) to support the IMF’s concessional lending activities.
Capacity development: The IMF provides technical assistance and training to help member countries build better economic institutions and strengthen related human capacities. This includes, for example, designing and implementing more effective policies for taxation and administration, expenditure management, monetary and exchange rate policies, banking and financial system supervision and regulation, legislative frameworks, and economic statistics.
SDRs: The IMF issues an international reserve asset known as Special Drawing Rights, or SDRs, that can supplement the official reserves of member countries. Total global allocations are currently about SDR 204 billion (some $275 billion). IMF members can voluntarily exchange SDRs for currencies among themselves.
Resources: Member quotas are the primary source of IMF financial resources. A member’s quota broadly reflects its size and position in the world economy. With the recent effectiveness of the 14th General Review of Quotas, total quota resources are now about SDR 475 billion (about $645 billion). In addition, credit arrangements between the IMF and a group of members and institutions provide supplementary resources of up to about SDR 181 billion ($245 billion), and are the main backstop to quotas. And in 2012 and 2016, member countries pledged to increase the IMF’s emergency resources through bilateral borrowing agreements; currently about SDR 245 billion (about $330 billion) are effective.
Governance and organization: The IMF is accountable to its member country governments. At the top of its organizational structure is the Board of Governors, consisting of one governor and one alternate governor from each member country, usually the top officials from the central bank or finance ministry. The Board of Governors meets once a year at the IMF–World Bank Annual Meetings. Twenty-four of the governors serve on the International Monetary and Financial Committee, or IMFC, which advises the Board on the supervision and management of the international monetary and financial system. The day-to-day work of the IMF is overseen by its 24-member Executive Board, which represents the entire membership and is guided by the IMFC and supported by the IMF staff. The Managing Director is the head of the IMF staff and Chair of the Executive Board and is assisted by four Deputy Managing Directors.
Fast Facts
Membership: 189 countries
Headquarters: Washington, D.C.
Executive Board: 24 Directors each representing a single country or groups of countries
Staff: Approximately 2,700 from 147 countries
Total quotas: SDR 475 billion (US$645 billion) (as of March 2017)
Borrowed resources: SDR 426 billion (US$575 billion) (as of March 2017)
Committed amounts under current lending arrangements (as of March 2017): SDR 112 billion (US$152 billion), of which SDR 103 billion (US$140 billion) has not been drawn US$159 billion, of which US$144 billion have not been drawn (see table).
The largest borrowers (amounts outstanding as of March 2017): Portugal, Greece, Ukraine, Pakistan
The largest precautionary loans (as of March 2017): Mexico, Poland, Colombia, Morocco
Surveillance consultations: 132 consultations in 2014, 124 in 2015 and 132 in 2016.
Capacity development spending: US$332 million in FY2016, over a quarter of the IMF's total budget
Primary aims:
Promote international monetary cooperation;
Facilitate the expansion and balanced growth of international trade;
Promote exchange stability;
Assist in the establishment of a multilateral system of payments; and
Make resources available (with adequate safeguards) to members experiencing balance-of-payments difficul
http://www.imf.org/en/About/Factsheets/IMF-at-a-Glance
The IMF is a US banking cartel setup to facilitate US imperialist hegemony. Most of the “members” are states in thrall to US imperialist interests. These member states are not independent states, but states subject to the US in one way or another, and through mechanism such as the IMF.
From Lenin:
Thirdly, monopoly has sprung from the banks. The banks have developed from modest intermediary enterprises into the monopolists of finance capital. Some three to five of the biggest banks in each of the foremost capitalist countries have achieved the “personal union” between industrial and bank capital, and have concentrated in their hands the disposal of thousands upon thousands of millions which form the greater part of the capital and income of entire countries. A financial oligarchy, which throws a close net of relations of dependence over all the economic and political institutions of contemporary bourgeois society without exception—such is the most striking manifestation of this monopoly.pp.123-124
And to round-out the US imperial banking monopolies (to exclude US “owned” banking cartels, like Goldman Sachs, JP Morgan Chase, Bank of America, etc.), we have the World Bank Group. Here is its take on its own history:
The past 70 years have seen major changes in the world economy. Over that time, the World Bank Group—the world’s largest development institution—has worked to help more than 100 developing countries and countries in transition adjust to these changes by offering loans and tailored knowledge and advice. The Bank Group works with country governments, the private sector, civil society organizations, regional development banks, think tanks, and other international institutions on issues ranging from climate change, conflict, and food security to education, agriculture, finance, and trade. All of these efforts support the Bank Group’s twin goals of ending extreme poverty by 2030 and boosting shared prosperity of the poorest 40 percent of the population in all countries.
Founded in 1944, the International Bank for Reconstruction and Development—soon called the World Bank—has expanded to a closely associated group of five development institutions. Originally, its loans helped rebuild countries devastated by World War II. In time, the focus shifted from reconstruction to development, with a heavy emphasis on infrastructure such as dams, electrical grids, irrigation systems, and roads. With the founding of the International Finance Corporation in 1956, the institution became able to lend to private companies and financial institutions in developing countries. And the founding of the International Development Association in 1960 put greater emphasis on the poorest countries, part of a steady shift toward the eradication of poverty becoming the Bank Group’s primary goal. The subsequent launch of the International Centre for Settlement of Investment Disputes and the Multilateral Investment Guarantee Agency further rounded out the Bank Group’s ability to connect global financial resources to the needs of developing countries.
Today the Bank Group’s work touches nearly every sector that is important to fighting poverty, supporting economic growth, and ensuring sustainable gains in the quality of people’s lives in developing countries. While sound project selection and design remain paramount, the Bank Group recognizes a wide range of factors that are critical to success—effective institutions, sound policies, continuous learning through evaluation and knowledge-sharing, and partnership, including with the private sector. The Bank Group has long-standing relationships with more than 180 member countries, and it taps these to address development challenges that are increasingly global. On critical issues like climate change, pandemics, and forced migration, the Bank Group plays a leading role because it is able to convene discussion among its country members and a wide array of partners. It can help address crises while building the foundations for longer-term, sustainable development.
The evolution of the Bank Group has also been reflected in the diversity of its multidisciplinary staff, who include economists, public policy experts, sector experts, and social scientists, based at headquarters in Washington, D.C., and in the field. Today, more than a third of staff are based in country offices.
As demand for its services has increased over time, the Bank Group has risen to meet them. For perspective, the World Bank made four loans totaling $497 million in 1947, as compared to 302 commitments totaling $60 billion in 2015.
This particular “history” is replete with Orwellian language and crass self-justifications; exactly what you’d expect from an instrument of imperialism.
This is no doubt enough (maybe too much) to kick-off this thread. We will add more to the tracing of the development of US imperial hegemony in the near future.
A primary issue will be if, and if so how, the current imperialism has changed from the imperialism described and defined by Lenin in 1916. That Lenin’s great work needs updating with the developments in imperialism over the last century is obvious, whether his theory needs amending is another, and primary, question. Hopefully, this thread will address and shed light on these and a range of other questions; after all, threads usually take on a life of their own and go where they please.
This thread should be one of commentary and not one of “simple” news. If a news story dealing with imperialism is posted, it should be accompanied by commentary tying it to one of the issues being developed in the thread.
Enough preamble!
We must arrive at a definition of imperialism.
The first paragraph in the Wikipedia entry for the term imperialism is as follows:
Imperialism is an action that involves a country (usually an empire or kingdom) extending its power by the acquisition of territories. It may also include the exploitation of these territories, an action that is linked to colonialism. Colonialism is generally regarded as an expression of imperialism.
https://en.wikipedia.org/wiki/Imperialism
Dictionary.com has this usage:
the policy of extending the rule or authority of an empire or nation over foreign countries, or of acquiring and holding colonies and dependencies.
http://www.dictionary.com/browse/imperialism
And just to round out the mainstream definition for imperialism we go to Merriam-Webster:
the policy, practice, or advocacy of extending the power and dominion of a nation especially by direct territorial acquisitions or by gaining indirect control over the political or economic life of other areas.
https://www.merriam-webster.com/dictionary/imperialism
(My emphases in each passage above.)
Whenever the subject of imperialism comes up, even in discussions with leftists and Marxists, almost invariably imperialism is taken to mean “a policy”, “a practice”, “an action decided upon”. It is as though some nefarious group of evildoers, a star chamber of megalomaniacs, simply met and chose to become imperialists; decided to enact a policy of imperialism for their own benefits. This is not historical materialism – this is idealism. The idea is that the US could just stop its imperialist behavior, or that Britain, France, or Germany could just vote to quit their imperialist activities. This idea is without merit and works to the benefit of imperialists everywhere. It blunts any criticism of imperialism before the criticism even begins.
We cannot simply look at what imperialist powers do and the effects world consuming imperialism has on nations and peoples, we must have a materialist understanding of imperialism, its origins, its development, and its reasons for being. We cannot hope to effectively stand against imperialism in the 21st century if we have no accurate understanding of what it actually is and how it actually operates. Fortunately, we have a clear and concise, materialist breakdown of imperialism at our disposal: V. I. Lenin’s Imperialism, the Highest Stage of Capitalism.
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. p.88 (All citations are from Imperialism, The Highest Stage of Capitalism, by V. I. Lenin, 1939 ed. International Publishers Co., Inc.)
(My emphases.)
According to Lenin, imperialism is the monopoly stage of capitalism. This materialist definition of imperialism automatically places those who are anti-imperialism, but who are not anti-capitalism, into a quandary. If imperialism is capitalism, then working for the end of one is working for the end of both. More on this later.
Imperialism, as the highest stage of capitalism began, in earnest, at the very beginning of the 20th century. Monopolies, which ended “free” competition, had been developing in various sectors of industry and raw materials production for nearly thirty years and early in the first decade of the new century had supplanted “free” competition across the board.
Thus, the principal stages in the history of monopolies are the following: (1) 1860-70, the highest stage, the apex of development of free competition; monopoly is in the barely discernible, embryonic stage. (2) After the crisis of 1873, a wide zone of development of cartels; but they are still the exception. They are not yet durable. They are still a transitory phenomenon. (3) The boom at the end of the nineteenth century and the crisis of 1900-03. Cartels become one of the foundations of the whole of economic life. Capitalism has been transformed into imperialism. pp. 21-22
We see clearly here that imperialism is fundamentally the development of capitalism into a new form of social relations. Instead of individual capitalists struggling against one another in “free” competition, groups or conglomerates of capitalists, working together as monopolies, effectively eliminated competition, and were able to capture larger market shares and more and more resources.
The transition to this new stage of capitalism was relatively smooth. As one commentator quoted by Lenin says:
And while at that time it appeared to be something novel, now the general public takes it for granted that large spheres of economic life have been, as a general rule, systematically removed from the realm of free competition. p. 21
The same can be said today. While most individuals would say capitalism is based on “free” markets and “free” competition, there seems to be no outward recognition that this has not been true for more than a hundred years.
With the solidification of the industrial and raw materials monopolies the banks were not far behind. And with the rise of the banking monopolies, imperialism came into its own.
The principal and primary function of banks is to serve an intermediary in the making of payments. In doing so they transform inactive money capital into active capital, that is, into capital producing a profit; they collect all kinds of money revenues and place them at the disposal of the capitalist class.
As banking develops and becomes concentrated in a small number of establishments the banks become transformed, and instead of being modest intermediaries they become powerful monopolies having at their command almost the whole of the money capital of all the capitalists and small businessmen and also a large part of the means of production and of the sources of raw materials of the given country and in a number of countries. This transformation of numerous modest intermediaries into a handful of monopolists represents one of the fundamental processes in the transformation of capitalism into capitalist imperialism.p. 31
Once capitalism transformed into imperialism the stage was set for the division of the planet.
The capitalists divide the world, not out of any particular malice, but because the degree of concentration which has been reached forces them to adopt this method in order to obtain profits. And they divide it “in proportion to capital”, “in proportion to strength”, because there cannot be any other method of division under commodity production and capitalism. But strength varies with the degree of economic and political development. In order to understand what is taking place, it is necessary to know what questions are settled by the changes in strength. The question as to whether these changes are “purely” economic or non-economic (e.g., military) is a secondary one, which cannot in the least affect fundamental views on the latest epoch of capitalism. To substitute the question of the form of the struggle and agreements (today peaceful, tomorrow warlike, the next day warlike again) for the question of the substance of the struggle and agreements between capitalist associations is to sink to the role of a sophist. p. 75
(My underlining.)
Between 1914 and 1945 the capitalist world was wracked by imperialist conflict and crises of biblical proportions. By the summer of 1945 half the world lay in ruins hundreds of millions of humans were dead and trillions in capital had been incinerated. Atop this ash heap stood the United States and the Soviet Union. Since this this a discussion of imperialism, the Soviet Union will not enter into it directly, but its presence was seminal and conditioned the development of US imperialism and still does to this day.
In July 1944, US imperial hegemony was established and codified at the Bretton Woods conference in New Hampshire. Here is the US Federal Reserve’s account of the US taking over the capitalist world:
Creation of the Bretton Woods System
July 1944
A new international monetary system was forged by delegates from forty-four nations in Bretton Woods, New Hampshire, in July 1944. Delegates to the conference agreed to establish the International Monetary Fund and what became the World Bank Group. The system of currency convertibility that emerged from Bretton Woods lasted until 1971.
U.N. Monetary Conference (Photo: Associated Press; Photographer: Abe Fox)
by Sandra Kollen Ghizoni, Federal Reserve Bank of Atlanta
The United Nations Monetary and Financial Conference was held in July 1944 at the Mount Washington Hotel in Bretton Woods, New Hampshire, where delegates from forty-four nations created a new international monetary system known as the Bretton Woods system. These countries saw the opportunity for a new international system after World War II that would draw on the lessons of the previous gold standards and the experience of the Great Depression and provide for postwar reconstruction. It was an unprecedented cooperative effort for nations that had been setting up barriers between their economies for more than a decade.
They sought to create a system that would not only avoid the rigidity of previous international monetary systems, but would also address the lack of cooperation among the countries on those systems. The classic gold standard had been abandoned after World War I. In the interwar period, governments not only undertook competitive devaluations but also set up restrictive trade policies that worsened the Great Depression.
Those at Bretton Woods envisioned an international monetary system that would ensure exchange rate stability, prevent competitive devaluations, and promote economic growth. Although all participants agreed on the goals of the new system, plans to implement them differed. To reach a collective agreement was an enormous international undertaking. Preparation began more than two years before the conference, and financial experts held countless bilateral and multilateral meetings to arrive at a common approach. While the principal responsibility for international economic policy lies with the Treasury Department in the United States, the Federal Reserve participated by offering advice and counsel on the new system.1 The primary designers of the new system were John Maynard Keynes, adviser to the British Treasury, and Harry Dexter White, the chief international economist at the Treasury Department.
Keynes, one of the most influential economists of the time (and arguably still today), called for the creation of a large institution with the resources and authority to step in when imbalances occur. This approach was consistent with his belief that public institutions should be able to intervene in times of crises. The Keynes plan envisioned a global central bank called the Clearing Union. This bank would issue a new international currency, the “bancor,” which would be used to settle international imbalances. Keynes proposed raising funds of $26 million for the Clearing Union. Each country would receive a limited line of credit that would prevent it from running a balance of payments deficit, but each country would also be discouraged from running surpluses by having to remit excess bancor to the Clearing Union. The plan reflected Keynes’s concerns about the global postwar economy. He assumed the United States would experience another depression, causing other countries to run a balance-of-payments deficit and forcing them to choose between domestic stability and exchange rate stability.
White’s plan for a new institution was one of more limited powers and resources. It reflected the concerns that much of the financial resources of the Clearing Union envisioned by Keynes would be used to buy American goods, resulting in the United States holding the majority of bancor. White proposed a new monetary institution called the Stabilization Fund. Rather than issue a new currency, it would be funded with a finite pool of national currencies and gold of $5 million that would effectively limit the supply of reserve credit.
The plan adopted at Bretton Woods resembled the White plan with some concessions in response to Keynes’s concerns. A clause was added in case a country ran a balance of payments surplus and its currency became scarce in world trade. The fund could ration that currency and authorize limited imports from the surplus country. In addition, the total resources for the fund were raised from $5 million to $8.5 million.
The Mount Washington Hotel, White Mts., N.H. (Photo: Library of Congress, Prints & Photographs Division, Detroit Publishing Company Collection, LC-D4-19762)
The 730 delegates at Bretton Woods agreed to establish two new institutions. The International Monetary Fund (IMF) would monitor exchange rates and lend reserve currencies to nations with balance-of-payments deficits. The International Bank for Reconstruction and Development, now known as the World Bank Group, was responsible for providing financial assistance for the reconstruction after World War II and the economic development of less developed countries.
The IMF came into formal existence in December 1945, when its first twenty-nine member countries signed its Articles of Agreement. The countries agreed to keep their currencies fixed but adjustable (within a 1 percent band) to the dollar, and the dollar was fixed to gold at $35 an ounce. To this day, when a country joins the IMF, it receives a quota based on its relative position in the world economy, which determines how much it contributes to the fund.
In 1958, the Bretton Woods system became fully functional as currencies became convertible. Countries settled international balances in dollars, and US dollars were convertible to gold at a fixed exchange rate of $35 an ounce. The United States had the responsibility of keeping the price of gold fixed and had to adjust the supply of dollars to maintain confidence in future gold convertibility. The Bretton Woods system was in place until persistent US balance-of-payments deficits led to foreign-held dollars exceeding the US gold stock, implying that the United States could not fulfill its obligation to redeem dollars for gold at the official price. In 1971, President Richard Nixon ended the dollar’s convertibility to gold.
Endnotes
1You can see some of the documents that resulted from those meetings here, and other archival material is available here and here.
Bibliography
Bernstein, Edward. “Reflections on Bretton Woods.” In The International Monetary System: Forty Years After Bretton Woods, 15-20. Boston: Federal Reserve Bank of Boston, May 1984.
Bordo, Michael D. "Gold Standard." In The Concise Encyclopedia of Economics. Library of Economics and Liberty. Article published 2008.
Bordo, Michael, Owen Humpage, and Anna J. Schwartz, "U.S. Intervention during the Bretton Wood Era: 1962-1973," Working Paper 11-08, Federal Reserve Bank of Cleveland, Cleveland, Ohio, April 2011.
Eichengreen, Barry. Exorbitant Privilege: The Rise and Fall of the Dollar and the Future of the International Monetary System. New York: Oxford University Press, 2011.
Kenen, Peter. “Bretton Woods System.” In The New Palgrave Dictionary of Economics, Second Edition, edited by Steven N. Durlauf and Lawrence E. Blume. Palgrave Macmillan, 2008.
Meltzer, Allan H. “U.S. Policy in the Bretton Woods Era.” Federal Reserve Bank of St. Louis Review 73, no. 3 (May/June 1991): 54-83.
Patinkin, Don. “Keynes, John Maynard (1883–1946).” In The New Palgrave Dictionary of Economics, Second Edition, edited by Steven N. Durlauf and Lawrence E. Blume. Palgrave Macmillan, 2008.
Written as of November 22, 2013. See disclaimer.
https://www.federalreservehistory.org/essays/bretton_woods_created
“The United Nations Monetary and Financial Conference was held in July 1944 at the Mount Washington Hotel in Bretton Woods, New Hampshire, where delegates from forty-four nations created a new international monetary system known as the Bretton Woods system. These countries saw the opportunity for a new international system after World War II” Indeed.
“It was an unprecedented cooperative effort for nations that had been setting up barriers between their economies for more than a decade.” Cooperation between nations either destroyed by war, economic crises, or nations who were already dependent upon one or another of the imperialist powers (or what remained of them) and the US colossus.
The Fed’s history is, of course, couched in bourgeois apologia, but the procedures and reasonings are easy to discern. The conference established the US dollar os the world’s currency, created the IMF and the World Bank and named the US as Imperial Hegemon. All under US guidance, of course. The US made the capitalist world ‘an offer it could not refuse’, so to speak.
Here is “the IMF at a Glance” - from the IMF, itself:
Full Text
The IMF at a Glance
April 20, 2017
The International Monetary Fund, or IMF, promotes international financial stability and monetary cooperation. It also facilitates international trade, promotes employment and sustainable economic growth, and helps to reduce global poverty. The IMF is governed by and accountable to its 189 member countries.
Founding and mission: The IMF was conceived in July 1944 at the United Nations Bretton Woods Conference in New Hampshire, United States. The 44 countries in attendance sought to build a framework for international economic cooperation in order to avoid repeating the competitive currency devaluations that contributed to the Great Depression of the 1930s. The IMF's primary mission is to ensure the stability of the international monetary system—the system of exchange rates and international payments that enables countries and their citizens to transact with each other.
Surveillance: In order to maintain stability and prevent crises in the international monetary system, the IMF monitors member country policies as well as national, regional, and global economic and financial developments through a formal system known as surveillance. The IMF provides advice to member countries and promotes policies designed to foster economic stability, reduce vulnerability to economic and financial crises, and raise living standards. It also provides periodic assessments of global prospects in its World Economic Outlook, of financial markets in its Global Financial Stability Report, of public finance developments in its Fiscal Monitor, and of external positions of largest economies in its External Sector Report, in addition to a series of regional economic outlooks.
Financial assistance: Providing loans to member countries that are experiencing actual or potential balance-of-payments problems is a core responsibility of the IMF. Individual country adjustment programs are designed in close cooperation with the IMF and are supported by IMF financing, and ongoing financial support is dependent on effective implementation of these adjustments. In response to the global economic crisis, in April 2009 the IMF strengthened its lending capacity and approved a major overhaul of its financial support mechanisms, with additional reforms adopted in 2010 and 2011. These changes enhanced the IMF’s crisis-prevention toolkit, bolstering its ability to mitigate contagion during systemic crises and allowing it to better tailor instruments to meet the needs of individual member countries.
Loan resources available to low-income countries were sharply increased in 2009, while average limits under the IMF’s concessional loan facilities were doubled. Under a new agreement that went into effect in January 2016, members’ financial commitments to the IMF, also known as their quotas, were significantly increased (see below), and access limits under the IMF’s non-concessional lending facilities were reviewed and increased. In addition, zero interest rates on concessional loans were extended through the end of 2018, and the interest rate on emergency financing is permanently set at zero. Finally, efforts are currently under way to secure additional loan resources of about SDR 11 billion (about $15 billion) to support the IMF’s concessional lending activities.
Capacity development: The IMF provides technical assistance and training to help member countries build better economic institutions and strengthen related human capacities. This includes, for example, designing and implementing more effective policies for taxation and administration, expenditure management, monetary and exchange rate policies, banking and financial system supervision and regulation, legislative frameworks, and economic statistics.
SDRs: The IMF issues an international reserve asset known as Special Drawing Rights, or SDRs, that can supplement the official reserves of member countries. Total global allocations are currently about SDR 204 billion (some $275 billion). IMF members can voluntarily exchange SDRs for currencies among themselves.
Resources: Member quotas are the primary source of IMF financial resources. A member’s quota broadly reflects its size and position in the world economy. With the recent effectiveness of the 14th General Review of Quotas, total quota resources are now about SDR 475 billion (about $645 billion). In addition, credit arrangements between the IMF and a group of members and institutions provide supplementary resources of up to about SDR 181 billion ($245 billion), and are the main backstop to quotas. And in 2012 and 2016, member countries pledged to increase the IMF’s emergency resources through bilateral borrowing agreements; currently about SDR 245 billion (about $330 billion) are effective.
Governance and organization: The IMF is accountable to its member country governments. At the top of its organizational structure is the Board of Governors, consisting of one governor and one alternate governor from each member country, usually the top officials from the central bank or finance ministry. The Board of Governors meets once a year at the IMF–World Bank Annual Meetings. Twenty-four of the governors serve on the International Monetary and Financial Committee, or IMFC, which advises the Board on the supervision and management of the international monetary and financial system. The day-to-day work of the IMF is overseen by its 24-member Executive Board, which represents the entire membership and is guided by the IMFC and supported by the IMF staff. The Managing Director is the head of the IMF staff and Chair of the Executive Board and is assisted by four Deputy Managing Directors.
Fast Facts
Membership: 189 countries
Headquarters: Washington, D.C.
Executive Board: 24 Directors each representing a single country or groups of countries
Staff: Approximately 2,700 from 147 countries
Total quotas: SDR 475 billion (US$645 billion) (as of March 2017)
Borrowed resources: SDR 426 billion (US$575 billion) (as of March 2017)
Committed amounts under current lending arrangements (as of March 2017): SDR 112 billion (US$152 billion), of which SDR 103 billion (US$140 billion) has not been drawn US$159 billion, of which US$144 billion have not been drawn (see table).
The largest borrowers (amounts outstanding as of March 2017): Portugal, Greece, Ukraine, Pakistan
The largest precautionary loans (as of March 2017): Mexico, Poland, Colombia, Morocco
Surveillance consultations: 132 consultations in 2014, 124 in 2015 and 132 in 2016.
Capacity development spending: US$332 million in FY2016, over a quarter of the IMF's total budget
Primary aims:
Promote international monetary cooperation;
Facilitate the expansion and balanced growth of international trade;
Promote exchange stability;
Assist in the establishment of a multilateral system of payments; and
Make resources available (with adequate safeguards) to members experiencing balance-of-payments difficul
http://www.imf.org/en/About/Factsheets/IMF-at-a-Glance
The IMF is a US banking cartel setup to facilitate US imperialist hegemony. Most of the “members” are states in thrall to US imperialist interests. These member states are not independent states, but states subject to the US in one way or another, and through mechanism such as the IMF.
From Lenin:
Thirdly, monopoly has sprung from the banks. The banks have developed from modest intermediary enterprises into the monopolists of finance capital. Some three to five of the biggest banks in each of the foremost capitalist countries have achieved the “personal union” between industrial and bank capital, and have concentrated in their hands the disposal of thousands upon thousands of millions which form the greater part of the capital and income of entire countries. A financial oligarchy, which throws a close net of relations of dependence over all the economic and political institutions of contemporary bourgeois society without exception—such is the most striking manifestation of this monopoly.pp.123-124
And to round-out the US imperial banking monopolies (to exclude US “owned” banking cartels, like Goldman Sachs, JP Morgan Chase, Bank of America, etc.), we have the World Bank Group. Here is its take on its own history:
The past 70 years have seen major changes in the world economy. Over that time, the World Bank Group—the world’s largest development institution—has worked to help more than 100 developing countries and countries in transition adjust to these changes by offering loans and tailored knowledge and advice. The Bank Group works with country governments, the private sector, civil society organizations, regional development banks, think tanks, and other international institutions on issues ranging from climate change, conflict, and food security to education, agriculture, finance, and trade. All of these efforts support the Bank Group’s twin goals of ending extreme poverty by 2030 and boosting shared prosperity of the poorest 40 percent of the population in all countries.
Founded in 1944, the International Bank for Reconstruction and Development—soon called the World Bank—has expanded to a closely associated group of five development institutions. Originally, its loans helped rebuild countries devastated by World War II. In time, the focus shifted from reconstruction to development, with a heavy emphasis on infrastructure such as dams, electrical grids, irrigation systems, and roads. With the founding of the International Finance Corporation in 1956, the institution became able to lend to private companies and financial institutions in developing countries. And the founding of the International Development Association in 1960 put greater emphasis on the poorest countries, part of a steady shift toward the eradication of poverty becoming the Bank Group’s primary goal. The subsequent launch of the International Centre for Settlement of Investment Disputes and the Multilateral Investment Guarantee Agency further rounded out the Bank Group’s ability to connect global financial resources to the needs of developing countries.
Today the Bank Group’s work touches nearly every sector that is important to fighting poverty, supporting economic growth, and ensuring sustainable gains in the quality of people’s lives in developing countries. While sound project selection and design remain paramount, the Bank Group recognizes a wide range of factors that are critical to success—effective institutions, sound policies, continuous learning through evaluation and knowledge-sharing, and partnership, including with the private sector. The Bank Group has long-standing relationships with more than 180 member countries, and it taps these to address development challenges that are increasingly global. On critical issues like climate change, pandemics, and forced migration, the Bank Group plays a leading role because it is able to convene discussion among its country members and a wide array of partners. It can help address crises while building the foundations for longer-term, sustainable development.
The evolution of the Bank Group has also been reflected in the diversity of its multidisciplinary staff, who include economists, public policy experts, sector experts, and social scientists, based at headquarters in Washington, D.C., and in the field. Today, more than a third of staff are based in country offices.
As demand for its services has increased over time, the Bank Group has risen to meet them. For perspective, the World Bank made four loans totaling $497 million in 1947, as compared to 302 commitments totaling $60 billion in 2015.
This particular “history” is replete with Orwellian language and crass self-justifications; exactly what you’d expect from an instrument of imperialism.
This is no doubt enough (maybe too much) to kick-off this thread. We will add more to the tracing of the development of US imperial hegemony in the near future.