Imperialism and Socialism

Chapter XV of Economic Causes of War by Peter T. Leckie,
published as a pamphlet in 1920
based on a series of articles from the
Western Clarion, March-November 1920

The two great schools of thought which confront the people of the civilized world today are Imperialism and Socialism. Although they are diametrically opposed to each other, they have some things in common. Both schools agree that Nationalism is dead or dying. Before going any further, it may be well to arrive at the meaning of the word Imperialism. The Oxford Dictionary gives the best definition of Imperialism of all the dictionaries I have examined. It says: “Imperialism is the extension of the British Empire where trade needs the protection of the flag”. It has been stated by many speakers that trade follows the flag, but my close study of history has convinced me that the trade advances ahead of the flag, hence I agree with the definition of the Oxford Dictionary.

Mr. J. S. Ewart, K.C., of Ottawa, one of the best historians of Canada, says in his Kingdom Papers Nº 2, page 32:

“British Imperialism in its relation to the British North American Colonies has always been based upon the ideas of profit, I now proceed to prove.”

Mr. Ewart divides up Canadian history into three periods, namely:

1st . - “From the beginning to the advent of Free Trade or say to the eighteen forties, British Imperialism was based upon the profit derived from trade.”
2nd .- “From the eighteen forties to the eighteen eighties there was very little British Imperialism because there was very little profit.”
3rd. - “Since the eighteen eighties, British Imperialism has become enthusiastic and exigent, because of the military as well as the commercial profit that appeared to be in it.” . . . “The European nations did not as a mere pastime fight for colonial possessions. They wanted profit.”

In the first period the mother country prohibited the colonists from engaging in manufacture, using them to promote home trade. Mr. Ewart says that Free Trade removed the monopoly in the second period and British Imperialism waned because the colonies ceased to be profitable. He does not mince matters, for on page 43 he says: “Nations must be governed by self-interest”. And on page 46:

“The reason for the extraordinary change in British Imperialism since 1897 is easily explained. In 1897 the Canadian Parliament gave to British manufacturers preferential treatment, with respect to customs duties, all the other colonies followed the lead. British Imperialism quickly and enthusiastically responded.”

“Added to the trade-profit came the new desire for the more important war profit.”

“Since 1897 British Imperialism had found plenty of nourishment and its growth has been phenomenal. The sentiment that it is in it is founded upon substantial profit.”

Mr. Ewart, replying to criticism says, page 89:

“I know that, until very recently, the United Kingdom had no love for us. I know that Canada was treated as a dependency as long as she was of commercial value; that she was told to ‘break bonds and go’ when her commercial value ended, and that only since she has appeared to be willing to furnish trade profits and able to supply military assistance, has effusive affection been lavished upon her.”

On page 90:

“The sight of trade profits and war profits has worked an extraordinary change in the last twenty-five years. Half-breed colonials are now ‘Overseas British guests and kinsfolk’. It is the turn of the Canadians to smile.”

That is the view of one of Canada’s outstanding K.C.’s on international law and probably one of the best historians in the Dominion.

One of the principal causes of the economic friction among nations and behind war is the fear of countries without access to convenient ports in their own country, a condition which might hamper their trade, not only in transit, but also by tariff walls. This is one thing that made Germany uneasy, because she did not possess the mouth of the river Rhine, and as I pointed out in an earlier article, a much similar situation obtained in Serbia’s desire for a port on the Adriatic Sea, and also in Russia not owning Constantinople for an all-year port. Modern Imperialism aims at the political control of all backward countries by the great capitalist governments of today, for the purpose of securing for their respective capitalists the security of industrial enterprises which they may establish in those backward countries. Also to insure raw material for the home industries and a monopolistic market for the finished product of the home exploitation, and the exploitation of native labor in the newly acquired territory. J. S. Ewart, as I have pointed out, says that Imperialism waned with Free Trade.

British capitalism became pacific after the development under the factory system as the ideas of the Manchester school of Free Trade became dominant. When the change came to renew Imperialism, it was not because as Mr. Ewart says the renewal of profits, but as Boudin says in his Socialism and War, capitalism had entered its Iron Stage. Mr Ewart dates this change from 1897. In 1895 Joseph Chamberlain entered the Cabinet representing Birmingham. Birmingham is the headquarters of the iron and steel industry, therefore iron and steel became represented in the powers of government. If you want to know how business is faring, if you want to feel the pulse of capitalism, look up the market reports of the iron and steel industries. Boudin tells us that:

“The world at large was surprised at Chamberlain selecting the Colonial Office as his particular field for activity; before that the office was considered a minor one in the Cabinet, instead of taking the Chancellor of the Exchequer which J. Chamberlain would have done if he had followed tradition.”

This was the entry of British capitalism into modern Imperialism. This change raised the Colonial Secretaryship from its former minor position to a place of first importance in the British Cabinet. The Boer War was a result of this change of policy. Although Chamberlain failed to carry his protection programme, England has proved by the results of the Great War that she is foremost in the Imperialistic procession.

Modern Imperialism is an expression of the economic fact that iron and steel have taken the place of textiles as the leading industry under capitalism. Textiles, being pacific, mean peace, but iron and steel mean war because the interests of this trade conflict in foreign markets, as I will point out further on. The basis of capitalistic industrial development is the fact that the workers not only produce more than they themselves can consume but more than society as a whole can consume. This permits an accumulation of wealth that must find a foreign market, and that market is generally in a country of a lower degree of capitalistic development. A market in a country equally as highly developed has no effect in disposing of the surplus wealth as it generally pays by exchanging other goods. The foreign market, therefore, must be an absorbent market, which results in the highly developed capitalist countries competing in the backward countries of the globe. Of course this cannot go on forever, as more countries reaching the stage of producing a surplus the number of absorbent markets becomes less and the competition for control of them becomes intensified. The capitalist world is to create new markets by means of obtaining concessions to build railways and canals and other public works. This gives an impetus to the iron and steel industry, and incidentally it creates a market for textiles. The highly developed capitalist countries produce the machines and means of production and less of the means of consumption. Consequently, they have to import raw material and foodstuffs, and this is particularly applicable to the European countries. A country in the early development of capitalism generally produces consumable products with machinery produced abroad, and when it becomes a competitor instead of a consumer it does not compete in all the fields of production. It continues as a customer mostly in machinery and begins to produce textile goods and other consumable commodities. This is why, in highly developed capitalist countries, the leading industries are iron and steel, as they put their accumulated wealth into means of production. Where there is a rapid accumulation of wealth the iron and steel industries have become more prominent and have taken the lead over textile industries. This is the real cause of the change of character from the pacific mood of the Free Traders like Bright and Cobden to the warlike and imperialistic mood of Joseph Chamberlain.

Capitalism has entered the era of Imperialism, and the reason for it is very simple. Iron and steel cannot be sold like textiles. For instance, clothes, hats and wearing apparel can be sold almost anywhere, where a missionary has been sent; you only need to send a good salesman and you need not worry under what flag the native is ruled. The situation is greatly changed if you want to sell locomotives or rails, as a salesman cannot take a cargo of them and sell them to the natives. The only way this can be done is to build the railway yourself. While a German could sell textiles in any British colony he would find some difficulty in building a railway through any of those colonies. Hence, it will be seen how free trade in textiles does not apply to iron and steel. Not only do the capitalist countries that are highly developed reserve the right to build their own railways, but they have all been very jealous of each other in the matter of building railways in the backward countries such as Turkey, Persia, China and Africa.

Marx tells us:

“The capitalist process of production consists essentially in the production of surplus value. It is not to administer certain wants but to produce profits. He does not advance capital merely for reproducing it, but with the view of producing a surplus in excess of the capital advanced.”

As no one can build railways in backward countries to produce dividends soon enough, pressure is brought to bear on the ruling power of that country for concessions, such as a subsidy of money from the Government, a monopoly market for themselves, or vast tracts of mineral lands. Sometimes a reluctance on the part of a backward country to grant concessions is altered by force, either threatened or actual. The trade of capitalist nations has ceased to be that of individuals but has become a matter of armed force used by large groups called nations. Owing to this intensified industrialism, statesmen must think in terms of commerce, about markets for manufactured goods and supplies of raw material for their country’s industries.

I might here draw your attention to the granting of concessions and the building of railways which are interwoven in every article I have written. You have the Cape to Cairo railway and various other railways in South Africa, a part of the globe I have not touched on. You have the railway incident in Morocco. The struggle for ownership of the railway in Chinas when it changed hands to Japan after the Russo-Japanese war. You have all the railways and concessions Germany forces from China given to Japan. The British, French, and the Standard Oil Company, with their railways in China. British and Germans both owned railways in Asia. Lord Rathmore presiding at the half-yearly meeting of the British company owning the Ottoman railway from Smyrna to Aden, in 1917, said:

“Our railway still remains in the possession of the Turkish Government by which it was lawlessly seized in November, 1914, and from that time we have not received any dividend from it.”

When he referred to the start of the company he said they had a struggling existence, but were becoming prosperous, with the intention of extending to Baghdad and the Persian Gulf, when the German enterprise penetrated into that territory and thereafter with forced diplomacy and systematic bribery of Turkish officials received advantages over the British company. The company lodged with the Foreign Claims Office a statement of their claims in respect to their losses which might amount to five million dollars. Lord Rathmore had written to the Foreign Office and had said:

“The frequent intrigue of the German companies against all similar enterprises, and the wholesale corruption of the Turkish officials, must make their continuing influence a constant menace to the peaceful and prosperous workings of other railways in Asia Minor.” “If the control of the Anatolian and the Baghdad railways be taken out of German hands my council would most respectfully suggest that our company be entrusted with their management.”

The Foreign Office had acknowledged the letter assuring the company that their claims and contentions would be most carefully borne in mind. This German railway was controlled by Herr A. Von Gwinner, of the Deutsche Bank. They operated 641 miles of railroad, the net profit of which in 1912 was 4½ million francs. They began operations in 1888 and induced the Turkish government to guarantee them an annual revenue of from £658 to $885 per mile. There is also a French concession railway in Turkish territory, the Smyrne Cassaba et Prolongement.

H. N. Brailsford in his War of Steel and Gold, tells us that foreign contractors paid by the mile, built railways zig-zag across the plains of Turkey, and when the railways could not pay dividends seized the customs receipts of the country for security. Germany and Austria for the purpose of expanding to the East with railways. Turkey was so heavily indebted to foreign capitalists that her revenue was placed many years ago under the supervision of an international commission representing the great European powers. The duties Turkey imposes on imports are prescribed for her by the same powers, and she could not increase her revenue by increasing her custom duties without their consent. As an increase of duties was practically the only source by which Turkey could pay a subsidy to the Baghdad Railway, the financing of that railway became a matter of international politics. England being one of the great exporters to Turkey, the duty on her goods would be really paying the profits which would be reaped by the Germans owning the railway. England vetoed the plan of paying the subsidy out of the increased import duties and therefore endangered the enterprise. Russia’s objections were mostly of a military and strategic nature.

Britain had other objections besides the purely financial one mentioned. She was at first rather favorable to the project, and even helped in the initial stages with her influence. This was the time that England was pacifist and making Germany gifts of Heligoland, etc. But by the time the project began to be realized Britain herself was in the era of modern Imperialism, and assumed a hostile attitude, which led to the “Kowait Incident”. The Baghdad Railway was not to stop at Baghdad but to extend to the Persian Gulf, the only logical terminus for such a railway. For it to end at the Persian Gulf was the chief British objection, and Britain therefore resolved to stop it, and she did so when it became apparent that Germany was reaping great diplomatic victories at Stamboul and that the Sultan was irrevocably committed to German plans. Britain discovered that Turkey’s sovereignty of Kowait was of a doubtful nature, and her interests demanded that she take an interest in the quarrels of some native chieftains with a view to eliminating the Sultan from the situation. One fine morning a British man-of-war appeared in Kowait harbor and Kowait was declared an independent principality, care being taken that the independent ruler looked upon the Baghdad railway scheme from the British point of view. Although the work continued on various sections of the railway, the original idea was defeated and Germany gave up the idea of reaching the Persian Gulf, being thwarted by France and Britain coming together. This made the railway futile and robbed it of its importance in an ocean ton ocean Empire scheme.

This steel and iron age of capitalism is not confined to railways; it is also very much interested in armaments. French and German ambassadors at Constantinople engaged in incessant conflict over the right to serve Turkey with armaments, from the forges of Creusot in France or Essen in Germany. The banks take their share in this competition and the procedure is to offer a loan, on condition that the proceeds be expended to purchase guns from either side as the case may be. A British firm built the forts at Dardanelles in 1914. Austria has been known to make it a condition of a tariff treaty with Serbia, that she should buy her guns from the Austrian works at Skoda. Britain’s treaty of defence of Spanish interests in Morocco resulted in the rebuilding of the Spanish navy by British firms. When a loan and railway concession in 1909 went to Germany, the British Ambassador objected and China was going to the fogs, but when Lever and Company combined to found a vast soap factory in China it was good business.

It was the great steel interests of the United States that dictated her entrance into the Great war. The exports of the States, which in 1913 were 2,466 billions, increased to 5,481 billions in 1916, the largest share of which went to the war industries. Out of the sudden falling off of their exports through the submarine warfare arose the demand for the freedom of the seas, or in other words a market for their products.

So we find that government today is in reality the executive committee of the trusts and affiliated banks who use diplomacy and armaments if not actually to annex semi-civilized countries, at least to secure markets, excluding competition from the building of railways and the exploiting of mines in their self-allotted spheres of interests. The Great War had ended with the Imperialist strengthened in the saddle of governments. The recent merging of the Canadian steel, iron and coal industries in the British Empire Steel Corporation is an inevitable outcome of the intensive development of the iron stage of capitalism. Imperialism aims at the autocratic control of all the small nations to exploit them for its own benefit. Production of profits merely considers wants that can be paid for, and the worker only gets a small share or slave’s portion of the wealth he produces. The Socialist wants to socialize the means of production and production for use, eliminating the exploitation of one by another.

While the contradictions of the capitalist system have become greater, such as production, which is a social act, yet the appropriation of the wealth is undertaken by the capitalist class because of their ownership of the mean of production. Capitalism has severed the worker from the tools and has made him a wage slave. There exists, as Engels points out, a: “Contradiction between socialized organization in the individual factory and social anarchy as a whole”. Through the perfecting of machinery being made compulsory for each manufacturer by competition there arises the great industrial reserve army, the great contradiction of want in the midst of plenty. Excess of the means of subsistence on the one hand and on the other, excess of workers without means of subsistence. As soon as a capitalist country is over-stocked with wealth, poverty stalks abroad. The most remarkable contradiction under capitalism is the fact that while the exploitation of the worker becomes greater the rate of profit has a tendency to sink. As Marx points out, profit is mystified surplus value because profit is the percentage calculated on the total capital invested. We are told to save for the dull times, but if all the people of Canada were to save a dollar a head per week they would hasten the industrial crisis by leaving between seven and eight million dollars worth of products on the market. Some say invest the money, but how can that be done when the demand for commodities has been cut down already? Capitalists recognize the social character of production which forced on them the joint stock companies and later the trusts with their concentration of wealth, making the capitalist class superfluous as all their social functions are being performed by salaried employees

It is this overproduction that brings on a struggle for foreign markets. Listen to a capitalist view. Hon. Leslie M. Shaw, while secretary of the United States Treasury under President Roosevelt, delivered a lecture to the students and faculty of Chicago University, March 1st, 1907, just previous to the financial panic of that year. He was speaking to a critical audience and knew his speech would be given a wide circulation. He said:

“The time is coming when the manufactories will outgrow the country, and men by the hundred of thousands will be turned out of the factory. The factories are multiplying faster than our trade, and we will shortly have a surplus, with no one abroad to buy and no one at home to absorb because the laborer has not been paid enough to buy back what he has created. The last century was the worst in the world’s history for wars. I look to see this century bring out the greatest conflict ever waged in the world. It will be a war for markets and all the nations of the world will be in the fight as they are all after the same markets to dispose of the surplus of their factories.”

Why this surplus? It is, as Mr. Shaw says, because the laborer has not been paid enough to buy back what he has produced. Then the workers are used as pawns in the fight and die for their country to obtain a market to dispose of the surplus wealth they themselves produced and that Shaw tells us we cannot buy back because we are not paid enough. The worker is recompensed for his services in the war with miserable pensions, street organs, and kicks.

Socialism is nothing but a reflex in thought of the conflicts which exist under capitalism. The fact exists outside of us, independent of the will or actions of even the capitalists who have brought it on. These conflicts are the contradictions I have mentioned and are the case of the antagonisms between what are called Capital and Labor. Some people would have us believe that war is an economic necessity. In its origin when primitive tribes spread over the earth in search of pastures new, because of famine or inadequate fertility of the soil, war may be termed an economic necessity, but today, while it may be an economic necessity for the capitalist class, to the Socialist it results from the instability of capitalism. The breakdown of the capitalist system, leading to the social revolution, is being brought about by the inherent contradictions of the capitalist system of production itself.

Meanwhile the discontent of the workers is growing, and the sense of injustice of the present social system has developed a new code of ethics. Having no property of their own, and the means of wealth production being owned by companies and corporations, having no body to be kicked or soul to be dammed, the workers fail to see the need of private property in production and shout for government ownership and control. But we must point out to the worker that that is not the remedy. Andrew Carnegie advocated Government ownership of railways, and if the capitalists sell out to the government and hold bonds, their unearned wealth would flow smoother than today because the government would use the military to squash labor with a still firmer hand.

Then again, a new phase has arisen which E. D. Morel in a speech in England has pointed out, and which we as workers cannot ignore, as a result of the Great War; that is that black troops are being used by France in the occupied territory of Germany. These troops, converted into machines of slaughter to save the world for democracy and for the glory of God, have brought about terrible conditions amongst the womenfolk of the occupied territory. France is militarizing her African colonies to such an extent that by 1922 she will have 200,000 African, mostly negroes, without counting the conscripts of French North Africa – Algeria, Tunis and Morocco. Two of the three years of their training is to be spent in France. There is no use in disguising the fact, these troops will be used in France, and Jean Longuet realizes that in a letter he wrote E. D. Morel. This policy of France will be forced upon Great Britain if she hopes to possess her share of Africa, which has only a force of 2,000 police to keep internal order with and which is next door to the French territory that is being militarized. If the policy of using these black troops in France to keep the workers down is carried out, don’t forget they will be used elsewhere.

To talk of peace through such a medium as the League of Nations, or any other method under capitalism, is preposterous. We, as Socialists, must carry on the class war by educating the worker to the fallacy of the Imperialists’ policy of pitting the workers of one country against those of another. The class war is not against the individual, but against the social system and the social position of the economically dominant class; not a fight to supplant the capitalist class but to abolish them. It is not a fight against an inferior class, because when the class struggle is understood a historic mission is ascribed to every class. The historic mission of the capitalist class has been accomplished and the class itself has outlived its usefulness, becoming parasitical consumers of the wealth produced. As the capitalist class represented a higher plane of civilization than the Feudal lords it does not mean that the Feudal system was of less importance in the gradual development of human progress. Engels is very clear on this development in his Landmarks of Scientific Socialism, in which he says:

“We must not forget that our entire economic, political and intellectual development has its foundation in a state of society in which slavery was regarded universally as necessary. In this sense we may say that without ancient slavery there would have been no modern socialism. It is very easy to make preachments about slavery and to express our moral indignation at such a scandalous institution. Unfortunately the whole significance of this is, that it merely say that these old institutions do not correspond with our present conditions and sentiments engendered by these conditions . . . And when we enter this matter we are obliged to say in spite of all contradictions and accusations of heresy, that the introduction of slavery under the conditions of that time was a great step forward.”

All previous class struggles have been waged in the interest of a minority class with the help of the workers. Today the class which represents social progress are the workers, which embraces all that is essential in the industrial process, and which, being in the overwhelming majority, has not to depend on another class like all previous classes. It is the duty of the Socialist to make the facts of history known to his fellow workers. This I have endeavored to do in these articles. Let us point out to our fellow workers that in capitalist society living labor is but the means to increased accumulated labor, or capital, for the owners. Socialism means accumulated labor is but a means to widen, enrich and promote the existence of the laborer. The mechanical development of the productive forces today requires production on a large scale, and if we are to eliminate wars, waged to obtain markets for the surplus wealth the workers produce, we must realize that our position in society is to transform the private ownership of the means of production and distribution (which is used co-operatively by the workers today producing socially the means of subsistence for the profit of a few) into social ownership, producing for use instead of for profit. The function of the Socialist Party of Canada is to educate the workers to this end.