N.I. Bukharin: World Economy and the "National" State

N.I. Bukharin: Imperialism and World Economy -preface and index

1. REPRODUCTION OF WORLD CAPITAL AND THE ROOTS OF CAPITALIST EXPANSION. 

2. OVERPRODUCTION OF INDUSTRIAL GOODS, UNDERPRODUCTION OF AGRICULTURAL PRODUCTS, AND OVERPRODUCTION OF CAPITAL AS THREE FACETS OF THE SAME PHENOMENON. 

3. CONFLICT BETWEEN WORLD ECONOMY AND THE LIMITATIONS OF THE "NATIONAL" STATE.

4. IMPERIALISM AS THE POLICY OF FINANCE CAPITAL. 5. IDEOLOGY OF IMPERIALISM.

From the point of view of the ruling circles of society, frictions and conflicts between "national" groups of the bourgeoisie, inevitably arising inside of present-day society, lead in their further development to war as the only solution of the problem. We have seen that those frictions and conflicts are caused by the changes that have taken place in the conditions of reproducing world capital. Capitalist society, built on a number of antagonistic elements, can maintain a relative equilibrium only at the price of painful crises; the adaptation of the various parts of the social organism to each other and to the whole can be achieved only with a colossal waste of energy, under tremendous "faux frais" of this adaptation, which flow from the character of capitalist society as such, i.e., from a definite historical formulation of the development in general.

We have laid bare three fundamental motives for the conquest policies of modern capitalist states: increased competition in the sales markets, in the markets of raw materials, and for the spheres of capital investment. This is what the modern development of capitalism and its transformation into finance capitalism has brought about.

Those three roots of the policy of finance capitalism, however, represent in substance only three facets of the same phenomenon, namely of the conflict between the growth of productive forces on the one hand, and the "national" limits of the production organisation on the other.

Indeed, overproduction of manufactured goods is at the same time underproduction of agricultural products. Underproduction of agricultural products is in this case important for us in so far as the demand on the part of industry is excessively large, i.e., in so far as there are large volumes of manufactured goods which cannot be exchanged for agricultural products; in so far as the ratio between those two branches of production has been (and is more and more) disturbed. This is why growing industry seeks for an agrarian "economic supplement" which, within the framework of capitalism, particularly its monopoly form, i.e., finance capital, inevitably expresses itself in the form of subjugating agrarian countries by force of arms.

We have just discussed the exchange of commodities. Capital export, however, does not represent an isolated phenomenon, either. Capital export, as we have seen, is due to a certain overproduction of capital. Overproduction of capital, however, is nothing but another formulation for overproduction of commodities:

Overproduction of capital [says Marx] never signifies anything else but overproduction of means of production-means of production and necessities of life-which may serve as capital, that is, serve for the exploitation of labour at a given degree of exploitation. ...Capital consists of commodities, and therefore the overproduction of capital implies an overproduction of commodities.1)

Conversely, when the overproduction of capital decreases, there is also a decrease in the overproduction of commodities. This is why capital export, in decreasing overproduction of capital, . aids also in decreasing the overproduction of commodities. (Let us note parenthetically that if, for instance, iron beams are exported into another country to be sold there, we have commodity export pure and simple; if, however, the beam-producing firm establishes an enterprise in another country and exports its commodities to equip the enterprise, we have capital export; obviously, the criterion is whether the transactions of purchase and sale take place or not.)

But even aside from simply "relieving the congestion" by exporting capital in commodity form, there is also a further connection between capital export and the decrease in the overproduction of commodities. Otto Bauer has very well formulated this connection.

Thus [he says] the exploitation of economically backward countries by the capitalists of a European country has two series of consequences: directly, it creates new spheres of investment for capital in the colonial country, and at the same time more selling opportunities for the industry of the dominating power; indirectly, it creates new spheres for the application of capital also inside of the dominating country, and increases the sale of the products of all its industries.2)

If we thus consider the problem in its entirety, and take thereby the objective point of view, i.e., the point of view of the adaptation of modern society to its conditions of existence, we find that there is here a growing discord between the basis of social economy which has become world-wide and the peculiar class structure of society, a structure where the ruling class (the bourgeoisie) itself is split into "national" groups with contradictory economic interests, groups which, being opposed to the world proletariat, are competing among themselves for the division of the surplus value created on a world scale. Production is of a social nature; international division of labour turns the private "national" economies into parts of a gigantic all-embracing labour process, which extends over almost the whole of humanity. Acquisition, however, assumes the character of "national" (state) acquisition where the beneficiaries are huge state companies of the bourgeoisie of finance capital. The development of productive forces moves within the narrow limits of state boundaries while it has already outgrown those limits. Under such conditions there inevitably arises a conflict, which, given the existence of capitalism, is settled through extending the state frontiers in bloody struggles, a settlement which holds the prospect of new and more grandiose conflicts.

The social representatives of this contradiction are the various groups of the bourgeoisie organised in the state, with their conflicting interests. The development of world capitalism leads, on the one hand, to an internationalisation of the economic life and, on the other, to the leveling of economic differences,-and to an infinitely greater degree, the same process of economic development intensifies the tendency to "nationalise" capitalist interests, to form narrow "national" groups armed to the teeth and ready to hurl themselves at one another any moment. It is impossible to describe the fundamental aims of present day politics better than was done by R. Hilferding. "The policy of finance capital," he says, "pursues a threefold aim: first, the creation of the largest possible economic territory which, secondly, must be protected against foreign competition by tariff walls, and thus, thirdly, must become an area of exploitation for the national monopoly companies."3) The increase in the economic territory opens agrarian regions to the national cartels and, consequently, markets for raw materials, increasing the sales markets and the sphere of capital investment; the tariff policy makes it possible to suppress foreign competition, to obtain surplus profit, and to put into operation the battering ram of dumping; the "system" as a whole facilitates the increase of the rate of profit for the monopoly organisations. This policy of finance capital is imperialism.

Such a policy implies violent methods, for the expansion of the state territory means war. The reverse, however, is not true; not every war or every increase in the state territory implies an imperialist policy. The determining factor is whether the war expresses the policy of finance capital, the latter term being taken in accordance with the above definition. Here, as everywhere, we find some intermediary forms, whose existence, however, by no means vitiates the main definition. This is why attempts like those made by the well-known Italian economist and sociologist, Achille Loria, are fundamentally incorrect. Loria, namely, has attempted to construct two conceptions of imperialism which, he alleges, contain "entirely heterogeneous relations" (des rélations tout à fait hétérogènes). Loria distinguishes4) between "economic" imperialism (l'impérialisme économique, ökonomischer Imperialismus) and "commercial" or "trade" imperialism (l'impérialisme commercial, Handelsimperialismus). The object of the former, he says, are tropical countries, the object of the latter are countries whose conditions make them suitable also for European colonization; the method of the former is armed force, the method of the latter, peaceful treaties (des accords pacifiques); the former has no shadings or grades, in the latter they range from the maximum of full assimilation or a single tariff to incomplete forms, like preference tariffs between the colonies and the mother countries, etc.

This is Loria's theory. It is quite obvious that it is made out of whole cloth. Both the "commercial" and the "economic" imperialism are in substance the expression of the same tendencies, as we have seen above. A closed ring of tariff duties, and the raising of the latter, may not result in an armed conflict immediately; they will, however, bring about such a conflict later. It is thus obvious that we cannot contrast "peaceful treaties" with "armed forces." (Peaceful treaties between England and its colonies mean a straining of the relations between England and other countries.) Neither can we assert that "economic" imperialism is merely of a "tropical" nature. The best proof is the fate of Belgium, Galicia, and the probable fate of South America, China, Turkey, and Persia.

To sum up: the development of the productive forces of world capitalism has made gigantic strides in the last decades. The upper hand in the competitive struggle has everywhere been gained by large-scale production; it has consolidated the "magnates of capital" into an ironclad organisation, which has taken possession of the entire economic life. State power has become the domain of a financial oligarchy; the latter manages production which is tied up by the banks into one knot. This process of the organisation of production has proceeded from below; it has fortified itself within the framework of modern states, which have become an exact expression of the interests of finance capital. Every one of the capitalistically advanced "national economies" has turned into some kind of a "national" trust. This process of the organisation of the economically advanced sections of world economy, on the other hand, has been accompanied by an extraordinary sharpening of their mutual competition. The overproduction of commodities, which is connected with the growth of large enterprises; the export policy of the cartels, and the narrowing of the sales markets in connection with the colonial and tariff policy of the capitalist powers; the growing disproportion between tremendously developed industry and backward agriculture; the gigantic growth of capital export and the economic subjugation of entire regions by "national" banking combines all this has thrown into the sharpest possible relief the clash of interests between the "national" groups of capital. Those groups find their final argument in the force and power of the state organisation, first of all in its army and navy. A mighty state military power is the last trump in the struggle of the powers. The fighting force in the world market thus depends upon the power and consolidation of the "nation," upon its financial and military resources. A self-sufficient national state, and an economic unit limitlessly expending its great power until it becomes a world kingdom - a world-wide empire - such is the ideal built up by finance capital.

With a steady and clear eye does it [finance capital] view the Babylonian confusion of peoples, and above all of them it sees its own nation. The latter is real; it lives in a powerful state, which keeps on increasing its power and grandeur, and which devotes all its forces to making them greater. In this way, the interests of the individual are subjugated to the interests of the whole-a condition without which no social ideology can live; a nation and a state that are hostile to the people are tied into one whole, and the national idea, as a motive power, is subjugated to politics. The class conflicts have disappeared; they have been annihilated, absorbed as they are in serving the interests of the whole. In place of the dangerous class struggle, fraught for the owners with unknown consequences, there appear the general actions of the nation which is united by one aim-the striving for national grandeur.5)

Thus the interests of finance capital acquire a grandiose ideological formulation; every effort is made to inculcate it into the mass of workers, for, as a German imperialist has correctly remarked from his point of view: "We must gain power not only over the legs of the soldiers, but also over their minds and hearts."6)

Notes

1) Capital, Vol. III, pp. 300-301.

2) Otto Bauer: Die Nationalitätenfrage and die Sozialdemokratie, Vienna, 1907, p. 464.

3) Rudolf Hilferding: Finanzkapital, p. 412.

4) Achille Loria, "Les deux notions de l'impérialisme," in Revue économique internationale, 1907, Vol. 3, p. 459 ff.

5) Rudolf Hilferding, l.c. pp. 428-429

6) Die deutsche Finanz-Reform der Zukunft part III of the book Staatsstreich oder Reformers by Ein Ausland-Deutscher, Zurich, 1907, p. 203.

. Imperialism as an Historic Category