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January 2003 • Vol 3, No. 1 •

From the Arsenal of Marxism

The International Prospects of Capitalism and Socialism

By James P. Cannon

The Second of Six Lectures From America’s Road to Socialism

Part 2

Go back to part 1

After two victories in two world wars, Britain, once proud queen of the seas and banker of the world, ends up as a beggar, living on America’s dole. Its days of glory have departed; its empire is shattered and falling apart, and all the king’s horses and all the king’s men can never put the jolly old empire together again.

France emerged from her victories in the two wars in the same position, only worse. The French empire is dying in agony on the battlefields of Indochina. Capitalist Britain and France are just a couple of American satellites.

The United States and the Soviet Union came out of the war as the only winners—with one important qualification: the colonial world rose to its feet during the war and entered the arena of world history as an independent force. The course of history in the postwar period has been primarily determined by the relations between these three powers, the United States, the Soviet Union, and the insurgent colonial world. All the other countries play merely supporting roles.

America’s position in the new world setup is a truly great one. Let no patriotic vigilante accuse me of minimizing it. I admit it, even if I’m not proud of it. The United States is the first and dominant power of the entire capitalist world, economically and militarily. It has the money and the bombs and the moral self-satisfaction too. What could be cozier than that? Our boys in Wall Street are doing all right for themselves. They don’t even have to play a fiddle. All they have to do is whistle, and the others dance. But—and here we come to the fly in our ointment, or maybe it is somebody’s thumb in our eye—that section of the world which is no longer capitalist, or is trying to break away from capitalism, doesn’t want to dance to America’s tune. A conflict over this matter has been in progress ever since the end of the war.

An examination of the course this conflict is taking is now pertinent to the question posed in the subject of our discussion: “The International Prospects of Capitalism and Socialism.” The question might be put in another way:

“Who is winning the cold war?” The question could be formulated in a third way and be even more precise: “Is revolution and the nationalization of industry, the economic foundation for socialism and the transition to it, gaining ground, or being pushed back?”

The answer to the riddle of the future is wrapped up in this formulation of the question. Obviously, America has been losing the first rounds. That’s bad enough; the odds at the ringside always turn against a fighter who has to come from behind. But if our examination shows that America has not only been losing ground but is the chief author of its own setbacks, the odds on the final outcome must be changed radically. No fighter is so sure to lose as the one who knocks himself out. And that, my friends— candor obliges me to report—is precisely what our great and glorious country—or more correctly, the Wall Street people who own this country lock, stock, and barrel—is doing in the battle for the championship of the world.

I charge them with throwing the fight. I accuse them before the Un-American Activities Committee, on my oath and without claiming any rights against self-incrimination—I accuse the Wall Street money sharks as the world’s greatest and most dangerous revolutionists, as the chief instigators of social revolution, colonial revolt, and nationalization of industry in the entire world.

Look what they have done in Eastern Europe. This territory wasn’t “given away to the Russians at Yalta,” as the irresponsible radicals on the lunatic fringe of the Republican Party say. It was simply a power vacuum filled by the Red Army as a result of its victory and the collapse of the Nazi war machine. Predominant Soviet influence in this territory was an ineluctable circumstance resulting from the war.

The question was how to accommodate this circumstance to the interests of American and world capitalism. Stalin, for his part, was willing to make such an accommodation. He offered, and in good faith too, to maintain and guarantee the capitalist system of production and the capitalist form of government in the countries of Eastern Europe. And that is precisely what he did in the first three years of the postwar period. He went further and offered to guarantee the capitalist system of production and capitalist political regimes in Italy and France, where they were badly shaken.

And that is precisely what he did there too, by sending Communist Party representatives into the bourgeois cabinets as supporting forces. Their special assignment was to curb the workers and suppress strikes, and they carried it out. In return for these truly great concessions to prop up the tottering system of capitalism in both Western and Eastern Europe, Stalin asked only a small concession in return—a deal.

“Let us alone in our part of the world,” he said in effect, “and we will let you alone in your part. Let’s coexist and be happy.”

But the rulers of America said, “No.” Drunk with power and ignorance, combined perhaps with that senile dementia which invariably strikes the ruling circles of outlived social systems, they decided to “get tough with Russia.” They responded to Stalin’s conciliatory policy in Eastern Europe with a stepped-up armaments program and the Marshall Plan.

The Marshall Plan was contrived to let America’s stricken Allies in Europe live, or rather breathe, while strengthening America’s grip on their economy. At the same time it was designed to break the economies of the Eastern European countries out of the orbit of Soviet trade and harness them to the West. The Stalinists replied (they had no alternative) by breaking up the bourgeois governments in Eastern Europe—they were so weak, lacking all popular support, that they could be dismissed by a mere police action—and proceeding to the nationalization of the industries.

This was nothing less than an economic revolution, instigated by America and carried out by bureaucratic means. In France and Italy the Communist Party representatives were kicked out of the cabinets at the behest of the American paymaster. The Stalinists responded—again they had no alternative—by switching to a policy of opposition and radical agitation.

These are tremendous developments of world-historical import. The extension of the system of nationalized and planned economy—not socialism, but the economic foundation for it—to the whole of Eastern Europe means and can mean nothing else than the exclusion of this whole territory from the world capitalist market and a consequent shrinking of the capitalist sector of world economy, which is already too small. The ouster of the Stalinists from the governments of Italy and France means and can mean nothing else than a stimulus to the radicalization of the working class in these two decisive nations.

Let us put down these colossal happenings, loaded with revolutionary dynamite, as fact number five, and ascribe the main responsibility to the revolutionary incendiaries of New York and Washington. “Father, forgive them, they know not what they do.” That’s the way it reads in the Bible, but history will not be so magnanimous.

The camera eye now shifts to China and the colonial world. And what a world of unexpected wonders and calamities, with signs and portents of more to come, it has turned out to be. American capitalism went fishing in the Orient and caught a whale big enough to sink the boat. The war in the Orient was fought over China. It was fought by America in the name of the noblest ideals enunciated by Roosevelt, the greatest enunciator of them all.

The declared aim of the war was to drive the Japanese imperialists out of China and liberate this great country of half a billion people; to secure for China, by the armed might of magnanimous America, an independent, prosperous national existence, free from all foreign domination and exploitation.

That’s one way of explaining our war aims, anyway. Another way would be to say that America waged the war in the Orient to drive the Japanese out of China, and get this tremendous market, the richest prize in all the world, for itself, for its own unhampered exploitation. That would be a more accurate way of putting it.

The development of China on a basis of capitalist economy, with a stable government capable of guaranteeing the eventual repayment of loans and credits, could have provided America with an outlet for its huge surpluses of goods and capital for years to come. And if the other capitalist powers were allowed to participate, even modestly, in the exploitation of this almost limitless market, they also might have overcome their internal crises and attained a new stabilization of their systems, also, for a period of years to come.

From a strictly capitalist standpoint, one must admit that such a prospect was well worth a war, even without any moralistic pretensions. And if the enterprise could be dressed up with idealistic bunkum at no extra cost, all the better. Anyway, we fought the war with Japan over China.

And the first half of the war aims were realized completely. Japan was driven out of China by military force, and even driven out of its other possessions, and condemned to stifle and stagnate in its own little chain of islands. But again something happened. Again something went wrong. America had staked all its cards on Chiang Kai-shek, the political and military leader of capitalist China. It allied itself with him and the narrow stratum of capitalists, landlords, and usurers whom he represented, and overlooked the Chinese people, who number half a billion, most of them hungry for land and bread.

These hungry people, just when the first half of the American plans were executed, with the defeat of Japan, most inconsiderately decided to get Chiang Kai-shek and his parasitic gang off their necks along with the Japanese. They started a ruckus, otherwise known as a revolutionary civil war. Chinese capitalism, deformed in its development by colonial exploitation of the great powers, had become senile before it reached maturity, senile, weak, corrupt, and parasitical.

The Chinese capitalist government of Chiang Kai-shek, propped up by American money and military support, and without much else to lean on, was not strong enough to contend with the popular revolt. By 1948 the popular revolution had driven Chiang Kai-shek and his gang completely off the mainland of China.

And one bright day the world was suddenly confronted with a new China, which was really independent, but backward in its industrial development and eager to get foreign loans and credits. The government of Mao Tse-tung offered to guarantee the capitalist system of production and to guarantee all loans on that basis.

The statesmen and leaders of British capitalism, who are older, wiser, and more experienced in world affairs, wanted to come to terms with the new reality, to recognize the new revolutionary government and continue trading with the new China. But the American statesmen and leaders wouldn’t have it that way. They can’t understand how it happened. They feel that somebody gypped them, and they are as indignant as a farmer who has been played for a sucker in a carnival shell game. China, according to their thinking, “belongs” to them and somehow or other, by some trick or other, they “lost” it.

That was a literal statement, repeated a thousand times in the recent election campaign: “We lost China.” But did this great nation, with its half billion people and its unmeasured natural riches, really “belong” to them? Did Santa Claus promise them China for Christmas and then fail to deliver? Did somebody shoot Santa Claus? That’s what they seem to think. Anyway that’s the way they carry on in their mad search for spies and other culprits in the State Department.

As for China itself, they arrogantly ordered the revolutionary seas to subside; continued to bet their money on Chiang Kai-shek, the horse that had already lost the race; refused recognition to the new revolutionary Chinese government; refused them the loans and credits they were eager to get and to make concessions for; and established a virtual blockade against any foreign trading with China.

What are the results of all this wisdom? We can list the three most important ones: First, American policy alienated the sympathies of hundreds of millions of people throughout the Orient and the whole colonial world who had previously taken our idealistic pretensions in good faith. Revolts and revolutions throughout the entire colonial world, starting in Asia, then spreading to the Middle East, then to Africa, and now already leaping across to South America, are being fed today by hatred of American imperialism as gasoline feeds a fire.

The Korean War is a part of the colonial revolution. That’s why it has presented so many surprises to the arrogant American militarists. The power of hunger is behind these revolutions—hunger for bread and land and national independence—and no power on earth can stop them.

The second result of America’s policy of refusing to recognize the new Chinese government, refusing to trade with it, ordering a blockade against it, and even threatening war against it—the second result of this policy is to close off all possibilities of any further development of China on the basis of capitalist economy. Regardless of what their intentions and wishes might be, the Chinese Stalinists at the head of the new revolutionary government will be forced, as were the regimes in Eastern Europe, to embark on a wholesale program of nationalization, as a condition for the survival and development of the country’s economy.

China couldn’t be developed on a capitalist basis without a tremendous influx of foreign capital in the form of loans, credits, and investments. Deprived of this blood transfusion, weak, undeveloped, and shaken, Chinese capitalism—whatever may be left of it at this moment—is condemned to die of anemia. It has to be put out of its misery as the precondition for the revival and development of Chinese industry and agriculture.

If one is willing to recognize reality, regardless of what his personal wishes might be, he can safely predict that China will witness the development of a nationalization program on an ever-expanding basis, bringing with it an expansion of that sector of world economy held by nationalized and planned economy, and shrinking further that section held by capitalist economy.

The Wall Street financiers who shudder at modest welfare benefits in America as a form of “creeping socialism” are, by their policy, instigating and forcing a galloping program of nationalization of industry in China, which, I repeat again, is not socialism, but the economic preparation and premises for it and the transition to it.

A third result of America’s arbitrary policy of blockading China and refusing to allow other capitalist nations to trade with her is the powerful blow it deals British capitalism. At a time when the very existence of capitalist Britain depends on an expansion of its foreign trade, America’s policy in China arbitrarily drives it from ths Chinese market. Thereby they worsen the already helpless position of British capitalist economy, undermine the living standards of the British workers, and drive them to Bevanism on the road to Bolshevism.

Blindly, unconsciously, but all the more surely and effectively, the masters of America are doing Lenin’s work in Merry England. The disciples of Lenin, from London to Los Angeles to Shanghai and all points in between, should recognize the extraordinary help they are getting from the leaders and masters of American capitalism, even if they feel no need to express their gratitude formally.

The Chinese revolution, America’s policy toward it, and the catastrophic results of this policy can be put down as the sixth and final outstanding fact in our panoramic survey of world developments over the past half century.

Whatever side one may take in this worldwide struggle between capitalism and socialism, anyone with a respect for facts must recognize that enough important facts have been piled up in the course of world development since 1914 to indicate an unmistakable trend. That trend shows capitalist economy ridden everywhere by incurable crisis, declining and decaying.

On the other hand, the historical trend shows the sector of nationalized economy expanding, an increasing radicalization of the workers in the crisis-ridden countries of capitalist Europe, and a veritable prairie fire of colonial revolutions breaking out everywhere and increasing in power and intensity all the time. The masters of America, the financial overlords and the political spokesmen all together, see these facts and these trends as well as we do.

They have but one answer. That is counterrevolution by military force. They propose to reverse the historic trend by another war. This is what they are preparing for, this is what they are trying to drag their reluctant allies into. The satellite governments of England, France, and Italy will be the allies of American imperialism in this terrible, desperate adventure of a third world war. The thin stratum of landlords, capitalists, and usurers in the backward countries will be their allies too.

But that is just about all they can count on. The majority of the people in Europe, including England, are outspokenly neutral or hostile to America. Where, then, will the troops come from? America is rich and powerful, the most productive nation in the world, with 160 million people. That is a tremendous power. But the two billion people in the world are a still bigger power. And when you contemplate the possible or probable outcome of the war and weigh the forces and resources on each side, don’t forget to count the two billion people in the world. They could be, and, in my opinion, will be, the item which tips the scales and decides the outcome.

There is no doubt whatsoever, and no one who has respect for facts can deny it, that the prospects for capitalism on an international scale, outside the United States, are bad and declining. The prospects for nationalized economy and the further spread of radicalization and revolution are ascending. That’s the state of the world as it looks from here.

But what about America itself? Capitalism is certainly supreme here, and socialism is very weak indeed. It is reduced to a virtual handful of people with a theory and conviction. What are the prospects between these two antagonists within the United States?

That, as Kipling would say, is another story, and we’ll get around to it next week.





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