January 27, 2012

CAPITALIST COMPETITION has never been based on peaceful exchange.

In Karl Marx's Capital, he quotes an economist who says that if capital can get 100 percent profit, it will "trample on all human laws; 300 percent, and there is not a crime at which it will scruple, nor a risk it will not run...If turbulence and strife will bring a profit, it will freely encourage both."

It's true that the most powerful states and corporations can often impose their will without resorting to violence. This has certainly been the case, for example, with International Monetary Fund "structural adjustment programs"--where loans are advanced to poor countries on the condition that they privatize, cut public spending and open up the foreign investment.

But where financial coercion fails, the threat--and use--of violence, has always been an important way in which states have promoted the economic interests of their own ruling classes.

For example, the U.S. engaged in what was known as "gunboat diplomacy" in the early part if the 19th century. The U.S. would send the Marines to a Caribbean island that was having payment problems and simply take over the customs house.

Columnist: Paul D’Amato Paul D'Amato is managing editor of the International Socialist Review and author of The Meaning of Marxism, a lively and accessible introduction to the ideas of Karl Marx and the tradition he founded. Paul can be contacted at [email protected].

War and conquest accompanied capitalism from the beginning. With the world's most powerful naval fleet, Britain seized and plundered India, destroying its indigenous textile industry in order to force British textile products on them.

But even before that, with the emergence of the world's first commercial powers in Europe in the 15th and 16th centuries, violence was the rule rather than the exception.

In fact, the accumulation of capital necessary to fuel the development of industrial capitalism in Europe came from the plunder of the Americas and Africa--especially from the development of the slave trade.

Marx wrote:

The discovery of gold and silver in America, the extirpation, enslavement and entombment in mines of the indigenous population of the continent, the beginnings of the conquest and plunder of India, and the conversion of Africa into a preserve for the commercial hunting of black skins are all things that characterize the dawn of the era of capitalist production.

AT THE time Marx wrote about modern industrial capitalism, it had barely developed in Britain and a few European countries. But as the 20th century approached, capitalism became truly global.

Capitalist production burst the bounds of the nation state and was forced to seek outlets overseas. The result was not only economic competition but military competition between the great powers on an international scale.

As early as the 1870s, Frederick Engels could write, "Militarism dominates and is swallowing Europe...Competition among the individual states forces them...to spend more money each year on the army and navy, artillery, etc.?

In the period after Engels wrote this, the most powerful states--Britain, the U.S. Germany and France--scrambled to divide the world. Their new colonies provided raw materials, cheap labor and markets for their goods and investments.

As the earth was carved up into "spheres of influence," competition between the great powers for who would control the biggest markets intensified. A "balance of power" was maintained by each state arming itself to the teeth--a balance continually in danger of being upset by the emergence of a new power eager for a slice of he imperial pie.

Writing at the time of the First World War, Lenin described the new period of capitalism as "imperialism"--a system characterized by the domination of giant capitalist monopolies inside the borders of the great powers and competition among the powers on an international scale.

Lenin's analysis was crucial because it pointed out that imperialism isn't a policy but a new stage in the development of capitalism that grew out of earlier conditions. The logic of imperialism is international economic competition between states--leading to war.

There were people at the time, like the German social democrat Karl Kautsky, who argued that the creation of a world market and economic interdependence of nations would make war obsolete.

Just the opposite was the case.

Tens of millions of people died in the world wars fought to decide which country would, the words of Leon Trotsky, "be transformed from a great power into the world power."

First published in the May 12, 2000, issue of Socialist Worker.