Lenin’s Theory of Imperialism

The Instagram account “leftist.professor.peter” summarizes Vladimir Lenin’s argument that capitalism necessarily leads to imperialism. The account author states: “Lenin argued that imperialism isn’t just about conquest; it’s a natural outcome of capitalism... When capitalism reaches its limits at home, competition creates monopolies, big corporations dominate entire industries... When domestic markets become saturated and resources are fully exploited, they pressure governments to secure new markets and resources abroad… He argued that as long as capitalism exists, powerful nations will seek to dominate weaker ones to maintain economic growth” (https://www.instagram.com/p/DGPQm6Lim63/)

If it were true that big corporations invest in poorer foreign nations to exploit their labor and resources, we would expect to see most foreign investments going to poor countries rather than to rich ones. Thomas Sowell writes that during the time when Lenin published his book on Imperialism, the majority of foreign investment was in other rich nations, not poor nations. When Lenin was claiming the Western world was exploiting underdeveloped nations: “The United States was the largest single recipient of British, German, and Dutch capital” and “the United States invested more in Canada than in all of Africa and Asia put together” (Sowell, 2016, p. 246-247). This was true for most of the 20th century until many Asian nations began to rise in power later that century. Rich nations invest more in other rich nations because they are more productive. Peter Bauer points out that the poorest nations of the world today are those that have the least amount of commercial contact with developed nations. He facetiously remarks that if foreign investment in poorer nations is exploitation, then “the poverty of these countries shows that they have experienced too little rather than too much exploitation” (Bauer, 1976, p. 169). 

References

Sowell, T. (2016). Wealth, Poverty and Politics. Basic Books.

Bauer, P. T. (1976). Dissent on Development: Revised Edition. Harvard University Press.