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Imperialism, A Study
This could have been written today.
Imperialism is only beginning to realise its full resources, and to develop into a fine art the management of nations: the broad bestowal of a franchise, wielded by a people whose education has reached the stage of an uncritical ability to read printed matter, favours immensely the designs of keen business politicians, who, by controlling the press, the schools, and where necessary the churches, impose Imperialism upon the masses under the attractive guise of sensational patriotism.
The chief economic source of Imperialism has been found in the inequality of industrial opportunities by which a favoured class accumulates superfluous elements of income which, in their search for profitable investments, press ever farther afield: the influence on State policy of these investors and their financial managers secures a national alliance of other vested interests which are threatened by movements of social reform: the adoption of Imperialism thus serves the double purpose of securing private material benefits for favoured classes of investors and traders at the public cost, while sustaining the general cause of conservatism by diverting public energy and interest from domestic agitation to external employment.
The ability of a nation to shake off this dangerous usurpation of its power, and to employ the national resources in the national interest, depends upon the education of a national intelligence and a national will, which shall make democracy a political and economic reality.
from Imperialism, A Study (Part II, Chapter VII, II) by John A. Hobson – James Pott and Co. New York, 1902.
Hat tip to Craig Murray who pointed out this valuable book.
wow. fun. the old boy really nails the globalization of capital in his own time. I read part I. These jumped out at me:
The particular direction in which large quantities of capital and labour have been employed has been determined by these external markets. But we are not entitled to conclude that if this export trade had not grown up this capital and labour would have been without productive employment, though some of it must have been differently employed. The assumption that home demand is a fixed amount, and that any commodities produced in excess of this amount must find a foreign market or remain unsold, is quite unwarranted. On the contrary, there is no necessary limit to the quantity of capital and labour which can be employed in producing goods for the home market, if the productive power is disposed in industries which meet the rising demands of the consumer.
so, here we presume i guess at least constant returns on investment, confiscated by the “certain class”:
Irrational from the standpoint of the whole nation, it is rational enough from the standpoint of certain classes in the nation. A completely socialist State which kept good books and presented regular balance-sheets of expenditure and assets would soon discard Imperialism; an intelligent laissez-faire democracy which gave duly proportionate weight in its policy to all economic interests alike would do the same. But a State in which certain well-organised business interests are able to outweigh the weak, diffused interest of the community is bound to pursue a policy which accords with the pressure of the former interests.
so,the basic distinction of hobson’s account from that-person-whose-name-makes-leftists-moan/groan is that there is no structural imperative (what was often called “iron law of production”) rationalizing global expansion of markets assuring accumulation because of decreasing returns on investment resulting in “the tendential fall in the rate of profit.” hobson rejects this thesis:
Such is the array of distinctively economic forces making for Imperialism, a large loose group of trades and professions seeking profitable business and lucrative employment from the expansion of military and civil services, from the expenditure on military operations, the opening up of new tracts of territory and trade with the same, and the provision of new capital which these operations require, all these finding their central guiding and directing force in the power of the general financier.
so, what is irrational is the intercession of “certain classes” in the exploitation of a capitalist mode of production. Whereas the man-w/-whitebeard-and-soft-eyes-and-bighair would say that the basic mode of capitalist production determines class conflict, hobson says that it’s in the interests of certain classes to be what they are regardless of the mode of production:
Thus a great increase of savings seeking profitable investment is synchronous with a stricter economy of the use of existing capital. No doubt the rapid growth of a population, accustomed to a high and an always ascending standard of comfort, absorbs in the satisfaction of its wants a large quantity of new capital. But the actual rate of saving, conjoined with a more economical application of forms of existing capital, has exceeded considerably the rise of the national consumption of manufactures. The power of production has far outstripped the actual rate of consumption, and, contrary to the older economic theory, has been unable to force a corresponding increase of consumption by lowering prices.
thus, because certain classes choose to deprive lesser classes a fairer share of the social product, overaccumulation occurs. overaccumulation is the”taproot” of imperialism. the normative aspect in hobson’s book is:
Whatever is, or can be, produced, can be consumed, for a claim upon it, as rent, profit, or wages, forms part of the real income of some member of the community, and he can consume it, or else exchange it for some other consumable with some one else who will consume it.
…
It is not industrial progress that demands the opening up of new markets and areas of investment, but mal-distribution of consuming power which prevents the absorption of commodities and capital within the country.
this is great stuff, reminiscent of veblen, frank parsons, etc. … but, to be sure, the tradition of critique of capital derived from the man-whose-checkbooks-were-balanced-by-his-best-friend locates the problem in actually existing social relations determined by the capitalist mode of production. the only way to change these relations is the transformation of the mode of production. the old-man-whose-name-must-not-be-uttered might not be right, and hobson’s reformism might work, but we’ve had a century of reforms and look at the mess we’re in.
great post. thanks.
Posted by: slothrop | Aug 4 2007 19:29 utc | 10
Jim Lobe has a relevant post up RE sloths assertions, in real life time:
Today’s quotation in the Financial Times attributed to Danielle Pletka, the Vice President for Foreign and Defense Policy Studies of the American Enterprise Institute (AEI), was a stunner. “If we …begin to sanction foreign companies through more stringent sanctions in the Iran Sanctions Act, I think there will be serious repercussions for our multilateral effort.”
Whatever would possess AEI and Pletka, who personally has been one of the most prominent and enthusiastic cheerleaders of the rapidly spreading state divestment movement against companies doing business in Iran, to offer a cautionary note about adopting unilateral sanctions, let alone stress the importance of preserving multilateral unity with limp-wristed European allies in dealing with a charter member of the “Axis of Evil”? Judging from its provenance at what must be considered Neo-Con Central, it certainly couldn’t be common sense.
In fact, Pletka’s observation probably reflects growing tensions between AEI’s corporate contributors, many of whom are represented on its board of trustees, on the one hand, and, on the other, the hard-line neo-conservative views of its foreign-policy fellows, such as Richard Perle, Michael Ledeen, Michael Rubin, Joshua Muravchik, and Pletka herself; academic advisers, such as Gertrude Himmelfarb, Eliot Cohen, and Jeremy Rabkin; and its board chairman, Bruce Kovner.
As AEI jumped on the divestment bandwagon initiated by Perle protégé Frank Gaffney’s Center for Security Policy (CSP) earlier this spring with its publication of a list of evil-enabling companies, some of its corporate contributors with interests in some of those same companies — or in countries where those companies are based — objected. After all, multinational corporations, such as ExxonMobil, Motorola, American Express, State Farm Insurance, Dow Chemical, Merck & Co., Dell Inc. – all of which are represented in various ways on AEI’s board of trustees – not to mention General Electic, Amoco, Kraft, Ford Motor, General Motors, Eastman Kodak, Metropolitan Life, Proctor & Gamble, Shell, General Mills, Pillsbury, Prudential, Corning Glass Works, Morgan Guarantee, and Alcoa – all of whose foundations have reportedly contributed significant amounts of money to AEI – generally oppose economic sanctions that interfere with their investment and commerce, especially if they are unilateral and especially if they result in many jurisdictions (i.e. states) enacting different sanctions with which companies must comply.
“I know for a fact that some companies who are AEI contributors have complained to the president of AEI [Christopher DeMuth] about AEI’s involvement in this,” said William Reinsch, the president of the National Foreign Trade Council (NFTC), an association of some 550 of the biggest U.S. companies that, among other things, opposes unilateral economic sanctions. “There has been a significant level of upset by a number of [them].” In some cases, he added, companies complained about their inclusion on the list posted by AEI, while “others believe that it’s not an appropriate activity for AEI to be engaged in.”
Indeed, it is very strange that a think tank purportedly devoted to “limited government,” “private enterprise,” free markets and other neo-liberal ideals and funded in major part by the foundations of multinational corporations is actively leading a campaign to impose unilateral sanctions (and divestment) against multinational corporations like themselves and, in some cases, their own subsidiaries. After all, the history of such sanctions – against the Soviet Union, Cuba, and Iran itself, for example — shows that they often result in both resentment and retaliation – not just by the target country (Iran in this case), but also by friendly governments whose own companies stand to be negatively affected. That, in fact, was the point of the FT article whose lead sentence ran: “European governments are warning Congress that US legislation aimed at Iran could hit European energy groups, undermine transatlantic unity on Tehran’s nuclear programme and provoke a dispute at the World Trade Organisation.”
(Even the Bush administration, whose incumbency was due largely to the financial contributions of corporate givers, has opposed pending divestment and related sanctions legislation. “The Administration fears legislation such as H.R. 2347 would have the effect of dividing and splintering the coalition of allies and friends, which would be harmful to our common goal. Thus, passage of such legislation could result in a net loss, alienating friends, and having little to no prospect of modifying Iranian behavior.” The letter, delivered August 1, had virtually not impact, as the legislation in question, the Iran Sanctions Enabling Act, was approved by the House, 408-6.)
While Pletka’s statement shows that she clearly understands the argument, however, there is no sign yet that AEI is reassessing its championship of sanctions and divestment. Despite her caution, the conference at which she voiced it was described by one corporate attendee as a “pep rally” for the divestment campaign. The question then is what will the corporate funders of AEI – which clearly like its free-market orientation but abhor divestment and sanctions – do? Will they back up their complaints by pulling their support? Or do they believe that the costs of its neo-conservative foreign-policy agenda are outweighed by the benefits of its effectiveness in promoting its neo-liberal economic agenda?
[…]
Still, the question remains: why do corporations provide funding to highly political think tanks that aren’t more responsive to their interests?
Interesting little clusterfuck the AEI has gotten itself into. Looks like the mullah’s there have gotten a bit ahead of themselves, issuing edicts upon their cash cows. Or, are they looking for some sacrificial examples to trump the cows as a matter of state (over corporate) interests? Judging from Pletka’s remorse, it could be backtracking just the same. They must really hate it when that happens, just when their magical Straussian philosophers party was about to liberate itself from the mundane.
Posted by: anna missed | Aug 6 2007 7:57 utc | 27
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