Ji Xuhui & Ye Qing :   Research on Contemporary Capitalist Economy: Development Stages, Crisis Evolution and Covit Epidemic Impact

July, 2022

【About the author】 Ji Xuhui is an associate professor at the Party Building Teaching and Research Department of the Party School of the Central Committee of the Communist Party of China (National School of Administration), and the deputy secretary of the school’s Youth League Committee. Ji Xuhui holds a doctorate in political economics from the School of Economics of Renmin University of China. His main research interests include Marxist political economics, party building in state-owned enterprises, and party leadership.

The world today is undergoing a major change unseen in a century, and the accumulation model, exploitation methods and contradictions of the contemporary capitalist economy are in constant change. The contemporary capitalist economy, dominated by financial capital, has given birth to a new economic form in the transformation of information technology and digital technology, transitioned to a new stage, and has caused new evolutions in the crises and contradictions of capitalism under the huge impact of the COVID-19 pandemic.

In 2021, scholars in the field of political economy conducted in-depth research on issues such as the development stage of the contemporary capitalist economy, the evolution of crises and the impact of the epidemic, achieved rich research results, and deepened their understanding of the development, changes and prospects of the capitalist mode of production.

1. Current Researches on the Development Stages of Contemporary Capitalism

Contemporary capitalism is still developing in the direction of the imperialism discussed by Lenin, and has shown new characteristics in terms of the degree of monopolization, means of exploitation and hegemony. In 2021, the political economy community conducted in-depth research on the formation, characteristics and impact of new imperialism, and further explored the development characteristics of capitalism in the digital age, and debated the essential attributes of digital labor, which promoted the development of contemporary capitalist economic research.

1. The Formation, Characteristics and Impact of New Imperialism

Lenin proposed in the early 20th century that capitalism had developed from free competition to a new stage of monopoly, and called this stage imperialism. The essential characteristics and development laws of contemporary capitalism still conform to Lenin’s analysis of imperialism, but the development of contemporary imperialism presents many new manifestations and new characteristics. It is a new stage of the development of imperialism and is called neo-imperialism.

When did the new imperialism begin? Existing studies have three main representative viewpoints: since World War II, since the 1970s, and since the collapse of the Soviet Union in 1991. These three time points are also three key time nodes in the development of new imperialism. The characteristics of new imperialism gradually emerge over time. Zhou Wen and Xiao Yufei believe that after the end of World War II, the colonial system established by Western imperialist countries with their strong military strength began to collapse, and the traditional imperialist ruling method could not be maintained. Western countries led by the United States gradually built up the new imperialist hegemony with their strong comprehensive strength; the dramatic changes in the Soviet Union and Eastern Europe in the 1990s caused a major setback to the world socialist movement. The United States became the world’s only superpower and wantonly promoted imperialist hegemony and the capitalist system to the world, gradually forming a capitalist world system with a close integration of global politics and economy. [1]

The 1970s was a turning point in the development of contemporary capitalism. Some scholars believe that it should be regarded as the beginning of the new imperialism. Lu Baolin pointed out that the 30 years after the war cannot be regarded as a transitional period to the new imperialism for three reasons: after the end of World War II, the US-Soviet hegemony curbed the pace of the imperialist system’s global expansion; national independence and national liberation movements emerged one after another, and the capital hegemony of developed countries encountered the most serious challenge; during this period, state intervention was valued, financial liberalization was strictly regulated, labor-capital relations moved towards compromise, and the social welfare system was relatively sound. In the 1970s, the capitalist system began a profound structural reorganization, and the new imperialist system gradually took shape. From a time span, the new imperialism was conceived in the 1970s and 1980s, took shape in the early 1990s, reached its peak at the turn of the century, and began to decline after being hit hard by the financial crisis in 2008. The disintegration of the Bretton Woods system, the world economic crisis in the 1970s, the “supply revolution” of “Thatcher-Reaganism” and the disintegration of the Soviet Union are the four landmark events in the formation of the new imperialism. [2]

The disintegration of the Soviet Union in the early 1990s led to a dramatic change in the balance of power between world socialism and capitalism, providing a favorable environment for the expansion of U.S. hegemony around the world. This event is also seen as an important sign of the formation of neo-imperialism. Some scholars call neo-imperialism “new American imperialism,” arguing that neo-imperialism is the result of a lack of checks and balances among capitalist powers and the continued expansion of superpower power. The disintegration of the Soviet Union in 1991 marked the formation of a world order based on the unipolar hegemony of the United States, which laid the foundation for the United States to use its political power to earn economic benefits. At the time, oil resources, weapons, and open commodity and capital markets were the main sources of capital profit, and the Gulf War and the Iraq War can be seen as landmark events in which neo-imperialism took center stage on the world political stage. [3]

The essence of both new imperialism and old imperialism is monopoly, and there are different era characteristics and manifestations in the two periods. Lenin described the five major manifestations of imperialism in the late 19th and early 20th centuries in “Imperialism, the Highest Stage of Capitalism”. Lenin’s summary provides a basic framework for studying new imperialism. Most of the research on the characteristics of new imperialism is carried out from the concentration and monopoly of production and circulation, the monopoly of financial capital, and the global hegemony of the new empire.

Starting from the five characteristics of imperialism summarized by Lenin, Li Donglian and Xie Yuantai also summarized the abnormal development of the essential characteristics of Lenin’s imperialism in contemporary American imperialism into five aspects: the characteristics of imperialism have developed from the highly concentrated capital in Lenin’s period to the high-tech monopoly, from the domestic financial oligarchy to the international financial oligarchy, from capital export to the dollar hegemony, from the international monopoly alliance to the international power politics alliance, and from the division of the world by multiple countries to the super imperialism of American imperialism. The essence of American imperialism is manifested in five aspects in reality: economic imperialism, political imperialism, ideological imperialism, legal imperialism and military imperialism. [4] Capitalist countries, represented mainly by the United States, attempt to control the world through political hegemony, economic hegemony, cultural hegemony, military hegemony and other means. This is the basic manifestation of new imperialism. Zhang Chaoying believes that Lenin’s theory of imperialism is not outdated. Compared with Lenin’s era, the current capitalist capital export and profit-making methods have changed. Surplus value is obtained in a more secretive and higher-tech way, but the essence remains the same. [5] Compared with the analytical method that directly expands the basic characteristics of imperialism summarized by Lenin, Lu Baolin emphasizes the globalization and financialization characteristics of capitalism under the dominance of neoliberalism, and summarizes the particularity of neo-imperialism as a special development form of monopoly capitalism into four aspects: global monopoly capitalism, highly financialized and virtualized capitalism, neoliberal-dominated capitalism, and American imperialism with “one superpower and multiple powers as the guardian”. [6] Other scholars, based on Lenin’s view that the bourgeoisie bought off the working aristocracy, believe that the working aristocracy is becoming a booster of imperialist politics. They serve the capitalists and incite the working class to support specific candidates in the US presidential election. The US presidential election has become a “democratic” game manipulated by financial oligarchs. [7]

There are some relatively innovative summaries on the characteristics of new imperialism, such as “IOU export”, “carbon tribute”, and usury imperialism. Yu Bin regards “IOU export” as a typical economic feature that distinguishes new imperialism from old imperialism. “IOU export” has a stronger imperialist flavor and predatory nature than the capital export of old imperialism. IOUs include US dollar IOUs and US Treasury IOUs. New imperialism first forces other countries to exchange their own production capital and commodities for its IOUs, and seizes other countries’ seigniorage by virtue of the right to issue IOUs, thus obtaining the first level of tribute income; then it uses the production capital of other countries obtained as its own capital export to obtain further surplus value and obtain the second level of tribute income. In addition, new imperialism also uses intellectual property rights to collect rents and the power to stipulate carbon emissions to collect carbon tribute for excess emissions. [8] Wang Binbin and Li Xiaoyan also studied the important role of carbon emission rights trading in contemporary capitalism, arguing that the endless cycle of capital accumulation in capitalism has exceeded the carrying capacity of nature, and the relatively limited fossil energy cannot meet the needs of capital accumulation. The resulting deterioration of natural conditions has forced the capitalist economic system to formulate environmental policy tools such as carbon emission rights trading and ecological payment services that conform to the logic of capitalism. With the further concentration of control over fossil energy, the right to use fossil energy and carbon emission rights have become one of the focuses of contemporary global class struggle and national struggle. [9] Other scholars believe that usury imperialism is a distinctive feature of contemporary US imperialism. The ratio of the total US government debt to GDP is close to the highest point in US history, that is, the level at the end of World War II. The United States has been alienated into a debt slave of Wall Street. The US government has been alienated from an independent institution serving the US national interests to a comprador group serving Wall Street creditors. In the second half of the 20th century, it transformed from military-industrial imperialism to imperialism aimed at profiting from financial products, that is, usury imperialism. [10]

The monopoly of new imperialism is manifested in many new aspects, and knowledge monopoly is one of the important manifestations. Many scholars regard knowledge monopoly and technological hegemony as important characteristics of new imperialism, and believe that Western monopoly capital creates technological barriers through monopoly of intellectual property rights and exploits and seeks huge profits on a global scale. Li Yan believes that knowledge capital is the product of capitalism at a certain stage of development. The combination of knowledge and capital in the contemporary capitalist system is manifested in the international monopoly capital monopolizing science and technology to control the structural power in global economic activities and grab surplus value on a global scale. The global monopoly of scientific and technological knowledge is the decisive factor for the accumulation of contemporary monopoly capital. International monopoly capital combines knowledge monopoly with the globalization of production, promotes intellectual property protection and strengthens knowledge monopoly on a global scale, and aggravates the unbalanced development of the capitalist world division of labor system. [11] Capitalist countries represented by the United States maintain their enterprises’ monopoly position on a global scale through knowledge monopoly and technological hegemony, plundering high surplus value, while aggravating the unbalanced development of the world economy and seriously hindering scientific and technological progress. This fully shows that the production relations of new imperialism have become a shackle on the development of productivity.

In the process of seeking monopoly and hegemonic rule, neo-imperialism has had a bad impact on the development of various fields around the world, seriously endangering the development and progress of human society. Feng Wangzhou summarized the impact of neo-imperialism on the world in the process of implementing hegemonic rule and power politics into six aspects: neo-imperialism uses comprehensive methods to achieve capital expansion and seek maximum benefits, resulting in capital out of control and damaging the development justice of the world; neo-imperialism controls parliament and “democratic elections” through money politics, and controls the working class through postmodern consumer culture, damaging political justice and social fairness and justice; neo-imperialism achieves a sharp increase in wealth by formulating and infiltrating its economic rules, leading to polarization and unbalanced development, damaging global spatial justice; the hollowing out of industrial production in neo-imperialist countries has hindered the improvement of social productivity and damaged production justice and distribution justice; neo-imperialism has caused a global ecological crisis and damaged ecological justice; neo-imperialism has led to a global digital divide and damaged digital justice. [12] Zhou Wen and Xiao Yufei believe that the most dangerous and deadly consequence of neo-imperialism is the export of American-style democracy. The United States, with military intervention as its forerunner and the state violence machine as its support, attempts to transform developing countries with standard American-style democracy through the export of democracy around the world, and to establish an international political hegemony order that conforms to the United States’ global hegemony. This has brought serious disasters to the world. Neo-imperialism has also continuously shaped the world system of the center-periphery structure by building a global financial trap for the self-growth of financial capital, forming a long-term and stable dependence of developing countries on developed capitalist countries, causing global wealth polarization and a crisis in the global reproduction system . [13] The harm that neo-imperialism has done to global development shows the injustice and drawbacks of the capitalist system, and once again proves Lenin’s assertion on the parasitic and decadent nature of imperialism.

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