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Sdmce & Society, Vol. 74. No. 2, April 2010, 215-247 Critical Globalization Studies: An Empirical and Theoretical Analysis of the New Imperialism CHRISTIAN FUCHS Abstract. Affirmative globalization studies stress positive aspects of global capitalism, while critical globalization studies use no- tions such as "Empire" and "new imperialism" to analyze the global economy's negativity. Critical globalization suidies, how- ever, frequently lack a precise theoretical notion of imperialism. TTiis absence can be corrected by connecting the notion of a "new imperialism" to the classical theory' of imperialism, as found in Lenin's canonical work. Empirical analysis of data from recent decades shows that Lenin's aspproach remains broadly correct, and that adaptation of his method to new realities strengthens the theoretical foundation of recent work on global capitalism. T HIS PAPER SEEKS TO CONTRIBUTE to the reconsideration of Lenin for analyzing and criticizing contemporary capital- ism, by using his notion of imperialism (Budgen, Kouvelakis and Zizek, 2007; Lih, 2005; Zilek, 2004a) to determine whether con- temporary capitalism can be seen as a new form of imperialism. The method for doing this will be, primarily, macroeconomic statistical analysis. For each characteristic oí imperialism that Lenin identified, at! empirical analysis of contemporary capitalism will be provided. I hopeby this means to show the importance of Lenin's theory for con- temporary globalization sttidies. Globalization has been one of the most discussed topics of the past decade. It has been defined in various ways: "an increasing num- ber of social processes that are indifferent to national boundaries" (Beck, 2000, 80); the "capacity to work as a unit on a planetai^ scale in real time or chosen time" (Castells, 2000, 10); the "intensification 215

Transcript of Lenin was right

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Sdmce & Society, Vol. 74. No. 2, April 2010, 215-247

Critical Globalization Studies: An Empiricaland Theoretical Analysis of the New Imperialism

CHRISTIAN FUCHS

Abstract. Affirmative globalization studies stress positive aspectsof global capitalism, while critical globalization studies use no-tions such as "Empire" and "new imperialism" to analyze theglobal economy's negativity. Critical globalization suidies, how-ever, frequently lack a precise theoretical notion of imperialism.TTiis absence can be corrected by connecting the notion of a "newimperialism" to the classical theory' of imperialism, as found inLenin's canonical work. Empirical analysis of data from recentdecades shows that Lenin's aspproach remains broadly correct,and that adaptation of his method to new realities strengthensthe theoretical foundation of recent work on global capitalism.

THIS PAPER SEEKS TO CONTRIBUTE to the reconsiderationof Lenin for analyzing and criticizing contemporary capital-ism, by using his notion of imperialism (Budgen, Kouvelakis

and Zizek, 2007; Lih, 2005; Zilek, 2004a) to determine whether con-temporary capitalism can be seen as a new form of imperialism. Themethod for doing this will be, primarily, macroeconomic statisticalanalysis. For each characteristic oí imperialism that Lenin identified,at! empirical analysis of contemporary capitalism will be provided. Ihopeby this means to show the importance of Lenin's theory for con-temporary globalization sttidies.

Globalization has been one of the most discussed topics of thepast decade. It has been defined in various ways: "an increasing num-ber of social processes that are indifferent to national boundaries"(Beck, 2000, 80); the "capacity to work as a unit on a planetai^ scalein real time or chosen time" (Castells, 2000, 10); the "intensification

215

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of worldwide social relatiotis which link distant localities in such away tbat local happenings are shaped by events occuring many milesaway and vice versa" (Giddens, 1990, 64) ; tbe "widening, deepeningand speeding up of worldwide interconnectedness in all aspects ofcontemporary social life .. . tbe growing extensity, intensity and veloc-ity of global interactions" (Held, el al, 1999, 2, 15; see also Held andMcGrew, 2007,2f) ; "the compression of tbe world as a whole" (Robert-son, 1995, 40); "circtmistances wbere territorial space is stibstantiallytranscended" (Scbolte, 1999, 12); and "the rapid developing and ever-densenitig network of intercontiections and interdependencies thatcharacterize modern life" (Tomlinson, 1999, 2).

These definitions have in common not only emphasis on theincreasing qtianlity. scale, and speed of social interactions, but alsocharacterization of globalization as a general pbenomenon. If, forexample, one considers world religions, the Roman empire, tbe em-pire of Han Cbina, tbe British Empire, tbe world market, colonial-ism, migration Hows that resulted from tbe Irisb potato bligbt, thesystem of submarine cables established in tbe middle of the 19tb cen-tury that formed tbe first global .system of communication, or theInternet, tben it becomes clear ihat globalization indeed seems tobave general aspects. However, general definitions pose tbe tbreatof constructing mythologies that see only positive sides of globaliza-tion and ignore the negative consequences of contemporary global-ization processes. Tbis can create tbe impression tbat society neitherneeds cbange nor can be altered by collective political action.

It is therefore no wonder that some of tbe abovementioned au-thors are fairly optimistic about tbe effects of contemporary global-ization. Tbey speak of globalization resulting in the acceleration oftlie "consciousness of tbe global whole in the twentieth century. . . .tbe intensification of consciousne.ss of the world as a whole" (Robert-son, 1992, 8), "emergent fonns of world interdependence and plan-etary consciousness" (Giddens, 1990,175), tbe creation ol "agrowingcollective awareness or consciousness of the world as a shared socialspace" (Held and McGrew, 2007, 3), or argue that "htiman beingsassume obligations towards tbe world as a whole" (Albrow, 1997, 83).Such formulations imply that contemporary globalization is bring-ing about increasing freedom and equality, despite tbe fact that welive in a world of global ineqtiality. One compelling example is tberatio of tbe average salary of Cbief Executive OIFicers (GEOs) of large

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U. S. corporations to that of an average U. S. worker, which currentlystands at 245 to 1 (Sutcliffe, 2007).

The developed world accounts for approximately 25% of theworld's population, btit has accounted for more than 70% ofthe world'swealth on a continitotis basis since 1970 (Fuchs, 2008). The least de-veloped countries' share of wealth has dropped from above 3% to justover 1% since 1980 (Fuchs, 2008). In 2008, the total sales ofthe tentop-selling worldwide companies (US$2533.5 billion) were 2.3 timesas large as the total gross domestic product (GDP) o f the 22 leastdeveloped countries (US$1{)81.H billion) (Fuchs, 2008). These dataindicate that we live in a world of persisting inequality that is a globalphet iomenon, and that therefore people are not moving closertogether, but tend to be rnore separated. C^ass divisions have beenwidening, not closing. Wealth and its distribtition are objective foun-dations of global consciotisness. If there are widening class divisions,then focusing on positive concepts such as global consciottsnessfor describing the contemporain world ttinis into an ideology. Onecan therefore conclude that uncritical optimism regarding global-ization can easily turn into mythologizing. To refer to and to reloadLenin for explaining contemporary globalization is a demytholo-gizing move that cotinters the globalization optimism advanced bybourgeois thinkers. It furthermore serves the political task of repeat-ing "in the present global conditions, the 'Leninian' gesture ofreinventing the revolutionary project in the conditions of imperi-alism, colonialism, and world war" (Budgen, Kouvelakis and Zi2ek,2007, 3).

1. Theoretical Foundations

For Hardt and Negri, Empire is a system of global capitalist rulethat is "altogether different" frorn imperialism:

Imperialism was really an extension of the sovereignty of the Europeaniiiition-states beyond their own boundaries. . . . in contrast to imperialism.Empire establishes no territorial center of power and does nol rely on fixedbotindaries or barriers. It is a decentered and deterritorializing apparattisof rule that progressively incorporates the entire global realm within its open,expanding frontiers. . . . First and foremost, then, the concept of Empireposits a regime that effectively encompasses the spatial totality, or really thatrules over the entire "civilized" world. (Hardt and Negri, 2000, xii, xiv.)

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This system is dominated by the United States, which sees itself aspossessing a global right of militaiy intervention and as the world'smost powerful actor. Ftirther actors in this network are internationalorganizations, such as World Trade Organization (WTO), Interna-tional Monetary Fmid (IMF), the United Nations, Group of Eight(G8), transnational corporations, nation-states, and civil society or-ganizations (Hardt and Negri, 2000, 309-324).

Harvey argties that various forms of continuous primitive accumu-lation based on colonizing spaces are needed for overcoming capital-ist crises of overaccumulation. This takes on the form of spatio-temponilfixes, that is, "temporal deferral and geographical expan.sion" (Harvey,2005,115). Overaccumulatiíín produces capital stirpltises that cannotbe invested within existing boundaries; as a restilt, "profitable ways mustbe fbtmd to absorb the capital siirpltises" (Hai*vey, 2005, 88) by "tem-poral displacement through investment in long-term capital projectsor social expenditures (such as education and research) that defer there-entry of capital valties into circulation into the future" and/or "spa-tial displacements throtigh opening tip new inarkets, new productioncapacities, and new resource, social and labor possibilities elsewhere"(Harvey, 2005, 109). Capital accumtilation, therefore, in search ofprofitable spheres, produces spaces and thereby creates uneven geo-graphical development. The new imperialism is for Harvey a specificform of primitive accumulation that developed after 1970: neoliberalimperialism (ibid., 184, 188, 190), or "imperialism as accumulation bydispossession" (137-182).

Accumulation by dispossession employs four strategies for turn-ing assets into profitable use, that is, the commodification of every-thing (Harvey, 2005, 165ff): the privatization and commodificationof public assets and institutions, social welfare, knowledge, nature,cultural forms, histories, and intellectual creativity (the enclosure ofthe commons); financialization that allows the overtaking of assetsby spectilation, fratid, prédation, and thievery; the creation, manage-ment, and manipulation of crises (for example, creation of debt cri-ses that allow the intervention of the IMF with strtictural adjtistmentprograms so that new investment opportunities, deregulations, lib-eralizations, and privatizations emerge); and state redistributionswhich favor capital at the expense of labor (Harvey, 2005, 160-165;Harvey, 2006, 44-50). For Harvey, new imperialism is a revisiting of

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the old, robbery-based imperialism of the 19th century in a differentplace and time (HatA'ey, 2005, 182).

For Harvey, the main goal of the U. S. war against Iraq is the trans-formation oflraq into a neoliberal capitalist economy (Harvey, 2005,214f). This allows the United States to have geopolitical intltience inthe Middle East so that it can control the global oil spigot, which isnecessary for controlling the global economy {Harvey, 2005, 19)."What the U. S. evidently seeks to impose by main force on Iraq is aftill-fledged neoliberal state apparatus whose fundamental mission isto facilitate conditions for profitable capital accumulation" (Hai*vey,2006,11). For Harvey, the seizure of Iraq is a form of military-enforcedaccumulation by dispossession. Opening up new spaces cotild eitherbe achieved by militaiy force and commercial pressure or voluntaryopening (Harvey, 2006, 108). 9/11 was used as an opportunity formobilizing patriotism and creating an American nationalism thattolerates and supports imperialist expansion (Han'ey, 2005, 15, 193).Iraq shottld also serve as powerfttl geostrategic position for the UnitedStates in Eurasia (Harvey, 2005, 85).

In line with Harvey's thesis, Christian Zeller (2004a) argttes thatthe new imperiali.sm is based on a global economy of dispossession.Methods of dispossession for him are war, privatization, mergers andacquisitions, subcontracting and alliances, and the commodiftcationof nature and knowledge with the help of patents and intellectualproperty rights. New imperialism is, in tliis context, permanent pritni-tlve accumulation. Another feature is the emergence of an accumu-lation regime dominated by finance capital (Zeller, 2()04b, 82ff).

Ellen Meiksins Wood uses the term "imperialism" in the sense ofthe militar)' creation of a global economic and political hegemonyof the United States. For her, globalization means the "opening ofsubordinate economies and their viilnerability to imperial capital,while the impeiial economy remains sheltered as mtich as possiblefrom the obverse effects" (Wood, 2003b, 134). Worldwide U. S. mili-tarism shows that globalization does not bring about an end of thenation-state, but that "the state continues to play its essenfial role increating and maintaining the conditions of capital accumulation"[ibid., 139). Imperialism today depends more than ever on a systemof multiple nation-states, dominated by the United States. "The newimperialism we call globalization, precisely becattse it depends on a

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wide-ranging economic hegemony that reaches far beyond any state'sterritorial boundaries or pohtical domination, is a fortu of imperial-ism more dependent than any other on a system of multiple states"(154).

Characteristics of the new imperialism that Wood mentions are;war without temporal end, geographic limits, and specific aims; pre-emptive military strikes, and universal capitalism. She argues that thenew imperialism has been created after World War II (Wood, 2003b,131,151 ). The primary tnotivation for the war against Iraq is for Woodnot oil supply, but securing tiie global hegemony of the United States.For Wood, the new imperialism means the global unilateral rule ofthe United States, "unilateral world domination" {ibid., 164). "Inall cases, the overriding objective is to demonstrate and consolidateU. S. domination over the .system of multiple states" (167).

William 1. Robinson (2007) argues that Wood's account lacksenipirical evidence and suggests that contemporary capitalismcan best be characterized as global capitalism that is based on atransnational capitalist class, a transnational state apparattis, andtransnational capital that diffuses the whole Marxian circuit of capital— Money-Commodity . . . Prodttction . . . ('.ommodity'-Money'(M-C . . . P . . . C'-M') — all over lhe globe. In this circuit, tnoney isinvested for buying the commodities labor power and means of pro-ditction. In the production process, labor transforms the means ofprodtiction and creates a new commodity that contains surpUis labor.This transformed commodity is sold on the market so that surplusvalue is realized in the form of profit that is controlled by capitalists,hi the early 20tb centui^, according to Robinson, only the selling ofcommodities took place at a transnational level (see also Robinson,2004). Imperialism is for Robinson not a recent re-emerging phenom-enon, but means "the relentless pressures for outward expansion ofcapitalism and the distinct political, military and ctiltural mechanismsthat facilitate that expansion and the appropriation of sut pluses itgenerates" (Robinson, 2007, 90). Robinson is interested in new quali-ties of global capitalism, such as information and communicationtechnologies that allow capital to go global, global mobility of capi-tal, the global outsourcing of production, subcontracting, or newmanagement philosophies.

Leslie Sklair (2002) employs the notions of global capitalism andcapitalist globalization in a manner that is comparable to Robinson.

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Sklair conceptualizes globalization with tbe concept of transnationalpractices, by which he means "acting within specific institutionalcontexts that cross state borders" (Sklair, 2002, 84) in economy, pol-ity, and culture-ideology. Tbe global system works in three spheres:economic, political, and cultural-ideological.

In order to work properly the dominant institutions in each of the threespheres have to take control of key resources. Under the conditions of capi-talist globalization, the transnational corporations strive to control globalcapital and material resources, the transnational capitalist class strives tocontrol glohal power, and the transnational agents and institutions of theculture-ideology of consumerism strive to control the realm of ideas. (Sklair,2002,115.)

Tbe transnational capitalist class consists of executives of transnationalcorporations (TNGs); bureaucrats, politicians, professionals, mer-chants, and consumerist elites that have global perspectives and life-styles and identify with "tbe interest of the capitalist global system"(Sklair, 2002, 9, 98-105, Robinson, 2004, 36).

Gontemporary tbeories of imperialism, empire, and global capi-talism can be categorized on a continutmi that describes the degreeof novelty of imperialism. On one end of the continutmi there areauthors who argue tbat imperialistn no longer exists today; tbat a post-imperialislic empire bas emerged. Tbe stress is on discontinuity {e.g.,Panitcb and Gindin, 2004, 2005; Robinson, 2004, 2007; Hardt andNegri, 2000, 2004, Negri, 2008; for discussions of Hardt and Negri,Buchanan and Pahtija, 2004; Gallinicos, 2007, 345; Lafley and Weldes,2004; ZiXek, 2004b). On the other end of the continuum tbere areauthors who argue that contemporary capitalism isjust as imperialis-tic as 100 years ago, and tbat tbere is a new imperialism. The stress ison continuity {e.g., Gallinicos, 2003, 2005, 2007; Harvey, 2003, 2005,2006, 2007; Wood, 2003; Zeller, 2004a, b). A middle ground is theassumption tbat imperialism bas reemerged and been qualitativelytransformed, tbat through capitalist development and crisis new quali-ties of capitalism have emerged and otbers been preserved, and tbatthe new qualities on the one band constitute a return to capitalistimperialism, but that on tbe otber band tbere are aspects of imperi-alism today that are different from the imperialism tbat Lenin, Lux-emburg, Kautsky, and Bukharin described 100 years ago {e.g., Sklair,2002; O'Byrne, 2005). Some of the most important tbeories of new

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imperialism, empire, and global capitalism will now be discussed, witha view to which concepts of imperialism underlie these theories andwhat role Lenin's theory of imperiaHsm plays in this context.

Theories ofa new imperialism, empire, and global capitalismhave brotight about discttssions ofthe economic and political strate-gies of capitalism and their limits. They therefore have an importantpublic and political function. But in many cases the notions of imperi-alism employed in these discussions remain rather imprecise (Castrée,2006) or unexplained (Brenner, 2006). This might be related to a lackof grotmdingin classical theories. The discussion of Lenin's notionof imperialism remains rather superficial. It is therefore importantto review this concept, in order to see if it can be applied today.

For Lenin, there are five characteristics of imperialism:

1 ) The concentration of production and capital developed to such a stagethat it creates monopolies which p!ay a decisive role in economic life.

2) The merging of bank capital with industrial capital, and the creation,on the basis of "fmance capital," ofa financial oligarchy.

3) The export of capital, which has become extremely important, as distin-guished from the export of commodities.

4) The formation of international capitalist monopolies which share theworld among themselves.

5) The territorial division of the whole world among the greatest capitalistpowers is completed. (Lenin, 1917,237.)

Lenin's work, Imperialism, the Highest Stage of Capitalism^ is not, assuggested by some authors, only a very rough definition (Zeller, 2004b,88,111 ) and not "pamphleteering" instead of theorizing (Harvey, 2007,59). In the first six chapters, Lenin gives a detailed empirical accountof economic developments that he then summarizes in the well-knowndefinition, given in chapter seven. It is therefore an interesting task toobserve which empirical indicators for the existence of imperialismLenin used. Bob Sutcliffe (2000, 74) describes the works by Hardt andNegri, Harvey, and Wood on new imperialism as "empirico-phobic."In contrast, Lenin gave close attention to the empirical data that wasavailable at his time. He undertook "enormous preparatoty work"(Labica, 2007, 223) for his study, work that is documented in his 21Notebooks on Imperialism (Lenin, 1912-1916), which contain notes on150 books and 240 articles. To re-engage with Lenin's theory of im-perialism today, one should therefore update his theoretical argu-

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ments and his support of the.se argtiments by data, using the samerigorous empirical method — a feattne that contemporain worksunfortunately frequently lack. Updating Lenin can be undertakingby .substituting "for the data he presented what we have availabletoday" (Labica, 2007, 232). To repeat and reload Lenin today means"to retrieve the same impulse in today's constellation" (Zizek, 2004a,11; cf. Budgen, Kotivelakis, and Zizek, 2007, 1-4). This also meansto take Lenin asa theoretical and methodological model for contem-porary critical globalization studies.

2. The Concentration of Capital

"The enormous growth of industry and the remarkably rapidprocess of concentration of prodtiction in ever-larger enterprisesrepresent one of the most characteristic features of capitalism" (Lenin,1917,178). Lenin identified an antagonism between competition andmonopolyas an immanent feature of capitalism (180,185, 236, 260f).The formation of monopolies and the concentrafion of capital arefor Lenin not an exception to the rule of competition, btu a neces-sai7 otitcome of capitalist compefition.

Concentration indicators that Lenin used included: the develop-ment of the number of large enterprises, the share of workers in theeconomy that are employed by large enterprises, and the share ofotitput in an indtistry that is produced by large enterprises.

In order to assess if there is a new imperialism, one has to find outif capital concentration is a feature of contemporary capitalism. Withinsuch a framework, one can analyze concentration in the informationsector. Concentration generally means tliat a small number of enter-prises controls a large share of assets (such as capital, workers, infra-structure). Data from Eurostat tell the stor)-: Large companies in theEU27 counüies (those witli more than 250 employees) account for only0.2% of the total number of enterprises, but for 32.9% of all employ-ees, 42.5% of total turnover, and 42.4% of total value added.

Industries have become more concentrated throtigh mergei"s andacquisitions (M&A). So a sharp rise in the total number and value ofmergers and acquisitions is likely to indicate increasing concentrafion.The total valtie of annual worldwide mergers and acquisifions hassharply increased, from US$74.5 billion in 1987 to 880.5 billion in 2006(Table 1).

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TABLE 1Number and Vahie (Billions of USS) of Mergers and Acquisitions

1987198819891990199119921993199419951996

Source:

Ntimher

8631480220125032854272128353494424745H9

UNCTAD

Value

74.3115.6140.4150.680.779.383.1

127.1186.6227.0

1997199819992000200120022003200420052006

Number

4987559769947894603544934562511361346974

Value

304.8531.6766.0

1143.8594.0369.8297.0380.6716.3880.5

In total numbers of M&:<\ this means an increase from 863 an-nual M&A in 1987 to 6974 in 2006 (Table 1).

Figure 1 shows that the finance sector accounted for the largestshare of these M&A in 2006: 24.6% (1717) of all M&A, whereas thetransport, storage and commtmication sector accotinted for 5.4% (379)of all M&A and tbe printing and ptiblishing indttstries accounted for2.0% ( 142). All of these sectors have experienced dramatic rises in the

Figure 1

1800

1600

1400

1200

tooo

Total Number of Mergers and Acquisitions in SelectedIndustries

Source: UNCTADMining, auarrv^ng and petroleumTransport, storage and communications-

activjbes

-Trade-Finance'PrinUng, Publishing, and Allttd Services

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ntimber of M&A. but the largest and most rapid increase is in finance,which is an indication that finance is the most heavily concetUratedsector (finance is excluded ftom the Eurostat data cited above).

The data presented in this section suggest that the first charac-teristic of Lenin's definition of imperialism, capital concentration, isvalid today. Manufacturing, seivices, and finance are highly concen-trated industries.

3. The Dominance of Finance Capital

Einance capital "is the bank capital of the few big monopolistbanks, merged with the capital of the monopolist combines of manu-facturers" (Lenin, 1917, 237). Under imperialism, finance capitalcommands "almost the whole of the money capital of all the capital-ists and small businessmen and also a large part of the means of pro-duction and of the sources of raw materials of the given countiy andof a number of countries" (Lenin, 1917, 190). Tbe banks' control ofthe flow of investment money that is used for operating corporationsgives them huge economic power for controlling the capitalist economy(194). Lenin mentioned that banks are influential in acceleratingtechnical progress (202). Capital concentration and the formationof finance capital are connected developments (203). Finance capi-tal aims at generating extraordinarily high rates of profit (210). Afinance oligarchy consisting of rentiers emerges in the imperialiststage (213).

The indicators that Lenin used for verifying this second charac-teristic of imperialism included: the percentage of total deposits con-trolled by banks of a certain size (measured by total controlled capital) ;the number of holdings and establishments of certain banks; thenumber of letters received and dispatched by certain banks; the amountof capital held by certain banks; the capital invested by certain banksin a country; the profit rate of certain banks; and the total securitiesissued by certain banks.

I have analyzed the Forhe,s 2000 list of the world's 2000 biggestcompanies in 2008, by sector. The results are presented in Eigure 2.Finance companies and financial service corporations together ac-counted for the vast share of capital assets in 2008 (75.96%). Thesecond largest sector was oil, gas, and utilities (5.82%). The thirdlargest sector was the information sector (4.63%), comprised (for

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Figure 2 Share of Selected Industries in Total Capital Assets of theWorld's Largest 2000 Corporations

4.63%1.96%

11,51%• !.48%• 1.36%• 1.29%• 0,97%

175,96%

Source: Forbes 2000, 2008 List

• Finance (Banking. Financiáis, Insurance)• Oil & Gas Operations. Utiiities• Information (Telecommunicalions. Technology' Hardware & Equipment. Media. Software & Services. Semiconductors• Consumer Durables• Food (Food, Dnnks & Tobacto: Food Markets; Hotel, Restaurants & Leisure)• Conglomerates• Materials• Transpoituiion• Constniction

Statistical reasons) of the following subdomains; telecommunications,technology hardware and equipment, media content, software, andsemiconductors. The data indicate an economic predominance offinance.

The data in Figure 2 are for the year 2007. Data for 2008, the yeara new worldwide economic crisis started, show that the fmancial sec-tor suffered tremendoiLs losses: The world's biggest 176 diversified fi-nancial corporations had combined losses of $46,27 billion, the world's92 largest insurance companies had losses of $61.8 billion. Nonethe-less, the fuiancial sector still accounted for 74.9% of all assets of theworld's 2000 largest corporations, oil, gas 8c utilities for 6.2% and theinformation economy for 4.6%. This are only minor changes in com-parison to 2007, which shows that the economic crisis did not under-mine the intra<apitalist hegemony of financial capital.

Figure 3 shows the growth of financial asset transactions by in-vestment fLmds, insurance corporations, and pension funds for twoselected countries, the United States and Japan. The value of finan-cial transactions by U. S. insurance corporations and pension funds

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Figure 3 Total Financial Asset Transactions (m % of GDP, currency,deposits, securities, loans, shares and other equity)

140

120

100 ^ ^ ^ ^

M LO

Source: OECD Institutionai Investors Statistics-•—USA: Investment Funds-*~USA: Insurance corporations, pension funds

O O O O O Q O Oo t ^ r j u i ^ o

-Japan: Investment Funds•Japan: Insurance corporations, pension funds

increased from 51.7% ofthe U. S. GDP in 1980 to 122.92% of GDPin 2007; the value of financial transactions by U. S. investment fundsincreased from 5.3% of GDP in 1980 to 85.9% of GDP in 2007. InJapan, insurance and pensions corporations and pension funds in-creased the value of their financial tran.sacl,ions from 21.6% of GDPin 1980 to 75.6% of GDP in 2006; investment funds from 16.0% to72.7%.

The perception tliat speculative finance capital dominates contem-porary economies has in recent years resulted in the emergence ofconcepts such as finance market capitalism (Bischoff. 2006; Huff-schmid, 2002) or financial accumulation regime {Aglietta, 2000;Chesnais, 2004; Zeiler, 2004b) for describing contemporai7 society.

Statistical data confirm that today the second criterion of Lenin'sdefinition of imperiaHsm is valid. Finance capital has grown tremen-dously in the past 30 years and commands "almost the whole ofthemoney capital" (Lenin, 1917, 190). Its assets are so large that it hasthe power to infiuence all other economic sectors. Since the begin-ning ofthe 1980s, finance capital has increased its infiuence, im-portance, and concentration after it was subsumed under industrialcapital in the 60 years preceding 1980. The emergence of liberal-ized global financial markets has enabled these developments. Thereare new qualities of finance capital today that were not present at thetime of Lenin.

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Today, the financial market is more than stocks and bonds: thereis the powerful influence of insurance companies, pension funds,investment funds, and there are new financial instrutnents stich asfinance dérivâtes (exchange-traded futures, exchange-traded options,over-the-counter swaps, over-the-counter futures, over-the-counteroptions), insurance markets, foreign exchange markets. These mecha-nisms have increased short-tenn financial profits, but simultaneouslyadvanced the gap between financial values (what Marx termed ficti-tious capital) and actually accumulated values (between finance andeconomic commodity prodtiction) so tbat finance markets have be-come highly volafile. Excellent examples are stibprime lending andmortgage-backed securities, high-risk financial mechanisms that havebeen at the heart of the financial crisis that originated in the financiali-zation of the U. S. housing market and hit the world economy in 2008.

Finance capital is the dominant fraction of capital, which showsthat an important characteristic of imperialistic capitalism is presenttoday.

4. The Importance of Capital Export

"Under modern capitalism, when monopolies prevail, the exportof capital has become tbe typical feature" (Lenin, 1917, 215). Thegoal is to achieve high profits by exporting capital to countries where"capital is scarce, the price of land is relatively low, wages are low,raw materials are cheap" (Lenin, 1917, 216). Indicators that Leninused for verifying the third characteristic of imperialism included theabsolute amount of capital invested abroad by certain nations, andthe geographical distribution of foreign direct investment.

Foreign direct investment (FDI) as an indicator for capital exportrepresents only a fraction of total investment in overseas production(Held, et ai, 1999, 237; Held and McGrew, 2007, 91; these authorsmention a share of 25% ). Hirst and Thompson ( 1999, 77, 79,87) arguethat FDI measures only what companies invest in their foreign affili-ates, but not what they invest in their home countries. Although FDImight not be fully reliable as the only indicator, it nonetheless givesan indication of the level of global activities of corporations. Tables 2and 3 show that FDI flows have increased from approximately 0.5% ofworld GDP at the beginning of the 1970s to a share between 2% and4.5% since the end of the millennium. FDI stocks have increased from

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TABLE 2World Foreign Direct Investment (FDI):Inflows and Outflows, % of World GDP

Year

197019751980198519901995200020052006

Inflows

0.510.510.470.450.911.154.432.102.69

Oiitllows

0.470.480.470.491.041.223.891.862.50

Source. L'NflTAD

a level of about 5% of world GDP at the beginning of the 1980s to 25%of world GDP in 2006. This does not prove that capital accumulationis global, but it is an indication that in comparison to the phase ofFordist capitalism, capital export through global outsourcing of pro-duction in order to t educe labor costs and fixed costs has become moreimportant. The economy has become more global in the past 30 yearsin comparison to tbe years 1945-1975.

TABLE 3World Foreign Direct Investment (FDI) in Stock, % of World GDP

1980198119821983198419851986198719881989199019911992

4.644.975.325.465.626.206.126.516.607.328.048.358.09

19931994199519961997199819992000200120022003200420052006

8.659.009.3010.1811,6813.9315.9218,2419.6320.6222.1123.0022.3724.69

Sourer. UNCTAD

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230 SCIENCE 6= SOCIETY

The trans nation al ity index provided by the United Nations Com-mission on Trade and Development (UNCTAD) is calculated as theaverage of ibur shares: FDI infiows into a country as a percentage ofgross fixed capital formation for the past three years; FDI inwardstocks as a percentage of GDP; valtie added of foreign affiliates as apercentage of GDP; and employment of foreign affiliates as a per-centage of total employment in 2005. The simple average for devel-oped countries for the year 2005 is 24.4%, for developing countries21.8%, and for transition countries 19.6% (World Inve.stment Report,2008). These data seem to confirm calculations by Hirst and Thomp-son (1999,79-87) that show that "between 65 and 70 per cent of MNGvalue-added continues to be produced on the home territory" (Hirstand Thompson, 1999, 95). In the EU27 countries, 16% of the com-panies engage in international sourcing, 4% plan to engage in it, and80% do not engage and do not plan to engage in it (Eurostat). In2006, the top 100 TNGs listed in the World Investment Report hadan average transnationality index of 6L6% (WIR, 2008, 28), whichshows that large mtilti- and ü-ansnationals indeed do have transnationalvalue sources.

The biggest 2000 TNCs had sales of $1414.95 billion in 2007(calculation based on Forbes 2000, 2008). In 2007, world GDP was54,347,037,614,014 current $US. Worldwide compatiy revenues madeup 27% of world GDP, which is approximately $14,673 billion (WorldDevelopment Indicators). So the bigge.st 2000 TNGs accounted for9.6% of the worldwide reventies in 2007. These data show that we donot fully live in a globalized economy, but that transnational corpo-rations have become vexy important economic actors that manageto centralize a significant share of worldwide value generated to alarge degree not in their home economies, but at the transnationallevel. Transnationalization is an important tendency in the contem-porar)' capitalist economy. The most important reason for interna-tional sourcing for European companies is the reduction of laborcosts: 45% of EU27 companies with sourcing activities say that this isan very important motivational factor, 28.5% say it is an importantone, and only 9.9% say it is an unimportant factor (Eurostat). Thetwo other most important reasons mentioned are reduction of costsother than labor costs and access to new markets. This confirms thattransnational sotircing .should be conceptualized within a theory ofimperialistic capitalism.

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CRITICAL GLOBAIJZATION STUDIES 231

Foreign direct investments have significandy increased in the past30 years, as production has become more global. The world economyis still significantly rooted in national economies, but transnationalcorporations engage in global outsourcing of labor in order to savelabor and other costs and to increase profits. By transnational pro-duction and investment activities, they have managed to centralize asignificant share of worldwide economic value. Capital export, thethird characteristic of imperialism mentioned by Lenin, has in com-parison to the period 1945-1975 become far more important, per-haps qualitatively so.

The growth of FDI inflows and outflows shows that the economyhas become more global in the past 30 years in comparison to 1945-1975. The largest TNCs in the world have operations that are pre-dominantly global, i.e., located outside the home bases of these firms.This applies for sales, assets, and employees of these companies. Thedata confirm the presence of Lenin's third characteristic of imperi-alism today.

5. The Economic Division of the World Among Big Corporations

Lenin argued that under imperialism, big companies dominatethe economy. They divide among themselves spheres of influence andmarkets and make use of cartels, syndicates, and trusts. Finance capitalstruggles "for the sources of raw materials, for the export of capital,for 'spheres of influence,' i.e., for spheres of good business, conces-sions, monopolist profits, and so on; in fine, for economic territoryin general" (Lenin, 1917, 266).

Lenin used the following indicators for the fourth characteristic:tbe number of sub-companies of certain corporations, the developmentof turnover, number of employees, and net profits of specific big com-panies. Whereas the third characteristic focuses more on economicactivities that cross nation-state borders and the economic benefits thatderive from them, the fourth characteristic covers the spatial dimen-sion of tbese activities. This distinction is indicated by the term "divi-sion of the world among capitalist combines" (characteristic four) incontrast to the term "the export of capital" (characteristic three). Thetwo characteristics are nonetheless certainly closely linked.

Figure 4 shows that the share of developed countries in totalFDI inflows has fluctuated between 55% and 90% and the share of

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232 SCIENCE ¿f SOCIETY

Figure 4 Distribution of FDI Inflows

Source: UNCTAD Year

•Developing economies —•—Developing economies excluding China -*-Developed economies

developing countries between 10% and 45%. Overall, eapital exporthas remained an unequal affair. The vast bulk of transnational in-vestments stays within developed countries. Developing countriesremain marginalized, although there are times when they achievesignificant increases.

In 1970, the developing economies accounted for 28.7% of FDIinflows, in 2006 for 29.0%. So overall, there has not been muchchange. FDI outflows have continuously been very unequal since the1970s, although the developing countries have increased their over-all share (Table 4). The preponderance of investment comes fromdeveloped countries. The developed countries' share in FDI outflowshas dropped from 99.6% in 1970 to 84.1% in 2006. There is a moresignificant change in FDI outflows than in inflows. Lenin (1917,217)cited a statistic that displays the distribution of the total foreign di-rect investments of Great Britain, France, and Germany in 1910:32.1% were invested in Europe, 36.4% in America, and 31.4% in Asia,Africa, Australia. This shows that capital export was at the beginningof the 20th centuiy, just as at the beginning of the 21st, shaped byglobal inequality.

Figure 5 shows that Europe is the most important receiver oí FDI.In 2006, it accounted for 44% of all FDI iriflows, North America for19.2%. ' :

The most important change in FDI since the 1970s has been theincrease of FDI inflows in Asian developing economies (Figure 6).

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CRITICAL GLOBALIZATION STUDIES 233

TABLE 4Developed and Developing Countric-s:

Shares of Foreign Direct Investment Outflows (%)

Year

1970197519801935199Ô1995200020052006

Developed

99.6498.1394.1493.7594.8184.6688.9884.4584.13

Developing

0.361.875.866.255.19

15,1610.7613.8414.34

Sourer. UNCTAD

The FDI infiow share of developing economies in Asia increased from6.4% in 1970 to 19.9% in 2006; the infiow share of Latin Americachanged from 11.9% in 1970 to 12.7% in 2004 and 6.4% in 2006;the infiow share of Africa decreased from 9.4% in 1970 to 2.7% in2006. Africa and large parts of Latin America are excluded from capi-tal investment. Asia has attracted significant infiows. This is an im-portant qtialitative change in the landscape of capital export. Chinais the most important developing location for FDI inflows; it increasedits share from 0.000187% in 1970 to 13.3% in 1994, wbich then againdropped to 9.5% in 2003 and 5.3% in 2006. Nonetheless, the data

Figure 5 Share of PDI Inflows - Developed Regions

Source: UNCTAD Year

-America —»-Asia —*-Europe

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234 SCIENCE & SOCIETV

Figure 6 Share of FDI Inflows - Developing Regions

fM IN IN IN IN IN

Source: UNCTAD ^^»'

—•-Africa Hi-Lat in America - * -As ia -«-China -^*-East Asia —•—Oceania

show that China has become an important location for capital exports.Another significant change in capital export has been the decline ofthe United States as leading investor and the rise of Europe as lead-ing investing region.

In 2006, Europe accounted for 55.0% of FDI outflows and NorthAmerica for 21.9% (see Figure 7). North America's leading position

Figure 7 Share of FDI Outflows - Deveioped Regions

Source: UNCTADYear

•America •Asia —*—Europe

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CRITICAL GLOBALIZATION STUDIES 235

at the beginning of the 197()s has vanished; its capita! exports havedecreased by 40 percentage points, from a 60% share to a 20% share.

Developing economies in Asia have become more important incapital export (Eigure 8): They accotuited for only 0.007% of FDIoutflows in 1970 and for 9.6% in 2006. Ghina (including Hong Kong,Macao, and Taiwan) accounted for 5.6% of these 9.6% in 2006. Therise of Ghina as important capital exporter and importer has beenthe most significant change in the past 30 years in the world ecotiomy.In terms of capital export, Ghina is now more important than Japan,which accounted for 3.8% of capital exports in 2006. Latin Americaincreased its share in world capital exports from 0.2% in 1970 to 4.0%in 2006, Africa's share changed from 0.21 % to 0.7%. Africa is defactoexcluded from capital export and import.

The world economy has remained in the past 50 years a geo-graphically strongly divided class system. Lenin's fourth characteristicof imperialism, the asymmetric spatial division of the world economy,is valid today. However, some important qualitative changes havetaken place, especially the rise of Ghina as important actor in theworld economy and the deterioration of North America's positionthat benefitted bijth Europe and Asia. FDI inflows are stratified in arelation of 70:30 between developed and developing economies,world imports in a relation of 65:35, world exports in a relation of

Figure S Share of FDI Outflows - Developing Regions

Source; UNCTAD

-Latin America • -Eastern Asia

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236 SCIENCE 6= SOCIETY

6U:40. Europe is the most important sotirce and drain of FDI. Africaand large parts of Latin America are excluded from capital invest-ment. Asia has attracted significant inflow growths. China is tbe mostimportant developing location for FDI inflows. In 2006, developingAsia's share of FDI inflows was larger than that of North America.North America's position as leading capital export region has sincethe 1945 deteriorated significantiy (from a share of 60% to 20%),Europe accounted for more than 50% of world capital exports in2006. Latin America and Africa are essentially excluded lrom capitalexport, whereas Asia, due to the economic rise of China, has becomeimportant and now accounts for almost 10% of all capital exports.

In international commodity trade, Europe has remained the lead-ing import region in the past 50 years, Asia has become a more im-portant import region than North America, Latin America and Africaare both essentially excluded from world trade (imports and exports).World exports is an area that has undergone vei7 significant changesin the past 50 years: Europe became the most important export re-gion, North America's position vastiy deteriorated (decrease from a30% share to one slightly above 10%), developing Asia became thesecond largest export region. China has become the most importantdeveloping and Asian trade nation and is in this respect now evenmore important than Japan. The most significant changes of thespatial structiue of the world economy in tbe past 50 years has beenthe deterioration of North America in the areas of capital exportsand commodity exports and the rise of China as important locationfor FDI inflows and important trading countiy, especially in exports.Capitalist production and world trade are spatially stratifled, althoughChina is gaining importance, there is a continuous huge predomi-nance of corporations from Western countries both in capital exportand world trade.

Giovanni Arrighi (2005) argues that there are two new elementsof the capitalist world system: the divergence between military (U. S.)and fluancial (Cbina, East Asia) dominance, and shift of the epicen-ter of tbe global economy to East Asia, especially China). Our datashow tiiat wbile it is overdrawn to consider East Asia as epicenter ofthe world economy, it has nonetheless become an important eco-nomic region with China as a powerful economic actor. 'The fimda-mental point is that China is important for the OECD countries notonly as a source of cheap, and potentially disruptive imports, but also

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CRITICAL GLOBALIZATION STUDIES 237

as an increasingly important market for exports" (Glyn, 2007. 96).Andrew Glyn's analysis is certainly right, but it should be added thatChina has itself become one of the leading export nations. DavidHarvey (2003, 2005) argues that investment of OECD countries inEast Asia, especially China, is a spatio-temporal fix for the overaccumu-lation crisis of capitalism. This interpretation makes sense, but itshould be added that China in addition has become an importantexport nation.

6. The Political Division ofthe World as Completed Process

Lenin defined the fifth characteristic of imperialism as the "mono-polistic possession of the territories of the world which have beencompletely divided up" (Lenin, 1917, 237). Each dominant stateexploits and draws super-profits from a part ofthe world. "Each ofthem, by means of trusts, cartels, finance capital, and debtor andcreditor relations, occupies a monopoly position on the world mar-ket" (253). Lenin argues that under imperialism, all territories onthe globe have come under the inlluence of capitalist countries. Are-division would be possible at any time, but not a new seizure. Inimperialism, there are not just simply colonies and colony-owningcountries, but also semi-colonies, politically independent countries,which are "enmeshed in the net of financial and diplomatic depen-dence" (234). Eormal dependence under imperialism becomes "a linkin the chain of operations of world finance capital" (235).

Indicators that Lenin uses for the fifth characteristic include: thedevelopment ofthe percentage of territories that belong to the Eu-ropean colonial powers, and the area and population under the con-trol of certain colonial powers.

Panitch and Gindin (2004, 2005) argue that the failure of classi-cal theories of imperialism was their focus on inter-imperial rivah"y anda reduction of state power to the economy (a similar critique of Leninis made by Ahmad, 2004). Lenin never spoke of "inter-imperialist ri-x-alry" as a characteristic feature of imperialism, but he did say that thedivision ofthe world has come to an end under imperialism (226f).This means that there is a global rule of capitalist structures. Whetherone, two, or more countries dominate, whether they enter militaryconflict or economic confiict — these circumstances can all be ex-plained as specific historical expressions of this characteristic. Lenin

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238 SCIENCE & SOCIETY

Stressed the dynamic character of this division and therefore .speaksof possible re-divisions (Lenin, 1917, 227). The only time Lenin men-tioned rivalry in chapter VI of Imperialism was when he said that capi-talist corporations try to "make it impossible for their rivals to compete"(232). He wrote that finance capital is the dri\ing force of territorialconflicts: "Finance capital strives to seize the largest possible amountof land of all kinds and in any place it can" (233). This does not meanthat there is necessarily an inter-imperialist military rivahy betweencountries. But it is wrong to conclude that there is no livalr)- today.So for example the European Union sees the United States as its big-gest economic competitor and has therefore set itself the goal tobecome "the most competitive and dynamic knowledge-based econ-omy in the worid" until 2010 (Lisbon Agenda). There certainly iseconomic rivalry, although no major military rivalries between themajor countries are present today. However, military interventionssuch as in Afghanistan and Iraq on the one hand and global terror-ism on the other hand show that today there is militaiy rivalry amonggreat powers concerning world influence and in certain parts of theglobe. Both economic rivalry and military conflicts are indicative ofwhat Lenin described as conflicts for hegemony between great powers(which must not necessarily be nation-states because "great powers"are powerful actors, which can also be corporations, not only nation-states) that constitute "an essential feature of imperialism": "rivalrybetween a number of great powers in the striving for hegemony, i.e.,for the conquest of territory, not so much directly for themselves, asto weaken the adversary and undermine his hegemony" (239).

Tbe United States certainly is ihe dominant global military powertoday and has been successful in imposing its will by militaiy meanswithout much resistance by Europe, Rvissia, (^hina, or other coun-tries. The difference in military power can be gauged, for example,by government expenditures. In 2006, tbe EU2.'i countries devoted10.8% of their total government expenditures to defen.se, 12.9% toeducation, and 18.8% to health. By contrast, tbe corresponding sharesfor the LJnited States in 2008 were 17.1% on defense, 3.2% on edu-cation, and 11.2% on health. That the United States is a dominantglobal military power means only that it bas been successful in beinghegemonic, which does not mean that it will never again be chal-lenged by others witb military means.

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CRITICAL GLOBALIZATION STUDIES 239

Finance capital today is the dominant form of capital. If therewere really a fully American Empire, as Panitch and Gindin say. thenfinance capital would have to be fully dominated by U. S. institutions.However, of 495 companies that are listed under the categories bank-ing and diversified financiáis in the Forbes 20()()\\?,i of the world's big-gest companies in 2008, 100 (20.2%) are from the United States, 114from the European Union (23.0%), and 178 (36.0%) from countriesin East Asia/Southeast Asia/South Asia (China. Hong Kong, India,Indonesia, Japan, Malaysia, Singapore, South Korea, Taiwan, Thai-land). This shows that there is not an American finance empire, asclaimed by Panitch and Gindin (2005), but that U. S. capital standsin fierce competition with European and Asian capita!.

There are several competing explanations for the U. S. invasionof Afghanistan and Iraq (see Callinicos, 2003a, 2005, 2007; Harvey,2005. 2006; Panitch and Gindin, 2004, 2005; Wood, 2003b): secur-ing access to oil as economic resource, securing worldwide geopo-litical hegemony, the expansion of U. S. economic power in tbe faceof deterioration of the U. S. position in export of capital and com-modities and the strong position of Europe and China, the conquestof strategic countries in the Middle East iu order tt) be better equippedfor limiting the infiuence of Islamic nations and groups that challengeWestern world dominance, or the struggle for the extension of ueo-liberal capitalism all over the world. It is imaginable that the thesewars are caused by a combination of some or all of these elements.

No matter which factors one considers important, the war againstAfghanistan and Iraq, global terrorism, and potential future warsagainst countries like Iran, Pakistan. Syria, Lebanon, Venezuela, orBolivia, shows that war for securing geopolitical and economic infiu-ence and hegemony is an inherent feature of tlie new imperialism andof imperialism in general. Although investment, trade, concentration,transnationalization, neohberalization, structural adjustment, andfinancialization are economic strategies of imperialism that do notresort to militaiy means, it is likely that not all territories can be con-trolled by imperialist powers and that some resistance emerges. In orderto contain these counter-movements, overcome crises, and secure eco-nomic infiuence for capital, in the last instance warfare is the ultimateoutcome, a continuation of imperialism by non-economic means inorder to foster economic ends.

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240 SCIENCE àf SOCIETY

Statistical data show ÍX/ÍO.VÍ that economic ends can be importantinfluencing factors for the wars in Iraq and Afghanistan. Table 5 showsthat foreign investments have boomed in Afghanistan since 2002 andin Iraq since 2003. Oil is the main economic resource in Iraq. In 2002,99.3% of all exports fi om Iraq were fuels. In 2006, this level remainedata high level of 93.9% (UNGTAD). In 2006. the value of annual Iraqoil exports was 2.3 times the 2002 value.

Table 6 shows the increase of Iraq fuel exports in absolute terms.In the same period (2002-2006), a.s fuel exports from Iraq climbed,

the value of oil imports by the US increased by a factor of 2.8 and thevalue of oil imports by the UK by a factor of 3.8 (Table 7). These datastiggest that investment opportunities and resotirce access are impor-tant, but certainly not the only factors in the invasions of Iraq andAfghanistan by the US and the UK.

In 1988, the annual military expenses of the United States were$484 billion. There was a drop in spending after the end of the GoldWar (1998: $329 billion). The new wars in Afghanistan and Iraq re-sulted in a rise to $441 billion in 2003 and $547 billion in 2007 (allvalties in constant US$) (SIPRI Military Expenditure Database). In2007, the United States accotmted for the largest share of world mili-tary spending (45%), followed by the UK and Ghina (each 5%) {SIPRJYearbook 2008). Gomparing annual U. S. military spending for theyears 2001 and 2006 shows a growth of 30% for overall expenditure,47% for military operations and maintenance, and 58% for research,development, test and evaluation {SIPRI Yearbook 2007, 276). In 2006,

TABl-E 5Foreign Direct Investment Flows into

Afghanistan and Iraq, Million US$

Year

2000200120022003200420052006

Afghanistan

0.170.880.54 *2.010.623.612.08

Iraq

-3.14'• -6 .45

-I..^9-0.02

300.00, 515.30

27L76

Source. UNCTAD

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CRITICAL GLOBALIZATION STUDIES 241

TABLE 6Euel Exports from Iraq, Billion US$

199519961997199819992000

Sourer.

514.6502.6

3728.47288.616538.020547.8

LlNCTAD

200120Ü22003200420052006

12797.912139.19418.017201.022013.627597.8

41 U. S. companies accounted for 63% of the sales of tbe top 100arms-producing companies in the world (ibid.). In the period 1998-2007, annual world military expenditures increased by 45%. Thesedata show that the new imperialism is based on V. S. military hege-mony in military outlays and activities.

The U. S.-led war in Iraq and -Afghanistan is tbe practical valida-tion of the presence of the fifth cbaracteristic of imperialism today.Military conflicts that aim at territorial control and global hegemonyand coimter-iiegemony are immanent features of the new imperial-ism. Lenin (1917, 264) argues tbat imperialism is leading to annex-ation and increased oppression and consequently also to increased

TABLE 7Fuel Imports by the United Kingdom

and the United States, Billion SUS

Year

199519961997199819992000200120022003200420052006

UK

9241.110930.310699.27705.68478.014673.214686.514380.818242.529684.342770.054240.6

US

62984.177062.882545.362152.279273.4139621.6129014.4121927.4163251.8216377.0298037.3345058.8

Sourer. UNCTAD

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242 SCIENCE &> SOCIETY

resistance. 9/11 and the rise of global terrorism can be interpretedas a reaction to global U. S. economic, political, and cultural influ-ence. This has resulted in a vicious cycle of global war that createsand secures spheres of Western infiuence and global terrorism thatUies to destroy Western lifest\'Ies and Western dominance. At the timeof Lenin, there was an organized labor movement that resisted im-perialism and culminated in the October Revolution. Under the newimperialism, the political left is marginal and hardly influences woridpohtics, which are dominated by Western imperialists and Islamichardliners. Therefore today there seem to be much less politicalgrounds for emancipatory transformations than at the time of Lenin.In the early 21st century, the formula no longer is "socialism or bar-barism," but rather "barbarism or barbarism."

Conclusion

In this paper, I have tried to show that Lenin's notion of imperial-ism is important for analyzing contemporary capitalism. Contemporarycapitalism is characterized by a new imperialism, in Lenin's mean-ing of the term. There has been a return to the fundamental charac-teristics of imperialism identified by Lenin, but at tlie same time thesecharacteristics take on new forms.

The data suggest that contemporary capitalism is an imperialis-tic capitalism in Lenin's sense, and that Lenin's five characteristicsof imperialism can be reformulated for contemporary capitalism:

1. Capital concentration: Capital concentration remains an im-portant characteristic of industry, services, and finance. 2. Financecapital: Finance capital is still the dominant form of capital today.There are, however, more than stocks and bonds on financial mar-kets, as insurance companies, pension funds and investment fundshave gained in influence, and there are new financial instrumentssuch as finance derivatives. Neoliberalism has created volatile globalderegulated financial markets. The 2008-09 financial crisis has re-sulted in losses in all parts ofthe economy, not only of finance, butfinance is still predominant.

3. Capital export: this third characteristic of imperialism men-tioned by Lenin, has in comparison to the period 1945-1975 becomeiar more important; transnational corporations are in fact a qualita-tively new development of this feature. 4. Economic division: The

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CRITICAL GLOBALIZATION STUDIES 243

asymmetric spatial division of the world economy remains valid today.The new aspects are the Increased weight of Europe in FDI and theemergence of Asia, especially China, as a major importer and exporterof capital. Finally, 5. Pi)litical division. Tbe U. S.-led war in Iraq andAfghanistan is the practical validation of the continuing presence ofthis filth cbaracteristic of imperialism, Mihtar>' conflicts that aim atterritorial control and global hegemony and counter-hegemony areimmanent features of the new imperialism. The USA is a global mili-tar)'hegemon, but not a global economic hegemon. It faces economicchallenges by Europe and China.

Lenin observed on the First World War and the imperialism ofhis time:

Capitalism has grown into a world system of colonial oppression and of thefmancial strangulation of the ovci^whclming majority of the population ofthe world by a handful of "advanced" countries. And this "booty" is sharedbetween two or three powerful world plunderers armed to the teeth(America, Great Britain, Japan), who are drawing the whole world into theirwar over the division of //iWr booty. (Lenin, 1999, 28.)

Lenin described the First World War as "war for the division of theworld" {Lenin, 1999, 27).The War was tbe expression of tbe political-economic conflict between what Lenin termed imperialism's "greatpowers" (Lenin, 1917, 239). Imperialism is neces.sarily a system ofpolitical-economic competition between great powers. In present-day conditions, military conflictos and economic conflicts do not co-incide. Ai"ab nations question Western hegemony with military meansand Asian nations such as China with economic means. Lenin spokeof conflict between great powers, but this did not necessarily meanthat these powers must be nation-states, or that economic and mili-taiy conflicts must always coincide. Militaiy conflicts have economicdimensions and economic rivalries can, and in many cases do, resultin wars, but if and when this happens is not predetermined, but amatter of tbe contingent complexity of societal power struggles. Wesimply do not know for example if in the futtire there will be a warbetween Cbina and the Western nations for political-economic he-gemony. To assume that this will necessarily be tbe case would reveala deterministic understanding of bi.story, sometbing that is unfortu-nately not alien to Marxism and has proved to be a failure in the past.

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244 SCIENCE (^ SOCIETY

The future cannot be predicted; we can, however, say that, unlessalternatives to the global rule of capitalism emerge in the 21st cen-tury, it will be another century of violence, with new territorial warswaged for political-economic reasons. >

Unified Theory of Information Research GroupUniversity of SalzburgSigmund Haffner Gasse IS5020 SalzburgA ustriachristian.fuchs @sbg. ac. at

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