Capitalist Accumulation or Globalization

Let’s begin the analysis of Capitalist-led Imperialism with a look at the drive towards profit and accumulation, which is at the heart of territorial expansion. The bald logic of capitalism is the accumulation of wealth which, when combined with the continuous revolution in science and technology, has allowed a tiny proportion of the population to accumulate wealth beyond dreams for each new generation over the last two hundred years.

The drive to accumulate personal wealth, and through it political power, is an aphrodisiac that is hard to overemphasise. At the beginning of the twenty-first century, wealth of dizzying heights became possible for a tiny handful. The banks, oil companies, new digital companies and companies associated with basic products, such as water and food, straddle our world. It is the logic of ever- increasing wealth that has driven both the Colonial and Imperial expansion of the leading nations over the last two centuries.

And as these companies penetrate every global corner, so the nation state that gave birth to these companies needs to protect them with its armed forces, to provide conditions for them to invest in, and to move in and out of markets freely, with no responsibility for the consequences. A world system of stable finance, free trade and free movement of capital are the necessary conditions for the accumulation of capital on vast levels. The argument around whether these measures help countries to ‘develop’ their own people and resources is relevant only to the Imperial logic that it needs to be justified. The very logic of accumulation is both global and Imperial.

The term ‘‘capital accumulation’ is more often formulated in the less expressive term ‘Globalization’. At the centre of the process of Imperial expansion and control of the world’s resources is the enrichment of the Imperial countries’ companies, such as banks, insurance companies, manufacturers, pharmaceutical companies, and many others. There is a trickle-down effect, and the relatively wealthy middle classes throughout the Western world are the crumbs from the overall accumulation of wealth of the world’s ruling classes.

It is easy enough to see and to understand the accumulation processes inside the Imperial nations themselves. Here you will find three or four major companies selling food, with the same number running bookstores, for instance. In every field of sales and production, the accumulation of capital will have reached such a peak that smaller companies will have been gobbled up into the larger whole. In UK, there are only four companies that sell 90 per cent of all food consumed by 55 million people.

In all the European countries and in North America the processes of Capitalist accumulation are obvious. In many countries of the Third World these processes will not have reached the same degree. Here you will still be aware of the immense numbers of small traders, often selling the same goods but in a huge variety.

The pressure on the Western companies to expand abroad is huge. In most cases the opportunities for expansion in their home country have reached saturation. If they are to maintain their profits they need to expand abroad. This point too needs no emphasis. Capitalism involves the constant search for new markets in order to develop new profits.

The end of Apartheid in South Africa is a recent example of this process in action. Huge monopolies, gold and diamond businesses, and power had been built up behind the tariff walls created by the Apartheid system. The market for their products was saturated and, without altering the distribution of resources and enriching the local people, these companies had nowhere to go. They needed to break down the walls surrounding them, which were the result of a world boycott of their products. They wanted to be world companies, not just South African ones, and to achieve this the white monopoly power was broken.

All companies expanding outside their national boundaries remember the Soviet era and fear that their assets may be nationalised. They have looked for protection to the major institutions already mentioned, the IMF and the World Hank for instance. First, the IMF needs to prise open the borders of the country to allow in new investment without hindrance; once there, businesses need protection from nationalisation; and finally they need the freedom to export their profits without undue taxation, as well as the freedom to remove themselves whenever they wish.

Wherever they have a foothold, international banks and automobile companies will appeal to the instincts of acquisition and greed, whatever the sensibilities of the religion of the countries concerned.

Today the US aggressively supports the worldwide expansion of all its major transactional companies. From the Disney Corporation to Bill Gates’ Microsoft, the US will do whatever it takes to penetrate the barriers of national government protections.

Capitalist and global accumulation of capital is at the very core of the Imperial Globalization. This process sucks up surplus wealth wherever it goes, increasing the wealth of the elites, but leaving an ever-increasing impoverishment of all those left out of the process. Even the institutions like the World Bank have accepted the fact that poverty had significantly increased.

The facts are plain to see: by itself, development through transnational corporations is not the answer to growth and development.

Roger van Zwanenberg

Source: Essays on Muslims and the Challenges of Globalisation, Institute of Policy Studies, Islamabad. Republished with permission.