p The building of an all-embracing imperialist system was completed at the turn of the century, when the undivided 41 sway of monopoly capital was established in the main capitalist countries, and the territorial division of the world between them was fully completed. The main patterns of the functioning of monopoly capitalism began then to determine the decisive lines of development of the world economy and world politics. The concluding stage of the formation of a world economy, which took around two or three decades, belongs roughly to the same period.

p The transition irom pro-monopoly capitalism to imperialism was I he result of deep-seated shifts, above all in the productive forces a?id technical basis of society, under the action of the ever accelerating concentration and centralisation of production and capital in its main centres. The development of monopolies inevitably retarded technical progress, but at tho same time the increasing concentration of their economic and financial power opened up hitherto unprecedented opportunities for broader application of those advances of science and engineering in the world economy that helped them increase their profits.

p This period was marked by the introduction, especially in heavy industry, of major technical advances that brought into being economically more efficient forms and methods of production. The competitiveness of the monopoly mergers was enhanced and the objective conditions created for a further acceleration of the concentration and integration of production. The technical advances that had a marked effect in changing the structure and accelerating growth of the world capitalist economy included, for example, the invention of new ways of making steel (the Bessemer process in 1855, open hearth process in 1864, and the Thomas, or basic process in 1878). Their introduction by the monopolies of the main capitalist countries made it possible to convert the iron and steel industry into a leading branch of the world economy. Whereas only around 500,000 tons of steel was produced in 1870 in the whole world, production was 12 million tons in 1"890, and already 76 million tons in 1913. World production of pig iron rose to 24 million tons in 1890 and to nearly 80 million tons in 1913.

p The development of the engineering and chemical industries also had a considerable impact on the advance of many other branches of the economy. The application of technical advances in production that led to the perfecting of prime movers played a revolutionary role in tin’s respect. 42 Among them were the invention of the dynamo (1867), the fonr-stroko internal combustion engine (1877), the steam turbine (rnid-80s), and the Diesel engine (end of the 90s). The new types of engine promoted the development of new forms of transport: the motor car (1885), the Diesel locomotive (1891), and the aeroplane (1903). The application of improved means of transport and communication, which had in fact united all areas and countries of the globe at the beginning of the twentieth century, immeasurably accelerated the forming of the world system of division of labour of the imperialist epoch. In 1913 the length of the world’s railways was more than a million kilometres, of which more than 250,000 km had been built in colonial and dependent countries in Asia, Africa, and Latin America. There was also a steep increase in marine freights and ocean transport. The energy base of world capitalism, then based on coal, also grew rapidly. The mining of coal exceeded 1,000 million tons at the beginning of this century. The technical basis of the power industry also broadened considerably. For many decades after Watt’s invention of the steam engine capitalism’s economic growth was linked with the application of steam, but at the turn of the century the use of electricity was becoming more and more important, which also fostered the introduction of a number of new advances in the field of electrical engineering by the biggest companies: viz., the electric smelting of steel (1877), the electrolytic technique of obtaining non-ferrous metals (end of the 1880s), longdistance transmission of electricity (1891), etc.

p The world level of production in manufacturing industry rose by 120 per cent between 1880 and 1900, and by 270 per cent by 1913. World trade in manufactured goods rose by 210 per cent (in constant prices) in the same period, and in primary commodities by 220 cent.  [42•1  By the beginning of this century the lion’s share of world industrial output and trade was already concentrated in the hands, or under the full control, of the finance capital of ten imperialist powers, which led in a comparatively short time to establishment of the unlimited domination of imperialist monopolies in international economic and political relations. All that in turn brought about essential modifications in the 43 pattern of development of the world economy compared with the period of free competition. Since all countries and nations without exception had been drawn into the orbit of imperialist domination, elucidation of this pattern called urgently for theoretical comprehension of the actual changes taking place both in the economies of the main capitalist powers and on a world scale.

p It was necessary to get an overall picture of the whole capitalist economy and of the most important trends in its development. Lenin took it on himself to tackle this problem. The concrete, historical analysis of the main tendencies of economic development at the beginning of the century that he made in his book Imperialism, the Highest Stage of Capitalism enabled him to define imperialism as a special stage of capitalism within which monopolies and finance capital had established world domination, the export of capital had acquired salient significance, economic division of the world between alliances of capitalists had begun, and the territorial partition of the world among the capitalist powers had been completed.

p This definition of the imperialist stage included its main economic attributes, which at the same time also characterised other very important aspects of the affairs of capitalist society at that time in the realm of politics, social relations, class struggle, ideology, and culture. It was a matter, consequently, of a single chain of socio-economic and political changes that brought to light the very essence of the monopolistic stage of capitalism as a world system rather than of isolated or one-sided attributes In defining this essence, Lenin noted that

p on the one hand, finance capital is tho bank capital of a low very big monopolist banks, merged with tho capital of tho monopolist associations of industrialists; and, on the other hand, the division of tho world in tho transition from a colonial policy which has extended without hindrance to territories unseized by any capitalist power, to a colonial policy of monopolist possession of tho territory of the world, which has been completely divided up.  [43•1 

p The various fornib of monopoly in one country or another, and in the various branches of the capitalist economy had already arisen on the national and world markets, as we 44 know, under free competition, but they only acquired a dominant position on a world scale under imperialism. Marx and Engels, in wringing out the deep-sealed tendencies of development and the historical inevitability of the destruction of the capitalist formation, had been able in their day to trace the genesis of capitalist society from its embryonic state to the period when the joint-stock form of monopoly capital began to arise within it.

p They could not then foresee, of course, that capitalism would pass to a higher stage of development, but they perceived, with the shrewdness of genius, in the joint-stock form of the ‘self-movement’ of capital a tendency toward monopolisation that sapped the very principle of free competition.  [44•1  At the same time, their studies showed that this tendency, reflecting natural growth of the social character of capitalist production, must promote the creation of new objective conditions for mankind’s revolutionary passage to a more progressive social system.

p Lenin’s theory of imperialism brought together a Marxist analysis of the patterns of capitalism and a study of the qualitatively new processes and phenomena of world development at the beginning of the twentieth century. Elucidation of the economic essence of the new stage of capitalism was the core of this theory. Just as free enterprise was the main trend in the affairs of the world capitalist economy in its early stages of development, so establishment of the domination of finance capital on a world scale was the most important feature of its imperialist stage.

p Because the economic basis of capitalism consists in capitalist private ownership of the means of production, a uniting of two contradictory principles—monopoly and competition—is typical of the world economy of imperialism. At the same time it retains a broad spectrum of both pre-monopoly and even pra-capitalist forms of commodity production. Without them it would be inconceivable, since imperialism, as Lenin often stressed, is a kind of superstructure on the old capitalism that is the admitted consequence of the development, expansion, and continuation of the deepest, most fundamental tendencies of capitalism and commodity production in general. That formulation of the problems acquires special significance when we analyse the 45 structural changes in the world capitalist economy with the collapse of its colonial basis.

p The national features of the monopolisation, and consequently, too, of the internalionalisation, of large-scale proel uction and capital in no way rule out the operation in each country of the general patterns that in the aggregate determine the unity of the various features of imperialism’s economy and politics. Not all the main characteristics of the highest and last stage of capitalism, moreover, are manifested in each country to the same exten! and in all areas. The possession of colonies, for example, or the export of capital, played a minor role, or did not occur, in the specific conditions of its formation in certain imperialist countries, but the existence of the decisive characteristics—the domination of monopolies and finance capital—was obligatory. The economic attributes of imperialism, taken together, are manifested in their unity in the world capitalist economy.

p At the turn of the century this economy was wholly transformed into an antagonistic aggregate of two main groups of countries, imperialist countries on the one hand and the colonies and dependent countries exploited by them on the other hand. In that connection we must remember that some of these characteristics had already begun to be observable in Great Britain in the middle of the nineteenth century.  [45•1  By the end of the century, however, Britain’s advantages had largely been forfeited. One country’s domination had given way to the monopoly position of several main, competing imperialist powers.

p Although the policy of colonial enslavement of other countries in the capitalist system historically became very common, imperialism had nevertheless begun, right at the start, as we showed above, to create qualitatively new conditions for the expansion of finance capital in economically backward countries without their direct political subjugation. The patterns of the division of labour between developed capitalist, countries and economically backward agrarian ones 46 operating ai that time favoured further consolidation of these conditions.  [46•1 

p The omnipotence of finance capital in world economics and politics had grown to such an extent then as to enable the leading capitalist countries to convert even individual colonial powers that were lagging in economic development into dependent countries. To some extent this dominance enabled many features of the former structure of the uneven division of labour in the world capitalist economy to be retained subsequently, after the disintegration of the colonial system.

p An idea of some of the main trends of development and of the structural changes in the world capitalist economy at the turn of the century is given by the statistics in Table 1, which enable us to characterise in general form the shifts in the productive forces mentioned above over roughly a third of a century during the growing over of pre-monopoly capitalism into monopoly capitalism.

p One of the most essential features of world economic relations in the monopoly stage of capitalism is the export of capital. By greatly intensifying the foreign economic expansion of the main capitalist countries, it enabled the monopolies of the imperialist powers to gain a predominant influence in other countries, often with the letter’s retention of actual national independence. It also led to the development of the feature noted above, namely the tendency to an accelerated but dependent development of capitalism in colonies and other economically backward countries.

p The colonial policy of the monopoly capitalists continued, at the same time, to pursue the goal of maintaining survivals of pre-capitalist social structures in agrarian countries and raw-material suppliers (especially as regards their agrarian relations) as a social prop for their dominance and source of extra superprofit. The intertwining of pre-capitalist forms of production with monopoly forms and methods of exploitation intensified the contradictions of the world economic 47 The Growth of Imperial ism’s Colonial System and the of World Economic Development I able 1 Dynamics 1870-1880 i’JOII Colonies i:j III/: imperialist powers Population (millions) 315 T 520 500 2 852 Territory (mil. sq. km. 45 ! Industrial product ion (1880=100) 100 83 The World USA :i Great Britain Germany France Italy Russia 300 590(35.8) 190(14.1) 400(15.7) 230(0.4) 435(2.7) 590(5.5) 100(23.4) 315(32.2) 100(28.7) 150(18.0) 100(15.0) 200(17.0) 100(10.5) 155(7.0) 100(2.4) 100(3.0) 245(2.5) 300(5.0) World production, of selected product* (mill, tons) Coal Pig iron Steel 300 18.5 4.2 750 40.5 29.3 1300 79.2 70.3 Physical volume of irorld trade Manufactures Raw materials 100 100 Length nj railways (000 kilometres) 150* 190" Total Europe America Asia Africa Oceania (Australia and New Zealand) 370 170 175 15 5 5 790 285 400 00 20 25 1105 345 570 110 45 1 187U 2 1!)14 3 The figures in brockets give Hie USA’s and oilier countries’ percentage share of world production 4 Yearly averages for 18!)G-1!)00 Sources: calculated from V. I. Lenin. Imperialism, tlie Highest Stage of Capitalism. Collected Works, Vol. 22; E. S. Varga (Ed.). World Economic Crises 1848-1935 (Ogiz, Moscow, 1937), pp. 482-484; M. I!. Wolf and V. S. Klupt. Statislicheshi/ tpruvoclmih p<> ehonumichcshoi gcogrnfii stran hapitolisiicheskogo mira ( Statistical Handbook on the Economic Geography of tbo Countries of the Capitalist. World), Sotsekgiz, Leningrad, I!);i7,pp. 22, 23, 48, 74; League of Nations. Industrialization and Foreign Trade, pp 132-134, 157 (estimates rounded off). 48 system, and led to a further increase in tlie unevenness of the development, of its various parts, and of separate countries and regions.

p At the same time monopoly capital added to the old methods of capitalists’ expansionist policy a struggle for redivision of the already divided world, to take up its raw material resources and profitable spheres for the employment of capital, for new potential markets for their industrial output, and for spheres of monopoly control over economically exploitable areas in general. The inter-imperialist struggle fostered a steep increase in the spasmodic character of the economic development of various countries, which became a most important feature of the functioning of the world capitalist economy over the whole of its subsequent history.

p With the transition to the monopoly stage there were also considerable changes in the political and ideological superstructures of capitalist society. The determinant moment of all these changes was a strengthening of reaction all along the line. A period of unrestrained intensification of exploitation and national oppression of all the peoples of the world by the monopoly capitalist powers set in, a period of imperialist struggle for spheres of complete bossing of the show in the world. In these conditions the capitalists as a class finally lost their once progressive role.

p In creatively developing the Marxist theory of social development on the basis of a thorough study of this stage of capitalism, Lenin came to the very important conclusion that a fundamentally new historical situation had arisen promoting a further upsurge of the world revolutionary process:

p Capitalism has become reactionary; it has developed the forces of production to such a degree that mankind is faced with the alternative of adopting socialism or of experiencing years and oven decades of armed struggle between the ‘Great’ Powers for the artificial preservation of capitalism by means of colonies, monopolies, privileges and national oppression of every kind.  [48•1 

The unprecedented sharpening of the contradictions of capitalist development on a global scale created the objective conditions for snapping the single chain of imperialism at its weakest links, initially in a few countries, or one, taken by itself. Imperialism’s historical place in relation to capitalism in general was thus defined as a turning point in 49 society’s affairs, as the eve of a new historical epoch of revolutionary suppression of the capitalist social formation by a socialist one.