Imperialism, globalization and the profitability of capital – Michael Roberts

Profitability and imperialism

The characteristics of modern imperialism are to be found in modern capitalism.  That is not a tautology.  The key connection between imperialism and capitalism is the general tendency of the profitability of capital to fall over time, leading to shifting of capital ‘abroad’ by national capitals seeking to reverse any fall.

When 150 years ago Marx outlined the law of tendency of the rate of profit to fall in capitalist accumulation – a law that he considered the ‘most important in political economy’ – he made it clear that there were ‘counteracting’ factors to the operation of that law[i].  Indeed, this is why the law was a ‘tendency’ that was not always realized.  One important counteracting factor was foreign trade and investment overseas.  This could cheapen the cost of raw materials extracted from the colonies and could raise the rate of exploitation of the labour force by using the plentiful supplies of cheap labour (an untapped ‘reserve army’) in the colonial territories. The profit created by that labour could be transferred to the imperialist economies and thus raise the rate of profit at the centre.

Lenin, in Imperialism[ii] explained this counteracting factor as follows.  “The need to export capital arises from the fact that in a few countries capitalism has become ‘overripe’ and (owing to the backward state of agriculture and the poverty of the masses)” …. capital cannot find a field for ‘profitable’ investment.”  This is a limited explanation.  Henryk Grossman took it further[iii].  “Why,” then, “are profitable investments not to be found at home? The fact of capital export is as old as modern capitalism itself. The scientific task consists in explaining this fact, hence in demonstrating the role it plays in the mechanism of capitalist production.”

Marx’s theory argues that there will be a tendency to equalise the rate of profit between capitals (even under monopoly capital) – indeed, this is how the higher rates of exploitation in the poor or colonial South end up in the profit rates of the rich and imperialist North.  There is a transfer of value from less productive capitals of the South to more productive ones of the North.

See this example below.  In both the North and the South, the rate of exploitation (s/v) in value terms is the same = 100%.  The capitalists of the North use the latest technology so that the time taken to produce the value of labour power is much less (20v) than in the South where the capitalists use less technology and more cheap labour.  But the rate of exploitation is the same in this example (North 20/20 and South 60/60).

North: 80c + 20v + 20s=120V.  Rate of profit = 20/(80c+20v) = 20%
Rate of exploitation = 20s/20v = 100%

South: 40c + 60v + 60s= 160V.  Rate of profit = 60/(40c+60v) = 60%
Rate of exploitation = 60s/60v = 100%

Total: 120c + 80v + 80s= 280V.
Average rate of profit = 80s/(120c+80v) = 40%.

The capitalists in the South get 160V in value out of their workers, while the capitalists in the North get less, 120V.  The rate of profit in value terms in the North would only be 20% while it would be 60% in the South.  But competition in the global market equalizes the average rate of profit at 40%.  So the market price of production for the North and South is 140 and the North gets a transfer of value of 20 from the South.  The capitalists of the North get some of the value created by the workers in the South through price competition equalizing the rate of profit on the global market.

North = 80c + 20v + 40s = 140P (compared to 120V), so transfer gain of 20.

South = 40c + 60v + 40s = 140P (compared to 160V), so transfer loss of 20.

Now suppose that the workers in the South are ‘super-exploited’ and forced to accept a lower wage (halved from 60v to 30v in the above example).  Now the surplus value in the South is way higher (and the rate of surplus value is now 300% compared to 100% in the North).  The process of the global market produces an average rate of profit that is higher than before, at 65%.

North = 80c + 20v + 20s = 120V.  Rate of profit 20s/(80c+20v) = 20%.

Rate of exploitation 20s/20v = 100%

South = 40c + 30v + 90s = 160V.  Rate of profit 90s/(40c+30v) = 130%.
Rate of exploitation 90s/30v = 300%

Total = 120c + 50v + 110s = 280V.
Average rate of profit 110s/(120c+50v) = 65%

Through the transfer of values in the global market, the capitalists of the North now get an extra 45V out of the super-exploited workers of the South.  Super-exploitation in the South increases profits for the North.  Total surplus value in the North and South has risen from 80 in the first case to 110 in the super-exploitation case.

North = 80c + 20v + 65s = 165P (compared to 120V), so transfer gain of 45.

South = 40c + 30v + 45s = 115P (compared to 160V), so transfer loss of 45.

The wages of the workers of the North are unchanged.  In this sense, the workers of the North are not ‘living off’ those of the South.  Both the capitalists of the South and the North are exploiting the workers of the South by squeezing more value out of them.

It is the race for higher rates of profit that is the motive power of world capitalism and the driver of imperialism and rivalry among imperialist nation-states.  Foreign trade can yield a surplus profit for the advanced country.   For example, from about the mid-1960s onwards, the rate of profit fell in the major economies and reached a post-war low by the early 1980s.  So the leading capitalist states looked to counteract Marx’s law through renewed capital flows into countries that had massive potential reserves of labour that would be submissive and accept ‘super-exploiting’ wages. World trade barriers were lowered, restrictions on cross-border capital flows were reduced and multi-national corporations moved capital at will within their corporate accounts.  This explains the policies of the major imperialist states at home (an intensified attack on the working class) and abroad (a drive to transform foreign nations into tributaries).  Globalisation is thus a product of the drive to raise profitability after a significant decline in the major capitalist economies.

MR graph 1

This connection between the changes in the rate of profit in the major capitalist economies and globalization from the 1980s can be shown to have a common thread ever since capitalism became the dominant mode of production in the world, starting with Europe, the US and Japan in the mid-19th century.  Moreover, it appears that after a particularly long period of low profitability and stagnation in production, imperialist rivalry in the struggle of the share of global surplus value becomes intense.  Competition among imperialist powers for the spoils of exploitation turns into capturing the spoils of war.

There have been three depressions in the history of capitalism: one in the late 19th century; the Great Depression of the 1930s; and the current Long Depression[i].

They coincided with different stages of capitalism. The depression of the late 19th century was the impulse for the development of modern imperialism, namely the expansion of finance capital into the “colonies”.  This eventually led to a new imperialist battle, one that was not resolved by World War I.

The hegemonic imperialist power, Great Britain, had been irretrievably weakened by the 1914–18 war, but the rising hegemonic power, the United States, was not ready or willing to assume the mantle of imperialist dominance. The rising imperialist powers, Germany and Japan, tried to gain a bigger cut of the spoils. That led to World War II and the eventual assumption of Pax Americana after 1945.

The current Long Depression could also give way to a new period of imperialist rivalry (but more on that later).

We can show empirically that globalisation of trade and capital took off whenever the profitability of capital fell in the imperialist centres.

MR graph 2

Between 1832-48 profitability of capital in the major economies fell; after which there was an expansion of globalization to drive up profitability (1850-70).  However, a new fall in profitability led to the first depression of the late 19th century (1870-90), during which protectionism rose and capital flows shrunk.  With economic recovery after 1890, imperialist rivalry intensified, leading up to the Great War of 1914-18.

In the post-1918 period, after the defeats of various European revolutions and the isolation of the Soviet state, there was a brief period of rising profitability, before a new drop led into the Great Depression of the 1930s.  Imperialist rivalry bubbled up again, leading to WW2.

Again, after the defeats of various labour struggles post 1945 in Europe, Japan and in the colonial territories, capitalism entered a new ‘golden age’ of relatively fast growth and rising profitability.  Globalisation of trade (reduction in tariffs and protectionism) and capital (dollar-led economies and international institutions) revived, until profitability again began to fall in the 1970s.  The 1970s saw a weakening of trade liberalization and capital flows.  From the 1980s, however, capitalism saw a new expansion of globalization in trade and capital to restore profitability.

It is no coincidence that the movement in the profitability of capital in the imperialist countries aligned with the degree of openness in world trade.  Rising profitability from 1850-70 saw a significant fall in international trade barriers, relative to intranational trade barriers. However, as profitability fell from the mid-1860s during the late 19th century depression, open trade stopped and protectionism returned.  With rising profitability in the 1920s, trade barriers fell further until the Great Depression arrived.  A new wave of trade liberalisation only began again after the 1970s.

Export openness for three country samples: 1827-2014

MR graph 3

So we can divide globalization into three great waves[i].  The first wave was from 1860-1914 when Europe and North America were strongly affected by internationalisation. The flow of goods accelerated. Capital moved relatively freely between countries. In some respects, financial integration was more pronounced than it is today. Even international migration was greater than it is today. Roughly 60 million people left Europe to seek their fortunes in the New World.  Great Britain was the world’s leading economy.

The basis for the European free trade system was the 1860 free trade pact between Great Britain and France. Many other European countries subsequently aligned themselves with this free trade system.  However, from the 1870s, in the depression period, a Russian and American ‘grain invasion’ prompted higher tariffs in most of continental Europe. So overall trade costs did not decline dramatically after 1870 since tariffs and non-tariff barriers rose.

In the second wave after WW2, international regulations and organisations to support economic integration at the global level were created. Cooperation was based on the Bretton Woods Agreement of 1944.  The US was now the leading economy in the world and the dollar became the monetary basis of the financial system. The ‘Bretton Woods system’ meant that nations had fixed currency exchanges in relation to the US dollar, which in turn was fixed to the gold standard.

Two organisations were established during this period, the World Bank (IBRD) and the International Monetary Fund (IMF). In addition, a special agreement, the General Agreement on Tariffs and Trade (GATT) became operative in 1948. In practice, GATT became the international organisation which set the framework for several important steps towards increased global free trade, particularly via successive reductions in industrial tariffs. But by 1970 the Bretton Woods system was coming under increasing pressure.

MR graph 4

In the third wave from the mid-1980s, the more populous countries in the developing world, particularly China and India, opened their doors to the world. European cooperation widened and deepened. In the decades up to the end of 20th century, international trade grew significantly faster than total production. The export of goods amounted to 31% of global GDP in 2006 as compared to 12% in 1970. Foreign direct investment (establishing or buying up companies abroad) increased twice as fast as trade. An even more rapid increase has been seen in foreign securities (investments that do not lead to controlled ownership in foreign companies).

This third wave is visible in the expansion of gross foreign assets (capital invested abroad) since the 1980s.

MR graph 5

The ratio of global foreign assets to global GDP more than doubled – from 7% in 1870 to 19% in 1900. This upswing was reversed during the first half of the 20th century. The mayhem created by two world wars and the Great Depression on the one hand and the emergence of domestic ‘institutionalized waste’ on the other undermined the flow of capital and caused the share of foreign ownership to recede. After the second world war, the new world order under the US allowed the expansion of international capital flows again and by 2003, after a quarter century of exponential growth, it reached an all-time high of 122%.

According to the McKinsey Global Institute[i], between 1990 and 2006 the global proportion of foreign-owned assets has nearly tripled, from 9% to 26% of all world assets (both foreign and domestically-owned). The increase was broadly based: foreign ownership of corporate bonds rose from 7% to 21% of the world total, foreign ownership of government bonds rose from 11% to 31% and foreign ownership of corporate stocks rose from 9% to 27%.

Capitalism became truly global in the late 20th century. That’s because increased investment into emerging capitalist economies brought into the capitalist mode of production a huge supply of peasant and non-capitalist labor and much of it at a cost below poverty.

At the same time, imperialist economies are acting even more as bases for finance capital globally.  Tony Norfield points out that US corporation revenues from abroad are worth $3bn a day and total more than the annual GDP of Switzerland. A financial company operating in a major international financial centre can draw upon the surplus value produced anywhere in the world, for the ultimate benefit of the imperialist power in which it is based.  Just 147 companies globally control the world[ii].   The IMF reckons that just 30 banks have more than $47trn in assets, or more than one-third of bank assets and these banks control 70% of credit markets.[iii]

However, the world of international business is still a regional one, not a global one. Capitalism today remains divided, whatever the degree of its global integration, into distinct capitalist nation-states, ruled by their own capitalist classes, which project their interests and protect those interests against rivals. In 1980, when US ‘financialization’ started in earnest, US owners accounted for only 28% of global foreign assets. But by 2003, the asset share of US owners was reduced to a mere 18%.

MR graph 6The rapid expansion of international financial dealing since the 1980s has been a potential source of profit for, and an incentive behind the growth of, the financial sector of the economy in many countries. However, at the forefront of this trend has been the boom in the activities of the City of London, the centre of dealing for the imperialist power most closely associated with finance.

British capitalism lost its hegemonic status a hundred years ago but in the post-war period its financial sector has maintained its global status while its manufacturing base diminished.  The Eurodollar market in the 1960s and the ‘Big Bang’ of the 1980s, when US banks and foreign banks operated without restriction, preserved the City’s pre-eminence.

Britain is second only to the US in the importance of its financial sector globally and in some areas like foreign currency trading it leads[i] .  Britain has the second largest stock of foreign direct investment (FDI) of nearly $2trn, equivalent to 30% of UK GDP.  Of the top 500 global companies, the UK was second only to the US with 34 companies.  The UK had six financial institutions in the top 50, compared to the US with ten.  And UK bank assets are four times UK GDP, the highest ratio in the world after Switzerland and tax-haven Luxembourg.

The global pecking order (Norfield index).

MR graph 7

In the previous wave of globalisation after 1980, power had shifted from owners in one core country (Britain) to those in another (the United States). By contrast, in the next wave, the contenders could be from China, OPEC, Russia, Brazil, Korea and India, countries that have become major foreign investors with significant international positions, including large stakes in America’s ‘imperial’ debt.

The beginning of the 21st century brought to an end the third wave of globalisation.  Profitability in the major imperialist economies peaked by the early 2000s and after the short credit-fuelled burst of up to 2007, they entered the Great Recession, which was followed a by a new Long Depression[i].  So the counteracting factor to low profitability of exports of commodities and credit has died away. This threatens the hegemony of US imperialism, already in relative decline to new ambitious powers like China, Brazil, India and Russia. Renewed rivalry threatens to unleash major conflicts in the next decade or so.

MR graph 8

World trade growth in 2016 was well below the post-Great Recession average of 2.7% a year, which in turn is less than half the rate of world trade growth before the global financial crash (at 5.7%).[i] As the IMF put it: “Since 2012, growth in the volume of world trade in goods and services has been less than half the rate during the preceding three decades. It has barely kept pace with world GDP and the slowdown has been widespread.”  [ii]

McKinsey outlined why global trade and industrial growth has slowed to a crawl since the end of the Great Recession in 2009[iii].  “The shock of the 2008 global financial crisis triggered the first recorded drop in global GDP and the hangover has since persisted, with many countries struggling with unexpectedly weak recoveries.”  And it is not going to get any better. “More worryingly, long-term growth prospects are serious cause for concern. Annual GDP growth from 2014 to 2064 is projected to effectively halve, falling to 2.1% globally and 1.9% for developed countries”.

The ratio of import growth to real GDP growth in the major economies has fallen back sharply.

Trade elasticity (ratio of trade growth to GDP growth)

MR graph 9

Deutsche Bank economists concluded that “It feels like we’re coming towards the end of an economic era. Such eras often come and go in long waves.  In the past 30 years a perfect storm of factors — China re-entering the global economy in the 70s, the fall of the Soviet Union, and to some extent, the economic liberalisation of India — added more than a billion workers into the global labour market.”  [i]

Globalization and the high-tech revolution reversed the productivity growth decline in the 1990s.  But in this century productivity growth in the advanced economies has headed toward stagnation. Only productivity growth in the emerging economies has enabled world productivity growth to stay near 2% a year. Since the Great Recession, productivity growth has dropped to under 1% a year.

Advanced economy average productivity growth (%)

MR graph 10Source: OECD

What the productivity growth figures show is that the ability of capitalism (or at least the advanced capitalist economies) to generate better productivity is receding. Capitalists have squeezed the share of new value going to labor and raised the profit share to compensate. Above all, they have cut back on the rate of capital accumulation in the ‘real economy’, increasingly trying to find extra profit in financial and property speculation.

This story on productivity is repeated for employment growth in the advanced economies. Employment growth is now less than 1% a year.  If you add (to productivity growth) an employment growth rate globally of 1% a year, then global growth is going to be little more than 3% a year for the next decade (and a maximum of just 2% a year for the advanced economies).  The dynamism of world capitalism is waning.

Some argue that, after its 60-year decline, manufacturing may start to return to the advanced capitalist economies. Then profitability will rise again in the major capitalist economies through a new manufacturing revolution.  This is the theme of President Trump, who reckons he can cajole American manufacturers to produce at home and restrict cheap imports from China etc.

But this is really just so much wishful thinking. American manufacturing has been growing in the past few years, but the sector still has 2 million fewer jobs than when the Great Recession began. Worldwide manufacturing is growing much faster, even for many of the American-owned companies that are expanding at home. Wage levels may have risen in emerging economies and stagnated in the advanced economies, but the gap is still huge. Hourly compensation costs for manufacturing in the US were about four times those in Taiwan and 20 times those in the Philippines.

As John Smith has shown[i] “about 80% of global trade (in terms of gross exports) is linked to the international production networks of transnational corporations”. UNCTAD estimates that “about 60% of global trade … consists of trade in intermediate goods and services that are incorporated at various stages in the production process of goods and services for final consumption”. –A striking feature of contemporary globalisation is that a very large and growing proportion of the workforce in many global value chains is now located in developing economies. In a phrase, the centre of gravity of much of the world’s industrial production has “shifted from the north to the south of the global economy”.

On a standard measure of participation in global value chains produced by the IMF, the rise in profitability for the major multinationals is now stalling. Sure, information flows (internet traffic and telephone calls, mainly) have exploded, but trade and capital flows are still below their pre-recession peaks. Global foreign direct investment as a share of GDP is also falling and capital flows to the so-called ‘emerging economies’ have plummeted (See

MR graph 11

Yet imperialism continues to suck profit out of the peripheral economies in the way Marx outlined in his theory of profit equalisation and unequal exchange.  The US-based Global Financial Integrity (GFI) and the Centre for Applied Research at the Norwegian School of Economics tallied up all of the financial resources that get transferred between rich countries and poor countries each year: not just aid, foreign investment and trade flows but also non-financial transfers such as debt cancellation, unrequited transfers like workers’ remittances, and unrecorded capital flight (more of this later).  What they discovered is that the flow of money from rich countries to poor countries pales in comparison to the flow that runs in the other direction.

In 2012, the last year of recorded data, developing countries received a total of $1.3tn, including all aid, investment, and income from abroad. But that same year some $3.3tn flowed out of them. In other words, developing countries sent $2tn more to the rest of the world than they received. If we look at all years since 1980, these net outflows add up to $16.3tn – that’s how much money has been drained out of the global south over the past few decades.

Developing countries have forked out over $4.2tn in interest payments alone since 1980 – a direct cash transfer to big banks in New York and London, on a scale that dwarfs the aid that they received during the same period. Another big contributor is the income that foreigners make on their investments in developing countries and then repatriate back home.  But by far the biggest chunk of outflows has to do with unrecorded – and usually illicit – capital flight. GFI calculates that developing countries have lost a total of $13.4tn through unrecorded capital flight since 1980.

Most of these unrecorded outflows take place through the international trade system. Basically, corporations – foreign and domestic alike – report false prices on their trade invoices in order to spirit money out of developing countries directly into tax havens and secrecy jurisdictions, a practice known as “trade misinvoicing”. Usually the goal is to evade taxes, but sometimes this practice is used to launder money or circumvent capital controls. In 2012, developing countries lost $700bn through trade misinvoicing, which outstripped aid receipts that year by a factor of five.

A new phase of imperialism ahead?

The strategists of capital are worried that Trumponomics will only make things worse for profitability globally. Lorenzo Bini Smaghi, ex-member of the European Central Bank’s executive board and leading strategist of finance capital, commented: “Trying to reverse globalisation can be damaging, particularly for the country that takes the first step. It is the advanced economies that are facing the greatest challenges in its most recent wave, which is why anti-globalisation movements are gaining support and governments are tempted to become inward-looking. However, because their economies are so large, and so bound by the web of globalisation, they cannot reverse its course, unless emerging markets also retreat.”[i]

The world economy is in a Long Depression. However, world capitalism will not stay in this depressed state. Eventually, probably after another slump that will destroy sufficient value (the value of means of production, fictitious capital and employment), profitability for those capitals that survive will rise again to start a new upwave in investment and growth. This assumes, of course, that the class struggle does not lead to the forces of labor triumphing over capital in any major imperialist economy.

A new wave of globalization is thus possible. There are yet more human beings in the world to be exploited and there are always new technological innovations that can provide a new cycle for expansion of value and surplus value.

There are still huge reserves of labor as yet untapped, particularly in Africa. The latest UN projections for the world’s economies show that Africa is expected to dominate population growth over the next ninety years as populations in many of the world’s developed economies and China shrink.[ii] Africa’s population is expected to more than quadruple over just 90 years, while Asia will continue to grow but peak about 50 years from now and then start declining.

Can capitalism get a further kick forward from exploiting these hundreds of millions coming into the labor forces of Asia, South America, and the Middle East? While the industrial workforce in the mature capitalist economies has shrunk to under 150 million; in the so-called emerging economies the industrial workforce now stands at 500 million, having surpassed the industrial workforce in the imperialist countries by the early 1980s. In addition, there is a large reserve army of labor composed of unemployed, underemployed, or inactive adults of another 2.3 billion people that could also be exploited for new value.

The global industrial workforce (in millions) 1950-2010

MR graph 12

Source: International Labor Organisation (2016)—dgreports/—dcomm/—publ/documents/publication/wcms_443480.pdf

America’s intelligence services also looked recently at developments in the world economy.  The Office of the Director of National Intelligence (DNI)  published its latest assessment[i], called Global Trends: The Paradox of Progress, which “explores trends and scenarios over the next 20 years”.  And the DNI reckons that things are not going to get better.  The next five years will see rising tensions within and between countries. Global growth will slow, just as increasingly complex global challenges impend.”

What is the answer?  Well, this comment from the DNI report is unvarnished: It will be tempting to impose order on this apparent chaos, but that ultimately would be too costly in the short run and would fail in the long. Dominating empowered, proliferating actors in multiple domains would require unacceptable resources in an era of slow growth, fiscal limits, and debt burdens. Doing so domestically would be the end of democracy, resulting in authoritarianism or instability or both. Although material strength will remain essential to geopolitical and state power, the most powerful actors of the future will draw on networks, relationships, and information to compete and cooperate. This is the lesson of great power politics in the 1900s, even if those powers had to learn and relearn it.”

In other words, while it would be better to just crush opposition and “impose order” in America’s interests, this is probably not possible with a weak world economy and lack of funds.  Better to try “draw on networks, relationships and information” (ie spy and manipulate) to get “cooperation”.

But it is not going to be easy to sustain America’s dominance and the rule of capital, the DNI report concludes, as globalisation “hollowed out Western middle classes (read working classes) and stoked a pushback against globalization.”  Moreover, “migrant flows are greater now than in the past 70 years, raising the specter of drained welfare coffers and increased competition for jobs, and reinforcing nativist, anti-elite impulses.” And “slow growth plus technology-induced disruptions in job markets will threaten poverty reduction and drive tensions within countries in the years to come, fueling the very nationalism that contributes to tensions between countries.”

America’s intelligence services expose imperialism’s two Achilles heels.  The first is the tendency of the rate of profit to fall as capitalism accumulates, posing increased rivalry and even damaging and destructive wars. The second is the global proletariat – the gravediggers of capitalism – who are still growing in size across the world. The global proletariat has never been larger in the history of capitalism.  In that sense, Marx’s prophecy in the Communist Manifesto 160 years ago is confirmed.  Sure, the majority of the proletariat is now in the South and not the North.  But that does not mean the workers of the North will play no role in ending capitalism.  On the contrary, they are the key to ending imperialism in its centre.

  1. Capital Volume 3, Chapter 15.
  4. M Roberts, The Long Depression, 2016, Haymarket Books.
  6. McKinsey, Financial globalization: retreat or reset?, 2013
  8. IMF Global Financial Stability Report, October 2017, p5.
  9. Tony Norfield, The City, Verso Books, 2016
  10. M Roberts, The Long Depression (2016), Haymarket books.
  11. CPB World Trade Monitor, November 2016,
  12. IMF World Economic Outlook, October 2016,
  13. Turbulence ahead: Renewing consensus amidst greater volatility, McKinsey Global Institute, September 2016
  14. Deutsche Bank, Long-Term Asset Return Study, strategists Jim Reid, Nick Burns, and Sukanto Chanda,
  15. John Smith, Imperialism in the Twenty-First Century: Globalization, Super-Exploitation, and Capitalism’s Final Crisis, Monthly Review Press, 2016
  16. [1]
  17. UN World Population Prospects, 2015 Revision,



[ii] UN World Population Prospects, 2015 Revision,

[i] John Smith, Imperialism in the Twenty-First Century: Globalization, Super-Exploitation, and Capitalism’s Final Crisis, Monthly Review Press, 2016

[i]  Deutsche Bank, Long-Term Asset Return Study, strategists Jim Reid, Nick Burns, and Sukanto Chanda,

[i] CPB World Trade Monitor, November 2016,

[ii] IMF World Economic Outlook, October 2016,

[iii] Turbulence ahead: Renewing consensus amidst greater volatility, McKinsey Global Institute, September 2016

[i] M Roberts, The Long Depression (2016), Haymarket books.

[i] Tony Norfield, The City, Verso Books, 2016

[i] McKinsey, Financial globalization: retreat or reset?, 2013


[iii] IMF Global Financial Stability Report, October 2017, p5.


[i] M Roberts, The Long Depression, 2016, Haymarket Books.

[i] Capital Volume 3, Chapter 15.



Rethinking anti-imperialism today – Panagiotis Sotiris

Recent developments from the election to Donald Trump to Brexit and the increased tension between the US on the one hand, Russia and China on the other, have been presented as evidence for a broader crisis of ‘globalization’ and a turning point in modern imperialism. Many have even talked about an ‘end of globalization’. Moreover, these changes have been presented as a turn towards a nationalism or oven isolation. In what follows I will try to offer my thoughts on these questions in an attempt to problematize them but also to suggest what these changes imply regarding radical left strategy. In particular I will insist on the need for a new anti-imperialism based upon a rethinking of the notions of the people and popular sovereignty.

The question regarding some form of ‘crisis of globalization’ or even an ‘end of globalization’ is based on the assumption that there was indeed some form of globalized capitalism in the previous period. However, I think that globalization has been a misleading term since it suggested that we were moving towards some form of a unified system of social relations, a transnational social formation, with a transnational bourgeoisie.[1] In contrast, I insist that what we have witnessed has been a process of increased internationalization of capitalist production. This process has been instrumental regarding the reproduction and enhancement of aggressive forms of capitalist accumulation. Moreover, increased internationalization of production, in the form of increased capital flows, direct investment and trade, has been a mechanism of constant pressure for capitalist restructuring and for the expansion of neoliberalism as the dominant regime of accumulation. However, national capitalist formations and nation-states have remained the main loci of capitalist accumulation. By this I do not mean that there have not been important changes. In contrast, I would say that Poulantzas’s original insight in the 1970s that the relations of forces in the imperialist chain are being interiorized in the power block of each national capitalist formation has been exacerbated in the past decades.[2] By this I do not simply refer to the role of ‘foreign capital’, a constant reference point of older dependency theories, but to the way imperatives for certain strategies of accumulation become dominant in each capitalist formation. The centrality of competitiveness as the main measure of success and the main justification and legitimacy for aggressive capitalist restructuring and neoliberal reform after the 1980s attests to this. Processes of regional integration such as European Integration, with their extensive forms not only of lowering barriers to trade and the free movement of capitals, but also of ceding of forms of sovereignty, have been the most aggressive cases of using the exposure to increased foreign competition as a pressure for capitalist restructuring.[3]

Such an approach suggests that we put aside the rhetoric of globalization and instead attempt to theorize an inherently contradictory process of capitalist internationalization. Such an approach can explain both the tendency towards increased liberalization of trade and capital flows but also the presence of increased antagonism. In this sense, what we are witnessing today is a tendency towards increased conflict and competition within this process of capitalist internationalization. However, before proceeding along this line, we must also see some other important aspects of modern imperialism.

If we are to keep something from what in a very schematic way has been presented as a Marxist or even Leninist theory of imperialism are two important insights. The first has to do with the way that the Marxist tradition, including Lenin revolutionized the theorization of international relations by giving priority not to interstate relations, but to class relations and strategies and their projection to the international plane. States’ behavior is based in their internal class composition, accumulation strategies and the relation of forces in the class struggle. The second is that the hierarchy in the international plane, namely the complex interplay of interdependency and antagonism that the notion of the imperialist chain suggests, is not determined simply on the economic level, but also on the basis of political and even ideological relations of forces. The dominant social formation in the imperialist chain is not simply the most powerful in economic terms but also the one that can in a certain way guarantee the collective capitalist-imperialist interest of the entire imperialist chain, by having the political and military capacity to do so. Moreover, this also implies that modern capitalist imperialism has been fundamentally non-territorial having to do with the expansion of social relations of production, of social forms and of accumulation strategies and less with direct territorial domination, despite the importance of territorially based resources such as energy flows, minerals etc.[4]

To this classical ‘Leninist’ approach I would also like to add another important aspect. The antagonistic and hierarchical relations inside the imperialist chain also have to be treated as hegemonic relations. By this I am not referring to the traditional conception of hegemony one can find in the discourse of mainstream International Relations Theory, or even at classical Marxist texts on imperialism. I am using hegemony in its Gramscian conceptualization as a way to theorize the complex modalities of power in capitalist social formations and as a concept that refers not simply to ‘consent’ or ‘intellectual leadership’ but as the complex articulation of force, leadership and ideological appeal that indeed leads to a social class becoming not just ruling but the leading force of society. In such an approach the hegemonic force in the imperialist chain, or in a block of imperialist states is not just the most advanced in economic terms or the most powerful in terms of military force, however important these aspects are, but the one that can project a hegemonic project that ‘links in the chain’ would want to attach to. To give an obvious example, the United States became the hegemonic force of global capitalism after 1945 because they were the most advanced and productive capitalist economy, the only country that could match Soviet military capabilities but also a country that offered a hegemonic project. This hegemonic project combined the Fordist regime of intensified capitalist accumulation, ‘Western’ liberal-democratic institutions, and a mass culture that comprised consumerist hedonism and individualism. The fact that for example the United States initially helped other social formations becoming more competitive in relation to the US as part of a strategy to strengthen the reproduction of capitalist social relations, is something that can be seen in the support given by the US to both European Integration and the capitalist development of Japan.[5]

Apart from these broader theoretical lines of demarcation, I would like to point to another important point. We are still in the aftermath of the capitalist crisis of 2007-2008. There is an impressive literature and an open debate regarding the actual causal mechanisms of this crisis, and in a certain way the discussion has not yet been concluded. However, we can say that what happened was neither a typical cyclical recession nor just a crisis of financialization. Also, it was not another manifestation of a prolonged crisis that started in the 1970s. What we witnessed was the combined crisis of an entire social paradigm that comprised the productive model based upon post-fordist capitalist restructuring, the over expansion of the financial sector, neoliberalism as a regime of accumulation and a certain form of international monetary, financial, productive architecture. The reduced dynamism of the post-2010 recovery, the absence of large gains in both productivity and profitability, the stagnation of the EU, the continuous problem of increased debt, both public and private, the crisis in public finances despite successive waves of austerity, and the inability to go ahead with the big interregional free trade agreements (long before Donald Trump’s rise to power), all these attest to the structural and still unresolved character of this crisis. The reason is that what is needed is a new social and technological paradigm that has yet to emerge. Moreover, another important aspect is the uneven character of both the extent of the crisis and the responses to it. It is obvious that the crisis was deeper in the ‘western’ formations in the imperialist chain in contrast to the new competitors in the East and in particular China.

The economic crisis also created — especially in the US — certain cleavages inside the dominant power block. Although neoliberalism, deregulation and reduced taxation (along with the intervention of the FED towards keeping the banking system afloat) have been common elements, it is interesting to see the divergence between those sectors that were based upon globalized production and supply networks and those more based in the US, a fact that can account for different approaches towards international trade agreements and also different approaches towards the politics of Trump administration. However, it is interesting to underline the fact that so far the Trump administration has refrained from ‘protectionist’ measures and has mainly opted for aggressive attacks on social rights, such as the attack on Obamacare.

At the same time this economic crisis was combined with a deep political and in some sense hegemonic crisis in many formations. 2011 represents an important landmark in the sense of the opening of a broader global cycle of protest and contestation. There is growing widespread disillusionment with mainstream politics as a result of austerity policies, an authoritarian post-democratic turn (enhanced by the absence of any real difference between centre-right and centre-left political parties) along with a broader tendency towards an insulation of the political scene against the demands and aspirations of the subaltern classes.

All these tendencies and developments in their articulation not only represent the effectivity of social antagonism, but also form the basis of the new wave of increased antagonisms in the imperialist chain. Ever since the fall of the Soviet Union it was obvious that the United States has opted for a strategy that aimed at maintaining that kind of military superiority that would guarantee their leading role in the imperialist chain, even in the sense of a “management of instability” that would always make a US intervention indispensable. Despite the setbacks that this strategy suffered, especially in the form of the Iraq debacle and the failure of the attempt to  ‘export western-style democracy and market economy’ by military means, it remained dominant, exactly because it offered a means to maintain a leading role.[6]

However, at the same time the expansion of capitalist productive forms and shift regarding the poles of accumulation created new forms of antagonism. Especially China managed not only to expand its domestic economy but also to play an increasingly important role in the global economy, not only as the leading force in manufacturing or as attracting foreign investments but also as a major investor abroad. The rhetoric notwithstanding, the ‘one belt one road’ strategy indeed points towards China claiming an increased role in the internationalization of capital, also expressed in the fact that the Chinese leadership attempts to present itself as the leading force in favour of a globalization based on investment and not just financial transactions. At the same time the emerging alliance with Russia, which not only has advanced military capabilities but also an important productive and high technology base, suggests an attempt indeed to create an alternative pole in the global system. What is important is that this new model attempts to also have some form of ‘hegemonic projection’. The combination of neoliberalism with increased state intervention, the attempt towards a more ‘paternalistic’ approach to social inequality along with a more authoritarian version of a strong state, plus a more classical approach to international relations as balance of force and cooperation can indeed be considered a different hegemonic project, one that can have a certain appeal.

The response to this by the United States has been a preemptive attempt towards military confrontation, by means of attempting to turn regional crisis into forms of pressure towards Russia and China. From Ukraine and Syria to North Korea and the renewed attempt at aggression towards Iran, this has taken many forms in the past years with differing degrees of success (for example the Syria crisis ended up in a situation of increased Russian presence as an integral aspect of the attempt to solve the crisis). It is interesting that this strategy, which in certain aspects has the support of some of the leading ‘western’ formations — although not all of them (see for example European governments feeling uncomfortable with increased sanctions against Russia given the energy dependency of Western Europe) — in a certain way represents an element of continuity regarding US administrations (see for example the fact how Trump was forced to distance himself from advisors and senior staff that had opted for a different strategy).

At the same time we are witnessing the deep crisis of European Integration, which also leads to the inability of the EU to play a leading role.[7] The crisis of European Integration is multifold. On the one hand we face the same problem as in the US of an inability to attain increases in productivity that would enable increased and sustainable profitability. The economic, institutional and financial architecture of the Euro as a single currency has exacerbated both regional differences but also indebtedness. Although designed as the most aggressive use of the ceding of sovereignty as a means to enhance capitalist restructuring it also led to increased divergences in competitiveness which in their turn also created conditions for increased private and public debt. Moreover, as a result of the German dominance in the EU combined with reluctance of German capital and the German political system to even think about redistributive policies or even some form of mutualisation of the debt (e.g. Euro-bonds), the tendency has been mainly towards automatic ‘penal’ mechanisms and even more austerity instead of a coordination of policies.One might say that Germany has been dominant but not hegemonic. At the same time the political crisis in Europe also comes as a result of an increased authoritarian, disciplinary turn, exemplified in the unprecedented social and political violence unleashed upon Greek society.[8] All this creates conditions towards an intensified crisis of representation, especially since what is at stake in Europe is not just “austerity” but a much more profound erosion of whatever aspects of the ‘European Social Model’ were still in place. The emergence of coalition governments or of new political hybrids such as the “movement of Emmanuel Macron” are evidence of this deeper crisis. At the same time the increased turn of countries that became part of the EU as part of the enlargement process, especially in Eastern Europe, towards a much more authoritarian and racist politics is also an element stressing the extent of the political crisis at traversing European integration.

All this points towards a period of transition and a period of increased conflict and antagonism within the imperialist chain. It is not the end of globalization, but rather a period of a more conflictual form of capitalist internationalization, a period in which it is open what hegemonic relations will emerge.

It is in light of the above tendencies that we can see the re-emergence of nationalist rhetoric and also of certain forms of the Far-Right. Especially the Far-Right usually manages to gain the political space left open by the combination of the crisis of systemic political forces and the inability or inexistence of radical left forces that could represent and at the same time transform growing sentiments of resentment from the part of the subaltern classes. At the same time, it is obvious that most far-right formations do not actually challenge the basic premises of both the dominant regime of accumulation and the core of the process of the internationalization of capital. In this sense, I would not present contemporary politics as a return of isolationism. We are still living in a world of increased interdependency, yet this is becoming a contested terrain.  Moreover, as far as institutional racism and the politics of increased barriers to migrants and refugees are concerned, it was the political mainstream that initiated a reactionary policy of border fences, ‘discouraging’ of migrants and refugees to arrive, and anti-migrant and anti-refugee policies all over Europe. This has been the hard reality of Fortress Europe.

The forms that the conflict in the imperialist chain will take along with the form of a new balance of forces or a new hierarchy, are not easy to discern. At the same time, one cannot rule out the possibility that in the end this struggle for hegemony in the imperialist chain will take a more open or even violent form, as it has been the case in the 20th century with two world wars! For the time being it seems that this conflict mainly fuels the tension and the violence in peripheral conflicts and the various forms of ‘war by proxy’ between opposing blocks.

I believe that in such a conjuncture anti-imperialism acquires a new meaning. First of all the very fact of a world with more conflicts is also a world with more ruptures and more openings which means that it is possible to suggest a strategy of de-linking from imperialist networks, on the economic, political and ideological level. However, this approach does not suggest simply taking advantage of cleavages in the sense of an attachment to one or the other pole in the international system. Opposing increased US aggression against Russia and to a certain degree China should not lead to thinking of Russia or China as potentially ‘progressive’ allies.  Nor does it simply points towards the emergence of a different ‘foreign policy’. Rather it points to the direction of the possibility of a broad alliance of the subaltern classes becoming hegemonic in a ‘weak link of the chain’ and initiating a process of profound social change and transformation which would also include a different approach to foreign relations and a new internationalism. The centrality of the de-linking is not linked to some form of isolationist utopia but to the fact that any process of social change must reduce its exposure to the pervasive influence of internationalized capitalism and the ways that competitive pressure induces the reproduction of capitalist social relations.

In this sense, any process of radical change today is in a certain sense a form of reclaiming of sovereignty. However, as always with questions of sovereignty the crucial question has to do with the subject of sovereignty, the subject that exercises sovereignty or the collective subjective of which sovereignty is exercised. To play a little with words I would like to suggest that we do not need some form of national sovereignty; rather we need to re-invent popular sovereignty.

There are two important points to be made here. The first one is whether such an approach towards an anti-imperialist de-linking runs the danger of nationalism. To take an example in the debates in the European Left regarding the question of the Euro and the European Union in general, advocates of a strategy of rupture and exit have often been accused of having the same position as the populist far-right. I believe that such criticisms make two mistakes. On the one hand they do not see that capitalist internationalisation is in fact the ‘nationalism’ of capital, in the sense that the European Integration is a class project of the European bourgeoisies aiming at strengthening capitalist power and hegemony. Any anticapitalist strategy must necessarily include some form of rupture with these processes. There can be no socialism under the supervision of the European Central Bank and the European Commission. On the other hand, they underestimate the possibility that the demand for sovereignty can be articulated in a progressive, democratic, radically emancipatory fashion representing a broad alliance of the subaltern classes against not just the European Union but also capitalists. Such an alliance also makes possible to rethink internationalism. I do not think that it is possible to conceive of internationalism in the form – to take again the example of the European Union – of a pan-European movement that could coordinate movements of the subaltern classes in 27 different countries, with different languages, traditions, histories of struggle and relations of force. In contrast, I think that it is more probable to see the possibility of a sequence of ruptures, based upon the uneven development of class struggles. In such a sequence each rupture will induce destabilizing tendencies in other social formations along with offering examples of successful struggles. This can be the basis of a new internationalism. A movement reclaiming democracy and popular sovereignty is a movement that can more easily opt on ‘foreign relations’ based upon solidarity and cooperation instead of antagonism. States that have reclaimed sovereignty by means of movements that challenge imperialism but also capitalist social relations are more likely to find new forms of cooperation.

This reclaiming of sovereignty cannot be conceived in terms of a ‘national economic –capitalist– development’. Rather it would be a process of intensified class struggle around the possibility of a transition program that would represent a radical alternative in an anticapitalist direction. Processes of integration, such the European Union, have pervasive effects upon national economies and the forms of accumulation. ‘National’ bourgeoisies become attached to the processes of integration and the linkages with global capital. Consequently, it is no longer possible to think in terms of segments of capital supporting some form of reclaiming sovereignty. Even in those cases in which we saw fractions of capital supporting some form of rupture (such as Britain or Italy) these are internationalised fractions that feel that they could compete in the international plane better outside the contours of European Integration. In a country like Greece, where the measures imposed by the EU, the IMF and the ECB led to an economic depression without precedent,[9] the forces of capital remained loyal to the euro and insisted on Greece remaining inside the Eurozone.

The other important point concerns the very subject of sovereignty. This cannot be conceived in terms of the nation. It is here that the notion of the people acquires a new importance. In such an approach the people is not a discursive construction or a signifier waiting to be articulated as part of the antagonism of discourses as Laclau and the neo-populist current have suggested.[10] Instead, we should point towards a class-based analysis, which makes the people “a concept for strategy” as Poulantzas has suggested.[11] In this reading, ‘the people’ refers to a potential alliance of the subaltern classes under the hegemony of the working class, the ensemble of all those that are obliged, one way or the other, to sell their labour power in order to make ends meet. It is here that the question of a post-national and post-colonial conception of the people acquires its significance. From refugee flows to mass migration, it is impossible to find societies where the subalterns have the same ‘national origin’. Moreover, racism and what can only be termed as neo-colonialism create new divisions and new forms of increased exploitation and oppression among the subalterns. A post-national and post-colonial conception of the people as the ensemble of all those who live at the same state territory and share the same conditions of exploitation and oppression and also the same needs, aspirations and struggle, can help overcoming these divisions. This points to something more complex than the formation of the people by means of a process of signification that creates both a common identity and an opposition to a common ‘enemy’, however important such aspects for this re-emergence of the people as the collective agent of transformation and emancipation. When dealing with the particular problems posed by the need to create new forms of popular unity between the different segments of the subaltern classes and groups, divided as they are by ethnic or religious lines, but also by the institutional division between citizens and migrants and also undocumented migrants, more important than the common ‘cultural referents’ are the collective practices, demands, strategies, re-writings of histories, knowledges of each other, and –above all– common aspirations, that can indeed induce the common identification as people. This process also requires concrete struggles for the institutional forms that enable this convergence, especially full social and political rights, but also the forms of political organizing and mass political intellectuality that link this common condition to common hegemonic projects of transformation and emancipation and help the articulation of common struggles and alliances, in sum what Gramsci tried to define as the ‘Modern Prince’, the political form of a modern United Front. In this sense, following Deleuze we are talking about a people that is missing, a people that has to be produced, a people-to-come, ‘[n]ot the myth of a past people, but the story-telling of the people to come. The speech-act must create itself as a foreign language in a dominant language, precisely in order to express an impossibility of living under domination.’[12]

It is in light of the above that Antonio Gramsci’s notion of the historical bloc can be useful in any attempt to rethink such questions. For Gramsci the historical bloc,[13] a complex conceptual elaboration that refers to the relation between structure and superstructures, is not simply a reference to the combination between an alliance of the subaltern classes, a transition program of social transformation and new forms of organization and political practice.[14] In such a perspective, the question of sovereignty as a part of a radical and emancipatory perspective requires exactly the formation of a new historical bloc, in the sense of a process of transformation and an alternative narrative for societies. In this sense, there is a dialectical correlation between anti-imperialism and anti-capitalism. The question of sovereignty becomes a stake in the class struggle, and only a socialist perspective can indeed point towards reclaiming popular sovereignty and reclaiming democracy. It is exactly the emergence of a new historical bloc that can actually give a different meaning to sovereignty, linking it to social transformation and emancipation, basing it upon a strategy to actually fight racism and neocolonialism and transforming into a form of a potentially revolutionary ‘general will’, representing the democratic instance that is at the heart of communism as a material tendency.

To conclude: a new anti-imperialism is today indispensable. Yet at the same time this implies the articulation of reclaiming sovereignty with crucial aspects of a contemporary socialist strategy and a project of profound social transformation. All these require a rethinking of the very notion of the people as the collective subject of this reclaimed form of popular sovereignty but also of a process of emancipation.


Deleuze G. (1989), Cinema 2. The Time-Image, trans. H. Tomlinson and R. Galeta, Minneapolis: University of Minnesota Press.

Durand, C. (ed.) (2013), En finir avec l’Europe, Paris : La Fabrique.

Gramsci, A. (1971), Selections from Prison Notebooks, ed. and tr. by Q. Hoare and G. Nowell Smith, London: Lawrence and Wishart

Gramsci A. (1975), Quaderni del carcere, ed. by V. Gerratana, Torino: Einaudi.

Laclau, E. (2005), On Populist Reason, London : Verso.

Lapavitsas, C. et al. (2012), Crisis in the Eurozone, London: Verso.

Poulantzas, N. (1975), Classes in Contemporary Capitalism, London: Verso

Sakellaropoulos, S. (2009), ‘The Issue of Globalization through the Theory of Imperialism and the Periodization of Modes of Production’, Critical Sociology 35 (1).

Sakellaropoulos, S. and P. Sotiris (2008), ‘American Foreign Policy as Modern Imperialism: From Armed Humanitarianism to Preemptive War’, Science and Society, 72(1),

Sakellaropoulos, S. and P. Sotiris (2015), ‘From Territorial to Nonterritorial Capitalist Imperialism: Lenin and the Possibility of a Marxist Theory of Imperialism’, Rethinking Marxism 27 (1).

Sotiris, P. (2013), ‘Gramsci and contemporary Left strategy: The ‘historical bloc’ as a strategic Concept’,

Sotiris, P. (2017), From the Nation to the People of a Potential New Historical Bloc: Rethinking Popular Sovereignty through Gramsci’, International Gramsci Journal, 2(2).

Sotiropoulos, D., J. Milios and D. Lapatsioras (2013), A political economy of contemporary capitalism and its crisis: demystifying finance, London Routledge.

Toscano, A. (2015), ‘‘Portrait of a Leader as a Young Theorist’, Jacobin,

[1] For a critique of the notion of globalization see Sakellaropoulos 2009.

[2] On this approach see Poulantzas 1975.

[3] As Sotiropoulos, Milios and Lapatsioras point out, “if a capitalist country has entered into the phase of developed or developing capitalism, the route of exposure to international competition is the most appropriate strategy for organizing bourgeois power: as a model for the continuing reorganization of labor and the elimination of non-competitive individual capitals to the benefit of overall social capital.” (Sotiropoulos et al. 2013, p. 190)

[4] For an extended version of this argument see Sakellaropoulos and Sotiris 2015.

[5] On this see Sakellaropoulos and Sotiris 2008.

[6] On this see Sakellaropoulos and Sotiris 2008.

[7] On the crisis of the Eurozone see Lapavitsas et al. 2012 and Durand (ed.) 2013.

[8] On this see Sotiris 2017.

[9] On this see Sakellaropoulos and Sotiris 2014.

[10] See Laclau 2005 and Toscano 2015.

[11] ‘The articulation of the structural determination of classes and of class positions within a social formation, the locus of existence of conjunctures, requires particular concepts. I shall call these concepts of strategy, embracing in particular such phenomena as class polarization and class alliance. Among these, on the side of the dominant classes, is the concept of the ‘power bloc’, designating a specific alliance of dominant classes and fractions; also, on the side of the dominated classes, the concept of the ‘people’, designating a specific alliance of these classes and fractions.’ Poulantzas 1975, p. 24.

[12]Deleuze 1989, p. 223.

[13] ‘If the relationship between intellectuals and people-nation, between the leaders and the led, the rulers and the ruled, is provided by an organic cohesion in which feeling-passion becomes understanding and thence knowledge (not mechanically but in a way that is alive), then and only then is the relationship one of representation. Only then can there take place an exchange of individual elements between the rulers and ruled, leaders [dirigenti] and led, and can the shared life be realised which alone is a social force with the creation of the “historical bloc”’ (Gramsci 1975, pp. 1505-1506; Gramsci 1971, p. 418 [Q11, §67])

[14] On this see Sotiris 2013 and Sotiris 2017.

The return of the national imperialist state – Jörg Nowak, Ekrem Ekici

The return of the national imperialist state[i]

The ultimate political consequence of the great financial crisis is the retreat into and renewal of the national imperialist state, centred around an authoritarian-nationalist project. Nevertheless, this ‘return of the national imperialist state’ that was never absent is deeply embedded into the neoliberal form of today´s global capitalism. It pretends to cater to working class interests of its citizens to some greater extent; but this remains largely a symbolic gesture. That fake interpellation of the national proletariat – not much unlike classical fascism – is accompanied by a profound political weakness and instability of these regimes. While this tendency itself seems to be a global phenomenon, it is at the same time fraught with the challenge to establish an economic nationalism in the framework of a globally interconnected capitalism, thus placing an enormous contradiction in the heart of this very tendency.

Not only are the national imperialist states haunted by their promises of welfare and employment, they also are confronted with deeply divided and fragmented state apparatuses in which different state agencies pursue radically different strategies. This goes far beyond the institutional chaos that reigned over German fascism in the 1930s and 1940s with its sprawling multiplicity of state and para-state agencies, and is also completely different from the usual competition between different corporate factions that expresses itself in a certain but limited extent of elite fragmentation in liberal democracies. The splits within state elites and state apparatuses in the national imperialist state are profound and radical.

Contours of the renewed imperialist national state

We identify five countries as the main imperialist states: The US, China, Germany, the United Kingdom and Japan. These countries are connected to a broader range of subimperialist states like Canada, Mexico, Brazil, France, Spain, Russia, India, Turkey, Egypt, South Korea, Taiwan etc. These subimperialist states often dominate other countries, but are highly dependent on the main imperialist states in economic terms. For example, although Canada is much more stable as a social formation as Mexico, and has a much higher medium income, its economic dependency on the US is quite similar to that of Mexico, if not higher.

Before we start to look at some details, we will define some general features of this new emerging form of state:

  1. Economic and political strategies are focused on a strengthening of national industries and companies and employment creation in the national territory. This includes a shift away from former transnational strategies. It does not involve any strengthening of unions or working class power, or participation of workers in decision-making, and also not a strengthening of welfare aspects or social security aspects. This economic strategy involves strong competition to attract investments on the own national territory and signals a move away from directing investment to low wage areas in other countries, at least to some extent. But this does not go along with any positive changes in terms of wages or working conditions in the main imperialist countries.
  2. Strong collusion of government and corporate interests, including the presence of corporate leaders and/or strong corporate interests in the government itself. This allows almost no meaningful distinction between corporate and government interests – as can be observed on the inclusion of the representatives of global corporations, such as Goldman Sachs, Exxon Mobil, in the Trump cabinet; most notably, Rex Tillerson being the Foreign Secretary; the close collusion of corporate interests and political rule in the People’s Republic of China; the millionaire cabinet in the UK; the government protection of car companies that manipulate emission devices in Germany; and the government of Japan that restarted various nuclear power plants after the Fukushima disaster in 2011 in spite of adverse seismic conditions (currently two nuclear power plants are operational in Japan).
  3. The tendency to lure investments away from smaller to the main national imperialist states is reinforcing the contradictions between imperialist and subimperialist states of which some are a lot more volatile in their economic situation than the more stable imperialist states. Since employment creation on the own territory (as precarious as those jobs might be) is one of the means of legitimation for the imperialist states, this type of competition will enhance the pressure for subimperialist countries to lower the standards of salaries and social security and to offer even more tax breaks, subsidies and the like to investors. It will also involve a high volatility for the currencies of some of the subimperialist countries. Thus, imperialist domination is severely enhanced.
  4. Imperialism in its classical form involves competition between imperialist powers, both on the economic and on the political and military level. It is obvious that competition and cooperation go hand in hand on the economic level, and until now there is no protectionist trade war in sight, but rather empty threats – and a full-on trade war is also highly improbable given the level of mutual interconnectedness of all major imperialist economies. This does of course not preclude a constant and fiercer renegotiation of terms of trade and national economic policies. The governments of all major economic powers are more keen to protect their own national champions from hostile takeovers by other national champions. And for sure this competition is present concerning investments in third countries, often resulting in zones of influence not much unlike earlier 19th century colonial policies.
  5. As has been noted in the introduction, the regimes of the new national imperialist states are not strong regimes backed by a huge consensus and a stable legitimacy. This is, on the one hand, the result of serious conflicts within state elites and state apparatuses. That aspect is less pronounced for the cases of Japan and Germany. The political agendas of the increasingly authoritarian leaderships are controversial for a large part of the state apparatuses and the political elite, and are causing serious rifts in the state apparatuses: The Trump administration is facing a high amount of resistance by various state agencies; the Brexit scenario created a huge rift between different factions both within the main political parties, but also between state agencies; the Xi Jinping government faces enormous difficulties to align provincial governments to a more coherent national policy; and the tensions in Japan due to Abe’s nationalist and militarists line are considerable. For a while it seemed that the conservative pole of German politics could be torn apart due to its stance on migration, but these tensions seem to ebb away more recently. On the other hand, the political leaderships do not dispose of a stable consensus in the population that would back their rule. Electorates are as quickly pulling away their support as they were flocking to vote for authoritarian candidates. The volatility of voters and/or citizens in supporting leaderships has increased immensely. If candidates do not deliver on election or agenda promises quickly and appear to move on with collusion between corporate and public interests, they are losing a seemingly overwhelming support in record speed. This increases the pressure on political leaderships to come up with ideological spectacles or campaigns that target so-called enemies and increases the likelihood that those leaderships engage in erratic or not carefully designed moves that might increase the lack of legitimacy.
  6. The biggest pitfall for the leaderships of the national imperialist states are for sure the economic contradictions within those social formations. Suffice to say that these economic contradictions are neatly linked up with the issue of popular support for these regimes. For most of these countries, the economic contradictions that the governments are facing are enormous. Again, Germany and Japan are exceptions and see less pronounced economic contradictions at first sight. A lot of the trajectory of these states will depend on the fact if they will be able to maintain a general economic stability and an improvement of the living conditions of at least some significant part of the population. Dissatisfaction is widespread in all the populations of the major imperialist states and might erupt at any time in unexpected convulsions.

The renewed emergence of the national imperialist state responds to a certain conjuncture and to long-term economic and political developments of global capitalism. There is, first, the growing lack of legitimacy of the global economic and political order – the idea of the “strong state” responds with nationalism, traditional ideas of community, violence and what is currently traded as “economic nationalism”. There is, second, the growing lack of stable rates of profit, or better, the lack of profitable investments that can only be reinstalled temporarily with the help of the state, public funds, national or transnational development banks or state-supported acts of violent appropriation. Thus, the mixture of authoritarian politics and plundering of public budgets for corporate undertakings aims to restore both legitimacy and profitability – the strong state becomes the political and economic lender of last resort for a failing economic system. It is the inner contradictions of the national imperialist state and the shaky ground that it is supposed to remedy that make up for the fragility and instability of this form of state.

In terms of recent theories of imperialism there might be two contending lines of theory. The theory of a global Empire (Hardt/Negri 2000) that is only symbolically centred in the USA is adequate in highlighting the aspect that the global system of rule has become a unitary global system with a uniform shape and logic. But it underestimates the very real aspect of competition between national imperialist states that do not neatly work together but exhibit their own irrational excess of nationalism. The other extreme is the theory that ultimately all other states are still subjected to the rule of US imperialism (Panitch/Gindin 2010; Bellamy Foster 2015). This theory is adequate in the aspect that the USA is still the largest economic and military power of all imperialist states. But it fails to acknowledge the moment of competition and power rivalry, too. It is an important moment even if the US is still dominant in some respect.

The diagnosis of the revival of the national imperialist state raises inevitably the question about the transnational nature of the ruling classes. The question whether a transnational capitalist class exists cannot be answered with a clear yes or no. It is obvious that a more or less unified transnational capitalist class is coexisting with a vast number of national oriented capitalist classes that favour different policy sets than the transnational faction of capitalists (Hirsch/Wissel 2011). This response seems to evade a clear cut answer and raises questions as to how many percent of capitalist classes belong to the transnational or national ones. The turn to the national imperialist state signals that the earlier hegemony of the transnational faction of the capitalist class is in a serious crisis. At least some part of the transnational faction is reorienting towards a stronger national orientation, both in the US and in the PRC. This national reorientation of a part of the earlier transnationalists is much weaker in Germany, Japan and the UK – despite the Brexit strategy of a part of the Tories. The resurgence of the national imperialist state means that earlier rifts between the transnational and national factions of the global capitalist class are becoming serious rifts. But it is significant that the national factions seem unable to formulate a coherent strategy which reflects the national interdependence of economic networks today. The state of things is that both factions of the capitalist classes unite in the sense of urging national states to secure their conditions of investment: access to resources in other countries, military protection, access to markets. It’s the beggar-thy-neighbour policy that becomes the common ground for all factions of capitals in a time of sinking profit rates.

Thus, the issue of inter-imperialist competition should not be neglected. It is crucial since it is the form in which the contradictions of contemporary global capitalism are moving and in which these contradictions find their political expression. There is a clear move to focus on the domestic development of these national imperialist states in order to alleviate and minimise the social contradictions within these countries, but as stated this does not include a significant power shift towards the working classes in these countries. The hope of the authoritarian regimes is that a mixture of nationalist ideology, repression, manhunt against so-called internal and external enemies and creation of employment opportunities will be enough to deal with the internal contradictions of these regimes. At the same time, the surge in authoritarian rule is a desperate attempt to get the competing rackets within the state apparatus and the corporate elites united that are disintegrating due to strong contradictions between their interests, fueled by the lack of profitable investments and a long-term economic depression (Roberts 2016).

The 2008 crisis and the aftermath

But before we elaborate more on these issues, we have to look at the economic background for all this to happen. As said, the reappearance of the nationalist imperialist state is the outcome of the 2008 crisis and its long aftermath. But what does that mean in economic terms? First, growth rates did come back after the crisis, but did not reach the pre-crisis levels in any significant country, especially not in the BRICS states on which much of hope and economic growth rested before 2008. Second, Michael Roberts (2017) has highlighted the fact that the profit rates are going down both in the established and in the emerging economies and that the pre-crisis growth rate in labour productivity could not be restored. The European Central Bank and the OECD have recently published reports on these questions (McGowan et al. 2017: Acharya et al. 2017). These reports have found out that the most advanced large corporations are increasing their productivity at the same speed as pre-2008. In other words, there is a big group of medium and small companies that does not have enough capital stock in order to catch up with new technological developments.

The OECD finds that the amount of resources sank in those companies rose since the mid-2000s, and it estimates that across nine European countries that were in the focus of this study the capital in those zombie companies – those companies that are not making any profit after serving the interest payments for credits – makes up between 5 and 20 percent of the total private capital. This signals a concentration of profits in the large companies after the great crisis and explains some of the serious contradictions between large and smaller companies, thus also the renewed focus on renationalization among much of the middle classes.[ii] Due to the ECB report: “While banks that benefitted from the announcement increased their overall loan supply, this supply was mostly targeted towards low-quality firms (…) As a result, there was no positive impact on real economic activity like employment or investment. Instead, these firms mainly used the newly acquired funds to build up cash reserves.” (Acharya et al. 2017) Thus, from the perspective of a Gesamtkapitalist, those companies should disappear from the market (or should have already disappeared during the cleanup during the last crisis). They cannot deal with today´s requirements of competition, i.e. immense investment into research and development. Roberts interprets this correctly as one expression of the tendency of the rate of profit to fall, i.e. a higher technological composition of capital. This phenomenon is not confined to Europe, as the Bank of International Settlements (BIS) identifies it in all Western and large emerging economies (BIS 2017, 13), Japan proves to be the only exception in that respect. While in the Eurozone and the UK about 9 %, and in the US about 17 % of the largest companies are identified as zombie companies by the BIS, it is important to note that the numbers of BIS only relate to listed companies. It is significant that the amount of listed zombie companies is more or less stable in the US since 2003, but has risen steeply both in the UK (since 2014) and the Eurozone (since 2012). Daniel Lacalle reports that in the Eurozone 30 % of all SMEs are zombified, and the numbers for SMEs are at 20 % for the US and 25 % for the UK (Lacalle 2017). In China, the amount of zombie companies went down from a peak of 15 % in 1999 to only 5 % in 2016, but their share of total corporate debt has been rising disproportionately since 2011. State-owned enterprises play a crucial role here, contributing 60 % of the rise in total corporate debt between 2008 and 2016 (Lam et al. 2017). The BIS defines zombie companies as businesses unable to cover interest expense with earnings before interest and taxes. All of this is happening in the context of exceptionally low interest rates, and this is one of the reasons why upticks in interest rates are such a sensitive issue.

The other side of this tendency are the enormous job losses through automatization and robotization since the late 1970s – and more job losses are yet to come. The nationalist blame game is thus very obviously serving to move attention away from the paradoxes of technological improvement in capitalist societies: The overabundance of wealth made possible with technological improvements leads to immiseration and longer working hours. Within the capitalist class, it leads to increased contradictions and tensions between large companies and the SMEs, and to a growing number of indebted zombie companies that block profit-making. But robotization was used mainly in specific industries, namely in manufacturing, so that rather than having too much automatization, researchers of the IMF and of McKinsey underlined a lack of capital investment in most advanced economies over the last ten years (Adler et al. 2017; McKinsey 2017). The IMF paper highlights that apart from stagnant labour productivity the total factor productivity is also not increasing. This basically means that large sections of the economy in richer countries lack investment, but that these sections could see even larger job losses in the future (namely in the job-rich service industry) if capital investment catches up. For now, there is rather a problem of a lack of profitability. Thus, we have a small section of highly capitalised global companies, and a large section of companies with lack of increases in output per capital investment, lack of increases in labour productivity and lack of technological advances.

This leads us to a second aspect of the economic background: The financial sector. It tried to move out of the stock markets and evade some of the real estate markets that failed in the late 2000s – partly in order to move into new real estate markets, e.g. in Germany. On the other hand, the banks continued to feed the zombie companies with credit, and a huge amount of the non-performing loans goes back to these companies. While the small and medium companies feel increasingly strangled by the banks, some banks might be prone to fail if the number of those companies not able to pay the loans continues to rise. The enormous problems of Italian banks go back to this issue. Thus, the middle classes are trapped in between. While they continue to profit from rising real estate prices, and are able to get higher rents from small real estate property or higher private credit due to the rising value of property the middle classes live in, they face more difficulties to service loans for their companies and encounter more difficulties to expand their salaries by playing on the stock market which was one of the main pillars of integration of the middle classes into financialization (Mau 2015). On the larger plane, it has been convincingly argued that financialization served to reinforce the dominance of the main imperialist countries since they do not only have the largest and more powerful banking sectors, but the large corporate and private capital holders also use the financial sector as a relay to force whole countries to adapt to shareholder value expectations (Norfield 2016). The financial sector as such is looking for new fields of investment and due to an overabundance of capital that is crowding the few profitable investment opportunities it discovered recently “infrastructure as the new asset class” (Black Rock 2015; Hildyard 2016).

Infrastructure investment is the third element for our economic background and it is not by chance that it forms the central axis for both the economic rationale of the Trump administration and Xi Jinping´s showcase project of One Belt, One Road. While profit rates in the real economy are decreasing, and real estate markets still do not provide enough investment opportunities, there is an enormous liquidity of capital that is not being invested, above all in China, but also in the other main imperialist states. This hyperliquidity stems on the one hand from the dysfunctional domestic markets, witnessing the decreasing spending power of the general population. In addition, in China saving rates are high due to a largely incomplete social security system. Another reason for the hyperliquidity are dollars held by emerging economies in sovereign wealth funds, and the enormous redistribution of wealth to the top in the years after 2008. In any case, the new strategy to absorb this hyperliquidity is focused on state-led infrastructure projects that do not only procure private companies for construction, maintenance and operation, but also include multiple forms of financial investment and/or public-private partnerships that regularly benefit financial investors to the detriment of public budgets and citizens that face higher fees for toll roads, health service and education, or simply higher prices for railway and air transport. Black Rock (2015) reported a record high of 48.3 billion Us-dollar infrastructure investment globally for 2014, and cites a McKinsey estimate of 57 trillion US dollar of necessary infrastructure investment until 2030.

Although the last number should be dealt with cautiously, it illustrates where the hopes of investors lie. Nick Hildyard has demonstrated in detail how the different ways of extraction of public wealth for private interests work via infrastructure investments (2016) – basically, private capital demands a certain return on investment over a period of 5 or 10 or 20 years. If the infrastructure in question does not deliver the return defined in the contract, then state budgets will serve this gap. In this way, a growing (and uncertain) amount of the public budgets is already claimed by private capital, and this for decades in many cases.

So, it is on these types of investment that the hopes of many corporate actors today rest. The German government tries to privatize its famous highway system, under high pressure by insurance companies that enter shaky ground due to the low interest rates, and the long-running life insurances they sold with a much higher interest rate (Bock et al. 2015). The Juncker Plan in Europe and the EU capital market union are designed to encourage large infrastructure projects across Europe (Müller 2015). Donald Trump promised a large scale infrastructure investment that would create jobs for US citizens. The People´s Republic of China intends to invest in more than 60 countries in order to enhance infrastructure, get access to natural resources and to boost trade. The investment in the context of One Belt, One Road is estimated to be around 100 billion US dollars. Fitch Ratings issued a report in early 2017 that the Chinese financial system could be in danger due to potential risk defaults, since construction and manufacturing companies in China are currently the main sources for non-performing loans domestically, and Fitch sees an export of the same model with the One Belt, One Road infrastructure program (Wells/Weinland 2017). These infrastructure investments will in some cases also reinforce the domination of other countries by main imperialist powers, such as the inroads of Chinese companies into Brazil´s energy sector. In the context of the One Belt, One Road initiative, “Laos, for example, has provided assets in the form of potash mines as collateral for a loan that will push up its public debt to gross domestic product ratio by almost 60 percentage points.” (John 2017).

Achilles heel of the renewed national imperialist state: redistribution of wealth

Thus, we see three large tendencies: a slump in overall labour productivity focused on a growing portion of the all companies, financialization as the relay for enforcing high rates on return that are increasingly hard to get, and public infrastructure spending as both the promise to generate employment, an instrument of domination and influence, and an investment opportunity for the hyperliquidity of capital. The decisive question if of course, how all these tendencies will play out in the future – will it be feasible to integrate a considerable part of the zombie companies into infrastructure investment? Will it be possible to generate enough employment in order to compensate past and future job losses due to automation without a radical transformation of economic, social and political relations? It seems pretty unlikely that the infrastructure drive will serve to solve any problems of profitability or legitimacy of capitalism, but the challenge for the national imperialist governments will consist in raising the hopes as long as possible, while they will seek to generate new dynamics (wars, political campaigns) in order to distract from the paradoxes of high-tech capitalism.[iii]

While the question of economic performance and distribution of wealth will be the Achilles heel of these countries, it is not the only obstacle. While almost all governments worldwide follow the same economic model, the tensions between the imperialist countries and between the imperialist and the subimperialist countries will be a substantial characteristic of the coming period. Politically, this is much more resembling a pre-World War 1 situation than a pre-World War 2 situation. We are not facing consolidated fascist regimes with a more or less stable mass support, but rather shaky oligarchies that try to gather a mass support that remains very volatile. But for sure we are facing a kind of neo-Leviathan strategy that tries to rule with fear. Given the situation of the ruling classes, a socialist revolution might have some good chance of success, but we (still) do not have a revolutionary situation due to the lack of such sentiment in the broad masses and the lack of properly organised revolutionary political forces. Suffice to say that these were also seeming to lack in the end of World War 1.

We identified the competition between the main imperialist states as the form in which they unfold their logic of development. This competition is characterised by an overlapping of geopolitics and economic relations, as in every imperialist epoch. The most pronounced and influential variant is for sure the Trump administration in the US. Two driving forces have been commonly identified behind it: a crisis of representation of established presidential candidates, and a ‘realist’ reorientation of a part of the US elite towards confrontation with China. Mike Macnair has convincingly argued that this reorientation might be based on the fact that Russia is rather a second-class power today, and that the EU has run out of steam to be a potential competitor with the US, and thus does not have to be controlled via the UK anymore after Germany wrecked any political perspectives within the EU with its own imperialist oppression of other EU countries via the common currency and the 4-plus-2 compact established in a parallel law system in January 2012 (Macnair 2017). Brexit gave the death knell to the stumbling EU project.

The UK will try to strike a balance between trade with the EU and China, and a close relationship with the US, but there will be a strong push to strengthen strategic ties with the US, and the special relationship that Britain maintained with the US for a long time. This is enhanced by the fact that the US has the largest share of foreign-owned non-financial businesses in the UK with three times more gross value added than German-owned-companies (Office for National Statistics 2017). China seems to go onto the offensive with its parallel outreach of infrastructure investment outside and the project to prop up its poorer provinces. But apart from the huge liquidity that Chinese companies hold, and the ability to oppress any dissidents with ruthless oppression, the Chinese leadership is facing tough challenges. This mood could be read psychologically with the desperate embrace by Xi Jinping of free trade at the Davos meeting in 2017. Harder and colder facts are the sheer impossibility of coherent reform of the governance apparatus in China, with which Xi Jinping aims to combat corruption and regional and intra-party factionalism, and to improve product quality and the massive environmental problems. In regular patterns, all those problems are interwoven, as exemplified in the regular food scandals. As long as these problems persist, China will also be faced with them in any outside venture and remain unattractive as a role model to follow. In these aspects, the areas of superiority of the US as a superpower become quite clear, which might expand to the military aspects.

Japan, like Germany, is caught between China and the US. Both countries want to improve economic relations with China, but at the same time protect their own national champions against any Chinese takeovers. While this balancing act might be manageable, Japan´s geopolitical ambitions go along with an increasing tension with China, partly caused by Japan´s installment of a new missile defence system. Not unlike Germany, Japan’s government is quite good at ruining relations with allied countries, as can be witnessed with the ongoing and escalating fight about the comfort women with South Korea´s government. At the same time, both countries face allegations by the Trump administration to manipulate currencies. Other than China, Britain and the US, the national leaderships in Germany and Japan are not challenged by protest and widespread dissatisfaction, so they might rather be able to muddle through. The intention to both trade and compete with China finds its expression in recent reports and research papers from Europe that project the Chinese state and economy as a threat to free trade and to European companies (European Chamber 2017) or see China’s impact on the global economy as the central cause for ‘economic nationalism’ in Europe (Colantone/Stanig 2017). Colantone and Stanig contend that regions affected by Chinese imports would have voted stronger for the radical right – in implicit denial of the fact that German imperialism is likely to have a much bigger impact on European countries than Chinese imports. Why speak about the elephant in the room if you can blame the mosquito? These ideological repercussions of imperialist competition in academic research will not remain isolated incidents.

Shift in variables: towards a new encounter of “the Left” with the conjuncture

We have seen how the competition between the main imperialist states plays out. The decisive test for these projects will be whether one of those governments will be able to kickstart a new cycle of growth within a few years. All the predictions by the IMF and the World Bank do not indicate such a growth in foreseeable time. The political variables are an escalation of xenophobic and authoritarian movements beyond the control of governments and a growth of progressive movements or electoral victories of left-leaning governments. At least the UK could see the latter, and possibly also the US. On the other hand, the relative triumph of far right populism in the German elections in September 2017 and the following “low-intensity” political turmoil has confirmed the former part of that equation, the consolidation and relative electoral success of a Corbyn-led Labour Party in the UK the latter part. China seems to be static in political terms, but could face significant tensions in the future when more rural migrant workers retire without sufficient pension insurance and more workers are laid off due to high-speed robotization.[iv] More likely are in the present conjuncture in all five main imperialist countries more conservative, nationalist and protectionist movements in the population. At this point, ideological struggles will become one of the decisive crossroads in order to make inroads into this scenario.

A serious weakness of many left analyses consists in giving in to the liberal rhetoric of “populism” that is subsuming the state projects of the national imperialist states and recent renewals of social democratic or socialist political projects under the same heading. This lumping together under the name of populism (Mouffe 2016) suggests that these would be essentially similar approaches. In the light of the analysis above the whole notion of calling “populism” every political current that pretends to divert from the different brands of neoliberalism becomes visible as being an ideological manoeuver in itself, and a largely successful one. This manoeuver gives credibility to the national imperialist state projects by granting them some “popular” legitimation, and it collapses any progressive move towards a more equal society (even if it comes from largely failed social democratic revamps like Syriza or Podemos) with deeply authoritarian and corporate politics.

Such form of an inverted theory of totalitarianism (= right wing and left wing populism wanting essentially the same, i.e. put an end to free trade neoliberalism) signals the lack of a serious internationalist vision on the side of the remaining and hitherto weak left-wing political forces, accompanied by the “inability to intervene at the global scale in which markets operate” (Gonzalez Vicente/Carroll 2017). Both the expected and ongoing surge of imperialist and subimperialist nationalisms (and the ensuing types of competition and economic nationalism) as well as the increasing relevance of migrant labour and migration hint at the necessity of a radical internationalist orientation for any progressive politics in the future with a redefined terminology and vision to entrench itself against the reconstruction of the dynamics of national imperialisms.

This requires a clear view of the economic problems and constellations beyond the surge of the nationalist wave. It is an ideological move to the extent that the colluding political and economic elites in all major imperialist projects have strong transnational links through investments, company mergers, financial connections etc. But this ideological move represents the sentiment and hopes for more national focused economic projects by the big mass of small and medium enterprises, since the contradictions between large global companies and the majority of all other companies that do not see capital investment and increases in labour productivity is one of the driving forces of the current dynamic. This split within the capitalist class accounts also for the frictions within state apparatuses and state projects. At the same time, much of the political horizon of the middle classes is too narrow in order to conceive a political project of a Fordist-type class compromise on a level beyond the national state. It is in this arena that the weight of ideology is making itself felt. Thus, the national imperialist projects are fraught with the paradox that renationalization is no viable option on the economic plane, but part of the elites feel they need national rhetoric in order to tie the middle classes to the existing economic order. The move to engage in large infrastructure projects seems to represent a rather desperate attempt to relieve some of the political and economic deadlocks than a viable long-term project of accumulation and political rule.

It is clear that a social-democratic solution will not offer another way out of those impasses. On the other hand, it is obvious that political tensions and economic bottlenecks are rather increasing.

Towards the conclusion, we would like to draw attention to a relative new phenomenon which may very well evolve into a sub-conjuncture within the greater context of the rebirth of the national imperialist state: the re-emergence of separatist movements within the advanced economies.

Albeit it has a renowned and complex historical background, the Spain – Catalonia crisis points towards a new and escalated phase of internal contradictions in the developed economies. Carving “new micro-states” out of existing and centralized ones has been largely occurring in more peripheral states, but this phenomenon currently signals a serious tendency of crisis of the nation-state in Europe. However, the idea behind that relatively new form of “separatism” is not an anti-capitalist one. It is rather related to the fact of “distribution and redistribution of wealth” given the specific situation of the region of Catalonia within the Spanish state. In any case, with all its economic, socio-cultural, and more importantly, legal dynamics, the Catalonia crisis could be the harbinger of a significant overturn of the state formation in Western world. The fierce reaction of the central Spanish state to the independence referendum in early October 2017 also provides hints for the near future regarding the shape of things to come in the political scene of Europe.

What makes the “Catalonian dilemma” important is that this particular crisis demonstrates the fact that intra-capitalist contradictions have arrived at an irreconcilable stage even in the global North or in the Western world if you will. These developments should be read in the context of a concrete analysis of the concrete situation. Today, many purportedly progressive analyses and responses to such developments are rather based on a vague recourse to democracy. For instance, the Catalonian dilemma may be perceived in the framework of the “right to self-determination of oppressed nations”, instead of handling the issue in the context of the political-economic reality. The same argumentative logic of national self-determination and popular democracy is employed by nationalist right-wing parties like Front National in France and AFD in Germany. This does not legitimise equating the Catalan independence movement with the extreme right, but reveals the emptiness of a politicist recourse to democracy without any explicit basis in contemporary political economy and the economic interests at stake – taking into account that these are never ‚purely’ economic: they always take a political form. Similar examples of the ineptness of approaches of the ‚populist’ left can also be seen in the instances of the Syrian crisis or the Arab Spring. That ineptness has led and continues to lead to devastating ideological and practical-political errors.

In the light of all this, the most pressing issue remains to be the reconstruction of a renewed revolutionary response – not “alternative” – to rising neo-authoritarianisms on the one hand, and to a weakened and deformed mainstream cultural “left”. This situation is connected to a rather subterranean malaise: the avoidance of the idea of socialism centred around the issue of the ownership of the means of production – that is, the abolishment of private ownership of the means of production. To be more specific, the new phase of global capitalism and the re-emergence of the national imperialist state necessitate a corresponding, multi-dimensional and multi-layered communist thinking and program.


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[i] Many thanks to Toby Carroll for useful hints and debates on robotization, and to Brad Williams for background information on Japan.

[ii] A recent study found that the European resistance against the TTIP trade deal was also supported by small and medium enterprises, see Theurl 2017 for the case of Austria. European SMEs set up a website in which they declare opposition to TTIP:

[iii] As we finalise this text, the Trump administration launches a military attack against military bases of the Syrian government on 6 April 2017 – during the first day of Xi Jinping’s first meeting with the US president. It is yet unclear if this was rather a ‘drive-by-bombing’ as suggested by the Financial Times as one possible option, or if this announces a lasting direct engagement of the US military in Syria. For sure, Trump succeeded with this attack to line up formal allies like the German government and important politicians in his own party behind him. It is important to note that Xi Jinping did not leave the meeting with Trump after being informed about the attack. This points to a situation in which the Chinese leadership is so much afraid of a trade war with the US that it tolerated this maneouver.

[iv] Huang Yu conducted a very recent study in Dongguan province based on data from the year 2016 and found out that robotization led to a 60-70% decline of the workforce in different factories. If these robotization programs are rolled out on a massive scale in the framework of China’s Manufacturing 2025 program, backed with financial support of various levels of the state (as it is planned), there will be an enormous increase of underemployed surplus population all over China (Huang 2017).