Source: New International, Vol.7 No.11, December 1941
Written/First Published: 1916 (approximately) in The War and the Crisis in Socialism
Online Version: Zinoviev Internet Archive, May 2002
Transcription: Mike Bessler
HTML Markup: Roland Ferguson
Public Domain: Marxists Internet Archive (2002). You may freely copy, distribute, display and perform this work; as well as make derivative and commercial works. Please credit “Marxists Internet Archive” as your source.
(Editor’s Note: In the March, 1939, New International we began publication of an essay on Wars – Defensive and Aggressive. It was from a larger volume by the late Gregory Zinoviev, The War and the Crisis in Socialism, written in enforced exile in Switzerland during the First World War. In this issue, we print for the first time in English another section from the book. Older readers will recall how fresh and topical was the first essay, even though printed almost a quarter of a century after it was written. They will surely derive the same feeling from the essay which appears herewith. Zinoviev’s book was undoubtedly written in political collaboration, at least, with Lenin, whose exile he then shared, as may easily be seen by comparing the writings of the two men during that period. The volume, taken as a whole, appeared subsequently in Russian, and, years after the Bolshevik Revolution, in German. It is a thoroughgoing, scholarly work of a brilliant Marxian publicist and its revolutionary passion often pierces through the restrained “Aesopian” language with which Russian Marxists in those days had to clothe their works in the hope of greater mercy at the hands of the czarist censor. The reader should therefore understand that the author’s references to the “social democracy” are usually to the revolutionary Marxists; and that his polemics against the social-patriots in the labor movement, who supported the imperialist war then as they are doing now, had to be more veiled than direct.)
(As is known, Zinoviev became the first chairman of the Communist International, a past he held from its foundation until his removal by the Stalin clique in 1925-26. His career during and after that period is too well known to require elaboration here. Just as well known are the facts of how he was finally framed up and brutally murdered by Stalin and his GPU gangsters. Our own differences with Zinoviev’s course during the struggle inside the Soviet Union are also a matter of record. But they do not detract by a hair from the great contributions he made to the working class and revolutionary Marxist movements, of which the present article is one of the most typical and durable.)
Before answering this question, we wish to deal briefly with this question with the question: What Is Colonial Policy? For colonial policy constitutes one of the most important parts of modern imperialism. Imperialism and the latest forms of colonial policy, in the broader sense of the word are often evenly equated. The word colony is derived from the Latin colere, which means to cultivate, to build up. Different writers have stressed various features of the concept “colonial policy” as its criteria. Roscher is of the opinion that the age of the colonization is decisive: it is always an older nation that does the colonizing, whereas a more or less new country is subjected to colonization. James Mill considers its essential feature to be that the colonists and the whole of the structure built up by them shall stand in a certain legal and political relationship to the metropolis or to the fatherland. Fallot assents that the higher stage of civilization is as essential a feature of the colonizing nation as is the backwardness of the territory subjected to colonization. Guirault, Reinsch and others hold similar views.
Wakefed writes:
By a colony I understand, not a country like India, but a country which is either not at all or only partially inhabited and which emigrants from distant lands settle. This territory then becomes a colony of the country from which the emigrants come. The latter is therefore called the homeland. This process – and only this process – by means of which colony is populated, I would call “colonization.” The subordination of the colony to the metropolis is not an essential condition for colonization. The ancient independent colonies of Greece were genuine colonies, and, in my opinion, the United States of America remain to this day colonies of England. Colonies may be divided into two categories: dependent and independent colonies.
Levis defines a colony as a territory which is governed directly by the metropolis or with the aid of a subordinate government.1) The English writers do not emphasize very strongly the direct political dependence of the colony upon the metropolis as the distinguishing feature. In a certain sense that corresponds with the practice of British colonial policy. The American politicians and writers, on the other hand. stress, first and foremost, the element of political dependence upon the metropolis on the part of the colony.
Reinsch, for example, holds this view. In an economic sense, he allows for a broader definition of colony. In this connection, he says that Canada, for instance, may in a certain sense be considered even today a French colony, or South America a Germany colony. But his political definition of a colony is as follows:
A colony is a possession of some national state situated at a certain distance from it, which is ruled by a government subordinated to the metropolis. A colony may be inhabited by citizens of the metropolis or by their progeny, or its population may, in its preponderant number, belong to another race. But in any case, the government of the colony must in one way or another recognize its subordination to the metropolis.
Another American, Snow, dismisses the higher stage of civilization as a basic feature. Through him we hear the voice of the sober business man of the bourgeoisie.
Most modern French and German colonial writers insist upon the unconditional political subordination of the colony to the metropolis as the basic trait. James Mill, Leon Say, Leroy-Beaulieu, as well as the German writer, Heeren, Dedel and Roscher, divide the colonies, economically speaking, into three groups: 1. trade colonies; 2. colonies that serve for the settling of emigrants, and 3. colonies that serve for the planting and cultivation of different crops. More recent literature on the subject seems to have reached agreement on 1. settlement colonies for emigrants, and 2. colonies for the purposes of exploitation.
Lately (1908), Leroy-Beaulieu has the classification of three groups: 1. colonies of markets for goods; 2. ordinary colonies of settlement; 3. colonies for plantation or exploitation. (Paul Leroy-Beaulieu, De la Colonisation chez les Peuples Modernes, Paris 1908, Vol.I.)
Most of the quoted definitions of “colony” are dictated by conditions prevalent in the old epoch of colonial policy. That is why they arc all less than satisfactory.
The present relationships are not embraced even by the definition which Marx gives in the first volume of Capital. Marx writes:
The cheapness of the articles produced by machinery, and the improved means of transport and communication furnish the weapons for conquering foreign markets. By ruining handicraft production in other countries, machinery forcibly converts them into fields for the supply of its raw material. In this way East India was compelled to produce cotton, wool, hemp, jute and indigo for Great Britain. By constantly making a part of the hands “super-numerary.” modern industry, in ail countries where it has taken root, gives a spur to emigration and to the colonization of foreign lands, which are thereby converted into settlements for the growing of the raw material of the mother country; just as Australia, for example, was converted into a colony for growing wool. A new and international division of labor, a division suited to the requirement of the chief center of modern industry springs up and converts one part of the globe into a chiefly agricultural field of production, for supplying the other part, which remains a chiefly industrial field. This revolution hangs together with radical changes in agriculture. (Marx, Capital, Vol. I, Pt. IV, p. 453. London, 1901. Moore-Aveling trans.)
Today the picture has changed in many respects. It suffices to point out that the countries with a highly developed industry are precisely now not distinguished by extensive emigration. On the contrary, the greatest number of emigrants today comes from agrarian countries.
Much water has since flowed under the bridge. Even the old colonial policy was not especially noted for its humanitarianism, nor for the peaceful, cultural colonization work, of which the bourgeois gentlemen like to speak in such sublime tones. We shall see further on what cruelty characterizes the present epoch.
Wilhelm Liebknecht once remarked that human culture cannot altogether be divorced from colonization. He had in mind such great events in the history of humanity as the discovery and colonization of America, among others. Today the German social-imperialists (see, for example, Noske’s Book on Colonial Policy) attempt to utilize these words as a justification of modern imperialist colonial policy. But this same Liebknecht often pointed out that the present colonial policy is inseparable from the policy of bloodshed, of rape, of pillage.
The well known German, bourgeois scholar, Dr. O. Zoepfl, offers us a definition of modern colonial policy which is not half bad. He says:
Colonies are the foreign domains of a state administered by it for world economic and world political purposes.
And he continues:
When colonies are designated a foreign domains manipulated by a state for its world economic and world political aims, then that means that the world economic aims constitute the essential element, whereas the world political aims may, but need not necessarily, enter as a factor. (G. Zoepfl, Kolonien und Kolonialpolitik, in the Handwürterbuch der Staatswissenschaften, 3rd ed., Vol.5, p.930.)
With the frankness of a business man, the author dismisses such features as “the higher level of a nation,” the cultural mission, etc. The bourgeoisie considers the colonies as objects of commerce. Colonies are sold, exchanged, given away as gifts. Their economic value, their importance for the world market, their “economic” rôle – that’s what the bourgeoisie is guided by.
The economic dependence of the colony-that’s what is essential for the bourgeoisie, for the imperialists of our time. Naturally, political dependence and direct possession by the given state is also desirable. But it is not absolutely necessary. Zoepfl is right when he speaks simply of dolllains lying outside the boundaries of a given country. This forlnulation embraces colonies which are in direct and absolute political dependence upon the metropolis (e.g.. Kiaochaow in relation to the German Empire up to 1914), as well as those which enjoy a relatively substantial political independence (e.g. Canada in relation to England).
The definition which Zoepfl, the sober bourgeois, gives of the concept “colonial policy” leads us right up to the concept “imperialism.” This word has its origin in the Latin imperilcrn (empire). In its general meaning it is the expression employed for the aspiration to form a single, powerful empire encompassing the entire world; an aspiration which one state or another may realize by conquest, or by colonization, or by a “peaceful” political unification of existing sovereign entities, or by the simultaneous application of all these methods. In this sense, we speak of the Imperium Romanum, of the empire Julius Caesar founded in 45 BC, when he extended his personal power to all Roman countries and entrenched this power by assuming the title Imperator. In a similar sense one may speak not only of the Roman Empire, but also of the Greek Empire of Alexander the Great and, later on of Charlemagne’s empire, etc.
However, when we speak of modern imperialism, we have in mind that imperialism which was raised on the soil of a highly developed capitalism, the imperialism of the capitalist bourgeoisie, that imperialism whose main prop is finance capital.
The characteristic feature of modern imperialism is the interconnection between financial and industrial capital. To evaluate correctly the historic rôle of capitalism, it is necessary ro differentiate between the various types of capital. In the third volume of Capital, Marx for the first time undertook its subdivision into industrial capital, commercial capital and money capital. Kautsky, Hilferding, Hauer, Cunow 2) and other Marxists established a new category in their further elaboration of Marx’s discovery: that of finance capital.
The chief factor of the modern industrial epoch is the immense concentration of production, the centralization of capital by monopolistic cornbinations and enterprises (trusts, syndicates, etc.). At the same time a still greater centralization and concentration of banks is in process, so that they are now most intimately interlocked with industry, gaining continually in a growing importance over the economic life of the capitalist countries and dominating it more and more. The omnipotence of finance capital is also expressed in the subordination to itself of the state power in the monarchist, as well as the republican colonies and in the extension of its dictatorship over all strata of the possessing classes.
Hilferding writes:
Industry’s dependence upon the banks is, therefore, the outgrowth of the property relations. An ever greater share of industrial capital ceases to belong to the industrialists who employ it. They are granted control over this capital only through the good graces of the bank, which, in relation to them, represents the owner. On the other hand, the bank must invest an ever greater share of its capital assets in industry. Thus the bank becomes to an even greater extent, an industrial capitalist. I call the bank capital, that is, capital in the form of money, which is in this manner actually transformed into the industrial capital-finance capital. In reality, the greatest part of this capital invested in banks is transformed into industrial, productive capital (means of production and labor power) and transfixed into the process of production. An ever greater share of the capital invested in industry is finance capital, capital controlled by the banks and operated by the industrialists.
Finance capital develops along with the development of the stock company and reaches its apex in the monopolization of industry. The industrial returns assume a more secure and more constant character. Thus possibilities for the investment of banking capital in industry are increasingly expanded. But the bank retains control over banking capital and the owners of the majority of the bank’s stocks dominate the bank. It is clear that with the increasing concentration of property, the owners of the fictitious capital which is endowed with power over the banks and of that which is endowed with power over industry tend more and more to become one. All the more so since we have seen how the centralized bank is continually acquiring the power of control over this fictitious capital.
Although, as we have seen, industry becomes ever more dependent upon banking capital, it does not at all follow there from that the industrial magnates also become deperldent upon the bank magnates. Moreover, just as capital itself, on its highest plane, becomes finance capital, so the magnate of capital, the finance capitalist, unifies his control over the entire nalioIlal capital in the form of his domination over banking capital. Here too, personal union by intermarriages’ plays an important rôle.
Through combines and trustification, finance capital attains its highest degree of power, while commercial capital sinks into the lowest depths. Thus capitalism completes a cycle. In the beginning of capitalist development, money capital plays an important rôle in the accumulation of capital as well as in the transformation of handicraft production into capitalist production. Then we witness the resistance of the “productive,” that is, of the profit-making capitalists (namely, the commercial and industrial capitalists) to the money-lending capitalists. 3)
The mobilization of capital and the ever greater expansion of credit gradually bring about a complete change in the position of the monetary capitalists. The power of the banks grows, they become the founders and finally the overlords of industry, whose profits they arrogate to themselves as finance capital, just as the old usurer did long ago with his “interest” in relation to the peasant’s crop and the rent of the landlord.... Banking capital was the negation of usury capital: it is itself negated by finance capital. The latter is the synthesis of usury capital and banking capital, and appropriates the fruits of social production on an infinitely higher stage of economic development.
The development of commercial capital is, however, entirely different. The development of industry gradually unseats it from that dominant position in the productive process which it enjoyed in the period of manufacture. But this retreat remains permanent, for the development of finance capital reduces commerce absolutely and relatively and transforms the once proud merchant into a mere agent of an industry monopolized by finance capital. (Finanzkapital, pp.283-285)
In all capitalist countries we observe a tremendous, irrepressible growth of the productive forces. Everywhere we see a strong tendency toward the internationalization, of economic life. A thousand threads link one country with another. It would seem that every new mile of railroad, even ocean cable, every new telegraph line laid, must necessarily promote internationalization. However, we live under capitalism, in its imperialist phase, to, be precise. And within the bowels of imperialism arise powerful counteracting tendencies. The bourgeoisie of every country strives to transform its “fatherland” into an independent economic organism, capable of satisfying all its wants within the framework of “national” labor and “national” production.
The system of protective tariffs developed in this latest epoch plays a very important rôle in this connection. The international division of labor formerly in force (division into industrial and agricultural countries) becomes extremely difficult. Every state is now intent upon developing itself simultaneously into an agrarian as well as an industrial (agrarian-industrial) state and upon satisfying by itself all its own economic wants. In order to protnote its own national industry, every country) – with the exception of England, which has held first rank in the industrial field – took recourse to tariffs, which at first were only “baby” tariffs, but later on became transformed into permanent tariffs. Thus the protective tariffs arose.
In 1846 England abolished the corn laws. Soon thereafter the system of free trade triumphed decisively in England. But as we have seen, today Eree trade is being displaced by the protective tariff, even in England. Even the British colonies have introduced protective tariffs for the development of their industries, which close them to their own metropolis.
In the “Sixties” the system of liberal trade agreements triumphed temporarily on the European continent. But as early as the “Seventies” there already appeared – under the influence of the general crisis-a clearly predominant tendency toward protective tariffs. It happens in every country in its own particular way. Aside from economic causes, the singularities of the political life of each country are also important factors in this development. 4)
In 1879, Germany shifts to the system of high tariffs and introduces simultaneously protective tariffs for both manufactured and farm products. Liberal trade policy goes on the rocks. In 1885 and 1887, the German tariffs are again raised. In 1902, new tariffs are elaborated, which are dictated by the landlords. This development proceeds under the sign of a most intimate alliance between the landlords and the kings of heavy industry.
In 1881, France introduced the high tariff. In 1885, these are supplemented by agrarian tariffs. In 1910 new tariffs are introduced, based on the protective system.
In the “Eighties,” Russia and America, Italy and Austria-Hungary take the same path, and in 1910 even Holland joins them.
The tariffs rise, the growth of the internal market is retarded, the prices of the most essential necessities soar, the high cost of living develops into a veritable scourge of the working class, wages (even nominally) rise very slowly.
Tariff barriers circle the entire globe. Trade agreements become instruments for the enslavement of one country to the bourgeoisie of another country. Around these trade agreements, direct brawls take place between the capitalist cliques of the different countries – brawls which must be borne on the backs of the masses of the people.
Thus the tariff wars arise.
France carries on a ten-year-long tariff war against Italy (1887), Russia against Germany (1892-1894), France against Spain and Switzerland (1893-1895), Germany against Canada (1903-1910), Austria-Hungary against Serbia (1907-1911), Bulgaria against Turkey, Austria-Hungary against Rumania (1886-1890), Austria-Hungary against Montenegro (1908-1911), Germany against Spain (1894-1899), etc.
The capitalist cliques of every country try to coordinate the imposition of tariffs on imports with a forced growth in exports. The syndicates and trusts, which theoretically are supposed to “regulate” production, are in reality preoccupied with an entirely different task – that of squeezing out super-profits. Their greatest concern is over the increasing of exports. This results in a peculiar type of export, known as “dumping” – that is, the export of products at so-called cut prices, i.e., export at extremely low prices. “Dumping” is made possible for the trusts and cartels only because, on the domestic market in which they enjoy monopoly status – that is, inside of their “fatherland” – they are able to screw up prices so as to make up for their cost of production, thus naturally throwing the burden on the shoulders of the consumers of their own country. By means of tremendous development of their production, through its quantitative growth, the monopolists succeed in lowering their costs of production. That allows them to pillage all the more energetically, the consumer mass of their own country, that is, their “own” workers, their “own” peasants, their “own petty bourgeois.”
All countries aim at a forced export. There arises a complete economic chaos. Anarchy and competition mount.
Even the international syndicates, the latest invention of economic policy, cannot preserve the capitalist world there from, for the motive force of these syndicates is likewise only profit.
The trusts and syndicates-under various titles and forms and with their altered functions-play an ever greater rôle in the life of the industrial countries. In the first rank, in so far as trustification is concerned-stands the United States. But close behind it stand England, Germany, France, Belgium and even Russia.
The domination of finance capital is characterized in the same measure by the growth of concentration and centralization, by the development of trusts and cartels, by the growing influence of the banks as well as by the displacement of free trade through the protective tariffs.
The protective tariff increases the disadvantages of the smaller economic territory extraordinarily by restricting its export, thereby decreasing the possible size of its business enterprises, counteracting socialization and raising costs of production in this manner as well as by preventing a rational international division of labor ... While the protective tariff is an obstacle to the development of the productive forces and thus of industry itself, for the capitalist class it means a direct increase in profits. Above all, free trade impedes trustification and deprives trustified industry of its monopoly on the domestic market. In this manner the extra profits which flow from a utilization of trust-protecting tariffs are lost to them. (See Hilferding, Finanzkapital, pp.390f. In a later chapter we will go further into the causes that impelled the imperialists to combat free trade.)
The protective tariff [Kautsky wrote as early as 1901 in his Handelspolitik] is only one link in the chain of this new industrial system which constitutes the latest and probably the final manifestation of the capitalist mode of production. But whoever recognizes this particular link is compelled of necessity, if he wants to be consistent, to recognize also the others with which it is joined by the force of its own logic ... In place of the spirit of free trade there arises a spirit of violence among the industrial bourgeoisie. Previously peace-loving, it had dreamed of eternal peace, condemned war as a barbaric remnant of the Middle Ages, which could serve only feudal and dynastic purposes; today it [the bourgeoisie is itself becoming constantly more infused with the spirit of violence, no matter how much some of its ideologists may lament over the fact ... The next step is the demand for the violent conquest of a market on which it enjoys a privileged position, that is, for a colonial and expansionist policy. This, in turn, leads to conflicts or the danger of conflict with the competing industrial powers; the struggle with violent economic means threatens to become a struggle with powder and lead. with dynamite and lyddite ... The furtherance of the protective tariff today means a direct furtherance of that system which results in placing all the instruments of power in the nation at the disposal of a handful of capitalists, so that the latter may be in a position to crush violently or to starve every opponent inside as well as outside of the country. K. Kautsky, Handelspolitik und Socialdemokratie, pp.41f., Berlin 1901.)
The protective tariffs impede the development of the productive forces. Yet, in spite of this, they are always and everywhere defended by the rulers of finance capital. England was for a long time the classic land of free trade. However, British imperialism of late has also begun to renounce this tradition and to turn to protectionism. It suffices merely to recall Chamberlain’s aigtation in favor of a closer unification of the metropolis with the British colonies, into a “greater” British Empire. It suffices merely to recall his struggle for the introduction of differential tariffs in the British colonies – tariffs which favor goods originating in the British metropolis as against those of other countries and which in reality can only mean the incipient substitution of the protective system for the free trade system.
The idea of introducing the protective tariff in place of free trade is gaining a constantly growing following even in the camp of British Liberalism. A mass of evidence may be found to show that the protective system enjoys increasing popularity among the Liberals. “In our country it is not only possible but has become a burning necessity to gird ourselves with a strong self-defense mechanism [by means of tariffs] against foreign states”-we read in a manifesto of the English Liberals in favor of the system of protective tariffs, in 1903. This manifesto was signed by these well-known English Liberals: the Duke of Sutherland, L.S. Amery, S. Bourne, T.A. Brassey, J.C. Dobbie, A.F. Firth, Benjanlin Kidd, H.J. MacKinder, J. Saxon Mills, James Paxman, Charles Fennant, H.E. Vollmer and others (quoted in Bernhard Braude, Die Grundlagen, etc., p.141). Since 1903 the idea of protective tariffs has made tremendous progress in England. Chamberlain’s pamphlets, Three Years of Trade and Their Lessons for Us; Four Practical Problems; Cobden, Free Trade and the Cobden League, etc., as well as his speeches enjoyed great success. A series of conferences which he arranged in the name of the British government with representatives of the British colonies, became milestones in the struggle of the British capitalists for the introduction of protective tariffs in place of free trade. In 1895, Engels asked:
What will the consequences be when continental goods and especially American goods continue to flood the market in ever-increasing quantities, when the lion’s share of the world’s provisioning, which British factories still retain, begins to contract from year to year? Answer that, free trade, thou panacea! (F. Engels, in The Commonwealth, March 1, 1885. London. Also Neue Zeit, No.6, 1885.)
Today we have the answer. It is: modern imperialism.
Gregory Zinoviev
(To be continued)5)
1) Compare with what is, in a certain sense, the classic work of the writer on colonial policy, Dr. Zoepfl, Kolonien und Kolonialpolitik, in the Handwörterbuch der Staatswissenschaften.
2) We are speaking, of course of the “old style” Kautsky, Bauer and Cunow, before their latest evolution to the right.
3) In actuality, the “Usurer” was one of the main means for the accumulation of capital, that is, his partaking of the revenues of landed property. But industrial and commercial capital go more or less hand in hand with the landowners against this old-fashioned form of capital. – Marx, Theorien über den Mehrwert, Vol.I, p.19.
4) On Germany, read the interesting material of Kautsky in his book, Handelspolitik und Sozialdemokratie. The reader will find the latest figures in the last two books by K. Renner.
5) Note from NI editorial staff: More on this point in the comprehensive work of Bernhard Braude, Die Grundlagen und die Grenzen des Chamberlainismus, published by Dr. Heinrich Heckner, Zürich 1905.