By Greg Godels

April 7, 2023

The fashionable term “multipolarity” — popular with a significant section of the international left — has an historical antecedent. In 1914, Karl Kautsky — then possibly the most prominent Marxist theoretician in the world — wrote an essay on the phases of capitalism — past, current, and future. Like many modern-day multipolaristas who imagine a stable, peaceful imperialism after the taming of the US, Kautsky foresaw a benign phase of capitalist cooperation and peace after the war, after the belligerents were exhausted.

The capitalist countries would find peace on the international level through a process similar to cartelization– the formation of monopolies. Kautsky believed that the growth of monopoly concentration on the corporate level — a process ongoing in the late nineteenth century and acknowledged by nearly everyone — was parallel with the concentration of countries, their colonies, and spheres of interest on the international level. As monopolies reduce competition among corporations, Kautsky reasoned, ultra-imperialism would reduce competition and rivalry among state powers.

Written a few months before the First World War and published a few months after the war began (with revisions), Ultra-imperialism (September, 1914) sought– first and foremost– to explain qualitative changes in capitalism: from its nineteenth-century phase as “free market” capitalism led and dominated by Great Britain, to its imperialist phase or form, existing at the time of Kautsky’s essay, to its ultra-imperialist phase, anticipated by Kautsky after the war would end.

To today’s reader, Ultra-imperialism may express some unusual, even eccentric ideas, though they reflect the rapidly changing circumstances that engaged Marxists at the turn of the last century. Capitalism was changing; the working-class movement was changing; the socialist parties were changing; and the movement’s leaders were changing.

Capitalist enterprises were growing larger and larger, absorbing smaller competitors and concentrating significant industries into fewer units. Capital accumulation had grown as well, with the result that financiers were looking farther afield for investment opportunities. And states were encouraging the export of capital, while committing to protection of those investments through acquiring colonies and developing spheres of interest.

These profound qualitative changes did not go unnoticed; within Marxist circles, not only Kautsky, but others — Bukharin, Luxemburg, and, of course, Lenin — were exploring the meaning of these changes. Without question, Lenin’s contribution — the book, Imperialism — placed the most indelible stamp on the left’s understanding of imperialism over the next one hundred years.

For Kautsky, changes in the form or phase of capitalism sprang from disproportionalities between industrial and agricultural production. Granting that capitalist industrial production knew no bounds, exchange with the agricultural sector was always limited by the slower growth in the production of foodstuffs and the availability of raw materials, as well as the number of customers for industrial goods. While drawing a distinction between industrial and agricultural sectors may seem artificial to today’s readers, it reflects a difference better expressed as the difference between advanced capitalist countries and pre-industrial regions, countries, and even continents in the early twentieth century.

Kautsky sketches a plausible natural history of the advanced capitalist countries seeking answers to the problem of the “agricultural sector” through exporting capital to other countries for trade and markets. Colonization arises because these new markets lack infrastructure and –frequently — state structures. The capital exporter finds it easier to impose its state than to create a new state: “Naturally, this is best supplied by the State power of these capitalists themselves… Hence as the drive for increasing capital export from the industrial States to the agrarian zones of the world grows, so too does the tendency to subjugate these zones under their State power.”

This is Kautsky’s theory of the rise of imperialism. Interestingly, Kautsky, unlike Lenin, characterizes this relationship between colonizer and colonized as oppressive, rather than exploitative.

Not all countries that develop by the importation of capital are locked into a subordinate role by the industrialized countries; Kautsky cites the US and Russia as enjoying exported capital from other countries, but possessing “the strength to protect [their] autonomy… The desire to hinder this [autonomy] is another motive for the capitalist states to subject the agrarian zones, directly — as colonies — or indirectly — as spheres of influence…”

Where Lenin sees imperialism as an imperative of mature monopoly capitalism — a stage dictated by the very mechanism powering capitalism– Kautsky understands imperialism as a policy, a choice made somehow by the collective capitalist: “Does [imperialism] represent the last possible phenomenal form of capitalist world policy, or is another still possible?”

Significantly, Lenin’s Marxism engages laws of motion to explain the imperialist stage, while Kautsky’s Marxism counts imperialism as a path taken, among others available.

Further, Kautsky separates the arms race, militarism, and war from the logic of capitalism:

But imperialism has another side. The tendency towards the occupation and subjugation of the agrarian zones has produced sharp contradictions between the industrialized capitalist States, with the result that the arms race… and… the long-prophesied World War has now become a fact. Is this side of imperialism, too, a necessity for the continued existence of capitalism, one that can only be overcome with capitalism itself?

There is no economic necessity for continuing the arms race after the World War, even from the standpoint of the capitalist class itself, with the exception of at most certain armaments [sic] interests. On the contrary, the capitalist economy is seriously threatened precisely by the contradictions between its States. Every far-sighted capitalist today must call on his fellows: capitalists of all countries, unite! [my emphasis]

Thus, for Kautsky — as opposed to Lenin — war is not a constant, expected outcome of imperialism. Certainly, the call for capitalists to unite behind peace underscores the difference!

Because the economics of imperialism are turning against the capitalist– returns on capital exports evidenced a decline, according to Kautsky — “Imperialism is thus digging its own grave… the policy of imperialism therefore cannot be continued much longer.”

So, what comes next, in light of the pitfalls of continuing imperialism?

Kautsky answers:

What Marx said of capitalism can also be applied to imperialism: monopoly creates competition and competition monopoly. The frantic competition of giant firms, giant banks and multi-millionaires obliged the great financial groups, who were absorbing the small ones, to think up the notion of the cartel. In the same way, the result of the World War between the great imperialist powers may be a federation of the strongest, who renounce their arms race.

Hence from the purely economic standpoint it is not impossible that capitalism may still Jive [sic] through another phase, the translation of cartelization into foreign policy: a phase of ultra-imperialism, which of course we must struggle against as energetically as we do against imperialism, but whose perils lie in another direction, not in that of the arms race and the threat to world peace.

So Kautsky effectively bails out capitalism as the source of war and aggression.

With the finished manuscript about to be published in Die Neue Zeit only a few months after the beginning of what was shaping up to be a world war, Kautsky recognized that readers might find the promise of a post-imperialist lasting peace somewhat questionable. Nonetheless, he foresaw “this last solution, however unlikely it may seem at the moment.”

How do we judge this remarkable projection? Is there merit to the theory of ultra-imperialism?

Clearly, Lenin scathingly rejected it. He wrote in a December, 1915 Introduction to N. Bukharin’s Imperialism and World Economy in his characteristically caustic fashion:

Reasoning theoretically and in the abstract, one may arrive at the conclusion reached by Kautsky… that the time is not far off when those magnates of capital will unite into one world trust which would replace the rivalries and the struggle of nationally limited finance capital by an internationally united finance capital…

Particularly as regards Kautsky, his open break with Marxism has led him, not to reject or forget politics, nor to skim over the numerous and varied political conflicts, convulsions and transformations that particularly characterise the imperialist epoch; nor to become an apologist of imperialism; but to dream about a “peaceful capitalism.” “Peaceful” capitalism has been replaced by unpeaceful, militant, catastrophic imperialism… If it is thus impossible simply, directly, and bluntly to dream of going from imperialism back to “peaceful” capitalism, is it not possible to give those essentially petty-bourgeois dreams the appearance of innocent contemplations regarding “peaceful” ultra-imperialism? If the name of ultra-imperialism is given to an international unification of national (or, more correctly, statebound) imperialisms which “would be able” to eliminate the most unpleasant, the most disturbing and distasteful conflicts such as wars, political convulsions, etc., which the petty bourgeois is so much afraid of, then why not turn away from the present epoch of imperialism that has already arrived — the epoch that stares one in the face, that is full of all sorts of conflicts and catastrophes? Why not turn to innocent dreams of a comparatively peaceful, comparatively conflictless, comparatively non-catastrophic ultra-imperialism? And why not wave aside the “exacting” tasks that have been posed by the epoch of imperialism now ruling in Europe? Why not turn instead of dreaming that this epoch will perhaps soon be over, that perhaps it will be followed by a comparatively “peaceful” epoch of ultra-imperialism which demands no such “sharp tactics”[?]

In this tendency to evade the imperialism that is here and to pass in dreams to an epoch of “ultra-imperialism,” of which we do not even know whether it is realisable, there is not a grain of Marxism… [H]e offers us not Marxism, but a petty-bourgeois and deeply reactionary tendency to soften contradictions… Kautsky again only promises to be a Marxist in the coming epoch of ultra-imperialism, of which he does not know whether it will arrive! …For to-morrow we have Marxism on credit, Marxism as a promise, Marxism deferred. For to-day we have a petty-bourgeois opportunist theory — and not only a theory — of softening contradictions.

Lenin was, first and foremost, a political polemicist. While he was a profoundly deep thinker, he worked most often in the heat of political battles, where sarcasm and ridicule struck with the greatest force.

He explains Kautsky’s theory in the context of opportunism. Because Kautsky’s intellectual ship — and that of other Social Democratic leaders — had left their Marxist moorings, they were susceptible to the allure of idealized, dream-like illusions of peaceful capitalism and, subsequently, peaceful imperialism.

Against these illusions, Lenin pressed the realities of a growing human catastrophe– World War I– which was only beginning to reveal the human misery that lay ahead. It was this imperialist war — a war with no meaning besides imperialist rivalry — that shatters Kautsky’s dream.

With over a hundred years and the benefit of hindsight, we can better judge whether Kautsky’s “Marxism on credit, Marxism as a promise” can be cashed or redeemed. History is always the laboratory for the science of Marxism.

Clearly, Lenin was correct and Kautsky wildly mistaken — no period of peaceful capitalism or peaceful imperialism followed the first great war of the twentieth century. To the contrary, the last century was one of constant wars, imperialist aggression, and unprecedented human devastation. Nor could it be otherwise, as Lenin would argue, as long as capitalism continued to generate competition and rivalry.

Movements could and should rise to oppose this tendency. Revolutionaries should stand firmly against these wars and they should attempt to marshal as much broad support to delay, thwart, and stop these wars, but they should not be under the illusion that capitalism and its instrument, imperialism, would not continually express this tendency.

Kautsky’s theoretical argument for ultra-imperialism rests on a common mistake in understanding both Marx and monopoly. On the level of enterprises, Kautsky sees discrete stages where a competitive industrial sector moves inexorably towards a monopolized industry (he concedes that Marx always notes that monopoly always goes to competition, as well — an inconvenient formulation that he conveniently ignores). His theory of imperialism builds on this model: on the level of countries, he argues that imperialist competition (rivalry) always moves towards a global monopoly, an imperialist combine or cartel.

Hence, the global economy will usher in an era of stability and peace — ultra-imperialism.

But this is neither true to Marx’s thinking nor consistent with the dialectics of competition. The foundation of the Marxist theory of competition is found in the earliest published Marxist tract on political economy, Frederich Engels’ neglected Outlines of A Critique of Political Economy (1844), which gives considerable attention to competition and monopoly and birthed the proposition: “Monopoly produces free competition, and the latter, in turn, produces monopoly.”

While Engels understands the dialectical relation of competition to monopoly, he insists on the constancy of competition: “We have seen that in the end everything comes down to competition, so long as private property exists.”

In this, one of the clearest statements of the dialectics of competition, Engels explains this as, not necessarily discrete stages, but as a fundamental interplay:

The opposite of competition is monopoly… It is easy to see that this antithesis is again quite hollow…Competition is based on self-interest, and self interest in turn breeds monopoly. In short, competition passes over into monopoly. On the other hand, monopoly cannot stem the tide of competition — indeed, it itself breeds competition.

Engels emphasizes that competition is fundamental to what Marxists would call the capitalist mode of production — it permeates every aspect of capitalist social and economic life. While concentration (monopoly) is an ever-present process, it never supersedes competition, nor does it erase competition. Kautsky’s mechanical Marxism — like later day theorists of monopoly such as Sweezy and Baran — misunderstands both the constancy of competition and the process of monopoly or cartelization. Competition (rivalry) is the mainspring of capitalism in all of its forms and remains so as capitalism evolves.

Is Today’s Multipolarity the same as Kautsky’s Ultra-imperialism?

It has become popular, especially with the left, to hail the weakening of US and NATO imperialism as the singular goal of the anti-imperialist project. Certainly, a weaker, defanged US foreign policy, corporate reach, and military posture is both an urgent task and a fully justified goal for anti-imperialists. But should it be the singular goal?

After the fall of the Soviet Union and its Eastern European allies, the world might have appeared to be unipolar. The US, the remaining superpower that survived the Cold War, exercised near-absolute control over global institutions, maintained military bases in every region, and met little early resistance to its plans. As the US intervened in more and more countries’ internal affairs, the description of a “unipolar world” seemed more and more apt.

Predictably, resistance emerged. Several countries rebelled, especially in the Middle East and Central and South America. Popular movements, in defiance of the US, chose independent policies, insisted on national sovereignty, even waged what Lenin called “national wars” — direct or proxy national liberation wars (e.g. Iraq, Afghanistan, Syria) — against the US.

The twenty-first century saw further erosion of the US’s unipolar status and increasing resistance to the US government’s diktats. The growing economic might of People’s China, largely untouched by global economic turmoil, challenged the US on that front, as did Russia’s growing military might and energy competitiveness.

Clearly, only decades after declaring itself the global leader, US hegemony was under stress. Influence, power, and leadership were diversifying. In significant ways, the world was becoming multipolar. And, insofar as this new order restricts the US arena of action, it is a good thing.

But multipolarity as reality is different from multipolarity as a doctrine. To welcome multipolarity because it restrains the US is one thing; to welcome multipolarity because it heralds a new age of peaceful coexistence and world harmony is another– something far more misleading and dangerous.

Like Kautsky, some on the left leap to the conclusion that capitalism can be delinked from competition or rivalry, if only the US were contained. As Lenin observed, there is more wishful thinking in this position than a reflection of reality.

For doctrinaire multipolaristas, a century-old history of imperialist rivalry among the great powers, disrupted only partially by a united anti-Soviet, anti-Communist crusade, counts as little evidence that capitalism invariably stokes imperialist rivalries. They choose to overlook this pattern.

Less than two decades after the end of the great imperialist war, Japan, Italy, and Germany had begun quests of imperialist expansion, often at the expense of the empires of other great powers like the UK and France.

At mid-century, the Cold War confrontation and the threat of nuclear annihilation tempered the danger of global war, yet wars of both national liberation and anti-insurgency raged — imperialist wars. In many cases, economic aggression replaced military aggression, as former colonial masters sought to establish neo-colonial relations.

Despite this backdrop of persistent, unending imperialist competition and conflict, multipolaristas imagine a coming era of multilateral cooperation and mutual respect.

They imagine that India and Pakistan will establish an unprecedented harmony; that Japanese claims to the Kuril Islands will dissolve; that Balkan rivalries and Armenian and Azerbaijan conflicts will magically resolve; that the long-standing and always simmering rivalries in the Middle East will disappear; and that the struggle to control the vast wealth of the Democratic Republic of the Congo will wither away and be settled peacefully, once US imperialism is contained.

They see no ominous signs in the growing belligerence and greatly expanded military budgets of Germany and Japan. They hail global realignments and new alliances as steps toward peace, rather than potential sources of conflict.

The war in Ukraine unleashed a far greater threat to local, regional, and even global war than we have seen in fifty years. As Ian Buruma has noted, the war has licensed Germany to expand its war budget by 100 billion euros, while loosening the post-war shackles on this former instigator of the last global war, a moment that Chancellor Scholz calls a “historic turning point.”

Buruma cites a commitment that Japanese prime minister Kishida makes to increase military spending by 50% in 5 years, a dangerous break with Japan’s constitutional fetters. This is an omen of the utopian multipolarity to come?

Like Kautsky’s theory of ultra-imperialism, this theory of a peaceful and harmonious world of capitalist powers is a radical departure from what history teaches and from today’s realities. And like Kautsky, its proponents have lost touch with the dynamics of capitalism in the era of imperialism. Kautsky saw the basic contradiction of his time between competitive capitalism and monopoly capitalism, with the “cartelization” of empires eliminating global rivalries.

Today’s multipolaristas see the struggle between unipolarity and multipolarity as the principal contradiction facing the world. As with ultra-imperialism, this is an illusion that allows them to evade the great contradiction of our time: the struggle between an overripe, failed system — capitalism — and socialism.

Since the demise of Soviet socialism, advocacy of socialism has fallen out of fashion. To most on the left, socialism is, at best, a far-off dream, well beyond our reach. No doubt this despair– unmatched even by the most desperate times of the past– informs the attraction of multipolarity, something that appears within reach.

But intellectual integrity requires that we go where the truth takes us. And the truth in our day– like the truth in Kautsky’s day– demands that we recognize that capitalism generates war. And the final solution to war is socialism.