On states and classes in conflict: The central dynamic of capitalism and transition to socialism / by Charles McKelvey

In my last commentary of April 1, I reviewed a March 26 Webinar, “Clarifying the Struggle for Socialism: Uses and Misuses of Marx’s Capital,” sponsored by the International Manifesto Group.  My commentary included a summary of the presentation of Radhika Desai, convener of the International Manifesto Group and Director of the Geopolitical Economy Research Group, University of Manitoba, Winnipeg, Canada; and the author of Geopolitical EconomyAfter US Hegemony, Globalization and Empire

     In her presentation and in the Q&A that followed, Desai maintained that imperialism, (which is the policy of controlling markets and natural and human resources in other nations), is an intrinsic and necessary dimension of the pursuit of profit, the fundamental driving force of capitalism.  Capitalists, in the pursuit of profit, are compelled to direct their national state to carry out aggressive military actions and economic policies against other states and nations, so that other states will allow full and cheap access to natural resources, cheap labor, and markets.  As is logical, the peoples in other lands resist; they to a greater or lesser degree forge anti-imperialist movements, which impact the evolution of the world-system.  Thus, Desai maintains, the central dialectic of the capitalist world-economy is between imperialism and anti-imperialism.

     Desai maintained that Marx understood the intrinsic and necessary relation between capitalism and imperialism, but subsequent Western Marxists and Western thinkers have not seen the relation.  Their blindness is due to the influence of neoclassical political economy, which impoverished Marx’s analysis by removing the dimensions of history and contradiction, or more precisely, by eliminating from Marx’s analysis the historical unfolding of contradictions between states and between classes within nations.  Desai maintains that we most go back to Marx to rediscover the insights of classical political economy, which attained intellectual maturity in Marx’s analysis, and to free ourselves from the misunderstandings that we have been taught.

      At the conclusion of the Webinar, Desai made available a digital version of her 2020 article, “Marx’s critical political economy, ‘Marxist economics’ and actually occurring revolutions against capitalism,” published in Third World Quarterly.  In today’s commentary, I offer a summary and reflections on the article.

      In “Marx’s critical political economy, ‘Marxist economics’ and actually occurring revolutions against capitalism,” Desai maintains that, in Marx’s analysis, in the capitalist stage of human history, nations have been protagonists as much as classes.  Marx grasped that the search of the big capitalists for profits drove the advanced capitalist societies to imperialist domination of other lands, which logically generates an anti-imperialist resistance; creating a dialectic between imperialism and anti-imperialist struggles, which could only be organized as national struggles.  This means that the class struggle would be expressed primarily, not as a struggle between an international working class and an international capitalist class, but as a struggle within nations for control of the state.  At stake was the power to direct the state in accordance with class interests, either as a class of big capitalists seeking to dominate other nations in the pursuit of profit, or as a working class seeking to defend the nation against the imperialist aggressions and economic exploitation of the great powers.

      Marx thus saw a complex interrelation between class conflict and conflicts among states, with international relations driven by the imperialist aggressions of the advanced economies and by greater or lesser degrees of anti-imperialist resistance by the less advanced economies and weaker states; and with class conflict primarily unfolding within nations. 

      Marxists by and large have not seen this complex interrelation among classes and nations, tending to reduce Marx to class conflict.  The limited understanding of Marxists, Desai maintains, is due to the influence of neoclassical economics on their understanding.  Neoclassical economics was the bourgeois challenge to Marx’s advanced analysis; it was an intellectual counterrevolution, a counterrevolutionary attack on classical political economy, which Marx had brought to culmination.

     Desai outlines the ways in which neoclassical economics differed from classical political economy.  Neoclassical economics focused on consumption and exchange, and not on production.  Neoclassical economics thought that prices are determined by supply and demand, not seeing that value originates in labor, and that prices are pushed downward through competition.  Neoclassical economics denied the contradictions and crisis tendencies of capitalism, and it justified colonial patterns of trade.  Neoclassical economics did not see the significance of powerful capitalist countries exporting their excess production to colonial or otherwise unprotected markets, thus undermining industrial development in these regions.  Neoclassical economics, therefore, denied the essential link between capitalism and territorial expansionism and imperialism.  Whereas classical political economy analyzed capitalist society, neoclassical economics abstracted the economy from history and society as a separate autonomous ahistorical phenomenon.  Whereas classical political economy sees capitalism as a historically specific mode of production that historically develops through its contradictions, culminating in its demise; neoclassical economists deny historical change and always speak in the present tense.

     The limited understanding of neoclassical economics ultimately led to a distorted and simplistic supposedly Marxist discourse, which resulted in the confusions and historic errors of the Second International.  Moreover, neoclassical economics cast its obscuring shadow not only on Marxists and leftists, but also on mainstream academic thought, ensuring that Marx’s scientifically advanced analysis would be lost to the West. 

     Among the issues that have been lost to our understanding was the evolution in Marx’s thinking.  Desai writes:

“Marxism was born of revolution, its first iconic text, The Manifesto of the Communist Party, written to orient workers in the revolutions that gathered steam in early 1848. However, their defeat impressed on Marx and Engels the staying power of capitalism and turned Marx to the lifelong engagement with classical political economy that issued in the penetrating (if also incomplete) historical materialist analysis of capitalism as contradictory value production.” 

So, seeking to understand the capacity of capitalism to sustain itself beyond its appropriate time on the human stage, Marx arrived to understand more completely the integral role of imperialism in temporarily overcoming capitalism’s demand problem (or its tendency to overproduce beyond the market demands of national economies). But the resolution would be temporary, because imperialism itself would generate contradictions that would have to be resolved by a transition to socialism, if humanity is to avoid self-imposed extinction or collective self-destruction of the advanced civilizations that humanity has created. 

     Thus, Volume One of Capital, published in 1867, is more scientifically advanced than Marx’s earlier work.  It pushes scientific understanding further, going beyond the 1848 formulation of The Communist Manifesto, which gave primacy to class analysis.  And going beyond the previous formulation of Part One of The German Ideology, perhaps the most readable and most coherent of the Marxian corpus.   In the more mature formulation of Capital, Marx explains the dynamics of the necessary transition to socialism, which include the emergence of transnational monopoly capital and of anti-imperialist nationalist movements.

     There was a notable exception to the confusion of Marxists.  Rosa Luxemburg, in Accumulation of Capital, grasped that capitalism needed non-capitalist spheres to export excess production; she appreciated that demand deficits (or excess production) was a major contradiction of capitalism.  However, Desai laments, her arguments were dismissed without encountering her theory in its full integrity. 

       Even the great Lenin was influenced by the pervasive neoclassical confusions.  He described imperialism, as is well-known.  But he focused on the competition among the imperialist countries for colonies in a specific stage in capitalist development, and not on the inherent imperialism of capitalism.  Only Luxemburg paid specific attention to the consequences of imperialism for the colonies.

    However, Desai recognizes, from the perspective of backward Russia, Lenin could not ignore imperialism.  By 1916, he recognized the centrality of national revolutions against imperialism.  And the Third International focused on imperial and colonial questions.

     Because of the impact of the Third International on Marxism, imperialism occupied a prominent place in any Marxist discussion from the early 1920s to the 1970s.  However, the attention to imperialism was in the form of an eclectic Marxism blended with imperialism.  Paul Sweezy is an example.  Sweezy believed that the problem of overproduction and the falling rate of profit could be solved by the management of demand, thus believing that the contradictions could be managed and would not result in the self-destruction of capitalism.  Sweezy saw the possible demise of capitalism not through contradictions that could not be managed within the logic of capitalism, but through the “increasingly attractive power of a productively superior socialism.”  Thus Sweezy, in Desai’s view, surrenders to neoclassical economics. 

     Desai maintains that Monthly Review made important contributions, but its analysis overlooks important insights of Marx.  She writes:

Monthly Review produced rich and insightful analyses of imperialism – particularly American – of its militarism, its wars, its corporations and surplus transfer, its history and resistance to it. It gave rise to dependency theory and world systems analysis. It informed, and continues to inform, generations of the left and Marxists. However, its analysis dispensed with Marx’s analysis of capitalism as value production and was based on a conception of a capitalism which was, if not free of contradictions, at least free of unmanageable ones.”

     Desai further observes that imperialism disappeared from the pages of Marxist journals following the 1970s.  Robert Brenner’s famous article, “The Origins of Capitalist Development,” set the tone in in 1977.  He did not see the tendency of capitalism to overproduce national markets, and accordingly, he and other political Marxists held that capitalism did not need imperialism. 

     Ricardian Marxists, who leap over Marx to selectively read Ricardo, set back our understanding of imperialism and the dynamics of the relations among states.  The Ricardian Marxists recognized that imperialism does happen and aids capitalist accumulation, but it is not required by the logic of capitalism, in their view.  Moreover, Ricardian Marxism, Desai maintains, does not understand that dominated countries are the sources of the development of the West. 

      Not understanding the logic of Third World anti-imperialist people’s revolutions, it follows that Western Marxists have a limited and vague concept of revolution.  “Having dispensed with the notion of contradiction, Western Marxism relies on (western) working-class mobilisation alone to magically overcome a capitalism assumed to be all-powerful, worldwide and eternal.”  It cannot imagine autonomous national development in the neocolonies as a process integral to the transition to socialism.

     Discussion of imperialism among leftists is renewing, because of the current decadence of imperialism.  But unlike the 1960s and 1970s, Desai maintains, we must not ignore the resources that are found in Marx’s mature scientific analysis, found especially in Volume One of Capital.

Understandings of imperialism rooted in practice

    Radhika Desai is on to something important.  By its own logic, capitalism requires, first, the conquest and peripheralization of new territories; and then, imperialist control over the political-economic systems of the colonies, semi-colonies, and neocolonies.  Moreover, because of the universal desire of human beings to be individually or collectively in control of their own affairs, the capitalist logic of imperialism necessary creates its opposite, anti-imperialist struggles, which can, in determined conditions, take control of semi-colonial or neocolonial states and transform them into anti-imperialist states.  This dialectic of unfolding contradictions and conflicts between imperialist powers and anti-imperialist states and movements is fundamental to the capitalist world-economy and the neocolonial world system.

     As Desai maintains, if you don’t understand the imperialist logic of capitalism, you cannot understand the anti-imperialist logic of the people’s revolutions in the vast semi-peripheral and peripheral zones of the world-economy.  And if you don’t understand their logic, you may misinterpret what they are doing, thinking perhaps, that they a violating some dearly held human value.

     Desai is dedicated to the task of showing that Western intellectuals, academics, leaders, and activists, confused by bourgeoisie counterrevolutionary intellectual maneuvers, do not understand the logic of anti-imperialist Third World revolutions.

      However, we are speaking here of intellectuals, academics, leaders, and activists of the West.  The ideological dynamics of the Third World are different.  In the colonies, semi-colonies, and neocolonies, observing the profound ignorance and moral decadence of the West, leaders and intellectuals have taken upon themselves the task of discerning the true and the right, and leading their peoples toward an alternative world order, necessary for the preservation of the great civilizations that humanity has created.

       The starting point concerns fundamentals.  When a people experience that they have been conquered and colonized, and have had systems of forced labor imposed, coercing them to participate in the foreign plunder of their natural resources, it will not be long before leaders and thinkers emerge who interpret this experience, proclaiming that the wealth of the colonizers has been constructed on a foundation of force.  They will arrive sooner or later, depending on objective and subjective conditions, to the understanding that the European colonial domination of the world is the source and the foundation to the advanced economies of Western Europe and the settler societies of North America.      

     I first encountered the Third World anti-imperialist perspective in the early 1970s at Chicago’s Center for Inner City Studies, where Jacob Carruthers and Anderson Thompson were formulating what they called “colonial analysis.”  They saw European colonial domination of Africa as the foundation to the underdevelopment of Africa and the development of Europe, and they saw race relations in the USA through this prism.  Their analysis included class divisions within the African colonies, in which an African elite educated in the West played a central role in facilitating the transition to European neocolonial domination.  They concurred in Kwame Nkrumah’s description of neocolonialism, in which supposedly independent African nations are placed in an “economic stranglehold,” with accommodation expected from the African “educated elite.”  They appreciated Julius Nyerere’s vision of “ujamaa socialism,” a uniquely African socialism constructed on a foundation of a modern reformulation of traditional African values.  They rejected Marxism, but what they were rejecting was a superficial Marxism in the USA that historically had applied a unidimensional class analysis to the African-American colonial situation in the United States. 

      In the 1970s, the North American sociologist Immanuel Wallerstein initiated publication of his multi-volume work on the modern world-system, which described the historical development of the world-system on a foundation of the conquest and colonial domination of vast regions of the Americas, Asia, the Middle East, and Africa during the course of four centuries.  In the preface to Volume One of the Modern World System, published in 1974, Wallerstein noted the importance of his experiences in Africa during the process of “decolonization.”  Listening to “the angry analysis and optimistic passions of young militants of the African movements” inspired him to turn to world-systems analysis, because it had become clear to him that “society” was a dysfunctional “unit of analysis” for understanding the African “colonial situation.”  Although Wallerstein formulated a historically accurate description of the development of the capitalist world-economy and its structures of superexploitation, confirmed as valid by Third World intellectuals, he never arrived to understand Third World anti-imperialist revolutions.  He did not continue to encounter and study the anti-imperialist revolutions of the Third World beyond his early period in Africa, and he subsequently confined himself to a few references in his writings to a possible future “socialist world-system,” the characteristics of which he did not attempt to define.  Sadly, he went to his eternal reward without ever having demonstrated an understanding of any of the real existing socialisms of our times.

     In the early 1990s, I traveled extensively to Honduras, where I again encountered the Third World anti-imperialist perspective and movement.  The Honduran national narrative begins with the Spanish conquest of the indigenous populations, and it continues with the quest of the Honduran nation for sovereignty, first from Spanish colonialism, and then in the face of American imperialism.  The Honduran popular movement placed its origins in the 1954 general strike, initiated by the banana workers strike, illegal at the time, against the American banana companies that dominated the economy and politics of the nation. 

     In the early 1990s in Honduras, a popular movement against IMF-imposed neoliberal policies emerged in reaction to the destructive consequences of the neoliberal project for the nation.  (Especially detrimental was the weakening of the capacity of the Honduran state to regulate its national currency, resulting in a significantly reduced purchasing power of Honduran wage earners).  The Honduran popular movement of that time united the agricultural workers in the U.S.-owned banana companies (who called themselves “salaried peasants”), small peasant subsistence farmers, economically displaced peasants living in urban “marginal neighborhoods,” informal workers, workers in low-wage foreign-owned export manufacturing, students, teachers and professors, women (whom had recently gained recognition as an economically exploited gender), and indigenous communities (who also had gained recognition as a new social movement). 

      Since 1993, I have traveled extensively to Cuba, deepening my understanding of the Cuban Revolution as an anti-colonial, anti-neocolonial, and anti-imperialist people’s revolution, expressing itself in different stages from 1868 to the present, which has included an effort to construct socialism since 1959.  Its defining moment was the Agrarian Reform Law of May 17, 1959, which Cuban scholar and diplomat Jesus Arboleya described nearly a half century later as a step that “defined the anti-neocolonial character of the revolution.” 

      Cuba in 1959 confronted a situation in which most agricultural land was in foreign hands, and there was high concentration of land ownership.  Addressing this structural problem in the Cuban economy, the Agrarian Reform Law of 1959 nationalized large-scale agricultural lands, making no distinction between foreign and national ownership, and providing for compensation in the form of “Agrarian Reform Bonds” that were to mature in twenty years.  Approximately one-third of the nationalized land was distributed to peasants who had worked on it as tenant farmers or sharecroppers; and two-thirds of the land was used for the establishment of state-managed farms and cooperatives.  The Agrarian Reform Law provided the foundation for a fundamental transformation in the quality of life of the rural population and for rural socioeconomic development. 

     In addition to agricultural land, banks and other companies in Cuba were under foreign ownership, including electricity and telephone companies, gasoline refineries, mining companies, and importing companies.  The Revolutionary Government on July 6, 1960, emitted a law authorizing nationalization of U.S. properties.  It established compensation through government bonds, and it required the Cuban government to contribute to a compensation fund through bank deposits equal to 25% of the value of the U.S. purchase of Cuban sugar in excess of the U.S. established sugar quota.  On the basis of the law, the Revolutionary Government emitted three resolutions on August 6, September 17, and October 24, 1960, nationalizing all 197 U.S. companies in Cuba. 

     These decisive steps struck at the heart of the Cuban neocolonial condition.  They did not intend the severing of relations with the United States; rather, they sought the transformation of the Cuban-US political-economic relation from exploitation and domination to cooperation and mutual respect.  The Cuban gesture toward cooperation was ignored by the USA, which was well on its road in its project of counterrevolutionary regime change.

     The Cuban Revolution also had to address the question of the Cuban national industrial bourgeoisie.  At the time of the triumph of the Cuban Revolution, the Cuban national industrial bourgeoisie was politically and ideologically weak relative to the Cuban landed estate bourgeoisie.  And it was totally subordinate to U.S. capital.  It was, Arboleya would later explain, a figurehead bourgeoisie, unable to lead the nation in the development of an autonomous national project.

     Because of these conditions, the probability was low that the national industrial bourgeoisie would participate in the autonomous development of the Cuban economy under the direction of a people’s revolution.  However, Fidel had the political intelligence to not prejudge the matter.  Representatives of the bourgeoisie were initially included in the revolutionary government, and Fidel called upon Cuban industrialists to support the revolution by, at a minimum, keeping their factories running and depositing their profits in Cuban banks.  But the Cuban industrial bourgeoisie demonstrated its incapacity to adapt to the new revolutionary political reality.  Its members abandoned their factories and their country and incorporated themselves in the Cuban counterrevolution directed by the U.S. government.  As a result, in 1961, the Cuban revolutionary government nationalized Cuban big industry and liquidated the Cuban industrial bourgeoisie as a class.

     In addition to understanding the structure and dynamics of neocolonialism, Arboleya also understood the necessity of imperialism for capitalism.  With reference to the concentration of capitalist enterprises in the United States in the second half of the nineteenth century, he wrote: “The immense increase of the North American monopolistic industry and capital required the constant growth of the markets to find outlets for products and to avoid provoking a fall in prices.  In this contradiction is found the need for external markets.”  It was necessary to obtain new consumer markets in order to maintain and even increase profits.  “This objective converted the North American monopolies into transnational companies, which required a new expansionist policy of the state.  These tendencies attained consolidation in 1896 with the election of William McKinley as president of the country.” 

       Imperialist policies, Cuban scholars see, are driven by their necessity as a correction to the insufficient demand of the domestic market; accordingly, they have been a persistent characteristic of U.S. foreign policy from McKinley to our days, even when imperialism was packaged as a “Good Neighbor” policy or an “Alliance for Progress.”  In their works, Arboleya and Cuban scholar Roberto Regalado describe the persistence of U.S. imperialist policies from one presidential administration to the next.  In Cuba, this is not a surprising view.  The belief that the United States is an imperialist power that must of necessity pursue imperialist policies in one form or another is widely held in Cuba. 

      Moreover, anti-imperialism is a fundamental principle of Cuba foreign policy.  The Cuban Constitution 2019 affirms the right of Cuba to sovereignty in international relations: “The economic, diplomatic, and political relations with any other State can never be negotiated under aggression, threat, or coercion.”  It affirms Cuba’s foreign policy principles of sovereignty, anti-imperialism, and self-determination.  It recognizes the need for the unity of the Third World in opposition to colonialism, neocolonialism, and imperialism.  It reaffirms its commitment to integration and solidarity among the nations of Latin America and the Caribbean.  It condemns interference in the internal affairs of states.  It describes wars of aggression and conquest as international crimes.  A similar anti-imperialist approach to Cuban foreign policy was formulated in the previous 1976 Constitution, with minor differences reflecting a different international situation.

      In the practical implementation of its constitutionally guaranteed foreign policy, Cuba is allied with China, Vietnam, Venezuela, Nicaragua, Bolivia, Russia, and Iran in the construction of a pluripolar world based on cooperation and mutually beneficial trade among nations, standing against the unilateral hegemony of the USA and the potential multilateral imperialism directed by Europe.

     The anti-imperialist, anti-neocolonial projection of the Cuban Revolution is a general phenomenon in the Third World.  In 2006, I was able to attend with a press credential the Summit of the Non-Aligned Movement in Havana, when Cuba assumed the presidency for the second time.  I was struck by the extent to which the Movement had retaken its historic anti-neocolonial and anti-imperialist agenda, influenced by the rising global popular movement in opposition to neoliberalism.  The Non-Aligned Movement’s 2006 Declaration of Havana, endorsed unanimously by the 118 member nations, called for a “more just and equal world order,” and it lamented “the excessive influence of the rich and powerful nations in the determination of the nature and the direction of international relations.”  It rejected the neoliberal project as promoting global inequality and “increasing the marginalization of countries in development.”  It affirmed the principles of the UN Charter, including the equality and sovereignty of nations, non-intervention in the affairs of other states, and “the free determination of the peoples in their struggle against foreign intervention.”  It proclaimed that “each country has the sovereign right to determine its own priorities and strategies for development.”  It called for the strengthening and democratic reform of the United Nations, and it proposed South-South cooperation as a complement to North-South cooperation. It rejected the politicization of the issue of human rights, and the double standard used by the global powers, as a pretext for intervening in the affairs of nations of the Non-Aligned Movement.  It proclaimed its support for the peoples of Palestine, Cuba, Venezuela, Bolivia, and Iran in their conflicts with the global powers. 

     The Non-Aligned Movement is rooted in a conference in Bandung, Indonesia in 1955, of representatives of twenty-nine newly independent Asian and African nations.  Sukarno of Indonesia was the leading force; Nehru of India, Nasser of Egypt, Zhou En-lai of China, and U Nu of Burma were among its prominent participants.  The Bandung conference declared the importance of Third World unity in opposition to European colonialism and Western imperialism.  It advocated economic cooperation rather than exploitation as the base of international relations.  It sought to break the core-peripheral relation, in which the Third World nations export raw materials and import manufactured goods, and thus, it called for the diversification of the economies of the formerly colonized nations and the development of their national industries.  It supported the regulation of international capital flows. 

      The Bandung conference led to the establishment of the Non-Aligned Movement in 1961 in Belgrade, Yugoslavia, by representatives of twenty-three governments of Asia, Africa, Latin America, and Eastern Europe.  Tito of Yugoslavia, Nehru, and Nasser were its leading voices.  U Nu, Ben Youssef (Algeria), Sukarno, Nkrumah (Ghana), and Osvaldo Dorticós (President of Cuba) were present at the first Summit in Belgrade.  The Summit called for the democratization of the United Nations, particularly with respect to the Security Council, which holds unbalanced power vis-à-vis the General Assembly, and which is dominated by the imperialist powers. 

     With the turn of the global elites to neoliberalism in the late 1970s, the Non-Aligned Movement lost its ideological orientation toward the defense of the sovereignty of the Third World nations.  However, beginning in 2000, the Non-Aligned Movement began to retake its radical agenda in defense of the sovereignty of Third World nations and in opposition to imperialism, which has been expressed in the various declarations from 2006 to the present.


     The great majority of intellectuals and leaders of the Third World do not have the disadvantage of having read neoclassical economists.  Freed from such distortions, their theoretical understanding was able to advance in accordance with the level of their commitment to the people’s movement, reflecting on the lessons learned in the concrete struggle in practice.  In this context, the most insightful leaders and intellectuals developed an advanced understanding of the dynamics of colonialism, neocolonialism, and imperialism in the capitalist phase of human history.  They constitute an indispensable resource for understanding today’s world-system dynamics.

     For those of us who are intellectuals of the Left, from and/or located in the imperialist heartlands, our task must be a study and rediscovery of Marx, the intellectually mature political economist of Volume One of Capital; combined with study of and encounter with real socialism today in China and various nations of the Third World.  This double focus on theory and practice would enable us to further develop the science of political economy in our time, such that it would be a tool enhancing the necessary greater understanding of our peoples and enlightening the correct courses of action.

Top Image: A scene from the mural on the side of the United Electrical Workers’ Western Region headquarters in Chicago, Illinois. Terence Faircloth / Flickr

Charles McKelvey is Professor Emeritus at Presbyterian College in Clinton, South Carolina, USA. He is influenced by black nationalism, the Catholic philosopher Lonergan, Marx, Wallerstein, anti-imperialism, and the Cuban Revolution. Since my retirement from college teaching in 2011, I have devoted myself to reading and writing on world affairs.

Source: Knowledge, ideology, and real socialism in our times [blog], April 5, https://wordpress.com/post/cpmaine.org/5386