Imperialism Chapter 5: The Division of the World Among Capitalist Combines

Main argument: The monopoly stage of capital makes capitalists seek markets abroad for their profits. Because of their huge size, and their backing by banks and states, it is impossible for small businesses to compete with them. However, between themselves they often form an alliance in the form of international cartels or syndicates. Such alliances are always uneasy alliances and can break down. They then compete with each other for division of the world. Since, each of these capitalists are tied to a state (German capital, or American capital, or British capital), this can also lead to war, which is one of the main arguments of the book. However, it is important to distinguish the substance of the struggle between ruling classes of different countries, which is for the division of the world, and the form of the struggle which can be peaceful or warlike.

“Monopolist capitalist combines, cartels, syndicates and trusts divide among themselves, first of all, the home market, seize more or less complete possession of the industry of a country. But under capitalism the home market is inevitably bound up with the foreign market. Capitalism long ago created a world market. As the export of capital increased, and as the foreign and colonial connections and "spheres of influence" of the big monopolist combines expanded in all ways, things "naturally" gravitated towards an international agreement among these combines, and towards the formation of international cartels.”

This is a new stage of world concentration of capital and production, incomparably higher than the preceding stages. Let us see how this supermonopoly develops.”

Capitalism naturally creates a world market. The concentration of capital and production is at a global scale. Lenin gives several examples from his time but we see this even more and more today.

The difficulty of competing against this trust, which is practically world-wide, controls a capital of several billion, and has its "branches," agencies, representatives, connections, etc., in every corner of the world, is self-evident. But the division of the world between two powerful trusts does not preclude redivision if the relation of forces changes as a result of uneven development, war, bankruptcy, etc.

An instructive example of attempts at such a redivision, of the struggle for redivision, is provided by the oil industry.

The alliance between monopolies is always an uneasy alliance and there can be competition between them. Lenin gives the examples of the oil industry where control over oil resources led to a fight between Rockefeller (America) and Deutsche bank (Germany). Rockefeller had more capital and better organized production and the German bank had to submit to the Americans. However, Lenin goes on to talk about how the German bank tried to regain control by getting the might of the German state behind it.

We see plainly here how private and state monopolies are interwoven in the age of finance capital; how both are but separate links in the imperialist struggle between the big monopolists for the division of the world.

This link between state and capital. Will talk more in the discussion question.

Certain bourgeois writers (whom K. Kautsky, who has completely abandoned the Marxist position he held, for example, in 1909, has now joined) have expressed the opinion that international cartels, being one of the most striking expressions of the internationalization of capital, give the hope of peace among nations under capitalism. Theoretically, this opinion is absolutely absurd, while in practice it is sophistry and a dishonest defense of the worst opportunism. International cartels show to what point capitalist monopolies have developed, and the object of the struggle between the various capitalist combines. This last circumstance is the most important, it alone shows us the historico-economic meaning of what is taking place; for the forms of the struggle may and do constantly change in accordance with varying, relatively particular and temporary causes, but the substance of the struggle...The capitalists divide the world, not out of any particular malice, but because the degree of concentration which has been reached forces them to adopt this method in order to obtain profits. And they divide it "in proportion to capital," "in proportion to strength," because there cannot be any other method of division under commodity production and capitalism. But strength varies with the degree of economic and political development. In order to understand what is taking place, it is necessary to know what questions are settled by the changes in strength. The question as to whether these changes are "purely" economic or non-economic (e.g., military) is a secondary one, which cannot in the least affect the fundamental views on the latest epoch of capitalism. To substitute the question of the form of the struggle and agreements (today peaceful, tomorrow warlike, the next day warlike again) for the question of the substance of the struggle and agreements between capitalist combines is to sink to the role of a sophist.

This is important where Lenin discriminates between the form of the struggle and the substance of the struggle. The substance of the struggle is the economic division of the world by the monopoly capitalists. The form of the struggle can be varied.

Discussion questions:

Is capital tied so strongly to a state anymore? Why does the neoliberal media go against Trump when he pushes for tariffs against international imports. Is this part of the conflict in between the ruling class?

Is there now an alliance between different capitalist countries? Does this alliance have contradictions i.e is the substance of the struggle the same and the form different? The continuous war that we see today is not intra-imperialist conflict, do we need to understand it differently?