Part 1: Capitalism and Imperialism
Many analyses of the contemporary international political economy highlight the inequality between the haves and the have nots. Inequality is discussed and studied in both domestic and international contexts, however, rarely does one hear of the reasons behind poverty and inequality on a global scale. Most believe that global inequality has to do with developing nations having less industry or technology and, therefore, are less productive than developed nations. But what many fail to highlight is how the current world order, which I will refer to as capitalist-imperialism, creates this inequality through the expropriation of resources, value, and wealth from the Global South to the Global North, which is necessary for the sustainability of First World living conditions.
Michael Parenti describes imperialism as “the process whereby the dominant politico-economic interests of one nation expropriate for their own enrichment the land, labor, raw materials, and markets of another people.” Imperialism is not new, but has existed for centuries, since the Persian and Roman empires. Imperialists seek to create an empire out of the peoples they conquer for their own benefit and the benefit of their empire.
Capitalism is the dominant economic system which prioritizes the maximization of profit for the capitalists. Many attribute it as the cause of global inequality and poverty. But oftentimes, they leave out imperialism, which leads to a misunderstanding of how the current system operates. Capitalism as we know it today cannot exist without imperialism. Therefore, if one wants to understand capitalism, they must understand imperialism.
The ties between imperialism and capitalism have existed for centuries. As Parenti notes, “Imperialism has been the most powerful force in world history over the last four or five centuries,” as it has carved up whole continents and wiped out entire civilizations. In Karl Marx’s critique of capitalism, he never explicitly mentions imperialism, but that does not mean he does not recognize it. In one of his letters, he writes:
“What they take from them without any equivalent and quite apart from what they appropriate to themselves annually within India, speaking only of the value of the commodities the Indians have gratuitously and annually to send over to England – it amounts to more than the total sum of income of the sixty millions of agricultural and industrial laborers of India! This is a bleeding process, with a vengeance! The famine years are pressing each other and in dimensions till now not yet suspected in Europe!”
Karl Marx, “Marx to Nikolai Danielson in St. Petersburg”
He clearly recognizes here how British imperialism over India has expropriated the resources of India and sent them back to England, while simultaneously impoverishing Indians. The “bleeding process” Marx describes is the parasitic capitalist-imperialist system.
Vladimir Lenin would go on to make explicit the link between capitalism and imperialism. He explains how “Capitalism in its imperialist stage leads directly to the most comprehensive socialization of production.” In other words, it leads to globalization. As profit is prioritized and sought after, capitalists expand to every corner of the globe to enrich themselves. In 1917, Lenin recognized that, “the ownership of capital is separated from the application of capital to production, that money capital is separated from industrial or productive capital, and that the rentier who lives entirely on income obtained from money capital, is separated from the entrepreneur” and that when this separation reaches vast proportions, it is known as imperialism, where a financial oligarchy made up of a small number of powerful states dominate the political-economic sphere. In the early 20th Century, Lenin noted how four nations — the U.S., Great Britain, Germany and France — controlled 80 percent of the world’s finance capital. This was the financial oligarchy which he had described.
Because these countries were major financial oligarchs, they sought to expand their colonial empires knowing full well the benefits that imperialism would bring. Hence why in 1898 the U.S. waged an imperialist war against Spain, despite mainstream objection, because the U.S. capitalists understood the economic benefit to seizing Spanish colonial possessions like Cuba, Puerto Rico and the Philippines. By 1914, the necessity to build large colonial empires reached a boiling point, which led to the first major imperialist war between rival imperialist nations attempting to control or expand their empires. The competition between imperialists led to a global division of the world; the first time the world has been fully divided.
Part 2: Imperialist Violence and Resistance
With capitalist-imperialism comes the bloody and atrocious history of the conquering of the globe. This history is important because it explains why so many people across the world are distrustful of Western imperialism and hegemony. It involves the massacring of entire peoples for their land and resources. Not to mention the maldevelopment of other societies which were more advanced than the imperialists. In Herrero, one of Germany’s African colonies, they put those who resisted the colonizers into concentration camps, where they were subjected to brutal conditions and death. The exploitation of resources in India under British rule led to one of the worst famines that Bengal has ever seen. Three million Indians died during the famine from 1943-1944, in which Britain extracted even more resources from India to fund their ongoing war effort against the Nazis.
In addition to the imperialist violence came the process of underdevelopment of colonized territories. Parenti explains how when the British first colonized India, it was exporting more textiles than England. However, with British colonization came the destruction of Indian manufacturing as it outcompeted English textile production. This destruction of a nation’s development is what Parenti describes as maldevelopment, a term which correctly notes that many of the so-called “underdeveloped” nations today were not originally that way, but were violently forced into a position of destitution by imperialists.
One only needs to look at the history of colonization to understand how maldevelopment works. The vast, advanced, and wealthy societies of the Americas were violently forced into slavery and poverty by the ruthless colonizers. Mayan Indians in Guatemala had more nutritional diets before European colonizers than they did in the 1990s. Capitalism is not a system which pushes our communities forward, but rather takes them backwards into destitution. This is not only true for Latin America, but Africa and Asia as well. Great and wealthy African civilizations faced the violent onslaught of enslaving colonizers whose greed made them more aggressive and expansionist.
A modern example of this is the nation-state of Libya. This was a nation that had seen an increase in material conditions for most of the population in the last few decades. Unfortunately, it was quickly reduced to an anarchic state embroiled in civil war, with modern day slave markets. Libya is not a poor country nor is it underdeveloped. It is a nation rich in resources — so much so, that the imperialists’ greed drove them to destroy any semblance of progress made by the Libyan people so they could stake a claim on the resources of the country. This is the process of maldevelopment.
India’s first Prime Minister, Jawaharlal Nehru, declared that fascism and imperialism are “blood brothers” and that “fascism … they in India had known … for long under the name of imperialism.” The brutality of imperialism is comparable to what we have seen in fascism. These atrocities of imperialism happen across the globe and occur all the time. They also reside deep in the minds of the people who had to suffer through these difficult times. It is easy for people in the U.S. to talk about the Vietnam War as a mistake or failure or something that should not have happened. However, for the three million Vietnamese killed, and the even more disfigured and disabled by Agent Orange, the war still plays a significant role in their lives. The atrocities of imperialism are as inevitable as the growing monopolization and concentration of capital into the hands of fewer and fewer, as Lenin described.
Part 3: Imperialist Value Transfer and 21st Century Imperialism
The next aspect of the capitalist-imperialist system one must understand, is how it transfers value from the South to the North. As I stated earlier, capitalism requires imperialism in order to sustain itself. This is true for the Global North or the First World, where material living conditions are far greater than the Third World or Global South. The difference is so vast that we have come to think of the Global South as a whole other world. To go further, the Global North relies upon the value expropriated from the Global South to meet its needs. The vast majority of productive workers are found in the Global South, rather than the Global North.
In 2010, the OECD accounted for 16.5 per cent of the total full-time equivalent global workforce in industry and agriculture of approximately 1.15 billion, or 190 million workers, whilst the full-time equivalent nonOECD workforce in industry and agriculture accounted for 83.5 percent of the total, or 960 million workers.
Immanuel Ness & Zak Cope, “The Palgrave Encyclopedia of Imperialism and Anti-Imperialism“
The OECD, or the Organization for Economic Co-operation and Development, is a group of 37 nations primarily in the Global North — the U.S., most of Europe, Japan and a few others. Every other nation is a non-OECD nation, so most of Latin America and Asia and all of Africa. With almost one billion of the world’s full-time workers coming from the Global South and only 190 million in the North, one could begin to see how imperialism expropriates resources for the benefit of another society.
The Global North extracts value from the South through a variety of means, but mostly through unequal exchange, uncompensated value and capital export imperialism. Unequal exchange, UE, is “surplus value transferred via the under-valuation of non-OECD goods and the overvaluation of OECD goods” and capital export imperialism, CEI, is “surplus value exported from capital-importing countries through the super-exploitation of their low-wage labor.” Through unequal exchange, the Global North managed to expropriate $1 trillion as “non-OECD goods exports should have been worth approximately $6.24 trillion,” but “only $5.2 trillion was paid for these goods,” thus leaving over $1 trillion unaccounted and unpaid for in 2012. On top of this, through CEI, the Global North was able to transfer “$405 billion of uncompensated value … from the non-OECD to the OECD.” Combined, that’s almost $1.5 trillion expropriated from the Global South to the Global North.
To further this divide, workers in the Global South get paid significantly less than their Northern counterparts for doing the same labor, often with more hours and less benefits. In manufacturing, the average hourly wage of Global North workers was $29.07, while the wages of Global South workers was $2.66. To put this further in perspective, “for every one fulltime equivalent worker employed in OECD industry and agriculture … there are 1.4 non-OECD workers … working for free alongside her. By this estimate, the rate of surplus value or of exploitation … is negative for the OECD countries.” Therefore, there are millions of Global South workers who are getting underpaid or not paid at all due to imperialism. The little pay they receive places many of the workers in the Global South in poverty and destitution. And these wage differentials have nothing to do with productivity. Workers in the Global North do not work harder or better, but instead use the same “techniques used to produce most of the exports from the Third World. However, real wages are much lower in the periphery.”
If the same methods, techniques, and technology are utilized in both the North and the South, then the underpayment of Southern workers has nothing to do with productivity. This super exploitation is uncompensated value which amounted to over $1.5 trillion in 2010 for the capitalist-imperialists. This vast amount of super profit being extracted from South to North is difficult to understand because of how extreme it is, but it is precisely the reason why corporations flock to the Global South. Capitalist-Imperialism, thus, is a system in which the dominant imperialist nations (i.e. the United States, Western Europe, Japan, etc.) are making profits off the backs of the impoverished.
Part 4: The Labor Aristocracy
With their superprofit, the capitalists of the imperialist core nations buy off the workers of their own nations. Buying off workers includes providing increased wages, better hours, better working conditions and more rights, allowing for stability in the core nations. This stability is important because it drives profit even further up in consumerist societies. The First World and the people of the First World are massive consumers. “The top 20 percent of the world’s population consumes an average 4.6 times more than it produces” and countries like the U.S., Canada, Japan, Western Europe, and other imperialist and junior imperialist states have “ the bottom 90 percent of the population consum[ing] more than double their share in global production.” On the other hand, the majority of the world’s population, “at least 70 percent of the world total is consuming significantly less than it produces, by an average factor of 4.8.” The global inequality and poverty differentials are vast because they have to be in order to support the First World lifestyle. By giving benefits to the workers of the First World and creating a consumerist society, the capitalist-imperialists create a labor aristocracy among First World workers which has mutual interests with the capitalists of their country, as their wages and benefits rely on the imperialist transfer of value.
Much of the cultural elitism and national chauvinism from the people of the First World, even what many would call the “workers” of the Global North, is not due to misinformation or lies, but a deliberate interest which the people have. Since workers in the First World are part of the labor aristocracy, they have a lot to lose if imperialism is on the decline. People will defend their interests if they have more material things to lose. The power of capitalism, imperialism and nationalism is that it provides so much material to the imperial populations that they have an investment in maintaining the current system.
“White nationalism and cultural elitism of societies in the global North is not the result of false consciousness,” but “rather … ideological expressions of the shared economic interest of a variety of social strata in the First World in maintaining super-exploitation.” People in the First World will often defend their nations and take a social chauvinist position. The nations of the imperialist core can wage war freely because the people of the First World are not interested in anti-imperialist struggles or anything that would endanger their material conditions. Oftentimes, this means that people in the First World will even defend the their countries’ wars and the atrocities their soldiers commit all in the name of fighting terrorism, humanitarianism or any other reason which veils the true ideological expressions of those at the core. There are plenty of examples of widespread agreement on issues amongst the First World population which demonstrates this.
For example, many people are against open borders and migration because migration puts pressure on capital in the Global North. Capital has an interest in utilizing cheap migrant labor, but as more and more migrants go to the Global North in search of better living conditions, they threaten to overburden the system and make it so that the capitalists of the Global North cannot afford to maintain the workers’ benefits in the core. Therefore, many workers and petty bourgeois in the U.S. and Europe are very hostile towards migrants. A gallup poll showed that 77 percent of people in the U.S. would consider it an important or critical threat if a large number of undocumented immigrants entered the United States. There is a real fear that people will lose their jobs and benefits as more migrants come to the Global North. Migration from the Global South to the Global North is not some anti-imperialist statement or attack on the Global North, but rather people who are simply in search of better lives. This is what they are afraid of: the victims of imperialism reappropriating the value that was stolen from them. The overwhelming support that imperialist nations receive from their populations despite their wars and atrocities is evidence of how the labor aristocracy of the Global North and the capitalist-imperialists of the globe share mutual interests in the super exploitation of the Global South.
When discussing the contemporary political economy, it is necessary to highlight the significance of imperialism in fortifying the capitalist world order. This is not a new phenomenon, but one which has been recognized for more than a century now. The majority of the people in the Global North would fall into the labor aristocratic class, but this only makes up a minority of the international working class.
Ernesto “Che” Guevara once said, “I’m very happy for the European working class with their higher wages. But don’t forget who is paying for those wages. We are — millions of exploited workers and peasants in Latin America, Africa and Asia.” He acknowledged back in the 1960s that the wealth in the West was reliant on the extreme destitution of the masses in the Third World. As wealth becomes more and more concentrated into the hands of a few, this reality becomes more true. Those in the Global South are still being underpaid in relation to their production and in comparison to workers who do the same work in the First World. This disparity will only grow worse as capitalism runs out of areas to expand, forcing them to find more people to exploit, either in their home nations or abroad.