The End of an Empire: Systemic Decay and the Economic Foundation of American Fascism

By Colin Jenkins

If you live in the United States and feel like everything is caving in around you, like you are being attacked and fleeced from every angle, like you can’t breathe, like you can’t ever seem to catch a break despite doing everything seemingly right, like you are on the verge of a mental-health crisis and/or homelessness, your feelings are justified.

We are living in the middle of widespread societal breakdown. We are witnessing the erosion of an empire. We are experiencing the effects of a rotten system (capitalism) coming to its inevitable conclusion. Simply put, the capitalist class and their two political parties have run out of ways to steal from us. Because we have nothing left for them to take. So, the system is responding like a vampire who is unable to find the blood it needs to survive… erratic, rabid, frenzied, and increasingly desperate and violent, while frantically searching for new avenues of exploitation to keep it churning.

The collapse of the United States is not just happening on a whim. There are very clear, systemic reasons for it. It began in the 1970s/80s, mostly due to the inevitable trajectory of capitalism, which went through a series of late-stage developments throughout the 20th Century. These stages interacted with the realization of a globalized capitalist economy near the turn of the 21st Century and a conscious policy shift implemented by the capitalist state, commonly referred to as neoliberalism. An era of financialization, buoyed by monetary policy that caters to finance capital by feeding it a seemingly never-ending stream of free money, has paralleled these other developments to culminate into a desperate and destructive effort to feed the capitalist class during a time when the system’s profit rates are decades deep in perpetual decline.

 

How Capitalism’s Perpetually Falling Rates of Profit Have Shaped the Modern World

The moves that have been made by the capitalist state in the US are typically done under the rhetoric of “stimuli” or “recovery.” Historically referred to as monetary policy, they are designed as a system of life support for capitalism and advertised as necessary steps to “protect the economy.” They are desperate measures that defy the reality of capitalism’s falling rates of profit. In other words, despite the apparent success of US corporations, which have amassed unprecedented amounts of profit and wealth during the neoliberal era (1980s – 2020s), the truth is the underbelly of capitalism is slowly rotting away due to countless internal contradictions inherent to the system. This perpetual degradation, which was long ago recognized in part by classical economists like Adam Smith and David Ricardo, exists in addition to the system’s cyclical need for crises and is one of the main phenomena that is driving capitalism to its grave. In his pivotal work, Capital, Karl Marx expanded, in detail, how this process develops over time:

“… proceeding from the nature of the capitalist mode of production, it is thereby proved logical necessity that in its development the general average rate of surplus-value must express itself in a falling general rate of profit. Since the mass of the employed living labor is continually on the decline as compared to the mass of materialized labor set in motion by it, i.e., to the productively consumed means of production, it follows that the portion of living labor, unpaid and congealed in surplus-value, must also be continually on the decrease compared to the amount of value represented by the invested total capital. Since the ratio of the mass of surplus-value to the value of the invested total capital forms the rate of profit, this rate must constantly fall.” [1]

Simply put, as surplus value (the extraction of unpaid labor) represents the lifeblood of capitalism, it must remain constant for the system to return the same rate of profit over a given time. However, as capitalism matures, and as capitalists constantly seek to lower costs by introducing machines, laying off workers, keeping wages low and stagnant, etc., the extraction of surplus value from human labor experiences a perpetually decreasing rate, even as cumulative profits seemingly grow. “Marx’s LTRPF (Law of the Tendency of the Rate of Profit to Fall) argues that the rate of profit will fall if the organic composition of capital (OCC) rises faster than the rate of surplus value or exploitation of labor,” Michael Roberts summarizes. “That is the underlying reason for the fall.” Marx explains further,

“Take a certain working population of, say, two million. Assume, furthermore, that the length and intensity of the average working-day, and the level of wages, and thereby the proportion between necessary and surplus-labor, are given. In that case the aggregate labor of these two million, and their surplus-labor expressed in surplus-value, always produces the same magnitude of value. But with the growth of the mass of the constant (fixed and circulating) capital set in motion by this labor, this produced quantity of value declines in relation to the value of this capital, which value grows with its mass, even if not in quite the same proportion. This ratio, and consequently the rate of profit, shrinks in spite of the fact that the mass of commanded living labor is the same as before, and the same amount of surplus-labor is sucked out of it by the capital. It changes because the mass of materialized labor set in motion by living labor increases, and not because the mass of living labor has shrunk. It is a relative decrease, not an absolute one, and has, in fact, nothing to do with the absolute magnitude of the labor and surplus-labor set in motion. The drop in the rate of profit is not due to an absolute, but only to a relative decrease of the variable part of the total capital, i.e., to its decrease in relation to the constant part.” [2]

Marxian and (some) non-Marxian economists alike have recognized a virtual ceiling for the global capitalist system that seems to have been touched in and around the 1970s, for various reasons. Despite the post-World War 2 boom that benefited the United States and, subsequently, the imperialist core countries throughout the West, in their service to global capital, this phenomenon of the tendency of the rate of profit to fall (TRPF) has remained the ultimate Achilles heel in that it seems immune to supercharged imperialism, neoliberalism’s monetary policy, ending the gold standard, multiple bouts of quantitative easing, and nearly every trick pulled out of the bag by the capitalist state since then. Thus, the reality is: capitalism is no longer viable, even for capitalists. Yet, the billionaire class (and soon-to-be trillionaire class?) which came to being during this era still needs to be fed. So, the system, and its imperialist state, continues to suck every ounce of blood available from the masses. In this process, the former industrialized “middle class” has been destroyed, big capitalists and landlords are devouring small capitalists and landlords (so-called “mom and pops”), and the US state has seemingly embraced at least some form of modern monetary theory (MMT) to benefit the capitalist class while pretending to play by the old-school rules determined by taxation, “controlled” spending, and debt when it comes to the working class.

The US government (the capitalist state), mainly through the Federal Reserve and its monetary policy, has kept capitalism churning, and thus kept capitalists wealthy, by constantly increasing the flow of new currency into the system and by using so-called public funds to purchase private assets that are deemed too toxic, or “too big to fail.” These golden parachutes, as they’ve become known, are introduced in true classist fashion, only benefitting large financial institutions, big capitalists, and wealthy shareholder. Marx predicted such a development, telling us

“… a fall in the rate of profit hastens the concentration of capital and its centralization through the expropriation of the smaller capitalists, the expropriation of the last survivors of the direct producers who still have anything to give up. This accelerates on one hand the accumulation, so far as mass is concerned, although the rate of accumulation falls with the rate of profit.” [3]

And, being consistent with the entire era of neoliberalism, this newfound creation of “unproductive capital” almost never trickles down because those who are awarded it are no longer incentivized to invest in the types of productive ventures that may have existed during the early days of capitalism and industrialization, as well as during the post-WW 2 boom. Now, with the arrival of globalization (1990s) and the subsequent death of the industrialized “middle class” within the imperial core (due to offshoring), the backbone of the US economy is an array of hollow service industries, which are buoyed by the arms industry, the highly speculative and unproductive financialization racket known as the stock market, and the rapidly dying staple of home ownership. Thus, capitalists can become extremely wealthy, relatively quickly, by merely moving fiat currency in and out of Wall Street through legalized strongarming that is only available to those with large amounts of capital and access to loopholes (i.e., hedge funds). For instance, the practice of artificially shorting stocks, a tactic that was exposed by the historical 2021 runup of GameStop, which was spurred by retail investors who miraculously destroyed the gargantuan Melvin Capital despite unethical steps that were taken to eventually halt buying of the stock.

Simply put, the capitalist class and its empires like that of the United States are running out of tricks to keep this decaying system alive. They are stuck in a cycle of creating seemingly unlimited amounts of currency to counter falling rates of profit, finding creative ways to take more value out of our labor without going over the tipping point of complete societal breakdown, and constantly shifting rates and numbers to keep the sinking ship afloat. This is all being done to keep capitalists wealthy, especially in relation to the working-class masses, who as always remain the sacrificial lambs in this process. So, for working people like ourselves, we may see rising wages like the recent move by some states to increase the minimum wage to $15/hour; however, such steps are naturally met with rising costs implemented by the owning class – capitalists and landlords alike – who don’t need to increase prices to maintain profit, but do so because (1) they own and control our means of survival, and (2) they utilize these means as a form of power to siphon all of our earned income, which they view as exponentially rising rates of return on their “investments.” This is, after all, the entire point of capitalism.

As with every such dynamic that exists under capitalism, the foundation of profit is merely unpaid labor. So, as wages appear to grow, this growth will almost always translate into more forceful actions made by the owning class to further exploit workers. Thus, maintaining growing profits amongst the systemic phenomenon of falling rates of profit requires hitting the working class harder and harder as time goes on, from all different directions and in increasingly creative ways.

While capitalists have employed their own army of economists to challenge both the surplus value of labor and falling rates of profit, Marx’s law of the tendency of the rate of profit to fall has been bolstered by substantial evidence over the past century. Starting with the empirical evidence alone, Roberts explains,

“…the formula is s/(C+v), when s = surplus value; C= stock of fixed and circulating means of production and v = value of labor power (wage costs).  Marx’s two key points on the LTRPF are 1) there will be a long-term secular decline in the average rate of profit on capital stock as capitalism develops and 2) the balance of tendential and counter-tendential factors in the law explains the regular booms and slumps in capitalist production.” [4]

Roberts and Guglielmo Carchedi’s “World in Crisis: A Global Analysis of Marx’s Law of Profitability” provides a collection of analyses that streamlines evidence of “empirical validity to the hypothesis that the cause of recurring economic crises or slumps in output, investment, and employment in modern economies can be found in Marx’s law of the tendential fall in the rate of profit.” As the editors explain, “Marx believed, and we agree, that this is ‘the most important law in political economy.” [5] Thus, understanding this perpetual decomposition of capital can help to explain many things, especially with regards to how the superstructure responds to this economic reality. It tells us why capitalist states like the US implement so many policies that are ultimately detrimental to its masses, who are viewed as collateral damage in the real business of serving and saving capitalism, buoying capital, and allowing the rich to continue accumulating wealth and property despite perpetually falling rates of profit.

Within this valuable collection, Esteban Ezequiel Maito explains how the recognition of this law has transcended theoretical spheres over the past few centuries, only becoming “irrelevant” within the neoliberal Chicago and Austrian schools that developed as more of a justification for capitalism rather than schools of analysis or critical thought. “In classical political economy, there was a concern about the downward trend in the rate of profit,” Maito tells us. “Adam Smith and David Ricardo, among others, noted that there was such a trend. The systemic tendency to crisis and insufficient profits generation has also been discerned by exponents of other economic schools (like Schumpeter or Keynes). All accepted the immanently real nature of this trend, despite the theoretical particularities of each of these economic schools.” [6]

As the United States is the clear forerunner of both capitalism and imperialism, its economy provides the greatest insights into the life cycle of global capitalism. The country has gone through the most advanced stages of capitalist development, has dealt with falling rates of profit by increasingly involving the government in the market (ironically under the guise of a “free” market), and has shown numerous signs of material degradation, most notably following the period of post-industrialization, which has especially impacted the American working class. Roberts and Carchedi argue that profit rates for US capital began to experience significant downturns even in the “boom” era, as early as 1948, before hitting a cyclical bottom in 1982:

“Empirical evidence confirms this. We shall focus on the United States since World War II. 4 Figure 1.1 shows that the rate of profit has been falling since the mid-1950s and is well below where it was in 1947. There has been a secular decline; the rate of profit has not moved in a straight line. After the war, it was high but decreasing during the so-called “Golden Age,” from 1948–65. This was also the fastest period of economic growth in American history. Profitability kept falling from 1965 to 1982, as well. The growth of gross domestic product (GDP) was much slower, and American capitalism (as did capitalism elsewhere) suffered severe slumps in 1974–75 and 1980–82.” [7]

In looking at not only the trajectory of global capital, but more specifically the US system in general, we can also see that a historic profitability crisis occurred in or around the 1970s. This crisis was temporarily halted during the first sixteen years of the neoliberal era, specifically between 1982 to 1997, due to many factors, including globalization, financialization schemes, and increased exploitation of workers within the imperial core. Roberts and Carchedi go on to explain this temporary halt and the real effects it had on profitability during this period:

“Then, as figure 1.2 shows, in the era of what is called “neoliberalism”— from 1982 to 1997—profitability rose. Capitalism managed to bring into play the counteracting factors to falling profitability: namely, greater exploitation of the American workforce (falling wage share), wider exploitation of the labor force elsewhere (globalization), and speculation in unproductive sectors (particularly, real estate and finance capital). Between 1982 and 1997, the rate of profit rose 19 percent, as the rate of surplus value rose nearly 24 percent and the organic composition of capital rose just 6 percent…

This “neoliberal period” had fewer severe slumps, although economic growth was still slower than in the Golden Age because profitability was still below that of the latter, particularly in the productive sectors of the US economy. Much of the profit was diverted away from real investment and into the financial sector. Profitability peaked in 1997 and began to decline. Between 1997 and 2008, the rate of profit dropped 6 percent and the rate of surplus value fell 5 percent, while the organic composition of capital rose 3 percent. This laid the basis for the Great Recession of 2008–2009.” [8]

The aberrations that occurred during this period, which allowed for not only a break in the downward trend but also an increase in many sectors, was never sustainable and ultimately represented a crossroads. It was also relatively insignificant, as we can see in Figure 1.1. As many economists across the spectrum have noted, the crisis that began in the 1970s now appears to be unique in both scale and in its effects on the reproduction of capital, to the point where some have pinpointed it as the peak of capitalism’s potential and beginning of the system’s overall decay.

The historical significance of the profitability crisis of the 1970s has also been backed by empirical evidence. In a 2020 paper published by Agrarian South: Journal of Political Economy, Paris Yeros and Praveen Jha illustrate how the reproduction of capital and profit have been on a permanent downward turn since, characterized by chronic recessions within the imperial core and residual depressions within the semi-peripheries:

“Overall, there has been a long-term decline of the rate of profit in the productive sectors of the leading capitalist state. This decline began in earnest in 1965 and persisted all through the 1970s. Then, a partial recovery occurred from 1982 to 1997, at roughly two-thirds the 1965 level. This was followed by another drop after 1997 and then another recovery in 2006, back up to 1997 levels. But this was then followed by a sharp fall in the course of the 2008 crisis, which took the profit rate down to roughly one-third of the 1965 level. Thereafter, another weak recovery ensued. This, indeed, makes for a long crisis—and on this we can agree. It has been a long systemic crisis punctuated by crashes, recessions and even depressions in some countries, particularly in the peripheries and semi-peripheries, including inside Europe. Indeed, it is no longer odd to encounter conditions comparable to those obtaining among advanced countries after 1929, with dramatic losses in gross domestic product (GDP) of up to 30 per cent and unemployment levels surpassing 20 per cent.” [9]

By examining the trajectory of capital over the past fifty years, especially regarding the relationship between technological advances and the system’s reliance on imperialism, Yeros and Jha expand on Marx’s TRPF to shows the uniqueness of the neoliberal-era crisis:

“If we take Marx’s law of the tendency of the rate of profit to fall ipsis litteris, we could easily reach the conclusion that the current crisis of capitalism is essentially like any other…

Yet, this is not a crisis essentially like any other, nor is its primary contradiction reducible to that between capital and labor. Some historical and analytical perspective on the long transition remains in order for a fuller explanation of what is at stake. We are witnessing not just a re-run of capitalist crisis, but the dramatic denouement of a 500-year-old social system. We cannot agree with Roberts (2016, p. 6) that ‘there is no permanent slump in capitalism that cannot be eventually overcome by capital itself’. This can only become clearer if we illuminate the mechanisms of systemic crisis by building on the original formulation of Marx’s law. For the exclusive focus on technological change and the construal of crisis exclusively to the organic composition of capital obscures the operation of imperialism and its modes of rule, reducing imperialism to a mere add-on—when considered at all. Even in Marx’s time, the connection between technology and profits was perched on a colonial relationship of primitive accumulation; this was observed, described and denounced, but never properly theorized. We would be remiss if we persisted with this flaw.” [10]

Finally, in representing perhaps the most substantial evidence to how this historic crisis has doomed this system to the dustbin of history,

“The financialization of profits has taken hold in an unprecedented manner. Industrial firms have become dependent on financial profits, even against industrial profits, and debt has ballooned among corporations, governments and households, with the USA at the forefront and with the active support of monetary authorities. This policy has reached the point today of obtaining negative interest rates across the Eurozone, Japan and the USA (in real terms)—to no good effect. We can, indeed, speak of the establishment of an enduring, systemic financialization logic, or monopoly-finance capital (Foster, 2010), whose great feat has been the perpetuation of a ‘wealth effect’ by the systematic inflation of asset prices, against falling profits in production. This has placed monopoly capitalism on life support and explains its perseverance, if not also the magnitude of its foretold collapse.” [11]

 

Imperialism, Globalization, and the “New Imperialism” as a precursor to domestic fascism

Analysis on imperialism’s relation to capital began to appear at the turn of the 20th century. VI Lenin’s Imperialism: The Highest Stage of Capitalism remains perhaps the most important contribution to this topic, and was written in response to both the first world war and the works of John Atkinson Hobson (1902), Rudolf Hilferding (1910), and most directly, Karl Kautsky, a fellow Marxist who had contributed much to the topic.

Lenin’s critiques of Hobson and Kautsky are especially useful in understanding the context of his own work. In Hobson, Lenin appreciated much of the analysis, although stopping short at the typical blind spots of social liberalism, which fail to recognize the revolutionary proletariat as the only force capable of combating the ills of imperialism. Ultimately, Hobson was unable or unwilling to view the matter through a Marxist lens.  In Kautsky, Lenin had a more piercing critique that arose in response to two main points. First was his belief that Kautsky erroneously identified imperialism as a mere “policy choice” made by competing capitalist nations, rather than a byproduct of a later stage of capitalist development. Lenin summarized this as “divorcing imperialist politics from imperialist economics, and divorcing monopoly in politics from monopoly in economics.” [12] Second, Lenin believed Kautsky’s motivation to separate politics from economics was to “obscure the most profound contradictions of imperialism and thus justify the theory of ‘unity’ with the apologists of imperialism and the outright social chauvinists and opportunists.” [13] To Lenin, the social chauvinists and opportunists were the petty bourgeoisie and upper echelons of the proletariat within the imperialist nations, which he referred to as a “labor aristocracy” who had been “bribed out of imperialist superprofits and converted to watchdogs of capitalism and corrupters of the labor movement… on the backs of Asia and Africa.” [14] This echoed the words of Friedrich Engels in 1858, which he wrote in a letter to Marx,

“The English proletariat is becoming more and more bourgeois, so that this most bourgeois of all nations is apparently aiming at the possession of a bourgeois aristocracy and a bourgeois proletariat alongside the bourgeoisie. For a nation that exploits the whole world, this is of course to a certain extent justifiable.” [15]

Lenin recognized that six decades of accumulation had only intensified this development, now extending far beyond the UK and infesting a group of imperialist nations, led by the US.  Most importantly, Lenin tied this social phenomenon directly to the concentrations of capital within each nation, as well as the inevitable decay that occurs with falling rates of profit, reconnecting the political with the economic and identifying this development as a distinct stage of capitalist production:

“As we have seen, the deepest economic foundation of imperialism is monopoly. This is capitalist monopoly, i.e., monopoly which has grown out of capitalism, and which exists in the general environment of capitalism, commodity production and competition, in permanent and insoluble contradiction to this general environment. Nevertheless, like all monopoly, it inevitably engenders a tendency of stagnation and decay. Since monopoly prices are established, even temporarily, the motive cause of technical and, consequently, of all other progress disappears to a certain extent and, further, the economic possibility arises of deliberately retarding technical progress.” [16]

While written a century ago, Lenin’s work remains as relevant as ever, especially in the United States, where these developments and effects have continued to manifest in various ways and within different theaters, both domestically and internationally. The post-Soviet global order, which left the United States as the sole superpower for the past three decades, has brought some developments perhaps unforeseen by the likes of Lenin and Marx, but still mirror many of the systemic tendencies they pinpointed so long ago. The most important of these remains their predictions of capital inevitably concentrating into the hands of fewer and fewer, leading to both the death of free competition and the birth of a bevy of corporatized states that become necessary for protecting the interests of capital against a constant growth of discontent among the masses. Lenin’s prediction of big capital eventually devouring small capital can especially be seen in the modern-day United States, where so-called “mom and pop” stores and small landlords are being pushed out by the ever-growing tentacles of private equity firms and finance capital. Lenin described this transition as the socialization of capital, which he predicted would lead to the development of a new social order where large corporate states are forced to subsidize the concentration of capital, or the capitalist class, leading to a scenario where gains are privatized, but losses are socialized (absorbed by the state and passed down to the people):

“Capitalism in its imperialist stage leads directly to the most comprehensive socialization of production; it, so to speak, drags the capitalists, against their will and consciousness, into some sort of a new social order, a transitional one from complete free competition to complete socialization…

Production becomes social, but appropriation remains private. The social means of production remain the private property of a few. The general framework of formally recognized free competition remains, and the yoke of a few monopolists on the rest of the population becomes a hundred times heavier, more burdensome and intolerable.

…Here we no longer have competition between small and large, between technically developed and backward enterprises. We see here the monopolists throttling those who do not submit to them, to their yoke, to their dictation.” [17]

Lenin foresaw not only the structural developments that we have experienced throughout the latter part of the 20th century and beginning part of the 21st century, but also the inevitable reactions to them. In the 2025 United States, we see small capitalists and more privileged sectors of the working class which had meshed with the bourgeoisie through property ownership or inclusion into the stock market now railing against finance capital as some sort of aberration, even ignorantly referring to it as a form of socialism. So-called “libertarians” are most known for this type of emotional response, believing it to be rooted in analysis provided by their revered Austrian School economists. What they do not realize, however, is that the concentration of capital was inevitable, as was the need for a corporatized state to form and strengthen alongside this concentration. Additionally, the “free market” that they most often associate with capitalism never actually existed, even during the system’s earliest days. Rather, capitalism has always required a highly-interventionist state for everything from destroying the commons (enclosure acts), enslaving Africans, forcing peasants into factories and mills, and breaking strikes to maintaining domestic exploitation, enforcing property laws, destroying socialist movements, and forcefully extracting resources from abroad. Lenin explains,

“Translated into ordinary human language this means that the development of capitalism has arrived at a stage when, although commodity production still “reigns” and continues to be regarded as the basis of economic life, it has in reality been undermined and the bulk of the profits go to the “geniuses” of financial manipulation. At the basis of these manipulations and swindles lies socialized production; but the immense progress of mankind, which achieved this socialization, goes to benefit . . . the speculators. We shall see later how “on these grounds” reactionary, petty-bourgeois critics of capitalist imperialism dream of going back to “free,” “peaceful” and “honest” competition.’ [18]

The pinnacle of US capitalism occurred within a relatively small window that opened after World War II and was only made possible by the near-total destruction of Europe, which allowed the US to use its geographical advantage to emerge as the global forerunner of capital. This, in turn, led to the US becoming the most advanced capitalist state the world has seen. The US working class experienced residual benefits from this advantageous position, but this was relatively short lived, essentially ending when US capitalists successfully globalized the labor market, began offshoring production to exploit cheap labor, and kicked off the neoliberal era of monetary policy in the 1970s and 80s.

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Not coincidentally, this also paralleled the profitability crisis of the 1970s, which has been identified as a significant period of stagnation caused by falling rates of profit. As mentioned before, this period is viewed by some as the point where capital reached a permanent breaking point in terms of representing a force of innovation and productivity. As such, a shift from industrialization to financialization occurred within the US to address the essential deadening of capital, which has since taken on a vampiristically toxic presence in advanced capitalist nations like the US. In simple terms, capitalism outlived its usefulness during this period and has been on life support ever since, for the mere purpose of appeasing the monopolistic conglomerates and financiers who both control the capitalist state and benefit from its interventions, which of course come at the expense of everyone else (from the most precarious of workers to even small capitalists). Lenin foresaw this development as well, telling us,

“Under the general conditions of commodity production and private property, the “business operations” of capitalist monopolies inevitably lead to the domination of a financial oligarchy.

…Finance capital, concentrated in a few hands and exercising a virtual monopoly, exacts enormous and ever-increasing profits from the floating of companies, issue of stock, state loans, etc., strengthens the domination of the financial oligarchy and levies tribute upon the whole of society for the benefit of monopolists.

…A monopoly, once it is formed and controls thousands of millions, inevitably penetrates into every sphere of public life, regardless of the form of government and all other “details.” [19]

Understanding the period in and around the 1970s as a crucial turning point for the capitalist system is important in understanding every development – whether social, political, or governmental – that has occurred in the US since then. This new form of capitalism, which would quickly become intertwined with the capitalist state out of necessity, is most easily viewed as the pinnacle of monopoly capital: the natural concentration of capital into unchecked monopolies that use unprecedented wealth to destroy competition via political power. John Bellamy Foster explains,

“Monopoly capital” is the term often used in Marxian political economy and by some non-Marxist analysts to designate the new form of capital, embodied in the modern giant corporation, that, beginning in the last quarter of the nineteenth century, displaced the small family firm as the dominant economic unit of the system, marking the end of the freely competitive stage of capitalism and the beginning of monopoly capitalism.” [20]

In further explaining how this new form of capital materialized through the system’s evolution, Bellamy Foster calls on Marx:

“The battle of competition,” he [Marx] wrote, “is fought by the cheapening of commodities. The cheapness of commodities depends, ceteris paribus, on the productiveness of labor, and this again on the scale of production. Therefore, the larger capitals beat the smaller…. Competition rages in direct portion to the number and in inverse proportion to the magnitude of the rival capitals.” Hence, capital accumulation presupposed both a growth in the size of individual capitals (concentration, or accumulation proper) and the fusion together of many capitals into “a huge mass in a single hand” (centralization). Moreover, the credit system, which begins as a “humble assistant of accumulation,” soon “becomes a new and terrible weapon in the battle of competition and is finally transformed into an enormous social mechanism for the centralization of capitals.” [21]

In the political realm, this new form of capital came to overwhelm the capitalist state in its liberal democratic form, leading to a shift in monetary policy from Keynesianism to neoliberalism, and the eventual formation of a full-blown corporate state that was realized at some point between the 1970s and 1990s. The formation of corporate governance is often blamed on individual players like Reagan, Carter, Nixon, or Milton Friedman, or entities like the much-maligned Federal Reserve. However, when analyzed from a materialist perspective, we can see that the corporate state was an inevitability — a structural necessity to address the monumental shift from entrepreneurial and industrial capitalism to corporate capitalism and what became known as financialization. It wasn’t created in opposition to capitalism, but to support it as a means of wealth creation, beyond its usefulness as an innovative force. More specifically, this shift was a systemic response to (1) the basic laws of capital accumulation, which led to large concentrations of wealth, as well as (2) perpetually falling rates of profit, which required increasing amounts of state intervention to manage. Thus, the large concentrationsn of wealth naturally transformed into large concentrations of political power for capitalists. And since “unproductive capital” now represented the dominant form, this power flowed to the financial sector while no longer offering avenues of innovation from below. The individual players who helped usher in this era just happened to be in power at the time of this necessary shift.

Therefore, it is not merely coincidental that the state became fully intertwined with capital to offset falling rates of profit and, in doing so, began to directly address systemic constraints that were compounding the negative effects of capital accumulation, such as the gold standard. As Ted Reese explains, with this structural understanding of the system, we can see that rather than neoliberalism serving as a turn away from Keynesianism, it more accurately represented a bridge to neoliberalism. [22]

The shift away from a productive and innovative form of capitalism is explained in detail by Bellamy Foster, who calls on the 1966 classic, Monopoly Capital: An Essay on the American Economic and Social Order by Paul Sweezy and Paul A. Baran:

“Capitalist consumption accounted for a decreasing share of demand as income grew, while investment took the form of new productive capacity, which served to inhibit new net investment. Although there was always the possibility that altogether new “epoch-making innovations”—resembling the steam engine, the railroad, and the automobile in their overall scale and effect—could emerge, allowing the system to break free from the stagnation tendency, such massive, capital-absorbing innovations were by definition few and far between. Hence, the system of private accumulation, if left to itself, exhibited a powerful tendency toward stagnation. If periods of rapid growth nonetheless occurred—Baran and Sweezy were writing at the high point of the post-Second World War expansion—this was due to such countervailing factors to stagnation as the sales effort, military spending, and financial expansion (the last addressed at the end of their chapter on the sales effort). All such countervailing factors were, however, of a self-limiting character and could be expected to lead to bigger contradictions in the future.” [23]

Fully merging with the capitalist state between the 1970s and 1990s allowed monopoly capital to further consolidate into an insurmountable political force, which would eventually consume both capitalist political parties in the United States. This marked the end of traditional liberalism in the US, which had been the source of periodic concessions made by the capitalist class to the working class throughout the 20th century, most notably with New Deal and Great Society legislation. With the implementation of neoliberalism, a concentrated effort to unleash monopoly capital from any remaining constraints tied to the Keynesian model, the arrival of a newly globalized labor/consumer market, and the subsequent fall of the Soviet Union (which had served as the only formidable check on global capital), monopoly capitalists in the US were set on a clear path of global domination.

Referring to this as the “new imperialist structure,” Samir Amin explains,

“Contemporary capitalism is a capitalism of generalized monopolies. What I mean by that is that monopolies no longer form islands (important as they may be) in an ocean of corporations that are not monopolies—and consequently are relatively autonomous—but an integrated system, and consequently now tightly control all productive systems. Small and medium-sized companies, and even large ones that are not themselves formally owned by the oligopolies, are enclosed in networks of control established by the monopolies upstream and downstream. Consequently, their margin of autonomy has shrunk considerably. These production units have become subcontractors for the monopolies. This system of generalized monopolies is the result of a new stage in the centralization of capital in the countries of the triad that developed in the 1980s and ’90s.” [24]

Expanding on the dynamics of this new paradigm, Amin tells us,

“These generalized monopolies dominate the world economy. Globalization is the name that they themselves have given to the imperatives through which they exercise their control over the productive systems of world capitalism’s peripheries (the entire world beyond the partners of the triad). This is nothing other than a new stage of imperialism.” [25]

This new imperialism, which became an extension of the corporate state that had already nestled in much of the world via market globalization, has allowed the United States, along with the West, NATO, and global capital, to run roughshod over much of the world, culminating into over 800 US military bases worldwide. Meddling in foreign governments and elections, carrying out coups, destroying and sabotaging socialist movements, stealing natural resources, and establishing new labor and consumer markets have all been included in this decades-long agenda that has continued without much interference. Despite trillions of dollars of “new capital” (i.e. exploited labor) created by this globalized racket, the corporate state has maintained its negligence of the US population, continuing to privatize most of the US infrastructure for the benefit of capital at home, and using monetary policy such as quantitative easing (under the TANF umbrella) to bail out corporations and financial institutions through the purchasing of toxic assets in wake of the 2008 housing crash.

This new stage of capital, combined with the formation of a fully intertwined corporate state and the development of a “new imperialist structure,” has ironically begun to reverse the process of bourgeoization that Engels and Lenin had pinpointed in the past, increasingly harming the upper echelons of the working classes within the imperial core. Unfortunately, rather than decoupling this group from the interests of capital, it has created a phenomenon where the privileged children of the former middle classes are largely turning to more overt forms of fascist politics, mostly at the behest of capitalist media. This development is useful in explaining the hard right-wing shift of Democrats and the political rise of Donald Trump, as well as the coordinated attacks against immigrants and more ambiguous things like “wokeness” – all of which have been designed to redirect attention away from the capitalist system. In a sense, what we are seeing play out in the US could aptly be viewed as a petty-bourgeois revolution, where more privileged sectors of the US working class are joining up with small capitalists and landlords to unknowingly bolster the corporate agenda via Trump, who has been falsely advertised as an outsider coming in to “shake things up.” [26]

Needless to say, in material terms, all of this has come at the expense of the American population as a whole, which now includes a sizable portion that is chronically unemployed and underemployed, a working class that is mostly living paycheck to paycheck, a housing market that is no longer accessible to a majority of working people, and costs of living that continue to grow out of control.

 

Marxism (DIALECTICAL/HISTORICAL MATERIALISM) is Needed to Decipher the Matrix

It is impossible to understand not only the present world but also modern global history without understanding capitalism. And the only way to truly understand the inner and outer workings of capitalism is to view things through a Marxist lens. This is why Marx, and the Marxist school of thought and analysis, is so widely demonized and suppressed within the United States. It is quite literally the key to exposing the corrupt power structure, both in terms of the economic system itself and those who serve the system from the halls of Congress, the oval office, the Supreme Court, the Pentagon, the DoD, the Federal Reserve, mass media, executive offices, board rooms, courts, police stations, etc. In other words, every aspect of our society stems from the arrangements set by capitalist modes of production.

As Shane Mage describes it, Marxism provides “sheer intellectual power” to the masses of people, as Marx “provided the concepts, categories, and structural analyses that were, and largely remain, indispensable for understanding the human historical process over past centuries and in the immediate historical present.” To think in a Marxian way is to seek mass liberation for the human race via working-class emancipation. Simply put,

“To be revolutionary, and truthful, all social thought must be essentially Marxian. Only two conditions are obligatory: awareness that there is something basically and gravely wrong with the human condition as it exists and has existed throughout the history of class society; and seriousness in the reading and study of Marx’s writings and those of his professed followers. Anyone who fulfills those conditions necessarily starts to think in a Marxian way.” [27]

Thus, in order to understand capitalism’s current slide into a more overt form of fascism, one must understand that capitalism, in and of itself and in its purest form, is already deeply rooted in fascistic tendencies. It is, after all, the latest stage of what Thorstein Veblen once referred to as the “predatory phase of human development,” which has been characterized within Western society by transitions between feudalism, chattel slavery, and capitalism (wage slavery), all of which include similar exploitative dynamics of a wealthy minority feeding off a toiling majority. As the Marxist historian Michael Parenti explains,

“There can be no rich slaveholders living in idle comfort without a mass of penniless slaves to support their luxurious lifestyle, no lords of the manor who live in opulence without a mass of impoverished landless serfs who till the lords’ lands from dawn to dusk. So too under capitalism, there can be no financial moguls and industrial tycoons without millions of underpaid and overworked employees.” [28]

With this understanding of capitalism’s foundation, we can begin to develop systemic analysis that pinpoint stages in its development. However, this can only be done accurately through a Marxist lens. And this is precisely why the capitalist class in the US, as well as its government and all institutions that anchor capitalist society, have made such a massive effort in both obstructing people from Marxism as a school of analysis and wholly demonizing it as some vague force of evil. Because, ultimately, Marxism is the key to understanding capitalism, not through dogmatic beliefs and childish rejections, but through scientific analysis. Marxism is not a magical blueprint for society, nor is it a utopian leap of faith, but rather it is an analytical tool for understanding capitalist modes of production as a stage of human development, class struggle as the driving force behind societal change, and the social offshoots of these modes of production, which make up what we refer to as society. Marxist economist, Michael Roberts, sums this up nicely by explaining,

“If we do not develop general theories then we remain in ignorance at the level of surface appearance.  In the case of crises, every slump in capitalist production may appear to have a different cause.  The 1929 crash was caused by a stock market collapse; the 1974-5 global slump by oil price hikes; the 2008-9 Great Recession by a property crash.  And yet, crises under capitalism occur regularly and repeatedly.  That suggests that there are underlying general causes of crises to be discovered.  Capitalist slumps are not just random events or shocks.

The scientific method is an attempt to draw out laws that explain why things happen and thus be able to understand how, why and when they may happen again.  I reckon that the scientific method applies to economics and political economy just as much as it does to what are called the ‘natural sciences’.  Of course, it is difficult to get accurate scientific results when human behavior is involved and laboratory experiments are ruled out.  But the power of the aggregate and the multiplicity of data points help.  Trends can be ascertained and even points of reversal.

If we can develop a general theory of crises, then we can test against the evidence to see if it is valid – and even more, we can try and predict the likelihood and timing of the next slump.  Weather forecasting used to be unscientific and just based on the experience of farmers over centuries (not without some validity).  But scientists, applying theory and using more data have improved forecasting so that it is pretty accurate three days ahead and very accurate hours ahead.

Finally, a general theory of crises also reveals that capitalism is a flawed mode of production that can never deliver a harmonious and stable development of the productive forces to meet people’s needs across the globe.  Only its replacement by planned production in common ownership offers that.” [29]

In capitalist society, we are bombarded with superficial definitions of capitalism through what Antonio Gramsci referred to as cultural hegemony, which are normalized interactions and sources of information and values that extend from the economic base, thus portraying the system in a positive light to manufacture consent even from the masses of workers whose exploitation fuels it. The before-mentioned bourgeoization of the working classes within the imperial core like the US makes this process of conditioning easier for the capitalist class as it can separate workers of the world into various sects. From our schools to our media, capitalism is described as a “free exchange of goods and services,” as being synonymous with “freedom and liberty,” or simply as the “free market.” Most, if not all, of these definitions and descriptors intentionally omit both the foundations and fundamental aspects of the system. Granted, Marx himself, and more importantly, the scientific methods that guide Marxist analysis (historical/dialectical materialism), view capitalism as a necessary evil in the progression of human civilization, especially in terms of creating the productive capacities necessary to sustain life. But, the scientific method also allows us to understand why this stage of production, which is aptly described as the most advanced stage of the “predatory phase,” will either (1) give way to the formation of socialism or (2) destroy both human civilization and our planet.

Parenti goes on to explain the illuminating effects of seeing things through a Marxist lens:

“To understand capitalism, one first has to strip away the appearances presented by its ideology. Unlike most bourgeois (mainstream) theorists, Marx realized that what capitalism claims to be and what it actually is are two different things. What is unique about capitalism is the systematic expropriation of labor for the sole purpose of accumulation. Capital annexes living labor in order to accumulate more capital. The ultimate purpose of work is not to perform services for consumers or sustain life and society, but to make more and more money for the investor irrespective of the human and environmental costs. An essential point of Marxist analysis is that the social structure and class order prefigure our behavior in many ways. Capitalism moves into every area of work and community, harnessing all of social life to its pursuit of profit. It converts nature, labor, science art, music, and medicine into commodities and commodities into capital. It transforms land into real estate, folk culture into mass culture, and citizens into debt-ridden workers and consumers. Marxists understand that a class society is not just a divided society but one ruled by class power, with the state playing the crucial role in maintaining the existing class structure. Marxism might be considered a “holistic” science in that it recognizes the links between various components of the social system. Capitalism is not just an economic system but a political and cultural one as well, an entire social order. When we study any part of that order, be it the news or entertainment media, criminal justice, Congress, defense spending, overseas military intervention, intelligence agencies, campaign finance, science and technology, education, medical care, taxation, transportation, housing, or whatever, we will see how the particular part reflects the nature of the whole. Its unique dynamic often buttresses and is shaped by the larger social system — especially the systems overriding need to maintain the prerogatives of the corporate class.” [30]

To use a Marxist lens is to see human history as an ongoing development in response to material reality or, more specifically, how a particular society arranges its means to produce and distribute the needs required to sustain human life. For instance, under capitalism, private interests own and control not only the means to produce/provide everything from food and shelter to medical care, but also the actual land that we inhabit. Thus, access to capital/currency (backed by a particular state) determines who can own and control natural resources. Then, in turn, those who take ownership (capitalists) deploy laborers, or what they refer to as “human resources,” on and with natural resources to produce commodities that can be sold back to the laborers, or general public, for profit. In this arrangement, those of us who make up the working-class masses are compelled to sell ourselves as commodities to capitalists because they have eliminated the commons (i.e. our ability to live off the land) and tied our survival to their for-profit commodity production.

The fundamental relationship between capital (the wealthy minority) and labor (the landless majority) naturally creates class division in this society, and understanding the class division that is inherent to privately-owned means of production (capitalism) is crucial to understanding nearly every other development within that society. When one is able to see it for what it is, understanding how it was constructed and how it functions in historical terms, it becomes clear as day; yet the institutions that extend from it – including schools and media – naturally obscure this reality to protect the interests of the owning class, who also control and disseminate the means of information. And they do this through various avenues, with the total obstruction and demonization of Marxist analysis/understanding being one of the primary aims of the US ruling class.

So, what this creates is a massive blind spot in mainstream (bourgeois) “reality,” to the point where many are unable to even see the reality that we live in. Thus, living in capitalist society without a basic understanding of a materialist conception of history and its subsequent developments is like being plugged into the Matrix, blind to your bondage and living a lie. From a working-class perspective, bourgeois analysis is largely impotent. And, whether intentional or not, this severe lack of understanding leaves most to rely on emotion – or reaction – in responding to structural developments that affect us on an individual level. For instance, take the current hot button issue of illegal immigration that is being pushed by mainstream media. From a bourgeois perspective, so-called “illegals” are easily decontextualized into mere criminals who are crossing the border to rape, steal, and take advantage of the “entitlements” offered in the US. Hence, the hysterical and irrational attempts to label this crisis as an “invasion,” something that is even more effective when sold to an already highly indoctrinated, racist, and xenophobic population.

Without a Marxist lens, issues like immigration — and poverty, homelessness, crime, child abuse, etc. — appear to occur in a vacuum, completely unattached from the capitalist/imperialist system and caused by mysterious “forces of evil” or simply “poor choices.” Or, as Parenti puts it, “lacking a holistic approach to society, conventional social science tends to compartmentalize social experience.” [31] So, we see in this development the same phenomena that Lenin saw in Kautsky’s analysis of imperialism – a divorce between the political/social and economic. This is precisely what the owning class wants because it knows that an informed and aware working class would become increasingly uncontrollable and, thus, unexploitable.

To understand this further, it is useful to compare the differences between mainstream/bourgeois perspectives versus the Marxist lens. Using racism as an example, Parenti contrasts the differences between the liberal and Marxist views:

“Consider a specific phenomenon like racism. Racism is presented as essentially a set of bad attitudes held by racists. There is little analysis of what makes it so functional for a class society. Instead, race and class are treated as mutually exclusive concepts in competition with each other. But those who have an understanding of class power know that as class contradictions deepen and come to the fore, racism becomes not less but more important as a factor in class conflict. In short, both race and class are likely to be crucial arenas of struggle at the very same time.

Marxists further maintain that racism involves not just personal attitude but institutional structure and systemic power. They point out that racist organizations and sentiments are often propagated by well-financed reactionary forces seeking to divide the working populace against itself, fracturing it into antagonistic ethnic enclaves.

Marxists also point out that racism is used as a means of depressing wages by keeping a segment of the labor force vulnerable to super-exploitation. To see racism in the larger context of corporate society is to move from a liberal complaint to a radical analysis. Instead of thinking that racism is an irrational output of a basically rational and benign system, we should see it is a rational output of a basically irrational and unjust system. By “rational” I mean purposive and functional in sustaining the system that nurtures it.” [32]

This understanding of an intimate connection between the base (capitalist modes of production/distribution) and superstructure (the social and political extensions of that base) is what made the original Black Panther Party, as Marxist-Leninists, so dangerous to the oppressive capitalist power structure in the US. It is why J. Edgar Hoover was adamant about killing Fred Hampton. It is why the US government was so heavily involved in sabotaging Martin Luther King, Malcolm X, the black power movement, and much of the anti-war movement. It is why McCarthyism and the Red Scare developed, why people-powered movements of self-determination (mostly of which are Marxist/Communist) throughout the Global South – from Latin America to Africa and Asia — are so fiercely opposed by global capital and its military forces from the US, Europe, and NATO. Because these movements figured out (or were on the verge of figuring out) that things like colonialism, imperialism, white supremacy, patriarchy, etc. are all extensions of capital’s need to grow, expand, and dominate like a cancer cell.

 

Imperial Boomerang, Fascism, and the Collapse of the American Empire

Viewing the history of capitalism through a Marxist lens allows us to identify stages of its development. Chronologically, these stages can roughly be broken down into agricultural capitalism, merchant/entrepreneurial capitalism, industrial capitalism, and monopoly/finance capitalism. More nuance can and has been applied to these stages. For instance, the American Marxist Erik Olin Wright referred to “a schema of six stages: primitive accumulation, manufacture, machinofacture, monopoly capital, advanced monopoly capital, and state-directed monopoly capitalism.” [33] Within these macro-stages include micro-stages, which can consider anything from geographical significance to state interference through monetary policy. Some, like world-systems analyst Giovanni Arrighi, have identified four systemic cycles of primitive accumulation that occurred in different eras, centered around the successive spheres of influence from European colonization:  “the Genoese cycle: from the 15th century to the beginning of the 16th century; the Dutch cycle: from the end of the 16th century to the middle of the 18th century; the English cycle: from the last half of the 18th century to the beginning of the 20th century; The American cycle: in the 20th century.” [34]  

Other world-systems analysts like Emmanuel Wallerstein and Samir Amin have used this lens to analyze how both colonialism and imperialism have interplayed with capitalist development, separating regions and countries into three distinct categories of “core, semi-periphery, and periphery,” all of which are determined by their relation to capital (from the oppressive and parasitic imperialist core to the oppressed and colonized/underdeveloped periphery, and those which fluctuate in between representing the semi-periphery. [35]

The United States has become the apex predator of capital over the past few centuries, benefitting from its geographical position/size and its early reliance on chattel slavery, which amounted to countless trillions of dollars’ worth of forced labor over the course of 241 official years (1619 – 1860) and is widely considered to be “the capital that jumpstarted American capitalism.” The invention of “whiteness” and the systemic perpetuation of white supremacy has allowed the capitalist class to create a distinct underclass based on racial identity, both internationally and domestically. This has been a significant factor in creating a strange bond between capitalists and working-class whites, many of whom willingly assumed the role of sycophantic class traitors in return for a more worthy designation of being white. W.E.B. Du Bois illustrated this powerful dynamic in his historical classic, Black Reconstruction in America:

“Most persons do not realize how far [the view that common oppression would create interracial solidarity] failed to work in the South, and it failed to work because the theory of race was supplemented by a carefully planned and slowly evolved method, which drove such a wedge between the white and black workers  that there probably are not today in the world two groups of workers with practically identical interests who hate and fear each other so deeply and persistently and who are kept so far apart that neither sees anything of common interest.

It must be remembered that the white group of laborers, while they received a low wage, were compensated in part by a sort of public and psychological wage. They were given public deference and titles of courtesy because they were white. They were admitted freely with all classes of white people to public functions, public parks, and the best schools. The police were drawn from their ranks, and the courts, dependent on their votes, treated them with such leniency as to encourage lawlessness. Their vote selected public officials, and while this had small effect upon the economic situation, it had great effect upon their personal treatment and the deference shown them. White schoolhouses were the best in the community, and conspicuously placed, and they cost anywhere from twice to ten times as much per capita as the colored schools. The newspapers specialized on news that flattered the poor whites and almost utterly ignored the Negro except in crime and ridicule.” [36]

Historically, the invention of “race” became an integral part of capitalist development, which was rooted in both European colonialism and the forced transformation of feudal peasants into proletarians. The former process occurred externally through the conquering and domination of foreign lands, while the latter was an internal process of exploitation whereas European Lords gave way to the European bourgeoisie, a new class of wealthy landowners who became the capitalist class. Both processes were rooted in the forced extraction of natural (land) and human resources (labor), the two elements required for capitalists to establish their means of exploitative production for profit. But these simultaneous developments were not easy to balance, especially since the forced creation of an industrial working class (which occurred through the destruction of common land) caused significant blowback in the form of peasant revolts. The capitalist class learned from this and used notions of gender/sex (in the Old World) and race (in the New World) to divide and weaken this newly formed industrial working class. In Black Marxism: The Making of the Black Radical Tradition, Cedric Robinson touches on this historical development that paralleled the birth of capitalism:

“The contrasts of wealth and power between labor, capital, and the middle classes had become too stark to sustain the continued maintenance of privileged classes at home and the support of the engines of capitalist domination abroad. New mystifications, more appropriate to the times, were required, authorized by new lights. The delusions of medieval citizenship, which had been expanded into shared patrimony and had persisted for five centuries in western Europe as the single great leveling principle, were to be supplanted by race and (to use the German phrase) Herrenvolk, in the seventeenth and eighteenth centuries. The functions of these latter ideological constructions were related but different. Race became largely the rationalization for the domination, exploitation, and/or extermination of non-Europeans.” [37]

The formation of the United States brought this entire process to a head, with the extermination of a Native population, the forced takeover of land, the introduction of a massive slave trade, and the establishment of a new ruling class made up of wealthy landowners and merchants who relied on both stolen land and bodies to be used as tools for economic development. This was the foundation of not only American capitalism, but also of the global system that came to dominate the modern world. But it is now coming to an end, as capitalism has run its course, and the American ruling class has seemingly run out of targets to exploit. The capitalist state in the US has exhausted its efforts in keeping capitalists extremely wealthy and, in doing so, has effectively impoverished a large majority of its own population, which has essentially joined the rest of the world in a race to the bottom.

This latest development of mass degradation has occurred in the neoliberal era due to (1) the systemic breakdown of capital (driven by falling rates of profit) and (2) a concerted reaction to the working-class rebellions of the 1960s, which were described by the ruling class as a dangerous “excess of democracy.” Six decades later, we have reached a point of no return, as this system has become a husk of toxicity that leaves no room for reversal. As Amin explains,

“The system of generalized monopoly capitalism, “globalized” (imperialist) and financialized, is imploding right before our eyes. This system is visibly incapable of overcoming its growing internal contradictions and is condemned to pursue its mad rush. The crisis of the system is due to nothing other than its own “success.” The strategy used by the monopolies has always resulted in the sought-after results up to this very day: austerity plans, the so-called social (in fact antisocial) plans for layoffs, are still imposed in spite of resistance. The initiative still remains, even now, in the hands of the monopolies (the markets) and their political servants (the governments that submit their decisions to the so-called requirements of the market).” [38]

Now, the US imperialist state must turn inward, and will call upon tactics that it has deployed throughout the world, especially in the Global South, to punish its own citizens. The difference between the US empire and other such states that have experienced “imperial boomerang” is that it already has a large network of internal systems of oppression, most notably in regard to its own black population which has historically been corralled into internal colonies complete with police forces that resemble foreign occupying militaries. The US’s prison industrial complex, which boasts the most prisoners in the world per capita, also serves as a useful proving ground for targeting a growing portion of US citizens in the coming years as more and more are cut lose from the decaying system.

Much like Keynesianism served as a bridge to neoliberalism, neoliberalism has served as a bridge to overt fascism. This fascism is forming from two distinct directions within the United States:

• First, through the foundation of a fully merged corporate state (a necessity to address capitalist decay from the economic base),

• Second, through cultural developments that are responding to the material degradation of capitalist decay (this includes organic reactions from within the population as well as the likely occurrence of government psyops designed to protect capitalists from retribution by redirecting anger and thus feeding reactionary politics).

From a structural standpoint, the economic base in the US has been ravaged by both the falling rates of profit, as discussed by Marx as a natural phenomenon, and the shift to a post-industrial society, which was the result of American capitalists moving overseas in droves during the 1990s to chase cheap labor. Since then, the capitalist state has relied on the military/arms industry and financialization to maintain so-called wealth, with financialization relying solely on fiat currency being moved around by big players in a way that represents unproductive capital disguised as wealth – meaning that it produces nothing of value in ways that manufacturing industries do. Ironically, this has created a snowball effect for the already-disastrous results stemming from falling profit rates, to the point where US capital has become further squeezed by its inability to reproduce itself without massive consequences for the population. As Roberts tells us,

“Until this overhang of unproductive capital is cleared (“deleveraged”), profitability cannot be restored sufficiently to get investment and economic growth going again. Indeed, it is likely that another huge slump will be necessary to “cleanse” the system of this “dead” (toxic) capital. The Long Depression will continue until then. Despite the very high mass of profit that has been generated since the economic recovery began in 2009, 10 the rate of profit stopped rising in 2011. The average rate of profit remains below the peak of 1997.” [39]

The capitalist state (i.e. the US government) realized long ago that it must become increasingly authoritarian in its service of capital (the rich) against the working-class masses who are being decimated by debt, rising costs of living, underemployment, etc. despite working longer hours than ever before. This is both an organic development in response to the downward trajectory of capital and a conscious attack against the masses for the protection of the wealthy. It is class war personified, and it is being carried out on multiple fronts, including everything from monetary policy, austerity, and increased police budgets to smothering propaganda campaigns, the criminalization of debt and poverty, and the likely formation of government psychological operations that are promoting culture wars. This centralization of power has developed out of necessity to keep capitalism churning. In doing so, it has brought capitalism to a very late stage in its lifespan, transforming into what many have come to refer to as “crony capitalism.” Amin explains,

“The centralization of power, even more marked than the concentration of capital, reinforces the interpenetration of economic and political power. The “traditional” ideology of capitalism placed the emphasis on the virtues of property in general, particularly small property—in reality medium or medium-large property—considered to purvey technological and social progress through its stability. In opposition to that, the new ideology heaps praise on the “winners” and despises the “losers” without any other consideration. The “winner” here is almost always right, even when the means used are borderline illegal, if they are not patently so, and in any case they ignore commonly accepted moral values…

Contemporary capitalism has become crony capitalism through the force of the logic of accumulation. The English term crony capitalism should not be reserved only for the “underdeveloped and corrupt” forms of Southeast Asia and Latin America that the “economists” (the sincere and convinced believers in the virtues of liberalism) denounced earlier. It now applies to capitalism in the contemporary United States and Europe. This ruling class’s current behavior is quite close to that of the mafia, even if the comparison appears to be insulting and extreme.” [40]

This concentration of wealth and power has manifested itself in very real ways throughout the country. For example, the agents of the surveillance state, which include everyone from police, prosecutors, and judges to ICE, FBI, and National Guard soldiers, are being emboldened to serve as a protective cushion between (1) the corporate state and its wealthy beneficiaries and (2) the increasingly desperate masses. However, these authoritarian mechanisms are nothing new in the US. As George Jackson told us in 1971, “The police state isn’t coming — it’s here, glaring and threatening.” It has always existed, only targeting certain demographics based on racial and class identities. McCarthyism was an extremely authoritarian process of targeting citizens based on political ideology. COINTELPRO consisted of spying, sabotage, and even political assassinations (most notably of Fred Hampton), and so on.

While it has always existed, the police state is now being expanded to target a much larger portion of the population, with the construction of an all-encompassing security state underway since the 1990s, and especially after the World Trade Center attacks that occured on 9/11. Both capitalist parties have participated in expanding and strengthening this state, creating the 1033 program in 1997, which tranfers military equipment and weaponry to police departments across the country, passing the Patriot Act in 2001, approving multiple bouts of the NDAA (National Defense Authorization Act), bolstering the NSA (National Security Agency), expanding FISA (Foreign Intelligence Surveillance Act) reach, creating the US Department of Homeland Security in 2002 and ICE (US Immigration and Customs Enforcement) in 2003, exponentionally increasing police and military budgets, building “Cop Cities” (for urban warfare training) across the country, and bringing tech companies on board to spy on citizens via social media, computers, and cellular devices, with the latest incarnation of such being Trump’s 2025 contract with Palantir to create a database that streamlines private information of citizens (bank accounts, tax returns, social media accounts, etc).

However, even this powerful security state is not enough to protect the rich from the mass discontent and unrest that has become inevitable. The working class still far outnumbers the ruling class. And, the second amendment still exists. So, for fascism to truly cement itself as the ultimate defender of capitalism within the US, a significant portion of the exploited masses must become supporters of the corporate project. This can only be accomplished by convincing many of its necessity. Thus, in the modern US, propaganda campaigns seeking both “manufactured consent” and “active participation/collaboration” are targeting the upper portions of the working class and/or the modern petty bourgeoisie, which consists of small business owners, landlords, and a more privileged sector of the working class that has inherited boomer wealth. These targeting campaigns are being carried out by both politicians and capitalist media, exploiting the lack of material analysis that exists within the US population to pull emotional strings that are rooted in insecurity and fear. The manufactured hysteria about illegal immigrants, which is a common tactic being used by all Western/capitalist governments in these times, is a classic example of misdirection via propaganda. As Frances Moore Lappe and Hannah Stokes-Ramos explain,

“Americans are struggling not because of immigrants taking their jobs and using up their resources. The real threat is the worsening and highly alarming concentrations of wealth and income in our country—more extreme here than in over 100 nations. The top 1 percent of Americans control 30.4 percent of the wealth. Just 806 billionaires hold more wealth than the entire bottom half of all Americans.”

In other words, the historic transfer of wealth that has occurred in the US over the past several decades is not due to immigration, but rather to conscious and deliberate moves being made by the capitalist class to further enrich itself in the face of falling rates of profit. Put simply: the American working class has been robbed by the American capitalist class. Capitalist media – both liberal and conservative – are certainly not going to focus on this fact, so it must find distractions and formulate misdirections. First and foremost, the capitalist class must obstruct the formation of a class-conscious population that would see this truth and then, in turn, seek solutions through class struggle. To date, they not only have been successful in doing so but have also convinced a significant portion of the population to support more authoritarian forms of government to their own detriment. In the short-term, these enablers of fascism may feel secure in their calls for violence against fellow citizens, but this collaboration will inevitably end poorly for them in the long-term as the corporate state will be forced to extend its brutality over time.

 

Conclusion

In its attempt to protect the sanctity of profit, we are seeing that capitalism will completely give in to its fascistic tendencies centered around (1) property/wealth dynamics, (2) the inherently exploitative relationship between capital and labor, and (3) minority dominance over the masses, especially within a dying US empire that is spread thin externally and unraveling internally. The fascist reality that has always existed for the hyper-oppressed (poor, homeless, black, brown, immigrants, women, LGBT) members of the working class has begun slowly extending into more privileged sectors (most notably, former “middle class” whites) since the 1970s. The difference is, rather than organizing with fellow workers against capitalism/fascism by embracing socialism, many of these white workers who have been decimated in the neoliberal era are being swayed to support the overtly fascist transition to maintain their privileges, at least in the short-term. In doing so, they are becoming willing foot soldiers for the corporate government, spurred to action by racist narratives and irrational fears disseminated by capitalist media.

This unfortunate development shows us why social identities that exist within the superstructure, while ultimately secondary to one’s relationship to the means of production, cannot be ignored or separated from class – because such an approach creates massive blind spots that are already being exploited by the ruling class. And, conversely, this is also why class cannot be ignored or separated from identity, as the ruling class has already fully coopted “identity politics” to be used as a smokescreen to obscure the class struggle. This process is well underway since corporate governance was fully cemented during the Reagan years, under the banner of neoliberalism, and has rapidly progressed before our eyes over the past decade alone. The Republican party is pushing the fascist envelope, while the Democrat party is enabling and steadying the transition. An authentic people’s movement, grounded primarily in class struggle with a firm understanding of how identity is used to both intensify class domination and obscure avenues of working-class liberation, is needed.

People must come to understand that the liberal democratic order which replaced monarchy and feudalism is no longer viable. Capitalism cannot be reformed. It cannot be regulated. And the US cannot be reindustrialized under capitalist control. Those days are long gone, as the system has reached its inevitable conclusion and, since the 1970s, has come to a fork in the road with only two paths: full-blown fascism (corporate governance with an authoritarian police/surveillance state) or socialism (working-class/community control of the means of production). The former is winning outright, but the game isn’t over.

 

Notes

[1] Karl Marx. Capital Vol. III, Part III. The Law of the Tendency of the Rate of Profit to Fall, Chapter 13. The Law As Such. Accessed at https://www.marxists.org/archive/marx/works/1894-c3/ch13.htm

[2] Ibid

[3] Ibid

[4] Michael Roberts. A world rate of profit: important new evidence. January 22,2022. Accessed at A world rate of profit: important new evidence – Michael Roberts Blog

[5] World in Crisis: A Global Analysis of Marx’s Law of Profitability, edited by Guglielmo Carchedi and Michael Roberts. Haymarket Books (October 2018)

[6] Ibid

[7] Ibid

[8] Ibid

[9] Paris Yeros and Praveen Jha, Late Neo-colonialism: Monopoly Capitalism in Permanent Crisis. Agrarian South: Journal of Political Economy 9(1) 78–93, 2020 (Centre for Agrarian Research and Education for South: CARES) Accessed at Late Neo-colonialism: Monopoly Capitalism in Permanent Crisis

[10] Ibid

[11] Ibid

[12] VI Lenin, Imperialism and the Split in Socialism (October 1916). Accessed at https://www.marxists.org/archive/lenin/works/1916/oct/x01.htm

[13] Ibid

[14] Ibid

[15] Marx-Engels Correspondence, Engels to Marx in London (October 7, 1858) Accessed at https://marxists.architexturez.net/archive/marx/works/1858/letters/58_10_07.htm

[16] VI Lenin, Imperialism: The Highest Stage of Capitalism (1916). Chapter 8: Parasitism and Decay of Capitalism. Accessed at https://www.marxists.org/archive/lenin/works/1916/imp-hsc/ch08.htm

[17] Ibid, Chapter 1: Concentration of Production and Monopolies. Accessed at Lenin: 1916/imp-hsc: I. CONCENTRATION OF PRODUCTION AND MONOPOLIES

[18] Ibid

[19] Ibid, Chapter3: Financial Capital and the Financial Oligarchy. Accessed at Lenin: 1916/imp-hsc: III. FINANCE CAPITAL AND THE FINANCIAL OLIGARCHY

[20] John Bellamy Foster. What is Monopoly Capital? (Monthly Review: January 1, 2018). Accessed at Monthly Review | What Is Monopoly Capital?

[21] Ibid

[22] Ted Reese. Keynesianism: A Bridge to Neoliberalism. (June 20, 2022) Sublation Magazine online. Accessed at Keynesianism: A Bridge to Neoliberalism

[23] John Bellamy Foster. What is Monopoly Capital? (Monthly Review: January 1, 2018). Accessed at Monthly Review | What Is Monopoly Capital?

[24] Samir Amin. The New Imperialist Structure. (Monthly Review: July 1, 2019) Accessed at Monthly Review | The New Imperialist Structure

[25] Ibid

[26] The Corporate State and its Fascist Foot Soldiers: Understanding Trumpism and the Liberal Response. (Hampton Institute: February 17, 2025). Accessed at The Corporate State and Its Fascist Foot Soldiers: Understanding Trumpism and the Liberal Response — Hampton Institute

[27] The Intellectual Power of Marxism: An Interview with Shane Mage. (The Platypus Affiliated Society: December 2020). Interview by CD Hardy and DL Jacobs. Accessed at The Platypus Affiliated Society – The intellectual power of Marxism: An interview with Shane Mage

[28] Contrary Notions: The Michael Parenti Reader (City Lights Books: 2007)

[29] Michael Roberts. The profitability of crises, an interview by Jose Carlos Diaz Silva. March 2018. Accessed at The profitability of crises – Michael Roberts Blog

[30] Michael Parenti. Blackshirts and Reds: Rational Fascism and the Overthrow of Communism. (City Lights Books: 1997)

[31] Ibid, p. 134

[32] Ibid

[33] Erik Olin Wright, Alternative Perspectives in Marxist Theory of Accumulation and Crisis. Enriching the Sociological Imagination: How Radical Sociology Changed the Discipline (Brill: January 2004)

[34] Giovanni Arrighi and Jason W. Moore, Capitalist Development in World Historical Perspective. Phases of Capitalist Development: Booms, Crises and Globalizations (Palgrave: 2001)

[35] Luis Bresser-Pereira, Phases of capitalism – from mercantilism to neoliberalism (São Paulo, 2023). This paper was prepared for the book being, “The Rise and Fall of Neoliberal Rentier Capitalism.” Accessed at https://www.bresserpereira.org.br/248-phases-of-capitalism.pdf

[36] WEB Du Bois, Black Reconstruction In America [1935], p. 700-701.

[37] Cedric Robinson, Black Marxism: The Making of the Black Radical Tradition, (University of North Carolina Press: 1983), p.26-27.

[38] Samir Amin. The New Imperialist Structure. (Monthly Review: July 1, 2019) Accessed at Monthly Review | The New Imperialist Structure

[39] Michael Roberts. The rate of profit is key (2012). Accessed at https://thenextrecession.wordpress.com/2012/07/26/the-rate-of-profit-is-key/

[40] Samir Amin. The New Imperialist Structure. (Monthly Review: July 1, 2019) Accessed at Monthly Review | The New Imperialist Structure

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