Barry Sheppard:Book Review: Imperialism and the Development Myth How rich countries dominate in the twenty-first century  Australian Marxist Sam King has provided a much needed service with this well-researched and documented book on the contemporary imperialism of the rich capitalist countries and their exploitation and domination of the poor capitalist countries.

In the present world situation, with the U.S. leading the imperialist countries, claiming that the two main enemies of the U.S. and its allies are Russia and China, it’s important to have a Marxist understanding of the imperialist stage of capitalism in the here and now.

There are currents of Marxists who claim that Russia and China are imperialist, and give various levels of support to the U.S. against them. This is dangerous and wrong.

One of the myths King explodes is that the poor countries, or at least many of them, are “developing” along a path that will lead them to joining the group of the rich countries. The prime example often given is China. 

In the United States, this view has often been expressed by comparing China’s Gross Domestic Product (GDP) to that of the U.S. In this comparison, China ranks second to the U.S., “and will soon catch up.”

But this comparison does not show what it is trumped up to show. That comparison of GDPs alone doesn’t tell much about how rich or poor a country is can be seen easily by comparing India’s GDP ($3.42 trillion in 2022) to that of Switzerland ($0.82 trillion in 2022) — but to say that one of the world’s poorest countries, India, is four times as rich as one of the world’s richest is silly.

GDP per capita, while not a perfect measure, is the best we have. For 2022, that figure is $2,389 for India and $92,101 for Switzerland.

The first part of the book examines the polarization of per capita income among countries of the world, illustrated by charts and graphs.

These visual aids present a startling picture, with the richest countries grouped way above the poorest grouped together, and a largely empty space in between of a small number of countries. Russia and China are in the top level of the poor countries.

Both Russia and China have about 20 percent GDP per capita of that of the United States. There are other poor countries, many very poor, below that.

The rich countries are also graduated, with the poorest being Spain, with a GDP per capita at around 45 percent that of the United States.

King uses the terminology of First World for the grouping of rich countries and Third World for the poor countries. In the U.S., the division is usually called between the global North and South.

The graphs show over time the gap between the rich counties and the poor ones growing, not lessening.

The rest of the book explains this picture, utilizing the pioneering work on imperialism by Lenin, including his booklet, “Imperialism, the Highest Stage of Capitalism,” written in 2016, and Lenin’s other important writings on the issue as well as evidence from contemporary scholars of the international economy.

King defends and explains Lenin’s work, beginning in a chapter entitled “Decline of Marxist analysis of imperialism” after around 1980, with renewed interest in the subject with the U.S. imperialist wars against Afghanistan and Iraq.

He polemicizes against Marxist writers who reject Lenin and/or falsify or ignore what he wrote, which helps clarify Lenin and his importance today.

Lenin explained that one feature of modern capitalist imperialism was that the world is polarized with a handful of rich countries on one side and poor countries on the other — the rest.

This is still the case. Moreover, today it is the same group of countries in the rich group as in Lenin’s time with the exception only of South Korea, Taiwan and Israel.

These exceptions now in the rich country group were artificially built up by imperialism for political reasons during the Cold War and during and after the struggle for independence of the colonial revolution after WWII.

South Korea and Taiwan were splits from Korea and China after the Chinese Revolution, and became bulwarks against it, built up economically  by U.S. imperialism. Britain, France and then mainly the United States did so in the development of Israel as a bulwark against the Arab revolution and as a military outpost against the Soviet bloc.

That the same main imperialist countries exist today that Lenin dealt with is an indication that the dynamic which created them in the first place still exists, maintaining their domination.

A key concept of Lenin’s was to explain how modern imperialism beginning in the late 19th and early 20th centuries was a result of the emergence of monopoly capitalism in the countries where capitalism first developed, by the beginning of the twentieth century. Monopoly resulted out of the free competition of the first period of capitalism, a tendency Marx noted. The big fish eat the little fish, especially in recessions  or depressions. Industrial monopolies grew, as did monopoly in banking and other financial institutions.

Part of this was the coalescence of industrial and banking capital to form monopoly finance capital, which led to a new form of economic exploitation by the rich countries of their colonies and other poor counties.

What Lenin’s work produced is something that “closely describes contemporary conditions: the concept of monopoly and and non-monopoly capital,” King writes. “Monopoly finance capital in the imperialist states can be described as ‘monopoly’ due to its monopolistic dominance of the global labor process. Non-monopoly capital is deprived of access to the higher levels of the labor process and can dominate only its lowest sphere, which, because it is easily reproduced, cannot be monopolized.”

One topic King takes up is the assertion by some Marxists that the development of imperialism and monopoly capitalism negated Marx’s labor law of value. He shows this assertion is not true, and that the law of value fused with Lenin’s explanation of modern imperialism explains how most of the surplus value produced by labor organized by imperialism in the poor countries is transferred to the rich countries resulting in super profits.

Monopoly did not end competition, Lenin said, but intensified it on a new basis, one of which was over areas of the world exploited by the different imperialist countries. In the early 20th century the world was completely divided up between capitalist monopolies, as well as between the great powers. Lenin’s booklet was limited to economics to avoid censorship, but as he wrote it, this competition led to the First World War raging at the time, then the Second one.

In addition to inter-imperialist competition, there is competition with the poor countries, and among them.

Monopoly financial capitalism evolved, and took on a new form after WWII.

What this new form has taken is the main point of King’s book, mainly illustrated in the period of neoliberalism following the overthrow of the nationalized and planned economy in the Soviet Union by the privileged bureaucratic layers, that restored capitalism. A slower but also a return to capitalism by the same social forces happened in China. How this happened is not taken up by King, but its impact on labor is.

Labor power was not a commodity in the Soviet Union or previously in China. But the return to capitalism, especially in China because of its vast population, released a massive quantity of labor power at relatively low wages on the world market, taken advantage of by the imperialist countries.

The new form of monopoly in the rich countries was not the result of this new wave of low wage labor. What had developed in the rich countries, especially the United States, beginning in the 1970s was increasing importance of intellectual labor in the labor process, including scientific research, technology, design and related high end labor, that was monopolized by monopoly finance capital and dominated non-monopoly capitalism in the imperialist countries and in the exploited countries where non-monopoly capitalism prevails.

King argues the essential monopoly developed and maintained by the imperialist countries is their ability to “revolutionize” the production process, as Marx put it, on this high technology basis.

The cartels and trusts of Lenin’s time have become the Multinational Corporations (MNCs) based in the imperialist centers that dominate the world.

Labor in the poor countries, as contrasted with the high end labor monopolized in the imperialist countries, consists in the main of “ordinary” labor such as assembly of products, sewing of garments or even more complex industrial processes that are already well established and no longer represent the cutting edge.

The full theory and many topics developed by King cannot be explained in this review, but one example indicates how the monopolization by the imperialist countries of high end labor utilizing the “ordinary” labor in the poor countries, extracts supper profits from them.

The Apple corporation is one of the most profitable of the MNCs. Apple is a non-manufacturing company, but it has a monopoly of the high end intellectual labor that goes into its iPhones (design, technology etc.) manufactured in China. Chinese firms that do the manufacturing are contracted by Hon Hai company base in Taiwan. By “2018 Hon Hai had $4.3 billion profit on assets of $110 billion (3.9 percent return on assets — RoA)” King reports. “Apple’s $59.3 billion profit that year was made from $366 billion in assets — 16.3 percent RoA) — over four times higher.

“Hon Hai employed some 668 million workers in 2018, giving it a $6,413 profit for worker employed. Apple employed 132,000 workers in high end labor, and earned $451,000 per worker — seventy times higher.”

Other figures, given for 2010, was that Apple imported completed iPhones for $179 each from China and sold them for $600 each in the U.S. at that time.

King explains many other important features of present day imperialism. One is the increased role of the state in research and development in the rich countries, which is necessary to reproduce imperial monopoly on high end labor. As technologies become older and better known they are less able to be monopolized through technological superiority. The huge resources to develop new (to the world) technology are beyond individual companies, and must be organized by the highest organ of capitalism, the imperialist state.

In the U.S. this is done by the Department of Defense and the Department of Energy. Many scientific and technological advances since the 1930s have been made by the needs of war production.

Finally, in a chapter titled “Stranglehold: the reproduction of highest labor power”, King says “Continuous development of more advanced means of production is inconceivable without the continuous development of more advanced skilled, scientific and technical labor….”

He explains that this is not just building universities and laboratories, etc., but the entire activity of society.

“Imperialist monopolization, usurpation of common human socio-cultural achievement on a world scale and its concentration and centralization of this in imperialist societies, therefore, parallels the same process of its concentration of the physical means of production, or, more recently of the highest aspects of that” says King.

“Third World societies subject to historical exclusion cannot quickly or easily raise their national sociocultural level. Nor therefore is it easy for these societies to produce the highest types of labor power on a sufficient scale that their firms, or a large number of them, can conceivably triumph in competition with the established MNCs, which draw upon the highly developed labor power of the imperialist states.”

Or to put it another way, to answer the question: why can’t the poorer capitalist countries simply go through the same development as England and then other countries did and achieve the same level as the present rich imperialist countries?

It’s because those countries which first became capitalist were breaking away from the last aspects of feudalism and the absolute monarchies, not confronting already existing imperialist capitalist countries they are no match for.

The final section of King’s book is titled “Super-exploitation of China and why catch-up is not possible.” It is composed of three chapters.

If any of the poor exploited countries could “catch-up” to the imperialist nations, i.e. become imperialist themselves, certainly China would be in the lead, with its rapid growth in the period of neoliberalism.

The first chapter is “China: Third World capitalism par excellence”. It is a detailed analysis of China’s rise from one of the poorest countries to the top of the group of poor countries as shown by the graphs and charts in the first part of the book. This occurred with Chinese enterprises owned by imperialist MNCs or like Apple under their control. “FDI [foreign direct investment], foreign capital, foreign contracts, foreign technology and foreign markets have been key drivers of China’s expanded commodity production …” King shows.

In other words, China’s rise was in the context of being in partnership with imperialism, not against it, with imperialist domination and exploitation of China’s low wages.

“Because China’s growth in the neoliberal period was characterized by the development of non-monopoly production, while fast, it was still dominated by more advanced [foreign imperialist] capital,” King says. “China became the most successful practitioner and developer of the non-monopoly labor processes allocated to the periphery within the imperialist-dominated international division of labor. In other words, China’ success is as the Third World society par excellence. It moved from one of the poorest Third World states to one of the least poor.”

King points to an important aspect of China’s advantages: the legacy of the Chinese Revolution which under its nationalized and planned economy, created an educated, literate and able population. Among the nations of the global South it stood out in the growth of scientists. It organized “labor into modern work units and established division of labor, systems of communication, plant, distribution of goods and so on.” By the late 1970s Chinese industrialization proceeded much faster than other comparable countries.

These and other gains made the transition to capitalism on a higher level than other third World countries.

The second chapter of this section I titled “The new Imperialist cold war against China”.

King says, “Imperialism has historically driven extremely hard bargains against even the weakest Third World societies using the most belligerent and violent means. Iraq and Afghanistan never threatened U.S. imperialism even if many reports and much analysis told us they did.”

An aspect of this is the trade war started by Trump and continued by Biden. As against those Marxists who try to use this conflict to claim that it showed that Chinese “imperialism” is a threat to U.S. imperialism, King argues it is “an economic attack on China by U.S. imperialism, which aims to strengthen imperialist claims to the value brought into world economy by Chinese labor.”

In this chapter and the final one, “Trade war and China’s latest attempts at upgrading,” King takes up many topics, including China’s Belt and Road initiative, the charges that China is a military threat to the U.S., U.S. sanctions against Chinese firms, and the limits of China’s plans to upgrade its economy.

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“Imperialism and the development myth” is important to understand the present world situation of imperialist war and exploitation, and implications for the future. There is a great deal of material this review cannot cover, but will be useful to Marxists to help orient themselves.

I suggest it would be useful to read (or reread) Lenin’s “Imperialism the Highest Stage of Capitalism” in conjunction with King.

By Sam King; Manchester University Press; Manchester, United Kingdom, 2021, 296 pp.

Available from Amazon Books: kindle, $35.10; hardcover, $56.60; paperback, $36.95