The Economic Interpretation of Imperialism A COMMENT ON SOME RECENT WRITINGS SINCE Hobson and Lenin produced their very different but essentially economic interpretations of modern imperialism Western historians have subjected their theories to repeated criticism. In general terms doubt has been cast upon the Marxist interpretation of history upon which Lenin's analysis was based. The impoverishment of the industrial prole- tariat that Marx believed was an inevitable consequence of capitalism did not occur. Rather the reverse, for the industrial proletariat of the ad- vanced capitalist states greatly improved its standard of living in the course of the twentieth century. The decolonization process after World War II appeared to deny any causal link between capitalism and im- perialism. Moreover the rise of the supposedly socialist USSR did little to advance the Marxist-Leninist interpretation of imperialism in Western eyes. On the one hand: 'The purportedly Leninist theory of imperialism presented in the . manuals of "orthodox" [Soviet] Marxism . can have had little power to attract those in search of an explanation for the tempestuous events of the twentieth century. Indeed, it tends more to confirm the picture of Marxism as presented by its opponents — an out- moded and one-sided dogma, a myth rather than a science, unworthy of the attention of serious thinkers.'1 On the other hand, the USSR's actions after World War II suggested that contemporary imperialist expansionism was by no means confined to capitalist states. More specifically a host of detailed historical studies tended to contro- vert economic interpretations of late nineteenth- and early twentieth- century imperial expansion. The motives for and process of imperial expansion in individual cases were shown to be complex and varied. Surplus capital, in so far as it existed, was shown to have gone not to new colonial territories but to Europe, North America and Australasia. Colonies were shown not to pay in most cases. The taproot of imperialism, insisted historians such as Richard Koebner2 and D. K. Fieldhouse, must be sought not in the economics of capitalism 178 the economic interpretation of imperialism 179 but in the complex politics of competing nation states. Fieldhouse ex- pressed most succinctly the point of view that may be said to have become the conventional wisdom of Western historians: First, . [the historian's] instinct is to distrust all-embracing historical formulas which, like the concept of 'the rise of the middle class', seek to explain complex developments in terms of a single dominant influence. Again, he is likely to suspect an argument that isolates the imperial expansion of the period after 1870 from all earlier imperial developments if only because he is aware of so many elements of continuity in the history of overseas empires over the past few centuries. But, above all, he must be aware that the [Marxist] theory simply does not appear to fit the facts of the post-1870 period as he knows them.3 However, even as Fieldhouse was dismissing the Marxist-Leninist interpretation of imperialism, it was being widely propagated not only by Communist parties but also by the leaders of newly-independent former colonial territories, such as Sukarno in Indonesia and Nkrumah in Ghana, the latter of whom systematized his ideas under the title of Neo-Colonialism — the Last Stage of Imperialism in 1965. With growing awareness of the failure of the former colonial territories (or Third World) to develop following independence and with the stimulus of the Vietnam war there ensued a revival of economic and neo-Marxist interpretations of imperial- ism. Although much of this writing made little attempt to explain the genesis of modern imperialism, concentrating more on the immediate reality of exploitation, it was accompanied by more scholarly re-examina- tion of the academic controversy about late nineteenth-century and early twentieth-century imperialism. Before we begin to examine such re-interpretations it is necessary to outline the essence of Hobson's and Lenin's theses. The core of Hobson's argument, to use his own words, was to the effect that whereas various real and powerful motives of pride, prestige and pugnacity, together with the more altruistic professions of a civilising mission, figured as causes of imperial expansion [after 1870], the dominant directive motive was the demand for markets and for profitable investment by the exporting and financial classes within each imperialist regime. The urgency of this economic demand was attributed to the growing tendency of industrial productivity, under the new technique of machinery and power, to exceed the effective demand of the national markets, the rate of production to outrun the rate of home consumption.4 Although this was 'not . the whole story' it was 'nevertheless true that the most potent drive towards enlarged export trade was the excess of capitalist production over the demands of the home market'.5 Fortunately, in Hobson's opinion, this drive was relatively easily eliminated by the redistribution of income at home. By increasing home demand this reform would end the excessive pressure for the export of capital and goods while at the same time improving the public welfare. Hobson's examples were to be used by Lenin but in a fundamentally different theoretical framework. Before we examine this it is essential to 180 m. r. stenson clarify the Marxist-Leninist definition of imperialism. Marxists were well aware of the existence of imperialism before the twentieth century both in the form of the feudal empires of continental Europe or Asia and the more recent maritime empires of trade and commerce. George Lichtheim has noted of the latter: Marxists have traditionally held that European overseas expansion since the sixteenth century was an aspect of capitalism, in the sense that it was both cause and consequence of the socio-economic transformation originally begun by the Italian city-states and culminating in the Industrial Revolution. Mer- cantilist policy . was thoroughly imperialist and the driving force behind it was the urge to amass national capital in competition with rival powers.6 But within Lenin's thought there is an implicit distinction between the earlier capitalist imperialism, which many Marxists refer to as colonialism, and the imperialist urges of the monopoly finance or highest stage of capitalism. For Lenin, then, imperialism is a particular stage in the evolution of capitalism, implicitly its final stage, when monopoly finance capitalism gives rise to surplus capital that cannot profitably be invested at home and must be invested in other countries. In Lenin's words: 'Imperialism is capitalism in that stage of development in which the dominance of monopolies and finance capital has established itself; in which the export of capital has reached pronounced importance; in which the division of the world among the international trusts has begun; in which the division of all territories of the globe among the highest capitalist powers has been completed'.7 Thus, Lenin did not attempt to develop a universal theory of imperialism, as so many of his critics have assumed. That other forms of imperialism arising from earlier modes of production could exist coterminously with the imperialism of monopoly finance capitalism was clearly acknowledged by Lenin in his references to 'the numerous "old" motives for colonial policy'.8 Similarly Lenin acknowledged that imperialist urges existed at earlier monopoly and pre-monopoly stages of capitalism, although he implied that they were of lesser intensity. Lenin also appreciated that other strategic or speculative economic motives for imperialism existed in the early twentieth century, albeit in a subordinate role. As he put it: 'The non-economic superstructure which grows on the basis of finance capital, its politics and its ideology, stimulates the striving for colonial conquest.'9 But while acknowledging that imperialist relations 'have always existed between big and little states', Lenin argued that 'in the epoch of capitalist imperialism they become a general system, they form part of the sum total of "divide the world" relations, become links in the chain of opera- tions of world finance capital'.10 However, as Tom Kemp rightly insists in his Theories of Imperialism, if we genuinely wish to understand Lenin's thinking we must go back to Marx. Indeed, Kemp suggests, virtually all modern discussions of im- perialism 'are explicitly or implicitly directed against what is presumed the economic interpretation of imperialism 181 to be the, or a, Marxist theory of imperialism'.11 In this respect, Kemp argues: 'It is particularly necessary to recognise the many-sidedness of his thought and the method which he developed to penetrate to the innermost secrets of social phenomena, Marx had no ready-made theory of imperial- ism because events had not ripened to the point where the phenomenon had assumed recognizable form, but his method and his analysis of capitalism (albeit incomplete) laid the foundations for grasping its nature and meaning'.12 Marx's fundamental contribution was the materialist conception of history. 'The application of materialism to the interpretation of social development meant that all aspects of human thought and action were seen as an inter-related whole, which had in turn to be seen as the working out of a process of development which could only be understood by finding its roots in the most basic form of human activity — the produc- tion and reproduction of the means of life'.13 Kemp emphasizes that this does not involve 'the simple reduction of history to economic causes'14 for in 'every concrete case it is the actual dialectical richness and complexity of the relationship which had to be investigated and understood'.15 'The assertion that men are motivated exclusively by their vulgar self-interest was not made by Marx but by some of the vulgarizers of classical political economy'.16 Kemp selects four other aspects of Marx's thought as central to an understanding of Lenin's interpretation of imperialism.