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[introduction.]

Monopolies inevitably lead to the decay of capitalism. Lenin pointed out that all monopoly under private ownership of the means of production engenders a tendency to stagnation and decay, or parasitism.^^181^^

Tendency to Retardation of the Growth of Productive Forces

p Monopoly hinders the growth of the productive forces and technological progress. "Since monopoly prices are established, even temporarily,"wrote Lenin, "the motive causes of technical and, consequently, of all other progress disappear to a certain extent and, further, the economic possibility arises of artificially retarding technical progress.""^^2^^

p Capitalists introduce technical innovations in order to gain superprofits. If these super-profits, however, can be obtained as a result of a monopoly on the market, then the stimulus to technological improvement is naturally weakened. Under pre-monopoly capitalism a capitalist got the better of his competitor mainly by improving methods of production, reducing costs and lowering prices. To maintain his position on the market, a capitalist had to replace old by new machinery, he had to improve his methods of production, When free competition gave place to monopoly, the situation changed drastically. New methods of obtaining high monopoly profits peculiar to imperialism made their appearance. As a rule, monopolies do not resort to reducing prices in order to maintain and strengthen their positions. In fighting their competitors, they make use of direct pressure and all sorts of financial manipulation (withdrawal of credit, deprivation of raw materials, boycotts, etc.).

p Monopolies often artificially restrict the production of certain commodities in order to maintain prices and profits at a high level. This, of course, considerably hampers technological progress. Retaining old equipment in which enormous capital has been invested also hinders technological progress. It is only when economies resulting from the introduction of new technique rapidly cover the depreciation of old investments, or in the case of new enterprises and new branches of industry in which old investments are relatively small, that technological progress takes place unimpeded.

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p Many bourgeois economists, recognising that monopolies hold up technological progress, have called for a return to the era of free competition. Lenin showed how completely unfounded were such hopes for a return to the past. "Even if monopolies have now begun to retard progress,” he said, "it is not an argument in favour of free competition, which has become impossible after it has given rise to monopoly.”^^181^^

p Retarded growth of the productive forces thus becomes a tendency of monopoly capitalism primarily manifested in the latter’s direct hindrance to technological progress. It is further manifested in the increasing discrepancy between the possibilities offered by science and engineering on the one hand, and the extent to which these possibilities are made use of, on the other; and in the unequal technological development in various countries and branches of industry. Finally, this tendency is revealed in the fact that, in the era of imperialism, people—the chief productive force—are more and more divorced from socially useful work, the creation of material values. Unemployment grows, while productive capacity is not utilised to the full. The number of workers not engaged in creating material values, but employed in the sphere of circulation, the state apparatus, the army, and personal services, also grows.

p However, the growth of productive forces under imperialism by no means comes to a halt. Monopolies can never eliminate competition completely or for long. Technological progress enables them to reduce costs of production sharply, and by slightly reducing the selling prices of their products they are able to squeeze out competitors. By barring the latter from access to technical improvements and new methods of production, monopolies can obtain high monopoly profits even at reduced prices.

p Capitalist monopolies enjoy enormous advantages over medium and small-sized enterprises in making use of the achievements of modern science and technology. It is well known, for example, that in various industries scientific research is conducted chiefly by large companies. With few exceptions, small firms do not possess the financial resources necessary to maintain research organisations. As a result, there is a monopolisation of technical improvements and inventions.

p Thus, the general tendency to retard technological progress by no means precludes the rapid improvement of technique and the growth of the productive forces during certain periods.

“It would be a mistake to believe,” wrote Lenin, "that this tendency to decay precludes the rapid growth of capitalism. It does not. In the epoch of imperialism, certain branches of industry, certain strata of the bourgeoisie and certain countries betray, to a greater or lesser degree, now one and now another of these tendencies.”^^134^^

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Growth of a Stratum of Rentiers

p Parasitism in the epoch of imperialism is clearly reflected in the growth of a stratum of rentiers—persons owning securities (shares and bonds) who live by “coupon-clipping”. The growth of joint-stock companies divorces the overwhelming majority of capitalists from the management of production.

p The financial oligarchy, while concentrating in its own hands the key economic positions in the capitalist countries, as a rule does not itself take part in the management of the hundreds and thousands of industrial companies, banks, railways and other enterprises which it controls. The “activity” of the financial groups more and more consists in expanding their domination by acquiring controlling interests in the many new companies being formed and by various financial manipulations. The direct management of-the enterprises, however, gradually passes into the hands of hired managers.

p The section of the population engaged in services to the exploiters, in catering to their parasitic whims, steadily expands. At the same time, the monopoly-dominated machinery of state, the police force and the army also grow.

Some imperialist countries become transformed into rentier-states. This is the result of an increase in the export of capital, which makes it possible for creditor countries to reap huge profits in debtor countries. The returns on capital invested by Britain abroad before the First World War, when her trade was the largest in the world, was five times as much as her returns from foreign trade. At present, the United States is the biggest commercial power in the capitalist world. Nevertheless, it is the export of capital and not the export of commodities that plays the decisive role in its economic expansion abroad. Today the United States is the world’s biggest creditor.

Political Reaction

p Capitalism was victorious over feudalism under the banner of "liberty, equality and fraternity”. Bourgeois democracy, as a form of political domination, met the needs of pre-monopoly capitalism. However, the situation changed with the transition to imperialism. The formation of monopolies meant a transition from relations of free competition to relations of domination and the coercion associated with it. Monopolies became the rulers of economic life.

p Once they achieve economic domination, however, monopolies strive to dominate politically as well, to have the machinery of the bourgeois state at their service. When they have concentrated power in their own hands, monopolies more often than not discard the methods of bourgeois democracy and resort to political reaction, which clearly reveals the decaying character of capitalism. It is also a result of this decay, a consequence of the fact that the capitalist method 253 of production has ceased to develop in an ascending line, that in the epoch of imperialism capitalist relations have begun to hamper the growth of the productive forces.

p A typical example of the offensive of political reaction is fascism— a terroristic dictatorship of the monopolist bourgeoisie. Fascism means the brutal suppression of workers’ and peasants’ movements, savage reprisals against proletarian and other democratic parties and social organisations, the militarisation of the country, and the inauguration of a policy of military adventure. Prior to the Second World War, Germany, Italy, Japan, Spain, Portugal and a number of other countries took the path of fascism. In the post-war period, a noticeable tendency toward fascisation appeared in the United States, the Federal Republic of Germany, France and other countries.

The sharpening of capitalist contradictions in the epoch of imperialism leads to political reaction, which, in turn, still further sharpens these contradictions. The monopolies seek to deprive the workers of their democratic gains, and this brings stubborn resistance from the masses. Hence, the growth of democratic sentiments among the masses is characteristic of the epoch of imperialism. In the political arena, the working people of capitalist countries struggle for political democracy against the forces of reaction and the policies of the monopolies.

The "Labour Aristocracy"

p The systematic bribing of certain sections of workers by the monopolistic bourgeoisie is a typical sign of the decay of capitalism. The imperialists have an interest in creating a privileged stratum of workers, which is split off from the broad proletarian masses. This phenomenon is, in itself, not new. Bribery of individual representatives and groups of the proletariat, as a method of struggle against workers’ movements, has taken place ever since capitalism came into existence.

p Under certain conditions, however, an economic basis develops for the establishment of an entire privileged stratum—a "labour aristocracy"—in the working class. This first arose in Britain during the period of pre-monopoly capitalism. Britain, in contrast to other countries, possessed two features of imperialism as far back as the middle of the nineteenth century: colonial monopoly and the exploitation of other countries by virtue of a dominant position on the world market. This yielded the British bourgeoisie super-profits, part of which was used to bribe a small upper section of the working class. This privileged group constituted a special social stratum—the "labour aristocracy"—which the bourgeoisie strove to counterpose to the broad mass of workers and to use as a political lever within the working class.

p Monopoly domination, export of capital to underdeveloped countries and colonialism led to the formation of a "labour aristocracy" in all imperialist countries. Bribery assumed various forms: increased 254 wages for individual sections of the working class, lucrative government posts for venal leaders of the working-class movement, direct subsidising of reformist organisations, etc.

p The "labour aristocracy" is the social basis of opportunism in the working-class movement. Opportunism means the adaptation of the working-class movement to the interests of the bourgeoisie—a policy of collaboration with the bourgeoisie and of splitting the workingclass movement. The opportunists attempt to divert the workers from the class struggle by preaching the identity of class interests of the proletariat and the bourgeoisie, and the possibility of “ improving” capitalism by reforms. Thus, the opportunists are agents of the bourgeoisie in the working-class movement.

Opportunism in the working-class movement, however, cannot hold back forever the growing class-consciousness of the proletariat and the class struggle, "for the trusts, the financial oligarchy, high prices, etc.,” wrote Lenin, "while permitting the bribery of handfuls of the top strata, are increasingly oppressing, crushing, ruining and torturing the mass of the proletariat and the semi-proletaria!.”^^1^^"