Capitalism and Socialism:
Non-Ideology and The Driver’s Way

A new epoch in Man’s history had arrived when in an unprecedented attempt the oppression of the many by the few was made the subject for study and scrutiny. And, not only that, it was practically challenged on the grandest possible scale. What Karl Marx did had never been attempted before in history. By showing the path to the oppressed and arming them with every conceivable tool they would need in their struggle, he launched on behalf of the entire humanity the first ever and calculated attack on the fortresses of the rich and the powerful for the radical transformation of the world to eradicate finally and once for all the exploitation of man by man from the face of the earth.

The idea started spreading. It inspired so many potential leaders, practically all over the world, bringing them as if from the underground to the surface to lead their masses. The struggle had to be and was, of course, very intense. 

And then, last century saw the action. Many battles were fought all over the globe. Some of the fortresses of the rich and the powerful were overrun and occupied. First, for a very long time, a belief had got rooted in the oppressed of the world that ultimately an oppression-free world could be built and then after the successful Bolshevik Revolution in Russia, they could see their belief come true. Now they believed that their new world was being built and it was only a matter of time that one day which could not be very far off when the entire world would become oppression-free. And that the Communist victory in China in 1948 strengthened their belief was quite natural.        

But most of it was not true. I mean these victories were not going to end the exploitation of man by man even in the liberated countries, what to talk about the whole world. New categories of oppression emerged — now there were new oppressors and new oppressed. But of course, the paradigm had changed. Although in this context George Orwell’s ‘Animal Farm’ cannot be dismissed lightly, but does it mean that if humanity fails today, it will fail all the time? Therefore, it was not a mirage as many would like to believe. When in history failure was not a possibility in any human enterprise? Man always tried to build again on his failure.   

Therefore, in practice, as history moved forward, the problem remained elusive, although, the rich and the powerful got satisfaction and felt secure in their fortresses dismissing the revolutionary upheavals as mere aberration in history. It was, in fact, their denial of the problem. But then, how and who could have termed them wrong when the Soviet Union, without creating a reasonably functioning alternative for humanity collapsed or when later, apparently, in a full circle change Communist China adopted capitalism after, I believe, careful deliberation?

But the truth is that they were wrong, because at best one could say was that the problem was too big and too complex.

And the fact is that this was not all. That the problem was too complex and too big was only one part of the story. Another part, which I believe to be the major part, was that leaders were not available who could have remained on the job irrespective of the circumstances.

Had leaders been available and continued to be available who could have remained focused on the fundamental nature of the problem, they would have responded by adapting themselves to the unfolding complexities. Like in the development of any new technology, the problems which crop up in the process and their solutions determine the actual path a technology takes, the ‘Political Technology’ to end exploitation of man by man would definitely have made new breakthroughs had its development continued with more competent men taking up this job and money invested on such men and their project.

Fundamental and basic clarity of the problem from such efforts would have helped the supposed leadership to shed wrong ideas and practices, perhaps even some of the basic and fundamental if found so, in their process of adaptation to meet new challenges. There is the need to underline here that Lenin maintained the basic clarity of the problem throughout his life. But how much an individual or two even if great can do when many are needed and needed all the time? In fact a well-rooted culture is needed. 

All this does not mean that nothing happened anywhere. In fact the process never stops and it never stopped. So many all over the world did what best they could do and were capable of in the specific circumstances they found themselves in.   

The question of scarcity of leaders – by which we by default mean exceptional leaders — is an integral part of human existence. Perhaps societies have to lift themselves up ultimately so that their demand for exceptional leaders will no more come up.

I understand that time and again history has shown that human societies are normally far behind and not capable of producing leaders for their right causes or before that even for defining and bringing them to the forefront. It has been normal in history that a problem persisted in a society but no leader emerged to grapple it for a long time. And when somebody did come up, the quantity of quality leadership has always been extremely meager and then available for practically very short periods anywhere in the world throughout history.  

Although evil, more or less, resides within individuals, it is the rich and/or the powerful who can and promote it by hundred and one means and make it monstrous for the unsuspecting and naïve humanity. When many rich and powerful individuals undertake this practice, which they do, it becomes a class, which by its actions produces a culture. As ever, they are the source of most of the woes of humanity. Obviously the rich and the powerful when sit in the driving seat of a state, become exponentially more powerful than when they are out of power and their capacity to promote evil rises proportionally.     

This manifesto aspires to change this scene. Therefore, the contemporary politics in Pakistan, occupation of Afghanistan and Iraq, the Zionist-American-Western intentions and games to perhaps disintegrate Pakistan, punish Iran to the extent that Iranians submit totally and utterly like Germans and Japanese after the West’s so-called ‘Second World War’ and start singing in praise of their so-called ‘Civilized World’ have determined what I have written in this manifesto.

And what made the intentions of the rich and the powerful the living realities of our lives corrupting and disintegrating our societies and snatching even the meager spaces from under the feet of our masses – collectively the historical turmoil caused mainly by the rich and the powerful of the world and their local thugs — have determined what I have written in this manifesto.

Our present situation and the way we reached here, I believe, have made us, very broadly, conscious of the fact that history has placed in front of us a very urgent and compelling task — the Liberation of our people from the American-led West where the Jewish-christian Zionists are in the position of fixing the priorities of this huge alliance. Therefore no doubt there is presently the urgency for political action really worthy of the task without any loss of time. Otherwise the people will be misled again in another wrong direction by demagogues of whom there is no dearth in Pakistan.

Even if this is well understood, we have to be careful as, in hurry, this can lead us to come up with some half-baked solutions. And such avoiding on our part, even with the best of intentions, of the real ‘theoretical difficulties’ we face in rationalizing our struggle in the wider historical perspective may go un-noticed in the rush of events.

But we should not even think of bypassing any such difficulty. And I have tried vigorously to remain very vigilant in this regard. Further, we have to understand very deeply that our being historically clear-minded is the first and the last most essential weapon we can and should have in our armoury. And that leads us to say that we should try very hard to shape our struggle that it should fit just rightly, historically, in the overall human struggle for emancipation.

Whatever our past in various parts of the world, the present world, as we experience it today anywhere on the globe, has been brought into its present shape under capitalism which originated in the West somewhere in the first half of the eighteenth century. “[T]he English agricultural revolution was a critical element in the transition from feudalism to industrial capitalism. … Marx saw the beginnings of change in the late 15th century, but thought the revolution began with the formation of a class of capitalist farmers by around 1670, and that capitalist landlords spread and deepened the revolution from around 1750.” [1]

“During the second half of the 18th century visible changes are occurring in Britain as a result of the developing Industrial Revolution. Where previously land has been the traditional source of wealth, and the purchase of land the natural investment for anyone with a spare fortune, money is now being put into manufacturing enterprises. In 1771 the greatest of the new entrepreneurs, Richard Arkwright, opened the first custom-built and water-powered cloth mill at Cromford.” And [The first batch of James Watt’s steam engines was delivered to their purchasers in 1776.] [2]

But before these developments, a worldwide strident and confident colonialism was already on the move. Therefore we can say that colonialism was in attendance when history delivered industrial capitalism to the world. If industrial capitalism was a new invention of man, colonialism was not. “Colonial policy and imperialism existed before the latest stage of capitalism, and even before capitalism. Rome, founded on slavery, pursued a colonial policy and practised imperialism.” [3]

Therefore, although not necessarily a modern phenomenon entirely, which concerns us here, the “colonialism changed decisively because of technological developments in navigation that began to connect more remote parts of the world. Fast sailing ships made it possible to reach distant ports while sustaining closer ties between the center and colonies. Thus, the modern European colonial project emerged when it became possible to move large numbers of people across the oceans and to maintain political sovereignty in spite of geographical dispersion.” [4]

Colonialism was led by Portuguese and Spanish exploration of the Americas, and the coasts of Africa, the Middle East, India, and East Asia. It was not until the 17th century that Britain, France and the Netherlands successfully established overseas colonies in direct competition with Spain and Portugal and with each other. Not all exploratory undertakings, however, were done by central governments. Charter companies and joint stock companies played a crucial role in exploration.

The first joint-stock enterprise was established in Britain in 1555. “Of later ventures launched on a similar basis, the best known are the East India Company (1600), the Hudson’s Bay Company (1670) and the South Sea Company  (1711). Even the Bank of England, when founded in 1694, is organized at first on joint-stock lines.” [5]

The original or the proposed names of the companies tell much about the spirit of the times: “The Governor and Company of Adventurers of England trading into Hudson Bay” and “The Governor and Company of Merchants of Great Britain Trading to the South Seas, and other parts of America, and for Encouraging the Fishery”, for example. The latter was proposed in 1710 by George Caswall, London merchant, financier, and stock broker, and John Blunt, London scrivener (notary or drafter) turned stock broker.  [6]

“One of the strangest parts of the history of the British Empire involves that commercial venture generally known as the East India Company, though its original name when founded by royal charter on the very last day of 1600 was the Governor and Company of Merchants of London Trading into the East Indies. As its name suggests, the company was the enterprise of London businessmen who banded together to make money importing spices from South Asia. For centuries the valuable spice trade with the East Indies (as they were long known) relied on land routes across Asia and the Middle East, but by the sixteenth century, the superior navigational technology and skills of the Portuguese for the first time permitted Europeans to cut out intermediaries and hence make themselves far greater profits.” [7] [7] http://usp.nus.edu.sg/victorian/history/empire/eic.html

In this way “by 1695 did more than one hundred joint stock companies exist. Several peers held stock in the New East India Company from the late 1680s to 1707.” [8]

“Expanding European empires in the New World [Americas] lacked one major resource — a work force. [And Africans were found to be the most qualified: They] … they often had experience of agriculture and keeping cattle, they were used to a tropical climate, resistant to tropical diseases, and they could be “worked very hard” on plantations or in mines.” [9]

Therefore in the triangular trade between Europe, Africa and Americas the ‘commodity’ of slaves from Africa played the main part. “Slaves were obtained from along the west coast of Africa with the full and active co-operation of African kings and merchants. … In return, the African kings and merchants received various trade goods including beads, cowrie shells (used as money), textiles, brandy, horses, and perhaps most importantly, guns. … The export of trade goods from Europe to Africa forms the first side of the triangular trade. … The transport of slaves from Africa to the Americas forms the middle passage of the triangular trade. … Slaves were needed on plantations and for mines and the majority was shipped to Brazil, the Caribbean, and the Spanish Empire. [From 1450 to 1900, the number of slaves accounted for who were transported from Africa to Americas was 11,328,000. The estimated death rate during the voyage was 13%; therefore the total comes to be 12,800,640 who were taken away. More than 35% of them traveled to Brazil while] Less than 5% travelled to the Northern American States formally held by the British. … The third, and final, leg of the triangular trade involved the return to Europe with the produce from the slave-labour plantations: cotton, sugar, tobacco, molasses and rum.” [10]

“For two hundred years, 1440-1640, Portugal had a monopoly on the export of slaves from Africa. It is notable that they were also the last European country to abolish the institution – although, like France, it still continued to work former slaves as contract laborers, which they called libertos or engagés à temps. It is estimated that during the 4 1/2 centuries of the trans-Atlantic slave trade, Portugal was responsible for transporting over 4.5 million Africans (roughly 40% of the total). During the eighteenth century however, when the slave trade accounted for the transport of a staggering 6 million Africans, Britain was the worst transgressor – responsible for almost 2.5 million, a fact often forgotten by those who regularly cite Britain’s prime role in the abolition of the slave trade.” [11]

 “The British Empire was the largest empire in history and, for over a century, was the foremost global power. It was a product of the Age of Discovery, which began with the maritime explorations of the 15th century, that sparked the era of the European colonial empires. By 1921, the British Empire held sway over a population of about 458 million people, approximately one-quarter of the world’s population.[1] It covered about 36.7 million km² (14.2 million square miles),[2] about a quarter of Earth’s total land area. As a result, its political, linguistic and cultural legacy is widespread. At the peak of its power, it was often said that “the sun never sets on the British Empire” because its span across the globe ensured that the sun was always shining on at least one of its numerous colonies or subject nations.”[12]

In short, we can sum up in the words of Marx and Engels written in 1847: “The discovery of America, the rounding of the Cape, opened up fresh ground for the rising bourgeoisie. The East-Indian and Chinese markets, the colonisation of America, trade with the colonies, the increase in the means of exchange and in commodities generally, gave to commerce, to navigation, to industry, an impulse never before known, and thereby, to the revolutionary element in the tottering feudal society, a rapid development.”

As the foundations of capitalism were being laid in Europe which would engulf the whole world later on, we – at that time Indians – along with Chinese, indigenous  Americans – the “Red Indians” – Africans, and many others, by becoming prey to colonialism, were also contributing our ‘share’ in the European project of capitalism. Capitalism, apparently, looks now to be an enduring ‘internationalism’! This, perhaps, is so because we have been living under its success story. Born or invented around 1750, it is now about 250 years old. The capitalist “rule of scarce one hundred years” made Marx and Engels to observe in 1847 in the Communist Manifesto: “The bourgeoisie cannot exist without constantly revolutionising the instruments of production, and thereby the relations of production, and with them the whole relations of society. … Constant revolutionising of production, uninterrupted disturbance of all social conditions, everlasting uncertainty and agitation distinguish the bourgeois epoch from all earlier ones.”

We can add now some more unprecedented and distinctive features of the capitalist era of which we, now, have the experience: Ideologies and wars, nuclear weapons, the unprecedented growth of manipulative power of the rich and the powerful due to increase in the wealth and population of the world, and their eating up of the environment for profits.

Such time can come when the rich and the powerful fail in every way and decide to create another reality in/of the world. Whether there is an adversary capable of overpowering them or not at that time, they can create a justification and an ideology to unleash nuclear weapons against a sizable party of the humanity. If ‘9/11’ was doable in America and ‘The Great Fraud’ in Pakistan in front of our eyes, why not such and a far bigger scenario in the future? It will depend how big the power holders will think or how big their courage will be. The question is: Can others create a different route and make history travel on it?   

Capitalism: 1750-1916

Obviously nobody can act rightly without a reasonably correct understanding of the situation one is in or, in other words, the reality one is confronting to change. For our today’s political act to be right, we have to understand what we confront today, what we want to change or defeat. The second sub-title of Al-Manshoor is stated to be “an answer to the evil designs of the Jewish-Christian Zionists and the American-led aggression against the Muslim world.”

At one time Jews were not Zionists and Israel did not exist. Similarly at one time the cause of an aggression against the Muslim world had not been manufactured in America. And then at one time America was not capable of committing aggression against us. How all these factors combined that today Jewish-Christian Zionists have evil designs against the Muslim world and Muslims are the victims of the American-led aggression?

There is the need to go deep into these developments to understand them. And this effort will help us by unveiling the weaknesses of the aggression. Moreover, it will equip us to counter the evil designs of the Jewish-Christian Zionists when all right thinking people in the world, in particular in the Muslim world, have stakes in defeating the present aggressions and in not allowing another to be launched.

This takes us back, when colonialism was already a reality, to the birth of capitalism in England, about 1750, and its subsequent various stages during its conquering mission of the world, which presently stands accomplished.

“Half a century ago, when Marx was writing Capital, free competition appeared to the overwhelming majority of economists to be a “natural law”. Official science tried, by a conspiracy of silence, to kill the works of Marx, who by a theoretical and historical analysis of capitalism had proved that free competition gives rise to the concentration of production, which, in turn, at a certain stage of development, leads to monopoly. Today, monopoly has become a fact.” Thus wrote Lenin in his Imperialism, The Highest Stage of Capitalism during January-June, 1916. And he observed that the new or the monopoly capitalism had definitely superseded the old, when there was free competition, by the beginning of the twentieth century.

In this work, Lenin had taken care of practically all the previous developments since the beginning of capitalism. By recapitulating some of the main ideas and narratives of his this work, and then looking forward to the present time and seeing the end product of capitalism, which exists today, we will be faithfully and reasonably doing what is the need of our time. In what follows I have tried to do the first part of “recapitulating” in a way I thought right and to the extent possible in making it a part of Al-Manshoor.

CONCENTRATION OF PRODUCTION AND MONOPOLIES: The principal stages in the history of monopolies were the following: (1) 1860-70, the highest stage, the apex of development of free competition; monopoly was barely discernible. (2) After the crisis of 1873, a lengthy period of development of cartels; but they were still the exception. Not yet durable, they were still a transitory phenomenon. (3) The boom at the end of the nineteenth century and the crisis of 1900-03; Cartels became one of the foundations of the whole of economic life. Capitalism had been transformed into imperialism. Cartels divided the markets among themselves. They fixed prices and divided profits among the various enterprises.

The Panic of 1873 was a severe nationwide economic depression in the United States that lasted until 1877. It was precipitated by the bankruptcy of the Philadelphia banking firm Jay Cooke and Company on September 18, 1873 along with the meltdown on May 9, 1873 of the Vienna Stock Exchange in Austria. It was one of a series of economic crises in the 19th and early 20th centuries.

By 1916, one could say that “Monopoly” was the last word in the “latest phase of capitalist development”. But what role banks played in that?

BANKS AND THEIR NEW ROLE: The principal and primary function of banks was to serve as middlemen in the making of payments. In so doing they transformed inactive money capital into active, that is, into capital yielding a profit. They collected all kinds of money revenues and placed them at the disposal of the capitalist class.

As banking developed and became concentrated in a small number of establishments, the banks grew from modest middlemen into powerful monopolies having at their command almost the whole of the money capital of all the capitalists and small businessmen and also the larger part of the means of production and sources of raw materials in any one country and in a number of countries. This transformation of numerous modest middlemen into a handful of monopolists was one of the fundamental processes in the growth of capitalism into capitalist imperialism.

A personal link-up had to develop between the banks and the commercial enterprises when they did business with each other. Then there was merging of one with another through the acquisition of shares. Further, there were the appointments of bank directors to the Supervisory Boards (or Boards of Directors) of industrial and commercial enterprises, and vice versa.

At one time, for example, six of the biggest Berlin banks were represented by their directors in 344 industrial companies; and by their board members in 407 others, making a total of 751 companies. In 289 of these companies they either had two of their representatives on each of the respective Supervisory Boards, or held the posts of chairmen. On the other hand, on the Supervisory Boards of these six banks (in 1910) were fifty-one of the biggest industrialists. From 1895 to 1910, each of these six banks participated in the share and bond issues of many hundreds of industrial companies (the number ranging from 281 to 419).

The “personal link-up” between the banks and industry was supplemented by the “personal link-up” between both of them and the government. Seats on Supervisory Boards were freely offered to persons of title, also to ex-civil servants to facilitate relations with the authorities. Usually, on the Supervisory Board of a big bank, there was a member of parliament or a Berlin city councillor.

The building and development of the big capitalist monopolies was therefore going on full steam ahead in all “natural” and “supernatural” ways. A sort of division of labour was being systematically developed amongst the several hundred kings of finance who reigned over modern capitalist society. Thus, the twentieth century marked the turning point from the old capitalism to the new, from the domination of capital in general to the domination of finance capital.

FINANCE CAPITAL AND THE FINANCIAL OLIGHARCHY: A steadily increasing proportion of capital in industry ceases to belong to the industrialists who employ it. They obtain the use of it only through the medium of the banks, which, in relation to them, represent the owners of the capital. This bank capital or capital in money form, which is thus actually transformed into industrial capital, is ‘finance capital’. 

The monstrous facts concerning the monstrous rule of the financial oligarchy had been so glaring that in all capitalist countries, in America, France and Germany, a whole literature had sprung up in which something called ‘holding system’ was given paramount importance in which the head of a concern, for example, could control the principal company (literally: the “mother company”); the latter reigned over the subsidiary companies (“daughter companies”) which in their turn controlled still other subsidiaries (“grandchild companies”), etc.                  

As a matter of fact, experience showed that it was sufficient to own 40 per cent of the shares of a company in order to direct its affairs, since in practice a certain number of small, scattered shareholders did not find it possible to attend general meetings. Incidentally, this was why, in the more “experienced” capitalist countries, the law allowed the issue of shares of smaller denomination. In Germany, the law did not permit the issue of shares of less than one thousand marks denomination, but in  Britain the issue of one-pound shares (= 20 marks, about 10 rubles) was permitted. Siemens, one of the biggest industrialists and “financial kings” in Germany, told the Reichstag on June 7, 1900, “the one-pound share is the basis of British imperialism”.

The “holding system” not only served enormously to increase the power of the monopolists; it also enabled them to resort with impunity to all sorts of shady and dirty tricks to cheat the public, because formally the directors of the “mother company” were not legally responsible for the “daughter company”, which was supposed to be “independent”, and through the medium of which they could “pull off” anything.

One time the Spring Steel Company of Kassel, for example, was regarded as being one of the most profitable enterprises in Germany. Through bad management its dividends fell from 15 per cent to nil. It appeared that the Board, without consulting the shareholders, had loaned six million marks to one of its ‘daughter companies’. The shareholders only heard of the loan long afterwards, when it had been proved to be a mistake and when Spring Steel shares dropped nearly 100 per cent, because those in the know were getting rid of them.   

“Finance capital … exacts enormous and ever-increasing profits from the floating of companies, issue of stock, state loans, etc., strengthens the domination of the financial oligarchy and levies tribute upon the whole of society for the benefit of monopolists.” In 1887, Havemeyer founded the Sugar Trust by amalgamating fifteen small firms, whose total capital amounted to 6,500,000 dollars. But the capital of the trust was declared to be 50 million dollars. This “overcapitalisation” anticipated the monopoly profits, in the same way as the United States Steel Corporation anticipated its monopoly profits in buying up as many iron ore fields as possible.

In France four of the most powerful banks enjoyed, not a relative, but an “absolute monopoly” in the issue of bonds. In reality, this was a “trust of big banks”. As monopoly ensured monopoly profits from bond issues, a borrowing country, usually, did not get more than 90 per cent of the sum of the loan, the remaining 10 per cent went to the banks and other middlemen. The profit made by the banks out of the Russo-Chinese loan of 400 million francs amounted to 8 per cent; out of the Russian (1904) loan of 800 million francs the profit amounted to 10 per cent; and out of the Moroccan (1904) loan of 62,500,000 francs it amounted to 18.75 per cent.

Capitalism began its development with petty usury capital. By 1916 it had gigantic usury capital at its disposal. It was said that the French were “the usurers of Europe.” “Fifty persons, representing a capital of eight million francs, can control 2,000 million francs deposited in four banks.” The “holding system” “leads” to the same result. One of the biggest banks, the Société Générale for instance, issued 64,000 bonds for its “daughter company”, the Egyptian Sugar Refineries. The bonds were issued at 150 per cent, i.e., the bank gained 50 centimes on the franc. The dividends of the new company were found to be fictitious, the “public” lost from 90 to 100 million francs. One of the directors of the Société Générale was a member of the board of directors of the Sugar Refineries.

It is not surprising that one was driven to the conclusion that the French Republic was a financial monarchy; “it is the complete domination of the financial oligarchy; the latter dominates over the press and the government.” 

“No banking operation brings in profits comparable with those obtained from the issue of securities!” According to a German Economist, the average annual profits made on the issue of industrial stock were as follows: 1895: 38.6 %, 1896: 36.1 %, 1897: 66.7 %, 1898: 67.7 %, 1899: 66.9 %, 1900: 55.2 %. In the ten years from 1891 to 1900, more than a thousand million marks were “earned” by issuing German industrial stock.

During periods of industrial boom, the profits of finance capital were immense, but during periods of depression, small and unsound businesses went out of existence, and the big banks acquired “holdings” in them by buying them up practically for nothing, or participated in profitable schemes for their “reconstruction” and “reorganisation”.

Speculation in land situated in the suburbs of rapidly growing big towns was a particularly profitable operation for finance capital. 

A monopoly, once it was formed and controlled thousands of millions, inevitably penetrated into every sphere of public life, regardless of the form of government and all other “details”.

“From these figures [not given here] we at once see standing out in sharp relief four of the richest capitalist countries, each of which holds securities to amounts ranging approximately from 100,000 to 150,000 million francs. Of these four countries, two, Britain and France, are the oldest capitalist countries, and, as we shall see, possess the most colonies; the other two, the United States and Germany, are capitalist countries leading in the rapidity of development and the degree of extension of capitalist monopolies in industry. Together, these four countries own 479,000 million francs, that is, nearly 80 per cent of the world’s finance capital. In one way or another, nearly the whole of the rest of the world is more or less the debtor to and tributary of these international banker countries, these four ‘pillars’ of world finance capital.”

And now, let us examine the part, which the export of capital played in creating the international network of dependence on and connections of finance capital.

EXPORT OF CAPITAL: “Typical of the old capitalism, when free competition held undivided sway, was the export of goods. Typical of the latest stage of capitalism, when monopolies rule, is the export of capital.”

“England became a capitalist country before any other, and by the middle of the nineteenth century, having adopted free trade, claimed to be the “workshop of the world”, the supplier of manufactured goods to all countries, which in exchange were to keep her provided with raw materials. But in the last quarter of the nineteenth century, this monopoly was already undermined; for other countries, sheltering themselves with “protective” tariffs, developed into independent capitalist states. On the threshold of the twentieth century we see the formation of a new type of monopoly: firstly, monopolist associations of capitalists in all capitalistically developed countries; secondly, the monopolist position of a few very rich countries, in which the accumulation of capital has reached gigantic proportions. An enormous ‘surplus of capital’ has arisen in the advanced countries.”

And the surplus capital would not be invested in the masses of a given country, as the practice is even today, for this would mean a decline in profits for the capitalists. For higher profits, it would go abroad to the backward countries. “In these backward countries profits are usually high, for capital is scarce, the price of land is relatively low, wages are low, raw materials are cheap.”

The principal spheres of investment of British capital were the British colonies. French capital exports were invested mainly in Europe, primarily in Russia. This was mainly loan capital, government loans, and not capital invested in industrial undertakings. Unlike British colonial imperialism, French imperialism might be termed “usury imperialism”. In the case of Germany, we have a third type; colonies were inconsiderable, and German capital invested abroad was divided most evenly between Europe and America.

“Thus finance capital, literally, one might say, spreads its net over all countries of the world. An important role in this is played by banks founded in the colonies and by their branches. German imperialists look with envy at the ‘old’ colonial countries, which have been particularly ‘successful’ in providing for themselves in this respect. In 1904, Great Britain had 50 colonial banks with 2,279 branches (in 1910 there were 72 banks with 5,449 branches), France had 20 with 136 branches; Holland, 16 with 68 branches; and Germany had ‘only’ 13 with 70 branches. The American capitalists, in their turn, are jealous of the English and German: ‘In South America,’ they complained in 1915, ‘five German banks have forty branches and five British banks have seventy branches…. Britain and Germany have invested in Argentina, Brazil, and Uruguay in the last twenty-five years approximately four thousand million dollars, and as a result together enjoy 46 per cent of the total trade of these three countries.’”

“The capital-exporting countries have divided the world among themselves in the figurative sense of the term. But finance capital has led to the actual division of the world.”

DIVISION OF THE WORLD AMONG CAPITALIST ASSOCIATIONS: 

“Monopolist capitalist associations, cartels, syndicates and trusts first divided the home market among themselves and obtained more or less complete possession of the industry of their own 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 associations expanded in all ways, things ‘naturally’ gravitated towards an international agreement among these associations, and towards the formation of international cartels.”

This was a new stage of world concentration of capital and production, incomparably higher than the preceding stages, the stage of super monopoly.

As a result, after 1900, concentration in Germany progressed with giant strides. Up to 1900 there had been seven or eight “groups” in the electrical industry. Each consisted of several companies (altogether there were 28) and each was backed by from 2 to 11 banks. Between 1908 and 1912 all these groups were merged into two, or one.

The famous A.E.G. (General Electric Company), which grew up in this way, controlled 175 to 200 companies (through the “holding” system”), and a total capital of approximately 1,500 million marks. Of direct agencies abroad alone, it had thirty-four, of which twelve were joint-stock companies, in more than ten countries.

But concentration in Europe was also a component part of the process of concentration in America.

Thus, twoelectrical “great powers” were formed: “there are no other electrical companies in the world completely independent of them,” wrote Heinig in his article “The Path of the Electric Trust”.

And then, in 1907, the German and American trusts concluded an agreement by which they divided the world between them. Competition between them ceased. The American General Electric Company (G.E.C.) “got” the United States and Canada. The German General Electric Company (A.E.G.) “got” Germany, Austria, Russia, Holland, Denmark, Switzerland, Turkey and the Balkans. Special agreements, naturally secret, were concluded regarding the penetration of “daughter companies” into new branches of industry, into “new” countries formally not yet allotted. The two trusts were to exchange inventions and experiments.

“The world oil market,” wrote Jeidels in 1905, “is even today still divided between two great financial groups—Rockefeller’s American Standard Oil Co., and Rothschild and Nobel, the controlling interests of the Russian oilfields in Baku. The two groups are closely connected.”

In merchant shipping, the story was not different.

International Rail Cartel was made as early as 1884. The manufacturers agreed not to compete with one another in the home markets of the countries involved, and they divided the foreign markets in the following quotas: Great Britain, 66 per cent; Germany, 27 per cent; Belgium, 7 per cent. India was reserved entirely for Great Britain.

 “The epoch of the latest stage of capitalism shows us that certain relations between capitalist associations grow up, based on the economic division of the world; while parallel to and in connection with it, certain relations grow up between political alliances, between states, on the basis of the territorial division of the world, of the struggle for colonies, of the ‘struggle for spheres of influence’.”

DIVISION OF THE WORLD AMONG THE GREAT POWERS: In 1876, the colonial powers, including the United States, were occupying 10.8% of Africa, 56.8% of Polynesia, 51.5% of Asia, 100.0% of Australia, and 27.5% of Americas. While in 1900, the occupations were, 90.4%, 98.9%, 56.6%, 100.0%, and 27.2% respectively.

Thus the humanity was living in a peculiar epoch of world colonial policy, which was most closely connected with the “latest stage in the development of capitalism”, with finance capital.                    

For Great Britain, the period of the enormous expansion of colonial conquests was that between 1860 and 1880, and it was also very considerable in the last twenty years of the nineteenth century. For France and Germany this period falls precisely in these twenty years. We saw above that the development of premonopoly capitalism, of capitalism in which free competition was predominant, reached its limit in the 1860s and 1870s. We now see that it is precisely after that period that the tremendous “boom” in colonial conquests begins, and that the struggle for the territorial division of the world becomes extraordinarily sharp. It is beyond doubt, therefore, that capitalism’s transition to the stage of monopoly capitalism, to finance capital, is connected with the intensification of the struggle for the partitioning of the world.

It is not without interest to observe that the leading British politicians saw the connection between what might be called the purely economic and the socio-political roots of modern imperialism. Chamberlain advocated imperialism as a “true, wise and economical policy”, and pointed particularly to the German, American and Belgian competition, which Great Britain was encountering in the world market. Salvation lied in monopoly, said the capitalists as they formed cartels, syndicates and trusts. Salvation lied in monopoly, echoed the political leaders, hastening to appropriate the parts of the world not yet shared out. And Cecil Rhodes said in 1895: “I was in the East End of London (a working-class quarter) yesterday and attended a meeting of the unemployed. I listened to the wild speeches, which were just a cry for ‘bread! bread!’ and on my way home I pondered over the scene and I became more than ever convinced of the importance of imperialism…. My cherished idea is a solution for the social problem, i.e., in order to save the 40,000,000 inhabitants of the United Kingdom from a bloody civil war, we colonial statesmen must acquire new lands to settle the surplus population, to provide new markets for the goods produced in the factories and mines. The Empire, as I have always said, is a bread and butter question. If you want to avoid civil war, you must become imperialists.”

Such were the men who mattered and such were their ideas! Summing up, we get, from Lenin, the picture of the state of the world at the end of 1914 in the table below.

COLONIAL POSSESSIONS OF THE GREAT POWERS

In words, in 1914, six “great powers” e.g. England, Russia, France, Germany, Japan, United States of America whose own total land area was 16.5 million square kilometers possessed colonies of 65.0 square kilometers; their own population being 437.2 million enslaved 523.4 million people in their colonies. In addition, Lenin wrote about Persia, China and Turkey that “the first of these countries is already almost completely a colony, the second and third are becoming such.”  And these three countries had total area of 14.5 square kilometers and population of 361.2 million people. 

I had to take up the thread from where Lenin left to the present, but the ongoing economic crisis, which unfolded during my writing of this manifesto, has shortened my work providing some relief to me. Now we will have a brief discussion on the subject keeping in front of us what has happened and what the world is going through presently. But first, once more, Marx and Engels and their Communist manifesto [All emphases by theauthor]:  

The “bourgeoisie [the class in bourgeois society who own the social means of production as their private property, i.e., as capital] has at last, since the establishment of Modern Industry and of the world market, conquered for itself, in the modern representative State, exclusive political sway. The executive of the modern state is but a committee for managing the common affairs of the whole bourgeoisie.”

“The bourgeoisie, by the rapid improvement of all instruments of production, by the immensely facilitated means of communication, draws all, even the most barbarian, nations into civilisation. The cheap prices of commodities are the heavy artillery with which it batters down all Chinese walls, with which it forces the barbarians’ intensely obstinate hatred of foreigners to capitulate. It compels all nations, on pain of extinction, to adopt the bourgeois mode of production; it compels them to introduce what it calls civilisation into their midst, i.e., to become bourgeois themselves. In one word, it creates a world after its own image.”

“A similar movement is going on before our own eyes. Modern bourgeois society, with its relations of production, of exchange and of property, a society that has conjured up such gigantic means of production and of exchange, is like the sorcerer who is no longer able to control the powers of the nether world whom he has called up by his spells. … It is enough to mention the commercial crises that by their periodical return put the existence of the entire bourgeois society on its trial, each time more threateningly. In these crises, a great part not only of the existing products, but also of the previously created productive forces, are periodically destroyed. In these crises, there breaks out an epidemic that, in all earlier epochs, would have seemed an absurdity — the epidemic of over-production. Society suddenly finds itself put back into a state of momentary barbarism; it appears as if a famine, a universal war of devastation, had cut off the supply of every means of subsistence; industry and commerce seem to be destroyed; and why? Because there is too much civilisation, too much means of subsistence, too much industry, too much commerce. The productive forces at the disposal of society no longer tend to further the development of the conditions of bourgeois property; on the contrary, they have become too powerful for these conditions, by which they are fettered, and so soon as they overcome these fetters, they bring disorder into the whole of bourgeois society, endanger the existence of bourgeois property. The conditions of bourgeois society are too narrow to comprise the wealth created by them. And how does the bourgeoisie get over these crises? On the one hand by enforced destruction of a mass of productive forces; on the other, by the conquest of new markets, and by the more thorough exploitation of the old ones. That is to say, by paving the way for more extensive and more destructive crises, and by diminishing the means whereby crises are prevented.” [to be concluded]