What is imperialism? The basics
Imperialism is often known as visible brute, colonial forces, but imperialism today shows us it is much more than that
Most people hear the word “imperialism” and think of empires, colonies, flags planted on foreign soil.
That version of imperialism existed and it mattered, but it’s also conveniently historical, something that happened in the past and that we’ve supposedly moved on from. The reality is that imperialism didn’t end when the colonies gained independence. It changed form, and the form it takes today is in many ways harder to see, which is partly why it works so well.
This post is about what imperialism actually is in a Marxist sense, why it still operates, and how it explains things that mainstream political commentary either can’t explain or doesn’t want to.
Lenin’s definition, and why it still holds up
In 1916, Lenin wrote *Imperialism, the Highest Stage of Capitalism*, and he argued that imperialism wasn’t just a policy choice by aggressive governments. It was a stage that capitalism inevitably reaches when certain economic conditions develop. He identified five features:
1. Production and capital become so concentrated that monopolies dominate economic life
2. Bank capital merges with industrial capital to create what he called “finance capital,” controlled by a financial oligarchy
3. The export of capital, as opposed to just the export of goods, becomes especially important
4. International monopoly groups form and divide the world’s markets among themselves
5. The territorial division of the whole world among the biggest capitalist powers is complete
The reason this still holds up is not because the world looks exactly like it did in 1916, but because the underlying dynamics Lenin described have intensified rather than disappeared. Capital is more concentrated now than at any point in history. Finance capital dominates industrial production in ways Lenin could only have imagined. And the export of capital, meaning investment flows, debt structures, and financial infrastructure rather than just selling goods abroad, is the primary mechanism through which powerful states maintain control over weaker ones.
The key insight is that imperialism is not about individual decisions by individual governments. It is what capitalism does when it outgrows national borders. Capital needs new markets, new resources, new places to invest, and the state becomes the instrument that secures those things, through military force when necessary, but more often through financial systems, trade agreements, sanctions regimes, and alliance structures that make it economically impossible for smaller countries to act independently.
What this looks like in practice
Take the UK’s relationship with the Middle East, which I’ve been writing about in my previous posts.
The Anglo-Iranian Oil Company, which later became BP, was making £170 million in profit from Iranian oil in 1950 while paying Iran £16 million in royalties (Hansard, 1951). When Iran’s Prime Minister nationalised the company, the UK imposed sanctions, blockaded Iranian oil exports, and helped organise a coup to overthrow him. That’s the old, visible form of imperialism, gunboat diplomacy with an oil company behind it.
Today it looks different but the structure is the same. BP still operates across the Gulf, and Gulf stability is directly tied to the protection of billions in Western capital. The UK’s financial institutions are locked into the US dollar system, meaning they comply with US sanctions on Iran regardless of what UK law says, because losing access to dollar-clearing would be catastrophic for the City of London. NATO obligations frame Iran as a threat to Euro-Atlantic security, which gives a North Atlantic military alliance a reason to operate in the Middle East. Gulf arms contracts worth billions dwarf anything the UK trades with Iran, so there’s a straightforward economic incentive to stay aligned against Iran and with the Gulf monarchies.
None of this requires anyone in government to sit in a room and say “we are doing imperialism.” It is the product of economic structures, financial dependencies, and alliance commitments that together make a certain foreign policy position the only rational one from the perspective of the people and institutions making the decisions. The UK doesn’t follow the US into wars because politicians are weak or stupid. It follows the US because the financial system, the defence industry, and the alliance architecture all point in the same direction, and going against that current would mean going against the material interests of the most powerful institutions in the country.
Finance capital and the dollar
Lenin’s point about finance capital merging with industrial capital is worth sitting with, because it explains something that often gets missed in conversations about foreign policy.
When people ask why the UK can’t just have an independent policy on Iran, the answer is not really about politics. It’s about money, and specifically about how money moves. The US dollar is the world’s reserve currency, and most major international transactions are processed through dollar-clearing systems. Any financial institution that wants access to that system, which is essentially all of them, has to comply with US sanctions. So when the US sanctions Iran, UK banks stop processing UK-Iran trade, not because the UK government told them to, but because they can’t risk being cut off from the dollar.
This is imperialism operating through financial infrastructure rather than military occupation. The US doesn’t need to send troops to enforce compliance. The architecture of global finance does it automatically. And the UK, despite being a major economy with its own currency, is subordinate within this system because the City of London’s entire business model depends on integration with dollar-denominated markets.
Lenin called this the financial oligarchy. Today we might call it the international financial system, or just “the way things work,” which is exactly the point. Imperialism is most effective when it doesn’t look like imperialism, when it just looks like economic common sense.
The export of capital
The other feature of Lenin’s analysis that maps directly onto today is the export of capital. Imperialism in the classical sense was about taking raw materials from colonies and selling finished goods back to them. That still happens, but the more important mechanism now is capital investment, specifically the way Western capital flows into resource-rich regions and then shapes those regions’ politics to protect itself.
Gulf sovereign wealth funds hold major stakes in UK assets, including Barclays, Heathrow, the Shard, and Canary Wharf. The relationship runs both ways, the UK sells arms to the Gulf and the Gulf invests in the UK, creating a mutual dependency that makes it structurally impossible for the UK to diverge from Gulf interests on something like Iran. This is not a conspiracy, it’s the logic of capital export. Once your economy is intertwined with another country’s wealth fund, your foreign policy follows your balance sheet.
And this is why the “rules-based international order” gets applied selectively. Russia gets sanctioned in weeks because Russian capital was never structurally integrated into Western economies in the way Gulf capital is. Iran gets treated as a permanent enemy because its exclusion from global financial circuits is itself profitable for the countries that control those circuits. Israel gets armed because the defence-industrial integration, particularly the F-35 programme, makes the relationship too expensive to sever. The rules aren’t applied based on who breaks them. They’re applied based on whose capital is at stake.
Why this matters
The reason I think it’s worth understanding imperialism as a system rather than a series of individual bad decisions is that it changes what you think the solutions are. If you think the UK’s involvement in the Iran war is because Starmer made a bad call, or because the Foreign Office is incompetent, then the solution is to elect better people or reform the institutions. If you understand it as the product of structural economic dependencies, financial integration, and the logic of capital accumulation, then you start to see why electing different people keeps producing the same outcomes, and why the institutions that are supposed to provide accountability keep failing to do so.
This is not a counsel of despair. Understanding the system is the first step to knowing where the pressure points actually are, which is something I’ll come back to in future posts. But it does mean being honest about the scale of what we’re dealing with. The UK doesn’t have a foreign policy problem. It has a capitalism problem, and its foreign policy is one of the symptoms.
Teaching note: This post uses Lenin’s theory of imperialism as the highest stage of capitalism, specifically his five features of imperialism from the 1916 pamphlet. The key analytical move is understanding imperialism not as a policy choice but as a structural feature of capitalism at a certain stage of development. This is what distinguishes Marxist analysis from liberal or realist accounts of foreign policy. Liberals see bad decisions that can be fixed by better institutions. Realists see rational strategy by self-interested states. Marxists see a system that produces certain kinds of decisions regardless of who is in charge, because the economic base constrains the range of political possibilities. When mainstream commentary asks “why does the UK keep ending up in these wars?”, the Marxist answer is that the question contains its own answer: “keeps” is the operative word, and repetition points to structure, not accident.
References
Lenin, V.I. (1916) *Imperialism, the Highest Stage of Capitalism*. Reprint. London: Penguin Classics, 2010.
Hanieh, A. (2018) *Money, Markets, and Monarchies: The Gulf Cooperation Council and the Political Economy of the Contemporary Middle East*. Cambridge: Cambridge University Press.
Harvey, D. (2003) *The New Imperialism*. Oxford: Oxford University Press.
Wearing, D. (2018) *AngloArabia: Why Gulf Wealth Matters to Britain*. Cambridge: Polity Press.