- Actually, Lenin, as we remember, revealed five main economic signs of imperialism: 1. The concentration of production and capital has reached such a high level of development that it has created monopolies that play a decisive role in economic life. 2. The merger of bank capital with industrial capital and the creation, on the basis of this “financial capital”, of a financial oligarchy. 3. The export of capital, in contrast to the export of goods, is of particular importance. 4. Formation of international monopolistic capitalist unions dividing the world. 5. The end of the territorial division of land by the major capitalist powers. "
“And yet, over a hundred years since the writing of the book, imperialism, despite Lenin’s instructions that this is the“ highest ”and“ last ”stage of capitalism, is still alive. But at the same time, certainly undergone major changes. Which ones?
- Each of its five economic signs has changed. But let's take a closer look at the fourth, most relevant feature today - as it turns out, the most unsafe for the world. This feature is devoted to the fifth chapter of the book, which is called "The division of the world between the unions of capitalists." The chapter begins with the following words: “Monopoly capitalist unions, cartels, syndicates, trusts, divide among themselves, first of all, the domestic market, seizing the production of a given country into their own, more or less complete, possession. But the domestic market, under capitalism, is inevitably linked to the external one. Capitalism has long created a world market. And as the export of capital grew and the overseas and colonial ties and “spheres of influence” of the largest monopoly unions expanded in every possible way, the matter “naturally” approached a worldwide agreement between them, the formation of international cartels. ”
So, the fourth economic sign of imperialism is associated with the formation of international cartels. International cartels are monopolies of monopolies, agreements of national monopolies of different countries (trusts, concerns, syndicates) about the economic division of the world. The creation of international cartels is preceded by the formation of cartels at the national level. This is what Lenin writes in the first chapter (“The Concentration of Production and Monopoly”). The first national cartels appear after the 1873 crisis of the year. The economic rise of the end of the XIX century and the economic crisis 1900 – 1903. led to the mass formation of cartels. It was at this time, as Lenin notes, “cartels are becoming one of the foundations of all economic life.” Many international cartels are also being formed at this time.
- What specifically divide the monopolists of different countries in the framework of international cartel agreements?
- First of all, the sales markets for goods are determined by the geographical boundaries of the spheres of operations of individual participants of the international cartel. At the same time, uniform (monopoly high) prices for similar goods and services are almost always set. Sometimes the marginal volumes of production and sales of certain goods are determined. In addition to markets, the section may be subject to sources of raw materials and the sphere of application of capital. There are also purchasing cartels (setting monopolistically low prices for purchased goods and services). It is obvious that international cartels restrict or even make impossible the trading, investment and financial activities of outsiders who have fallen behind the international agreements. Often, cartels “clear out” their “living space” by first carrying out synchronized dumping, and then setting monopoly high prices.
A striking example of the international cartel of the last century is the agreement between the American Electric General Trust and the German AEG corporation. In 1907, an agreement on the division of the world was concluded between these giants of the electrical industry. Competition in the markets for electrical products has been eliminated. Lenin describes in great detail history the creation and functioning of the international electrotechnical cartel. He also gives examples of international cartel agreements on the division of world markets for rails, zinc, and maritime merchant shipping. He describes in detail the competition between the American Rockefeller kerosene trust and the merger of German kerosene companies. At some point in time, competitors were close to forming a world kerosene cartel, but at the last moment the agreement was upset.
Lenin, in disclosing the fourth economic attribute of imperialism, refers to the study of the German economist Robert Liefmann (1874 – 1941), which is called “Cartels and trusts”. According to Lifman, in the 1897 year there were about 40 international cartels with the participation of Germany in the world, and about 1910 by the 100 year. It is noteworthy that at the beginning of the twentieth century almost no international cartel managed without the participation of companies from Germany and the United States who conducted an aggressive takeover of world markets. They "squeezed" the markets of their competitors from England, France, Belgium, Holland.
“But even in the times of Lenin, many countries already had antitrust laws in place that prohibited the creation of cartels. Or, at least, their creation required the consent of the antimonopoly services.
- The fact is that cartels have an advantage over other forms of monopolies (trusts, syndicates, concerns) that they can be created secretly from the state and society. These may be “gentlemen's agreements”. Even if the agreements are written, the documents are safely stored in the vaults of the signatories.
- That is, international cartels can be considered as a shadow economy?
- That's it. Often, cartels are masked by signs of information centers, scientific institutes, business unions, committees, commissions, etc. Companies that enter into a cartel agreement retain their financial, legal, commercial and production independence. True, sometimes cartel members create a joint-stock company of the joint-stock type to perform management functions. Production and market quotas of the cartel participants correspond to their shares in the joint stock company. As an example, an international cartel on nitrogen fertilizers (was created in 1928 year). In 1962, cartel members created the joint-stock company Nitrex (Nitrex AG) with a capital of 1 million Swiss francs (registered in Switzerland, Zurich). Shares were divided between cartel members. In a centralized manner, Nitrex collected all orders for the supply of nitrogen fertilizers and distributed them among the cartel members.
- There is a vast literature showing that international cartels were actively involved in the preparation and unleashing of the Second World War.
- In the period between the two world wars, the process of creating international cartels sharply intensified. By the beginning of the Second World War 1939 – 1945, according to some estimates, the number of international cartels increased almost to 1200; on the eve of the war, international cartels controlled from one third to one half of the total world trade turnover. Mostly these were the agreements of the monopolies of various European countries. The number of international cartels in which both European and American monopolies participated was small. The capitalist countries, which were in a state of protracted economic crisis, began to pursue a differentiated antitrust policy. In their own countries, the authorities nevertheless tried to limit monopolies and stimulate competition. And if international cartels were created that could strengthen the position of national companies in foreign markets, the authorities didn’t create any obstacles. Even on the contrary, they encouraged the creation of cartels.
Some international cartels with the participation of American and German companies did not cease their activities throughout the years of the Second World War.
- A number of accusations against international cartels and their participants were voiced even at the Potsdam Conference of the 1945 of the Year and the Nuremberg Trials.
- In all countries in the post-war years, sentiment against international cartels prevailed. The United Nations (UN) discussed the issue that this new institution should completely ban international cartels or at least control their creation and functioning. In the post-war decades to the 1970's. in the West, antitrust laws were more or less effectively implemented. Including in the part concerning international cartels. By the beginning of the 1970's. the number of such cartels was estimated at 70-80. It is noteworthy that these were predominantly transatlantic cartels, i.e. agreements with the simultaneous participation of European and American monopolies.
In the period from the end of the Second World War to the middle of the 70-ies. The most famous in the world were international cartels in the field of maritime shipping (there were several), for electrical equipment, radio equipment, automobiles, rolling stock. There were international cartels on fertilizers: nitrogen, potash and phosphate. In the field of production of chemical products, cartels created during the period between the two world wars acted: soda, for dyes and for quinine. In the area of non-ferrous metal production, the most famous cartels were for aluminum and copper. In the sphere of the production of ferrous metals, there were cartels for steel, certain types of rolled products, rails, pipes, and tinplate. Naturally, international cartels didn’t advertise their activities, trying to convince the society and state control bodies that they are engaged in “research” activities. For example, the functions of the international potash cartel (before World War II, it included the monopolies of France, Germany, Spain, Poland, Great Britain, the United States and other countries) after the war began to perform three "institutes". This is the International Potash Institute in Bern (Switzerland), representing mainly the interests of Western European companies, as well as two US organizations - the American Potash Institute and the Foundation for International Potassium Research. International cartels in the maritime industry were called "pools" and "conferences".
- As you know, most often for the international cartels used the "roof" of unions of entrepreneurs ...
- Absolutely. For example, the international steel cartel in 1967 created such a “roof” in the form of the International Iron and Steel Institute (ICHA). The creation of the ICP, as it was officially announced, is aimed at strengthening contacts between the steelmakers of various capitalist countries and the exchange of information regarding the situation on the ferrous metals market. In 1970, the IDF incorporated more than 100 metallurgy companies 24 in capitalist countries that produced about 95% of steel in the capitalist world. The exact number of international business unions is difficult to name. They can have a variety of names: chambers of commerce and industry, stock exchange committees, industry institutes, associations, commissions, etc.
- And the patent cartels, which in the post-war period began to play a large role, what were they?
“In the conditions of the unfolding scientific and technological revolution in international trade, the share of manufacturing goods, especially its knowledge-intensive industries, has sharply increased. The positions of corporations operating in such industries began to be actively defended using a tool such as patents (the right to exclusive use of technical innovation) and licenses (permission to use technical innovation to other companies for licensing fees, participation in capital or obtaining other rights). Many authors were quick to declare that under the NTR conditions the traditional international cartels “ordered to live long”, were replaced by patent cartels based on the exchange of patents and licenses within a narrow circle of companies from different countries. Moreover, these patent cartels did not hide, moreover, they were protected by patent and other services that protect the intellectual property of big business.
- Please tell us about the "cartel blockade" of the Soviet Union and Russia, which you have repeatedly mentioned in your speeches, because today it is very relevant.
- Surprisingly, so far our economists, political scientists and historians have absolutely not touched on this most important aspect of Soviet economic history. The point is that throughout all the 70 years of its existence, the USSR was in a tight circle of international cartels. There was a cartel blockade of our country. Soviet foreign trade organizations negotiated and concluded contracts with companies that were part of various international cartels. Soviet trade with companies that were not part of the cartels was extremely difficult. That is why we could trade with the West, only consistently pursuing the policy of the state monopoly of foreign trade. Without such a monopoly, international cartels could plunder us mercilessly, setting monopolistically high prices for goods imported by the Soviet Union, and monopolistically low for goods that we deliver to the West. Until the end of the USSR, it was not possible to overcome the “cartel blockade” factor, its action only softened. That is why the fundamental principles of the Soviet economic policy were self-reliance, as well as the priority development of trade and economic relations with the countries of the socialist community.
- After the collapse of the USSR and the creation of the Russian Federation, was the “cartel blockade” against our country somehow weakened?
- It is naive to think so. Thank God, our Federal Antimonopoly Service (FAS) realized this in time. The key activity of the FAS since 2014 has been the investigation of cartel activities involving foreign companies. True, the FAS has repeatedly stated that the fight against international cartels in Russia is very difficult. The main reason is the absence of an international act regulating joint inspections of the FAS with foreign antitrust authorities, as well as allowing for the exchange of confidential information with them.
But back to the 70 of the last century, when the patent cartels came to the fore. Of course, traditional cartels covering raw materials and semi-finished markets continued to exist. Some of them have completely gone into the “shadow”, others have changed their status. They acquired the form of interstate agreements on the protection of markets for certain goods. Such international commodity agreements (MTS) became widespread in the first two or three post-war decades. These are agreements on zinc, tin, and some other metals, grains, jute, coffee, bananas, and other commodities. The most well-known agreement on oil, called OPEC. It was believed that these agreements are designed to protect developing countries from the unequal exchange of poor countries of the “south” with countries of the rich “north” exporting industrial products (the so-called “price scissors”). However, one should keep in mind that the signs of developing countries often hid transnational corporations (TNCs) that operated in these countries and were interested in such cartel agreements of interstate type. A bright example is OPEC. This is an organization of countries - exporters of oil. Founded in 1960 by a number of countries (Algeria, Ecuador, Indonesia, Iraq, Iran, Kuwait, Libya, Nigeria, Saudi Arabia, etc.) to coordinate actions in terms of sales and pricing of crude oil. Due to the fact that OPEC controls about half of the world oil trade (estimated at the beginning of this century), it can significantly influence the level of world prices.
However, one should not forget that transnational corporations are behind the OPEC screen. Back in the 1960s, everyone had the international oil cartel, known as the "seven sisters." The history of the oil cartel began 87 years ago. 17 September 1928 was an informal agreement between Royal Dutch Shell, the Anglo-Persian Oil Company (future British Petroleum) and Standard Oil of New Jersey (future Exxon) in Scottish town Akhnakarri. It was designed to remove the tough competition between these giants of the oil business. For which it envisaged the reduction of oil production in accordance with the trends in demand for it and the preservation of the existing proportion between mining companies. Already by 1932, the Ahnacarri cartel included all seven major Anglo-American companies, which later created a “consortium for Iran”. It is noteworthy that the US antitrust services "blessed" the creation of the oil cartel, because it strengthened the position of American corporations on the world oil market.
- Today, almost nothing is heard about the international oil cartel. But in the media they talk a lot about OPEC.
- Thanks to some journalists, this organization was even called the “anti-cartel”, meaning that it was created to confront the “seven sisters”. Nothing of the sort: the oil cartel continues to exist. The “sisters” that are part of it have already managed to change their “maiden” names more than once. And most importantly - they are hidden behind the OPEC organization screen, which they learned to use as a kind of “Trojan horse”. As an example, we can recall the energy crisis of the year 1973, when the price of "black gold" for four months increased four times. Then the OPEC countries were accused of everything. However, the main "beneficiaries" of the "price revolution" were the same "seven sisters" (and several other oil corporations that joined them), as well as Western banks, where tens of billions of petrodollars from OPEC countries began to flow.
Yes, of course, in the world of oil in the 70-80-s of the last century, there were great advances. Formally, many third world countries have announced the nationalization of the oil industry. But oil buyers remain the same Western oil corporations. The members of the international oil cartel hold monopoly positions in oil refining, transportation and sale of petroleum products.
“And 1970's are also called the decline of the gold-dollar standard and the beginning of the“ golden age ”of international cartels.
- Right. Since the end of 1970's. the topic of international cartels is gradually disappearing from the economic literature, the media, the agenda of meetings of international organizations. In later years, if there are publications on the subject of international cartels, they contain materials and figures relating to previous years. It seems that the era of international cartels is over. But it is an illusion. Cartels were previously in the shadows. They still remain in the shadows. Earlier, antimonopoly services periodically made a fuss about international cartels, but now they prefer not to look and not to notice. An explanation of this phenomenon should be sought in the general weakening (and even dismantling) of the antitrust function of the modern capitalist state. And this weakening, in turn, is due to the fact that there has been a rather radical change in the global monetary and financial system. In the 70 years of the last century, there was a transition from the gold dollar standard (Bretton Woods monetary and financial system) to the paper dollar standard (Jamaica monetary and financial system).
- What is the essence of this transition?
- The fact that before the world currency was the US dollar, which was issued by the US Federal Reserve, but the issue was limited to US gold reserves. After the Jamaican Monetary and Financial Conference (January 1976), the dollar was pegged to gold. Figuratively speaking, the “golden brake” was removed from the “printing press” of the Fed. The owners of the “printing press” of the Fed found almost complete freedom. However, there was one and very serious limitation - the demand for the products of the “printing press” of the Fed - dollars. The topic of how the "owners of money" created and continue to create a very broad demand for dollars is beyond the scope of this conversation. But the first thing that occurred to the "owners of money" was to remove control over the prices of everything and everyone. The energy crisis is the first and very vivid manifestation of this new policy (as we noted, the price of “black gold” soared four times in 1973 over several months). In the light of new financial and currency realities, international cartels are very much needed by the “money masters”. On the one hand, the global financial oligarchy in every possible way assists in the creation of international cartels. On the other hand, she, controlling most of the media, is doing everything possible to ensure that the topic of international cartels does not “pop up” at all. It has an unspoken taboo.
Returning to Lenin's work “Imperialism, as the highest stage of capitalism,” I want to draw attention to the fact that the “classic” avoided one very important aspect of the theme of international cartels. Yes, he listed many industries and industries that were cartelized by the beginning of the First World War internationally (electrical industry, maritime trade, rail production, etc.).
- Is it possible, so to speak, to cartelize not only the production and sale of goods, but also banking?
- The topic of banking cartels is generally taboo. We emphasize once again that the cartel is first of all an agreement on prices. In the banking sector, it is not money that is produced, but money, which also has a price. It is expressed as interest on active (credit) and passive (deposit) operations. Banks (both at the national and international levels) can agree on uniform interest rates, as well as share credit and deposit markets. In the work “Imperialism as the Highest Stage of Capitalism” the second section of the work is devoted exclusively to banks (“Banks and their new role”). But in it, we also find no mention of banking cartels. Here is about banking trusts in America, Lenin writes: “Between the few banks that, by virtue of the process of concentration, remain at the head of the entire capitalist economy, the desire for a monopolistic agreement, a trust of banks, is becoming increasingly common. In America, not nine, but the two largest banks, the billionaires Rockefeller and Morgan, dominate over the capital of 11 billion marks. ” But a bank trust arises from the merger or acquisition of some banks by others. ”
However, one giant banking cartel arose two years before Lenin began to write his work. We are talking about the US Federal Reserve. Surprisingly, Lenin did not pay attention to such an event as the adoption by the US Congress of the law on the Federal Reserve in the last days of 1913. What is surprising that even many Americans have not shown interest in some little-understood “Federal Reserve System”.
- Meanwhile, the creation of the Fed has become a key event not only in American but also in world history.
- This is a topic of special conversation. Now we are interested in the Fed as a banking cartel. And the Fed was just a cartel, uniting under its control the lion’s share of all US banks. And it was a legal cartel, whose status was determined by the law of 1913 of the year. The fact that the Fed is a bank cartel is, unfortunately, not many people pay attention.
Formally, the Federal Reserve was the national banking cartel that operated within the United States. But it must be borne in mind that among the main shareholders of the Fed as a private corporation were bankers not only from New World, but also from Europe. Among them, first of all, the Rothschilds. About this back in the early 50-s of the last century, the American researcher Eustace Mullins told readers in his book “Secrets of the Federal Reserve”. Therefore, it is reasonable to believe that the Fed from the very beginning was an international banking cartel.
“But for some reason, Lenin did not even mention him in his work ...”
- And by the way, it was the largest members of the international cartel “FRS” that became the main beneficiaries of the First World War, since during the war years they gave out military loans to belligerent countries (above all, Great Britain and France) worth many billions of dollars. American economist Murray Rothbard wrote:
“The creation of the Federal Reserve System successfully coincided with the beginning of the First World War in Europe. There is a generally accepted opinion that only thanks to the new system the United States was able to enter the war and not only finance its own military needs, but also provide significant loans to the allies. During the war, the Federal Reserve approximately doubled the money supply in the United States and, accordingly, prices also increased 2 times. For those who believe that the US entry into World War I was one of the most terrible events of the twentieth century, which had disastrous consequences for both the US and Europe, the possibility of the US entering the war is hardly a convincing argument in favor of the Federal War. reserve. "
- But after all, the banking systems of most countries of the world are arranged according to the cartel principle.
“At the same time, the“ head ”of such cartels are the central banks, which determine the“ rules of the game ”for private commercial banks and monitor their observance of these rules. Still, these are predominantly national banking cartels. But in the period between the two wars, the building of a truly global banking cartel began. This is the Bank for International Settlements (BIS) in Basel, which was established in 1930 year. Originally it was intended for the organization of reparation payments by Germany in favor of the winning countries. However, after some time, its main function was to coordinate the activities of the largest Western banks. After World War II, the BIS officially began to coordinate the activities of central banks. Often, the BIS is called the “central bank of central banks,” or “the club of central banks.” In fact, this is the "head" of the world banking cartel. It is known that this international banking supercartel played an important role in the preparation and unleashing of the Second World War, and during the war years coordinated the actions of the bankers of the opposing countries. At the conference in Bretton Woods, the question was raised about the criminal activity of the BIS, it was (albeit with great difficulty) decided to liquidate this banking supercartel. However, the conference decision was never implemented. The international cartel of usurers with the "head" in the Swiss city of Basel still continues to manage the global money market. And through the money market - the entire world economy. Of course, the two world cartels - the Federal Reserve and the Bank for International Settlements closely interact with each other. They can be compared with the two heads of a single world hydra.
Let us return to the work “Imperialism, as the highest stage of capitalism”. In it, the “classic” constantly talks about the law of uneven economic and political development under capitalism. By this “unevenness” Lenin means the constant change in the balance of forces in the world arena of individual capitalist states, as well as the largest companies in the domestic and world markets. This “unevenness”, in particular, gives rise to the instability of international cartels. Many cartel agreements are made for a period, but often fall apart much earlier than the agreed date. Some participants of international cartels are increasing (for example, as a result of the support of their states), while others, on the contrary, are weakening. This inevitably causes the temptation to revise the original agreements by the strengthened monopolies. In some cases, they manage to achieve a revision. In others it is not. Then the cartels collapse. There are cases when it is not possible to agree on the creation of an international cartel at all.
“So are international cartels an illusion of universal peace or a real threat of world war?”
“Perhaps the most important political conclusion that Lenin’s analysis of the fourth economic attribute of imperialism is that international cartels pose a threat to peace, are sources of war. The conclusion, at first glance, is paradoxical. After all, it seems that cartel agreements provide for the termination of competitive wars between monopolies for markets, sources of raw materials and the sphere of capital investment. And at the beginning of the twentieth century, some economists and politicians concluded that an offensive on the earth was "perpetual peace", which is brought to humanity by monopolies and the internationalization of economic life. In his work, Lenin, by the way, sharply criticizes Karl Kautsky for the belief of this German in that the cartels carry the world to humanity.
In the final part of the fifth section of the book, Lenin writes: “The capitalists do not divide the world according to their special malice, but because the stage of concentration that has been achieved forces them to take this path for profit; at the same time they divide it “according to capital”, “according to force” - there can be no other way of sharing in the system of commodity production and capitalism. The strength varies with economic and political development. ”
- And how would you comment on this in the light of today?
- Well, monopolies for the redistribution of the world use their own power capabilities as much as they can (for example, they rely on private military companies). But they are clearly not enough. Therefore, their main power resource is a state with armed forces ready to participate in military operations anywhere in the world. The division of the world "by force" makes it inevitable to transform private monopoly capitalism into state-monopoly capitalism (MMC).
Analyzing the history of the creation and development of international cartels, we must learn from the history of the twentieth century. And do not fall into those illusions and utopias of the "eternal peace" that were common among the "academic public" at the beginning of the last century. The era when transnational corporations and transnational banks divided the world "in capital" is close to its end. We are entering an era when extensive world exploration by monopolies (called globalization) is no longer possible. Monopolies are beginning to divide the world "by force." Today's events in the Near and Middle East are a clear confirmation of this.