Imperialism should be distinguished from capitalism. Marxists have a robust theory of capitalism as a system in which one class exploits another, and exploitation doesn’t have to be confined to national boundaries. It can occur across borders. So imperialism has to be something more than just exploitation across national borders, because that is just capitalism.

Marxists are sometimes confused about this. Imperialism isn’t a situation when capitalists of one country exploit workers of another one. We already have a theory to explain that, and that’s our theory of capitalism.

This is why imperialism traditionally has been used by many Marxists and non-Marxists in a similar way, which is to refer to a fundamentally political phenomenon, not an economic one. It means that the ruling class of one nation-state limits or constrains the sovereignty and the autonomy of another nation-state. It can do so through a variety of mechanisms, be they economic, political, or military.

Imperialism, thus defined, can take the form of direct rule like colonialism or some kind of indirect influence. People have called the latter neocolonialism, among other things. The key point is to distinguish it from capitalism, because much of the confusion among socialists arises from mixing up the two.

The impulse for trying to understand colonialism was essentially a political one. European Marxists prior to 1914 were trying to understand what motivated their countries to impose colonial rule on other countries. Theorists like Luxemburg and Rudolf Hilferding took the motive to be an economic one. But the actual drive for control was political in nature — it was one state dominating another state. After 1914, the explanation changes. They are now asking: Why did European countries start a war with the active consent and participation of socialists and social democratic parties at a time when the global Left seemed so cohesive?

With Lenin, you see a change coming about where he draws on Hilferding to answer a slightly different question than the question that Hilferding himself was trying to answer, which was about what drives wealthy nations to dominate the Third World. Now, for Lenin, the chief question becomes: Why are wealthy nations fighting among each other? He gives an answer that involves imperialism. He claims they are fighting in order to gain control over the rest of the world, which is certainly motivated by the desire to serve their own capitalists. But Lenin now introduces inter-state competition within the advanced world as a central part of the theory. This competition, and the fact that so many socialist parties got drawn into it, was a new phenomenon. It traumatized the Left.

In the 1920s and 1930s, you see this new dimension being added to the theory of imperialism, which was no longer just a north-south phenomenon. Throughout the Third International and later, there was a desire to understand this horizontal dimension of imperialism. And it was in trying to answer this question, in my view, where they went terribly wrong.

First of all, they wrongly identified capitalism as having entered a new stage, which they called the “monopoly” stage, which I think is fundamentally flawed. After decades of argument and research from the 1960s onward, it’s pretty well-established that the evidence for a new stage of capitalism that arose by the 1920s and 1930s — superseding the competitive stage — is very flimsy. Capitalism back then was a competitive capitalism, as it has always been.

In order to explain a phenomenon that he didn’t understand, Lenin drew up a flawed theory about capitalism having changed in its essentials. It was flawed because it insisted that the antagonism between rich countries was not only brought about by this monopoly stage, but also that this antagonism would at the very least be a constant across the decades to come, or would even intensify. This was, of course, spectacularly wrong. Karl Kautsky turned out to be more correct than Lenin on this issue, in that he predicted that what you would get is cooperation between capitalist countries, not competition. We are still suffering from the consequences of these misjudgments on the orthodox Left.

A third mistake was that they grafted this theory onto an equally flawed theory of the bourgeois revolutions. The theory that Lenin and Leninist parties then upheld was one saying that a true bourgeois revolution is led by an authentic national bourgeoisie that has two characteristics: it is anti-feudal, just like the French bourgeoisie and the English bourgeoisie supposedly were, and it is anti-imperialist. They always held the idea that it had to be anti-feudal. Now they added that it also had to be anti-imperialist. And because you cannot have socialism until you’ve gone through a capitalist stage, the proper thing for revolutionaries to do is to assist this national bourgeoisie in its fight against imperialism and feudalism.

On the basis of this reasoning, Lenin and the Soviet Union, the latter particularly after 1945, lent support to nationalist movements that could be quite backward and right wing, as long as they were fighting against domination by a Western country in some way. So, for example, the insistence that the Communist Party of China support Chiang Kai-shek and his Nationalists, because they represented the “national bourgeoisie.” The justification was that by withdrawing from the imperialist chain, they would weaken the global capitalist system. Again, this was completely wrong.

The countries that were led by right-wing nationalist movements never tried to withdraw from the capitalist system. They ended up actually crushing their own workers’ parties using the language of nationalism. The Leninist parties weren’t very successful in opposing this because they held and abided by the same language.

The Leninist theory of imperialism is still used as a justification for Third World nationalism, which is not progressive in character. Some of the largest communist parties still abide by it, like the Indian, South African, and Philippine. This has been disastrous. The justification is: “We must first fight imperialism, then we’ll settle the national question.” But you can’t — you always have to fight both fights simultaneously.

You don’t hold the domestic class struggle in suspended animation while you’re fighting your imperialist enemy. There’s always a tussle going on as to which class will define the terms on which you gain your independence from colonialism or from imperialism. In this regard, the Leninist legacy did a lot of damage.

What’s ironic here was that Lenin was entirely correct in his criticism of the German Social Democratic Party and of the Second International, their decision to vote for the war, and of the workers’ parties across Europe that lent their support to it. So his political conclusion was right. He was entirely correct in saying that the Third International should support every anti-colonial movement in its entirety. But the theory of capitalism underlying it was flawed. You can come to the same political conclusions using a more accurate theory of capitalism, and of capitalism at that time. And that theory of capitalism can also help you avoid some of the more catastrophic errors around nationalism that the Left committed in the postwar era.

In my view, these are all empirical questions, so we shouldn’t turn them into an orthodoxy. The error was in thinking that capitalism, as it matures, veers toward a monopoly stage. Capitalism, as we’ve known it so far, has always had very powerful impulses toward eroding monopolies, not toward constructing them. It has remained competitive throughout. We can’t predict the future, and maybe there will be a time when you see monopolies taking over the economy, but it hasn’t happened yet.

What you do see is certain sectors becoming vulnerable to monopolization at certain times, and there are some sectors which are always vulnerable to it — sectors which even mainstream economists realize you need to regulate, like certain natural resources. But that doesn’t mean that the system as a whole has become fundamentally monopolistic.

There was tremendous work done by economists in the 1960s, ’70s, and ’80s looking at data on competitiveness, profit rates, and profit margins. The most important work here was done by Anwar Shaikh, but there were others as well, and I think this question is fairly well settled among Marxist economists by now. It has been established that both in Lenin’s time, but also in the late twentieth century and into the early twenty-first, there has been no system-wide tendency toward monopoly.

If you read Lenin’s Imperialism, he continually uses the word “concentration” as being synonymous with or providing sufficient evidence for monopolization. But concentration of capital can develop alongside very competitive dynamics.

The mere fact that you have gigantic firms doesn’t mean that they’re also monopolies. They are now competing with each other as gigantic firms. So Lenin made a severe conceptual error which allowed him to make use of empirical data to erroneously present it as evidence for monopolies, whereas it’s entirely consistent with the continuing presence of strong competition.

The underconsumption thesis says that capitalism, at its very foundations, faces the structural problem that it produces more goods than it can absorb. These goods accumulate primarily in the consumption sector. Because it produces too many goods, it has to constantly seek external markets to sell those goods. And that provides the impetus for colonial expansion and the underlying motivation for capitalist rivalries over these colonies.

Although she is well known for having advanced it, this was not a theory originated by Rosa Luxemburg, but actually John Hobson, a British left-liberal, who was probably the most influential theorist of imperialism at the turn of the century. Lenin and Luxemburg were both influenced by him to a large degree.

Interestingly, the most devastating critique of Luxemburg’s account of imperialism was written by Nikolai Bukharin, very soon after World War I. He pointed out that it assumes a model of capitalism that, even though it formally shows that there are two sectors, capital goods and consumption goods, it overlooks the fact that the capital goods sector generates demand for consumption goods on its own. Even if workers in the consumption goods sector can’t afford to absorb all the consumption goods, workers and the capital goods sector are also a market for consumption goods, which means that if you generate investments in the capital goods sector, it will generate demand that warrants additional investments for goods coming out of the consumption sector.

The underconsumption thesis makes a serious mistake of causal attribution: While there are certainly times when there are gluts in capitalist markets, and it’s certainly the case that in any crisis, lack of demand manifests as inventories building up in firms’ warehouses, it appear as if the inventory is building up is what is causing the crisis. But it’s actually a symptom of the crisis, not the cause. What is needed instead is a Marxist theory which locates roots of economic crises not in the inability of the market to absorb consumption goods, but in movements and fluctuations of profitability that arise out of the accumulation process itself. And I think that’s what a lot of the most persuasive work has pointed to.

It was never true. And it is yet another instance where the Leninist legacy did a lot of damage.

We have to again draw a distinction between particular sectors of the working class and the general notion that the working class has been bought off by imperialism. It is of course the case that some parts of the Western working class in some instances were positioned to get higher wages from certain firms because those firms were very well positioned in multinational trading networks.

That’s obviously true, but it has no significance whatsoever for a general analysis of either the North or of global capitalism, because you can find particular instances of just about anything if you look hard enough. If you look at the developed economies as a whole, it is true that there have been times when their working classes were somewhat conservative, but the idea that they were conservative because they enjoyed the fruits of imperialism is pretty flimsy.

There’s been tremendous empirical research on this, and that research has consistently shown that there was no continuous stream of revenues originating from imperialism that fed the wages of workers in, say, England or Germany. Whatever conservatism there was arose from domestic political and economic factors. In fact, the workers who are supposed to have been the labor aristocracy — highly skilled workers in high-end firms that were integrated in the global economy — were actually the more radical workers. Skilled workers in the machine and textile industry in England were the ones that led the class struggle.

Let’s look at the United States. In her article “The Global Class War” in Catalyst, Ramaa Vasudevan has shown that the era of the greatest expansion of American investment abroad (the period from 1980 onward), which should have been the period in which the American working class gorged on the fruits of imperialism, was in fact the longest period of wage stagnation. Now you could say that’s because the spoils of imperialism were kept away from the working class. But if you say that, then you’ve given up the argument, because what it shows is that there is no necessity that internationally acquired profits should lead to higher wages for workers in imperialist countries.

The reason there’s no necessary link between the two is that workers’ wages always depend on two things: productivity and class struggle. So if you don’t think that wages depend on class struggle, what is your implied model of capitalism? Essentially you have a national understanding of capitalism, not a class understanding. Which takes us back to this notion that imperialism is a phenomenon that concerns the relationship between nations, not classes.

The problems with the labor aristocracy thesis are threefold: First of all, international flows of capital don’t constitute imperialism — that’s just capitalism. Secondly, wages are a matter of class struggle, not a national affair. And thirdly, because they don’t see this, proponents of this view implicitly assume that workers and capitalists within a particular country are partners, not antagonists. They’re wrong on all three counts.

There must be two dimensions to any adequate theory of imperialism. One is a historical dimension which is trying to understand its evolution over time, and the other concerns the contemporary conjuncture.

There is still no successor theory to Lenin’s and Luxemburg’s accounts of imperialism, both of which were highly flawed — Luxemburg’s because of the underconsumption thesis, and Lenin’s because of this theory of monopoly capital, which are both very difficult to sustain.

Both of them drew the right political conclusions for their era. But the fact that they were correct politically has masked the fact that they were correct for the wrong reasons. So we need to have a better account for why socialists in 1914 should have opposed World War I and should have supported anti-colonial movements, but in a way that also is able to criticize how that generation of socialists fell in with elite nationalism in the colonial world and ended up sustaining some movements that did damage to the prospects of progressive change.

The first challenge is a historical one of explaining the relationship between capitalism and imperialism in Lenin’s time. That theory then also has to be able to explain consistently why we went from what you might call a Leninist world to a Kautskyian world in the 1950s. The same theory has to be able to show why antagonism between rich countries turned into cooperation. And it then has to lead to the present conjecture.

The main challenge for any theory of imperialism is going to be explaining the post–Cold War era and the way the horizontal dimension of imperialism is evolving, by which I mean the cooperation between the ruling classes of the Atlantic world. There has been work on this, and it is ongoing. But now, in the wake of Russia’s invasion of Ukraine, there is an added urgency to trying to understand the Atlantic alliance and NATO as the institution which oversees it, and what the real interests within it are. You cannot even begin to understand all of these phenomena unless you take a materialist approach, unless you see it as being driven by class interests.

We should again distinguish between internationalism and anti-imperialism. Internationalism simply means supporting working-class movements outside your own national borders. Every socialist in the advanced world should be an internationalist in that sense. Anti-imperialism specifically means stopping the aggression of rich nations against poor nations.

In the North, those end up being quite different projects, because while internationalism is geared toward bolstering working-class movements abroad, anti-imperialism will primarily be directed at your own government. So for socialists in Germany or the United States and England, what anti-imperialism means is working to change the policies of their own government, because you actually have some influence over what it can do. This is what Noam Chomsky has been saying for decades, and he is right. The way to build an anti-imperialist movement, first of all, is to engage in class struggle domestically.

Much of the Left today, because it is rooted in universities and NGOs, is not very open to this, because it likes symbolic and individualistic politics, and, quite frankly, it is steeped in exoticizing the South. So it perceives anti-imperialism as something different from domestic class struggle. But anti-imperialist politics cannot be engaged in individually. They are by necessity a collective endeavor.

Anti-imperialism means collective action in your country against your government’s militarism and aggression against other countries, and convincing your working class that their material interests are bound up with the de-escalation of conflict and the demilitarization of their own state. That’s anti-imperialism.