Friday, February 3, 2012

Marxism in the 21st Century: Alternative to Neoliberal Capitalism and Imperialism


Two decades after the fall of the Soviet Union, the mood of capitalist
triumphalism that existed then, has vanished. With the first prolonged
capitalist crisis of the 21st century, the focus is now on the future of
capitalism and the uncertain times faced by it. There is recognition,
as a banker wrote in the Financial Times, that capitalism is having a
“very Marxist crisis”.

Marxism, which was scorned as a 19th century philosophy and
which was declared as an anachronism by the end of the 20th century,has once again proved that it is the only scientific theory to analyse the crisis facing contemporary capitalism. Marxism remains the guide to action on how to transcend capitalism and build a new society free from class exploitation and social oppression.

Marxism, as theory and practice, has to constantly evolve. The
experience of the theory put into practice has to be evaluated. Based on that assessment, the theory needs to be updated and modified.

Marxism has to be seen as a developing theory. It is not a given corpus
of knowledge which needs only to draw upon and to be interpreted.
This needs to be stressed because of the legacy of Soviet style Marxism
in the 20th century. Marxism was seen to be a corpus of classical texts
by Marx, Engels, Lenin and so on. Based on these classics,
developments in the various fields of knowledge were analysed and
sought to be incorporated into an a priori framework. This ossified
theory and resulted in dogmatic practices or inertia.
Marxism in the 21st century has to make a break from this
theoretical straitjacket as it is an essential part of making Marxism a
living theory and an accurate guide to practice.


Marxist theoretical analysis of the contemporary world would affirm
the existence of imperialism as an integral part of the global capitalist
system. It has been argued that nation states have increasingly become
irrelevant in the era of globalisation and thus we need to move beyond
the concept of imperialism, which is based on rich nations colonizing
and exploiting the poorer nations. The problem with this argument
is that it fails to identify the principal class forces which drive world
capitalism today and instead confuses the changes in the form and
character of imperialism with the disappearance of its essence and

Lenin’s analysis of imperialism in the early decades of the 20th
century was based on the development of monopolies as a result of
concentration of capital and the coalescence between banking and
industrial capital in advanced capitalist countries giving rise to finance
capital. These national blocs of finance capital backed by their nation
states resorted to imperialism – controlling the resources and markets
of the poor countries. This also led to inter-imperialist rivalries between
nation states over the division and re-division of their ‘spheres of
influence’ causing wars like the world wars.

The way things have changed since Lenin’s time can be seen in
the development of international finance capital, which while
originating in the advanced capitalist nations is no longer national in
its form. The transnational banks and financial corporations today
have global operations and move around large volumes of capital
Marxism in the 21st Century across national markets on a daily basis in search of quick speculative
gains. International finance capital is globally mobile and fluid, it is
not tied to specific industries and it does not serve its interest to divide
the world market into rival blocks. What it wants is a globally
integrated market where it has unfettered freedom of movement. This
is the force that drives the process of neoliberal globalisation.
Rivalries between imperialist nation states have subdued under
the hegemony of international finance capital. However, this does not
imply a disappearance of imperialism. Rather imperialism has
acquired a particularly vicious form under the imperatives of
international finance capital. The major imperialist powers have
formed a bloc under the leadership of the US, which ensures that any
challenge to neoliberal globalisation and the hegemony of
international finance capital is eliminated. In this, the role of the US
state and its economy remains crucial.

This can be seen in the unfolding events under contemporary
capitalism. The present crisis which started in 2007-08 was brought
about by the depredations of finance – asset price bubbles created
through reckless lending and speculation. In the immediate aftermath
of the crisis, the imperialist nations took the initiative to form the G20
and proposed a coordinated expansion of state expenditure as the
way towards recovery. But once the big banks and financial companies
were bailed out using taxpayers’ money, the imperialist powers –
especially the US, Germany, France, UK – started advocating austerity
measures and cutbacks in public spending. The burden of adjustment
has been shifted on to the working people across the world through
the austerity measures even as international finance has recovered
from its losses at the expense of the state exchequer. This could not
have happened had it not been for the imperialist nation states acting
in unison in the interests of international finance. The possibility of a
shift away from neoliberal globalisation and curbing the power of big
finance in the backdrop of the crisis is being stymied by imperialism.
The hegemony of the dollar is a significant aspect of the
international finance driven imperialist system. Bulk of the financial
wealth and resources across the world continues to be held in dollars
owing to the imperialist strength of the US state. This allows the US
economy to suck in finance from across the world and sustain the
globalisation process.

The role being played by the NATO in the post-cold war era is
yet another signifier of imperialist militarism. The operations of the
NATO have been extended to West Asia, in the name of the ‘war on
terror’ or ‘humanitarian interventions’. The purpose is to destroy any
regime that asserts national sovereignty and protects the oil and mineral
resources of the region from the predatory oil companies based in the
West. The wars in Afghanistan, Iraq and most recently Libya were all
fought to meet these objectives. US militarism is an outcome of the
systemic needs of imperialism to maintain its hegemony over the

Therefore, from a Marxist point of view, imperialism continues
to be the foremost barrier before all those who seek to create a just,
democratic and peaceful world order. Struggle and resistance against
international finance driven imperialism comprises the core of
revolutionary movements in the 21st century.


In the throes of a crisis, finance capital assaults and seeks to dismantle
the welfare state built in the earlier phase of capitalism. The fight back
against the neoliberal orthodoxy requires the defence of the rights of
the working people and the gains made over the decades of struggle
in the 20th century in getting social benefits.

The neoliberal policies have resulted in heightened inequalities,
growing unemployment and homelessness for the people in the
developed capitalist countries. The ongoing crisis and the statesponsored
bailout of the corporates and the bankers have vividly
brought out for the people the iniquitous and unjust order that exists.
Protests against corporate greed and the austerity measures have
erupted and intensified in Europe and the United States. This,
however, is yet to transform into a powerful political alternative, which
can usher in substantive changes.

The resistance to imperialist globalization requires the building
of an alternative Left platform centred on rolling back the neoliberal
offensive and unshackling the grip of international finance capital to
restore economic and popular sovereignty. Such a Left platform
should advocate robust state intervention to develop the productive
forces in a manner which generates employment and reduces income
inequality. No progressive change in economic policies can be brought
Marxism in the 21st Century about without curbing the power of international finance. It is
necessary as a first step, to introduce a financial transaction tax and
regulation of the financial sector. The Left has to bring to the fore, the
agenda of state takeover of big financial assets and the breaking up of
giant multinational banks, which are ostensibly ‘too big to fail’.
Imperialism seeks to emerge from its current crisis by shifting the
burden of the crisis on to the people of the developing countries.
International agencies like IMF, World Bank and the WTO are the
handmaidens of this effort. The struggles against financial and trade
liberalisation in the developing countries, especially against
conditional austerity measures and unequal free trade agreements
have to be taken forward.

The Left alternative platform and the political movement for it
have to be developed in each country according to its specific
conditions. While international finance capital operates globally, it
utilizes the state in each country to enforce its neoliberal dictates. The
fight to wrest economic and popular sovereignty for the people is
therefore a class struggle within the nation state. Imperialist
globalization has not rendered this nation state based struggle
redundant. Even as the global forms of class struggle and antiimperialist
movements develop over time, the primacy of the nation
based class struggle cannot be underplayed.


The working class remains central to any revolutionary challenge to
capitalism. Despite assertions of the ‘post-Marxists’ to the contrary,
the working class has grown in its size and strength globally.
Deindustrialization and off shoring of industrial activities into the
developing world has led to the shrinking size of the industrial
workforce in the advanced capitalist world. However, the size of the
proletariat has grown in the developing world and the world as a
whole. Moreover, those employed in the services sector are also
exploited workers. The changes that have come about are in the forms
of employment and labour exploitation, under the rubric of ‘labour
market flexibility’. Across the world, organised formal sector
employment has been increasingly replaced by casual and contract
based work. Alongside the institutionalization of a hire and fire
regime, economic growth under the neoliberal regime has also led to
a ballooning informal economy characterised by intense exploitation
and self-exploitation of labour. A key challenge before the Marxists in
the 21st century is to devise new forms of organising the casualized
and informal workforce, who bear the brunt of intensified exploitation.
Perhaps the greatest churning process occurring in the world
today is in the countryside, particularly in the rural areas of the less
developed countries – in Latin America, Africa and Asia. Over the last
three decades, policies of so-called stabilization and structural
adjustment have systematically been imposed on the working people
of the third world by international capital, domestic bourgeoisie and
landed rural elites. These policies accentuate agrarian crisis,
impoverish and worsen the incomes and livelihoods of the peasantry.
Rural unrest on issues of land, livelihood and access to resources is a
widespread phenomenon across the developing world today.
Organising the peasantry and rural labourers and building an alliance
with the urban working class poses the main challenge in these

The theory and practice of Marxism in the 21st century also
requires the integration of gender issues into the mainstream analysis
of class exploitation and social oppression. Even the most advanced
capitalist countries have been unable to address in any substantive
way, the unequal division of labour that is detrimental to women. On
the contrary, the severe cutbacks in the social sector under the neoliberal
regime have meant that the burden of the care economy is borne
disproportionately by women. At the same time, the exploitation of
cheap female labour continues to be an important source of extraction
of surplus value.

Discrimination against women, reflected in unequal wages,
discriminatory labour practices and the political economy of the
reproduction of labour power shows that it is systemic and embedded
in the capitalist production system. The invisibilisation of women’s
work, the devaluation of their labour and the predominance of
patriarchal modes of life reinforce the exploitation of women under
neoliberal capitalism. The Left alternative to imperialist globalisation
must recognise and give prominence to the liberation of women from
patriarchal and class based exploitation.

The world is faced with a degradation of the environment and
Marxism in the 21st Century
ecology, which threatens life and nature on the planet. An important
factor in the struggle against neoliberal capitalism and the building
of an alternative has to be, in terms of Marxist theory and practice, a
proper understanding of the environmental issues and the struggle
to protect the environment and human life. The predatory nature of
capitalism is the primary cause for the threat to the world environment
and ecological sustainability. Imperialist globalization has heightened
the despoliation of nature and the loot of natural resources by big
corporations. Global warming and climate change is a common threat
to humanity as a whole but the responsibility for this lies more with
the rich industrialized countries. The struggle to protect the
environment and ensure that there is equity in addressing the
problems of environmental degradation should be on the agenda of
Left alternatives.


In the years immediately after the disintegration of the Soviet Union
and the restoration of capitalism in Russia, the debates centred around
what happened to the experiment of building socialism in the Soviet
Union and what had gone wrong. These debates prevailed amongst
Marxists and activists of the communist and working class movements
during the 1990s. But by the turn of the century attention was drawn
towards what should be the shape and nature of socialism in the 21st

It is by a critical examination of the experiences of socialism in the
20th century that we can arrive at a new and more meaningful concept
of socialism in the 21st century. This requires carrying forward some
of the original impulses of the October revolution and some of the
valuable achievements. At the same time, we have to discard some of
the negative aspects and distortions which manifested in the existing
socialism of the 20th century.

The debate on 21st century socialism is ongoing and has not
reached a finality. This is so, because the socialism in the 21st century
will arise not just from theory but also from practice. But we have now
some broad contours of what a renovated socialism of the 21st century
will look like. Here we can only set out some of them in an outline

(i) Socialisation of the means of production is a cardinal principle of
socialism. This requires that the capitalist forms of ownership of the
means of production be replaced by social ownership. In the socialism
of the 20th century, basing on the Soviet model, public ownership of
the means of production was, by and large, equated with state
ownership. State owned and run enterprises being the main form led
to the heavy hand of the bureaucracy controlling and running the
economy. The workers had no say in the running of the enterprises.
The growth of bureaucratic centralism can also be attributed to this.
Public ownership under socialism in the 21st century should be of
diverse forms, state ownership being just one of those forms. There
can be state owned enterprises or a public sector where there is wider
shareholding, or collective enterprises which are owned by the workers
and employees, or cooperatives. Unlike the highly centralized system
which existed in the Soviet Union, there can be different forms of
public ownership and competition amongst them.

(ii) The existence of commodity production and the market is not the
negation of socialism. Unlike in the Soviet Union where small
commodity production and retail trade were nationalized, in the
period of socialism, markets should play a role. They should be
regulated by the State to ensure that big capital does not develop.

(iii) A planned economy is another basic principle of socialism but
the nature of planning should not be such as to centralize all economic
decision-making. Further, in order to ensure popular participation
in economic decision-making and the running of economic
enterprises, planning has to be decentralized.

(iv) Democracy is the life blood of socialism. In the capitalist system,
democracy becomes ‘formal’ as the control of the bourgeoisie over the
means of production and the institutions of the state leads to restricting
democracy and the democratic rights of citizens. In the case of
socialism, it cannot develop without the active and popular
participation of the people at all levels. It is necessary to have a political
system under socialism which ensures popular participation. This
requires the creation of popular assemblies at different levels which
have powers not only with regard to the administrative sphere but
also the economic. A multi-party system under socialism will prevent
the distortions that a permanent one party rule can bring about.

(v) The demarcation between the State and the ruling party has to be
institutionalized. The socialist state represents the entire people and
the party cannot be a substitute as it represents only a fraction of the
working class and the working people. Socialism in the 21st century
will also have to be built in conditions of capitalist and imperialist
hostility. This is an inescapable reality. Socialist democracy cannot be
attenuated on account of this; rather it should be an instrument for
developing socialist consciousness and mobilizing the people to
defend the new society.


Indian Experience

It is now two decades since the policies of liberalisation were initiated
in India in 1991. The Indian ruling classes, in which the dominant
strata is the big bourgeoisie, embraced the neoliberal framework after
having gradually moved away in the 1980s from the earlier dirigiste
policies. A higher rate of GDP growth has been accompanied by
heightened inequalities and the intensified exploitation of the
working people. There has been a squeeze on the peasantry and large
scale agrarian distress. The Indian State is aiding and facilitating the
loot of natural resources and public assets by the big corporates and
foreign capital.

These neoliberal policies have, however, met with stiff resistance.
Due to the resistance put up by the trade unions and the popular
movements, the government has so far not succeeded in fully
liberalizing the financial sector. This is what spared India from the
worst excesses of the financial crisis. The fight to defend the public
sector is ongoing. The government is attempting to disinvest shares
gradually in the major public sector enterprises rather than going in
for outright privatization.

The shift in the domestic economic policies have been reflected
in the foreign policy with India forging a strategic alliance with the
United States and departing from the pursuit of an independent
foreign policy. The Left has been in the forefront in opposing the
neoliberal policies and the pro-US foreign policy. It is the position of
the Left and other democratic forces which has so far prevented the
full-fledged implementation of the whole range of neoliberal policies
and a total submission to the US strategic designs. Our experience is
that the struggle against the neoliberal policies cannot be carried
forward without countering the growing collaboration of the ruling
classes with US imperialism.

The role played by the Left in opposition to these policies has
resulted in a concerted attack on the Left forces, particularly in West
Bengal. The Left Front government in West Bengal was defeated in
the elections held in May 2011, after a continuous stint in office for 34
years. This is a setback for the Left movement in the country as West
Bengal is its strongest base. But the struggles against the neoliberal
policies and the movements of the working people in the state will
enable the Left to recover ground, even though there is repression
and violence directed against the movement. In Kerala, the Left-led
alliance lost the elections very narrowly and nearly succeeded in
breaking the cycle of alternative governments every five years. The
record of the Left-led government in implementing social welfare
measures and reviving the public sector enterprises found wide
support among the people.

The Left-led governments that existed in the states of West Bengal
and Kerala and which continues in Tripura have inspite of the severe
limitations of the powers and resources available to a state government,
sought to consolidate the gains made through land reforms, effect
decentralisation of powers and protect the rights of the working
people. The existence of these governments cannot bring about any
basic change but they definitely help the working class, the peasantry
and other popular movements to organize, fight for their rights and
to take forward the Left and democratic alternative at the national

In India, there is social oppression through the caste system. Given
the socio-economic formation in India, class exploitation both
capitalist and semi-feudal exists along with various forms of social
oppression based on caste, gender and religion. The ruling classes
extract surplus through class exploitation and for maintenance of
their hegemony they utilise various forms of social oppression. Hence
the struggle against both class exploitation and social oppression is
being conducted simultaneously.

In order to oppose the offensive of liberalisation, all the central
trade unions came together for the first time last year. Their joint
platform and united actions have galvanized the working class
Marxism in the 21st Century movement and a one-day general strike with the participation of all
the central trade unions is being planned for early next year.
The CPI (M) is working for a transitional programme towards
socialism in India. To achieve this stage of people’s democracy, we
have to build an alliance of class forces led by the working class. This
requires the building of a powerful worker-peasant alliance and the
rallying of all the forces that suffer from class exploitation and social
oppression. Till we are able to achieve this, our efforts are directed
towards forging a Left and democratic alternative to the present
bourgeois-landlord policies of the Indian state.


The current global capitalist crisis has two features which have a
bearing on the alternatives that the Left has to fashion. Firstly, the
ongoing recession is likely to be of a long duration. The governments
of the developed capitalist countries are no longer talking of fiscal
stimulus; instead there is a naked assault on the people through
austerity measures. Secondly, after a long time the crisis is centred in
the metropolitan centres and not the periphery. Its effects are hitting
the people of the developed capitalist countries as badly as those in
the developing capitalist countries. This opens the way for resistance
and struggles in the metropolitan centres along with the movements
and struggles in the developing world. These two streams of struggle
can strengthen each other.

To sum up, the fight for a Left alternative requires a struggle
against both the finance-driven neoliberal capitalism as also the
imperialist order, which perpetuates it with political power and
military force.

Prakash Karat

Courtesy : The Marxist, XXVII 4, October–December 2011

Paper presented at the conference on “Marxism for the 21st Century” at the Marx Memorial
Library, London, November 24-25, 2011, organised by the Marx Memorial Library and
Rosa Luxemburg Foundation, Berlin.


വര്‍ക്കേഴ്സ് ഫോറം said...

ദ മാര്‍ക്സിസ്റ്റില്‍ പ്രകാശ് കാരാട്ട് എഴുതിയ ലേഖനത്തിന്റെ പൂര്‍ണ്ണ ആംഗലേയ ടെക്സ്റ്റ്.

Stockblog said...

Fall of Soviet Union and communist regimes in eastern Europe indicates socialism is not practical. Reoccurring financial crisis and financial head winds indicates capitalism is also Fairlie..... So What else?