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p Lenin had worked out many specific points of his theory of imperialism long before he wrote his classic book Imperialism, the Highest Stage of Capitalism. Dozens of Lenin’s documents now published in complete form in the Fifth Russian edition of Lenin’s Collected Works touch, in one way or another, upon the question of imperialism. This section is intended not only to explain the main points of Lenin’s theory of imperialism, but also to show the great significance of this theory in describing the operation of the general laws of capitalism under conditions of 92 monopoly capitalist domination, and in analysing the main problems of modern capitalism.

p No matter how bourgeois economists, revisionists and dogmatists have tried and still try to set Lenin against Marx, i.e., to separate Leninism from Marxism, and to declare Marxism to be a 19th century doctrine which has lost its meaning in present-day conditions-despite this, Marxism-Leninism has never been anything other than a single integral doctrine, constantly changing along with changing historical conditions.

p Lenin’s book Imperialism, the Highest Stags of Capitalist! is a work of genius, developing further and directly continuing Marx’s Capital.

p Lenin’s conclusion that imperialism is the highest and the final stage of capitalism is based on the Marxist tenet that free competition leads to the concentration of production, which in turn leads, at a certain stage, to monopoly.

p "Capitalism in its imperialist stage leads directly to the most comprehensive socialisation of production; it, so to speak, drags the capitalists, against their will and consciousness, into some sort of a new social order, a transitional one from complete free competition to complete socialisation."  [92•1 

p Lenin proved that the deepest economic roots of imperialism are in monopoly. He also made clear the organic connection between competition and monopoly.

p One of the main points of Lenin’s theory of imperialism is his conclusion that the chief and most essential features of capitalism as a socio-economic system arc not radically changed by imperialism: "Imperialism complicates and sharpens the contradictions of capitalism, it ’tics up’ monopoly with free competition, but it cannot do away with exchange, the market, competition, crises, etc."  [92•2 

p While the imperialist pyramid has at its top a handful of giant monopolies playing an increasingly decisive part in economics and politics, at its foot is an enormous base of old capitalism.

p It is in the light of the two opposing but combined “elements” of capitalism, competition and monopoly, that one should consider the operation of the law of value and average profit, together with the trend towards a falling rate of profit, cyclical changes, and the question of the scale and speed of extended reproduction under monopoly capitalist domination.

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p The monopoly price is a very effective weapon in the exploitation of the workers and a means of enriching a handful of capitalist monopolies. It gives rise to a further sharpening of the struggle between labour and capital, between the monopoly bourgeoisie and the middle and petty bourgeoisie, and between the economically backward countries and the developed capitalist countries. The latter buy raw materials and foodstuffs from underdeveloped countries on the cheap and sell them manufactured goods at a premium.

p "The extent to which monopolist capital has intensified all the contradictions of capitalism is generally known. It is sufficient to mention the high cost of living and the tyranny of the cartels."  [93•1 

p This inflating of commodity prices by monopolies severely brakes the growth of production. In his article "The Oil Hunger" Lenin asks: "What lies at the bottom of the oil question?" In reply he writes: "First of all it is the shameless inflation of oil prices by the oil kings accompanied by the artificial curtailment of oil-well and refinery productivity by these ’knights’ of capitalist profit."  [93•2 

p Bourgeois economists do not understand the essence of the transition from free competition to monopoly production. After weighing up all the positive and negative points of both free competition and monopoly production, they are inclined to favour monopoly production, since the latter, according to them, ensures organised large-scale production and technical progress. But their desire to present the capitalist monopoly as the last word in large- scale production and high efficiency does not hold water.

p Monopoly capitalism does not and cannot lead to the complete socialisation of production, as public means of production under capitalism remain the private property of a small number of people. Growing socialisation of production within the framework of private capitalist property relations and private capitalist appropriation can lead only to an increase in the power of a handful of capitalist monopolies over the whole of society.

p Capitalist monopolies introduce new technology aimed at lowering costs of production. As a result of the lowering of costs, profits go up—but prices do not go down, as a rule. And this means that the development of the forces of production and technical advance are confronted by the tendency to stagnation characteristic of monopoly, which imperialism is not able fully to overcome.

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p "Certainly, the possibility of reducing the cost of production and increasing profits by introducing technical improvements operates in the direction of change. But the tendency to stagnation and decay, which is characteristic of monopoly, continues to operate, and in some branches of industry, in some countries, for certain periods of time, it gains the upper hand."  [94•1 

p Some bourgeois economists, recognising the negative aspects of monopoly, seek refuge in free competition. But the magnates of capital turn to their own advantage, and to the detriment of everybody else, both competition and monopoly. Reserves of productive capacity are used by Big Business as levers for winning new positions in sales markets. Simultaneously these reserves are also used to maintain monopoly price systems. Thus, the incomplete employment of productive capacities is the capitalist monopolies’ means of crushing rivals without price lowering, and indeed keeping monopoly prices high.

p Bourgeois ideologists close their eyes to the fact that under monopoly rule competition changes its nature by becoming a tool of monopoly capital. Whereas in conditions of free competition there is a struggle between small and large concerns and between technically backward and technically advanced ones, under monopoly capitalism the monopolies often simply sweep away from their path competitors who threaten to smash monopoly price systems by the extensive implementation of new technology, expanded production and lower prices. The monopolies employ many methods for this purpose, including the planned beating down of prices until a competitor is ruined.

p The report of the US Congress Committee on Price Discrimination (1956) mentioned the monopolies’ policy of selling "below cost to subjugate rivals too efficient to be dealt with competitively".  [94•2 

p Bourgeois economists continue to sing the praises of competition as the foundation of private enterprise, private initiative and other “virtues” of capitalism. They call modern competition “ imperfect”, but they don’t see its true features.

p Nearly half a century ago in his article "How to Organise Competition?" Lenin wrote, referring to monopoly capitalism: "Competition means the incredibly brutal suppression of the enterprise, energy and bold initiative of the mass of the 95 population, of its overwhelming majority, of ninety-nine out of every hundred toilers; it also means that competition is replaced by financial fraud, nepotism, servility on the upper rungs of the social ladder."  [95•1 

p The socialisation of production, technical progress, and the gigantic possibilities for expanding production are taken advantage of by a handful of capitalist monopolies. Each of the five main features of imperialism mirror this combination of competition and monopoly, giving rise to the sharpest contradictions and undermining the basis of imperialism.

p The contradiction between competition and monopoly manifests itself on a world scale in the export of capital. Indeed the search for ever new fields for investing capital, dictated by competition, and the rise of a few nations possessing financial power over the rest of the world, resulting from monopoly, make of the world capitalist system a system of financial oppression of capitalist countries, particularly those with underdeveloped economy, by a handful of imperialist states. The export of capital combines competition and monopoly, spawning innumerable conflicts and all manner of forms of struggle for markets.

p Lenin said in this connection that the higher the development of capitalism, the sharper its need for raw materials, and the keener the competition and the search for new sources of raw materials the world over, the more desperate is the drive to acquire colonies.

p Each of the economic features of imperialism represents some form of monopoly, but none of the manifestations of monopoly rule exclude competition, struggle, conflict and economic breakdown. On the contrary, they presuppose them. "In fact it is this combination of antagonistic principles, viz., competition and monopoly, that is the essence of imperialism, it is this that is making for the final crash, i.e., the socialist revolution."  [95•2 

p Lenin devoted a great deal of attention to state-monopoly capitalism. The development of Lenin’s theory of state-monopoly capitalism went through three stages. In his book Imperialism, the Highest Stage of Capitalism he defined the place of state monopolies in the capitalist system.

p "State monopoly in capitalist society is merely a means of increasing and guaranteeing the income of millionaires in some branch of industry who are on the verge of bankruptcy."  [95•3 

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p Further, Lenin stressed the “interweaving” of private and state monopolies in the era of finance capital, saying "that both are but separate links in the imperialist struggle between the big monopolists for the division of the world".  [96•1 

p In the rough copy of the draft theses for the Appeal to the International Socialist Commission and to All Socialist Parties (January 1917), Lenin introduced the concept of state capitalism, which he regarded in terms of regulating capitalist economies and of the imminent revolutionary transition to socialism. "In the course of the war world capitalism has taken a forward step not only towards concentration in general, but also towards transition from monopoly in general to state capitalism on a much broader scale than before."  [96•2 

p State capitalism sharpens all the contradictions of capitalism, and makes capitalist monopoly oppression even more intolerable than before. Lenin described how both America and Germany regulate economic life in such a way as to enforce the worst kind of "penal servitude" on the workers (and partly on the peasants, too), while making a paradise for the bankers and capitalists. This regulation consists in "bringing up" the workers to the starvation level, and in securing for the capitalists (secretly, and by bureaucratic means) higher profits than before the war.

p In his speech to the Seventh (April) All-Russia Conference of the Bolshevik Party Lenin points to the organic connection between state-monopoly capitalism and the concentration of production and the formation of capitalist monopolies. Some time later in his lecture "War and Revolution" Lenin observed that German imperialism, even more rapacious than British imperialism, "introduced the beginnings of state-controlled capitalist production, combining the colossal power of capitalism with the colossal power of the state into a single mechanism and bringing tens of millions of people within the single organisation of state capitalism".  [96•3 

p In The Impending Catastrophe and How to Combat It, Lenin deals with the development of monopoly capitalism in Russia into state-monopoly capitalism. "That capitalism in Russia has also become monopoly capitalism is sufficiently attested by the examples of the Produgol, the Prodamet,  [96•4  the Sugar Syndicate, 97 etc. This Sugar Syndicate is an object-lesson in the way monopoly capitalism develops into state-monopoly capitalism."  [97•1 

p The difference between the Sugar Syndicate on the one hand, and the Produgol and the Prodamet on the other, lay in the fact that the parties to the latter syndicates regulated production and prices without the direct participation of the state, while in the case of the Sugar Syndicate the government controlled sugar production by introducing restrictions on home consumption through rationing and taxing sugar sold on the home market. In addition, the government introduced a system of rebates on sugar exports. As a result, Russian sugar was sold in London 61.3 per cent cheaper than at home. It goes without saying that it was only by means of state-controlled production and regulation in the interests of the landowners and the sugar factory owners, or to be more precise, through sugar starvation engineered by factory owners with the direct assistance of the government, that it was possible to squeeze the consumer so hard and guarantee fantastically high profits to the sugar industry.

p Lenin exposed the true face of the reactionary bureaucratic regulation of production in the interests of the magnates of capital and developed an extensive programme of revolutionary democratic measures with the immediate aim of employing state control and regulation of production in the interests of the people. When he advanced the demand for the nationalisation of the banks, Lenin stressed that this measure, without presupposing even the smallest changes in property relations and without taking away a single kopek from the owners, would nevertheless secure, together with other measures, control over the country’s economic life in the interests of the people, particularly of the peasant masses and small producers. Demanding the nationalisation of the syndicates, the Sugar Syndicate among them, Lenin explained that this measure only meant the replacement of reactionary-bureaucratic regulation by revolutionary-democratic control.

p Lenin emphasised very strongly the democratic character of these measures and pointed out that their implementation would not entail the introduction of socialism overnight, but only the organisation of effective control over production and consumption; 98 that it would save the country from famine and ever greater devastation, curtail the power of the landowners and capitalists, and cut back the high rates of profits which they made out of the high cost of living, the supply of war materials, financial swindling and direct treasury grabbing.

p Lenin uncovered the real cause of the wild resistance to the introduction of such democratic measures put up by imperialists and their apologists, who call themselves democrats. It is more profitable for finance capitalists to keep banks private as they can then preserve the secrecy of their financial operations, obtain super profits, and engage in financial swindling and speculation.

p Not only “backward” Russian capitalists feared nationalisation in 1917, the whole of the modern imperialist bourgeoisie fears it too. And that when its ideologists boast that modern capitalism has become a "people’s" capitalism, that the very concept of imperialism has become an anachronism, and that private property is no longer vital for modern large-scale enterprise. However, if one judges modern capitalism not by the claims of its apologists but by the actions of capitalists, one will be convinced that the magnates of capital guard the “sacred” principle of private property like the apple of their eye, treating state ownership only as a means of strengthening their own private capitalist property. They resist all nationalisation, even when it is of a blatantly capitalist character, that is, when it is realised in such a way as to meet the needs of the monopolies to the maximum while taking minimal account of the demands of the workers.

p The trend towards state control is a result of the development of monopoly capitalism. From free competition to monopoly and from private monopoly to state-controlled monopoly—that is the objective historical path of development of monopoly capitalism. But this trend at the same time comes into the sharpest conflict with the existing general level of development of capitalism, i.e., with the domination of competition and private capitalist monopoly. There are, as it were, three layers of contradictions piled one on top of another, and these leave their mark on the process by which bourgeois state control is extended under monopoly capitalism.

p Reformists and revisionists try to prove that state property under monopoly capitalism constitutes a socialist sector, an " embryo" of socialism. They thus sow reformist illusions, diverting the workers from the revolutionary struggle against monopoly and against capitalist exploitation.

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p Lenin observed that the most common mistake in the labour movement is the bourgeois-reformist belief that monopoly capitalism, in particular state-monopoly capitalism, is no longer capitalism. To the bourgeois economist, and to the revisionist, the regulated economy is no longer a capitalist one. The dogmatist, on the other hand, runs for dear life from the very idea of a state- regulated economy for fear of finding himself imprisoned by revisionism. He cannot comprehend the organic connection between socialised production, the regulation of economic life and the creation of the necessary prerequisites for the socialist revolution. Knowingly or unknowingly, he ignores the main content of state-monopoly capitalism. While Lenin struggled against revisionism, he also struggled against the oversimplification and ignoring of the deep changes that occur in the economy with the transformation of monopoly capitalism into state-monopoly capitalism.

p "The dialectics of history is such that the war, by extraordinarily expediting the transformation of monopoly capitalism into state-monopoly capitalism, has thereby extraordinarily advanced mankind towards socialism."  [99•1 

p Lenin always stressed that state-monopoly capitalism represents the most complete material preparation for socialism. He explained that although trusts are not able to create a fully planned economy under state-monopoly capitalism, big capitalists can and do regulate production on a national and even an international scale, objectively demonstrating the feasibility of socialism, which not only makes a fully planned economy possible but also radically changes the whole character of the planned economy in the interests of the people.

p Lenin, who was the first to observe the process of development of monopoly capitalism into state-monopoly capitalism and to give a scientific explanation of it, wrote over fifty years ago:

p "Under private ownership of the means of production, all these steps towards greater monopolisation and control of production by the state are inevitably accompanied by intensified exploitation of the working people, by an increase in oppression; it becomes more difficult to resist the exploiters, and reaction and military despotism grow. At the same time these steps inevitably lead to a tremendous growth in the profits of the big capitalists at the expense of all other sections of the population. . . . But with private ownership of the means of production 100 abolished and state power passing completely to the proletariat, these very conditions are a pledge of success for society’s transformation that will do away with the exploitation of man by man and ensure the well-being of everyone."  [100•1 

p The development of state-monopoly capital is inseparably linked with the militarisation of the economies of the imperialist nations. Lenin was the first to expose the economic basis of imperialist wars and to show that they are the inevitable outcome of the development of the world economic and political forces based on monopoly capitalism and unrestrained imperialist rule. At the same time Lenin never saw war only as an economic phenomenon and resolutely rejected any attempt to put wars and such purely economic phenomena as crises on the same footing. In his article "Revision of the Party Programme”, Lenin wrote: "the linking up of ’crises and wars’ is particularly incorrect, for these are quite different phenomena of different historical origin and different class significance."  [100•2 

p Lenin pointed out even before the First World War that alongside the need to use the crisis brought about by war to speed up the overthrow of the bourgeoisie, there was also the possibility of using the general crisis of world capitalism, which had been aggravated by the preparations for the war and the intensified arms race, in the struggle against bourgeois class domination.

p “. . .Wars are rooted in the very essence of capitalism; they will end only when the capitalist system ceases to exist, or when the immensity of human and financial sacrifice caused by the development of military technique, and the indignation which armaments arouse in the people, lead to the elimination of the system."  [100•3 

p Bourgeois political economists often regard militarisation as a means of stimulating the economy. Need it be said that a social system which uses the production of weapons of mass extermination as a means of stimulating the economy pronounces its own death sentence? Lenin once observed that modern big capitalist industry is always engaged either in creating unemployment in the most flourishing and affluent countries, or else in doing nothing but fabricating weapons to destroy people.

p In his works on imperialism Lenin dealt with the general 101 crisis of capitalism which set in with the outbreak of the First World War. He came to the conclusion that the capitalist order is in no position to withstand such a trial as a world war, and that both the instability of the capitalist system and its tendency to stagnate arc aggravated by the wars unleashed by the forces of imperialism.

p "The strength or weakness of the institutions and social system of every nation arc determined by the outcome of the war and its consequences."  [101•1 

p We are now in a position to sum up the experience of the two world wars, each of which demonstrated the weakness of imperialism, its inability to retain its pre-war positions and to prevent more and more nations dropping away from the capitalist system. The outcome and the consequences of the two world wars showed that Lenin was absolutely right when at the very onset of the First World War, he wrote:

p "The European war is a tremendous historical crisis, the beginning of a new epoch."  [101•2 

p Lenin repeatedly said that no force could abolish capitalism before it had been undermined by history. The general crisis of capitalism derives from the very essence of the capitalist mode of production, it is the product of its innermost contradictions. The dialectics of history is such that socialised production leads capitalism, at the highest stage of its development, into a general and insurmountable crisis. Capitalist socialised production then represents, as Lenin put it, the most complete material preparation for socialism. There is therefore an inner organic connection between Marx’s theory of the process of socialisation of capitalist production at the various stages of its development, and Lenin’s theory of imperialism and the general crisis of capitalism.

p It is a fact that the most advanced country of the capitalist world, the USA, which amassed extraordinary wealth in the course of two world wars, is steadily falling behind in rates of economic growth. US industrial production fell 16 per cent during the first post-war (1946) recession. Four more recessions followed (1949-61). Another sharp drop in the rate of growth of the economy in 1967 led to an over-all average rate of growth for the entire post-war period (1946-69) of 3.8 per cent—that is, almost three times lower than the average Soviet 102 rate (10.8 per cent), despite the USA’s rapid progress over particular periods (especially 1962-66) as a result of the scientific and technological revolution and the development of state-= monopoly capitalism.

p The somewhat accelerated US rate of growth after World War II compared to that in the inter-war period is largely connected with the militarisation of the economy that has intensified even more the parasitism of American capitalism. Lenin observed in his time that the increased parasitism that went with economic progress was intrinsic to monopoly capitalism. He wrote in his book Imperialism, the Highest Stage of Capitalism: "In the United States, economic development in the last decades has been even more rapid than in Germany, and for this very reason, the parasitic features of modern American capitalism have stood out with particular prominence."  [102•1 

p Lenin’s characterisation of state-monopoly capitalism as the last stage in the historical development of capitalism indicates the futility of the frantic search by this moribund system for a way out of its general crisis by extending state interference in the economy. The experience of history tells us that state-monopoly capitalism greatly increases the exploitation of labour by capital, resulting in the fantastic enrichment of the financial oligarchy which appropriates the fruits of scientific and technical progress. And by encouraging the military application of advances in technology, state-monopoly capitalism confronts mankind with the threat of thermo-nuclear war.

Lenin also defined the historical role of the national liberation movement in the destruction of world capitalism. He showed that this movement in the course of its development would grow from a potential reserve of the world socialist revolution into a vital component part of the entire process of the revolutionary transition from capitalism and imperialism to socialism and communism on a world scale.

p The economic theory of Marxism and, in particular, the Marxist political economy of capitalism, was developed by Lenin in a number of his works over a period of three decades, from 1893 to 1923, above all in his books The Development of Capitalism in Russia and Imperialism, the Highest Stage oj Capitalism. 103 Both books are a continuation and enlargement of Marx’s Capital.

p The first book is a classic example of the creative application of Marxist theory to Russia’s economic and political conditions in the post-Reform period. Lenin’s analysis of the position and interests of the various classes just before the first Russian revolution brought out the economic basis of the proletariat’s leading role in this revolution.

p In the second book Lenin analysed monopoly capitalism, the economic features of imperialism and the place of imperialism in history, and on this basis gave the theory of capitalist development in the period of the maturing of the conditions for and the carrying through of the socialist revolution.

The October Socialist Revolution shook the entire edifice of world capitalism to its foundations, the world was divided into two opposing systems, and the process of the disintegration of capitalism and the generation of a new, socialist society—a new era in the history of mankind—began.