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Digital Labor and Imperialism

Christian Fuchs is Professor of Social Media at the Communication and Media Research Institute at the University of Westminster, and co-editor of the journal tripleC: Communication, Capitalism & Critique.

A century has now passed since Lenin’s Imperialism, the Highest Stage of Capitalism (1916) and Bukharin’s Imperialism and World Economy (1915), as well as Rosa Luxemburg’s 1913 Accumulation of Capital, all spoke of imperialism as a force and tool of capitalism. It was a time of world war, monopolies, antitrust laws, strikes for pay raises, Ford’s development of the assembly line, the October Revolution, the Mexican Revolution, the failed German revolution, and much more. It was a time that saw the spread and deepening of global challenges to capitalism.

This article reviews the role of the international division of labor in classical Marxist concepts of imperialism, and extends these ideas to the international division of labor in the production of information and information technology today. I will argue that digital labor, as the newest frontier of capitalist innovation and exploitation, is central to the structures of contemporary imperialism. Drawing on these classical concepts, my analysis shows that in the new imperialism, the information industries form one of the most concentrated economic sectors; that hyper-industrialization, finance and informationalism belong together; that multinational informational corporations are grounded in nation-states, but operate globally; and that information technology has become a means of war.1

Defining Imperialism

In his 1916 “Popular Outline,” as he subtitled his work, Lenin defined imperialism as

capitalism at that stage of development at which the domination of monopolies and finance capital is established; in which the export of capital has acquired pronounced importance; in which the division of the world among the international trusts has begun; in which the division of all the territories of the globe among the biggest capitalist powers has been completed.2

Bukharin and Preobrazhensky understood imperialism as “the policy of conquest which financial capital pursues in the struggle for markets for the sources of raw material, and for places in which capital can be invested.”3 Bukharin, a contemporary of Lenin and editor of Pravda from 1917 to 1929, drew conclusions similar to Lenin’s list of imperialism’s key features, delineating imperialism as “a product of finance capitalism” and arguing that “finance capital cannot pursue any other policy than an imperialist one.”4

For Bukharin, imperialism is also necessarily a form of state capitalism, a difficult concept to apply in the context of neoliberalism, which is based more on worldwide domination by corporations than nation-states. He saw nations as “state capitalist trusts” locked in a “worldwide struggle” leading to global war.5 For Bukharin, imperialism is simply “the expression of competition between” these trusts, all aiming to “centraliz[e] and concentrat[e] capital in their hands.”6 Lenin, in contrast, wrote that “an essential feature of imperialism is the rivalry between several great powers in the striving for hegemony, i.e., for the conquest of territory, not so much directly for themselves as to weaken the adversary and undermine his hegemony.”7 Lenin’s formulation of a competition between “great powers” is more careful than Bukharin’s concept of state capitalist trusts, because it encompasses both companies and states.

For Rosa Luxemburg, meanwhile, imperialism is the violent geographical and political expansion of the accumulation of capital, the

competitive struggle for what remains still open of the non-capitalist environment…. With the high development of the capitalist countries and their increasingly severe competition in acquiring non-capitalist areas, imperialism grows in lawlessness and violence, both in aggression against the non-capitalist world and in ever more serious conflicts among the competing capitalist countries. But the more violently, ruthlessly and thoroughly imperialism brings about the decline of non-capitalist civilizations, the more rapidly it cuts the very ground from under the feet of capitalist accumulation.8

Luxemburg argues that capital wants to extend exploitation globally, to “mobilize world labor power without restriction in order to utilize all productive forces of the globe.”9

Whatever their differences, Lenin, Bukharin, and Luxemburg all share the conviction that imperialism is “the final phase of capitalism,”10 or a form of “decaying capitalism,”11 and that consequently the “ruin of the bourgeoisie is inevitable.”12 Such statements reflect not just the political optimism felt by revolutionaries of the time, but also a then-common structuralist and functionalist understanding of capitalism that assumed the system’s inevitable decline. Indeed, they were writing at the outbreak of the First World War, which was to be followed after a short prosperity by the Great Depression and the Second World War—giving adequate support to their arguments for the global instability of the system. A hundred years later, capitalism continues. But while it may have taken on new qualities, capitalism can still be characterized as imperialism, and continues to experience major outbreaks of its inherent tendencies toward crisis.13

Labor and Imperialism

Lenin, Bukharin, and Luxemburg all saw the international division of labor as a central feature of imperialism. Lenin uses the notion of the division of labor to mean a division between the industries on which certain banks focus their investment activities.14 He sees the export of capital, in contrast to the export of goods, as a crucial feature of imperialism:

As long as capitalism remains what it is, surplus capital will be utilized not for the purpose of raising the standard of living of the masses in a given country, for this would mean a decline in profits for the capitalists, but for the purpose of increasing profits by exporting capital abroad to the backward countries. In these backward countries profits are usually high, for capital is scarce, the price of land is relatively low, wages are low, [and] raw materials are cheap.15

Similarly, Bukharin argued, based on Marx, that a social division of labor between town and country and among enterprises, branches, economic subdivisions, and nations–the international division of labor–is a defining feature of capitalism.16 This division depends partly on natural causes (for example, “cocoa can be produced only in tropical countries”17) and partly on social causes, “the unequal development of productive forces” which “creates different economic types and different production spheres, thus increasing the scope of international social division of labor.”18 The “labor of every individual country becomes part of that world social labor through the exchange that takes place on an international scale.”19 Given a world market and unequal productivity, less productive countries are forced to sell commodities at prices below their value in order to compete, which results in a system of unequal exchange.

Rosa Luxemburg focused in her concept of imperialism on the “relations between capitalism and the non-capitalist modes of production,” in which the

predominant methods are colonial policy, an international loan system—a policy of spheres of interest—and war. Force, fraud, oppression, looting are openly displayed without any attempt at concealment, and it requires an effort to discover within this tangle of political violence and contests of power the stern laws of the economic process.20

For Luxemburg, the international relations of imperialism require robbery and the exploitation of labor: “Capital needs the means of production and the labor power of the whole globe for untrammeled accumulation.” Hence, “it cannot manage without the natural resources and the labor power of all territories.…’sweating blood and filth with every pore from head to toe’ characterizes not only the birth of capital but also its progress in the world at every step.”21

Although Lenin, Bukharin, and Luxemburg differed politically on several aspects of imperialism, especially on questions concerning the role of nationalism in class struggles and liberation, national self-determination, and the use of foreign markets in capitalism, it is clear that for all three theorists, the periphery is not just a source of resources and a market for selling commodities, but is also embedded in an international division of labor.22 As part of this division, the exploitation of workers in the periphery enables the export and appropriation of surplus value by large companies.

The International Division of Digital Labor

Global communications, in the form of the telegraph and international news agencies, already played a role in imperialism by the time of the First World War, helping to organize and coordinate trade, investment, accumulation, exploitation, and war.23 A hundred years later, qualitatively different means of information and communication such as supercomputers, the Internet, laptops, tablets, mobile phones, and social media have emerged. But just like the labor of workers in the periphery during earlier stages of imperialism, the production of information and information technology is part of an international division of labor, one that continues to shape modes of production, distribution, and consumption.24

Critical scholars introduced the notion of the new international division of labor (NIDL) in the 1980s in order to stress that developing countries had become cheap sources of manufacturing labor and to track the rise of multinational corporations.25 In their book The Endless Crisis, John Bellamy Foster and Robert W. McChesney situate the rise of multinationals in capital’s attempt to overcome long-term economic stagnation and attain global monopoly profits.26 Multinationals aim to drive down the wage share globally and increase their profits by installing a system of global competition among workers. The consequence is a worldwide increase in the rate of exploitation that Foster and McChesney, drawing on Stephen Hymer’s work, call a “strategy of divide and rule.”27

Table 1 shows comparative data for the world’s 2,000 largest multinational corporations in the years 2004 and 2014. These companies’ revenues accounted for more than 50% of worldwide GDP, showing that multinationals compete for monopoly status at the global level. In both years, almost three-quarters of the capital assets of these companies were located in the FIRE sector—finance, insurance, real estate—which confirms Foster and McChesney’s assertion that we can accurately speak of a system of global monopoly-finance capitalism.28 However, these assets also include significant shares in mobility industries (transportation infrastructure, oil and gas, vehicles), manufacturing, and information (from telecommunications hardware, software, and semiconductors to advertising, the Internet, publishing, and broadcasting). All of this indicates that to varying degrees, global capitalism means not only monopoly-finance capitalism, but also monopoly-mobility capitalism, monopoly-hyperindustrial capitalism, and monopoly-information capitalism.29

Table 1. World’s 2,000 Largest Multinational Corporations, 2004–2014

2004

2014

Total revenues$19,934 bn$38,361 bn
Total capital assets$68,064 bn$160,974 bn
Total profits$760.4 bn$2,927.5 bn
Share of revenues in world GDP50.8%51.4%
Share of finance, insurance, real estate (FIRE) in total assets70.8%73.6%
Share of FIRE in total profits32.7%33.5%
Share of information industries in total assets5.9%5.5%
Share of information industries in total profits0.8%17.3%
Share of information industries in total revenues11.3%13.1%
Share of mobility industries in total assets7.5%6.9%
Share of mobility industries in total profits22.4%19.0%
Share of manufacturing in total assets7.1%6.9%
Share of manufacturing in total profits28.3%18.6%
Chinese multinationals in top 200049207
U.S. multinationals in top 2000751563
Share of Chinese assets1.1%13.7%
Share of Chinese profits3.6%14.3%
Share of North American and European assets77.4%63.1%
Share of North American and European profits82.9%61.7%

A significant change between 2004 and 2014 was the rise of Chinese multinationals, whose shares of assets, revenues, and profits dramatically increased. European and North American multinational corporations now no longer control around three-quarters, but instead two-thirds of global capital, which means that they nevertheless continue to be dominant. That Chinese multinationals play a more important role does not signify a fundamental break, but rather shows that China imitates Western-style capitalism, so that a “capitalism with Chinese characteristics” has emerged.

The NIDL is at the heart of the information and digital economy that produces information and communication technologies (ICT) and information itself. Various forms of physical work produce information technologies that are then used by workers in the media and cultural industries to create digital content, such as music, movies, data, statistics, multimedia, images, videos, animations, texts, and articles. Technology and content are thus dialectically interconnected, so that the information economy is at once physical and non-physical. The information economy is neither a superstructure nor immaterial, but rather a specific form of the organization of productive forces that cuts across the base-superstructure divide.

Figure 1 shows a model of the major production processes that are involved in the international division of digital labor. Each production stage involves human subjects (S) using technologies of labor (T) on objects of labor (O), yielding a new product. The very foundation of global digital labor is the agricultural labor cycle by which miners extract minerals. These minerals then become the objects in the next production stage, as they are processed into ICT components, which in turn enter the next labor cycle as objects: assembly workers build digital media technologies using ICT components as inputs. The outcome of all this labor is these digital media technologies, which manage the production, distribution, circulation, and consumption of diverse types of information.

Figure 1. The International Division of Digital Labor

Figure 1. The International Division of Digital Labor

“Digital labor,” therefore, does not only denote the production of digital content. It is a category that rather encompasses the whole mode of digital production, a network of agricultural, industrial and informational labor that enables the existence and use of digital media. The subjects (S) involved in the digital mode of production–miners, processors, assemblers, and information workers–stand in specific relations of production. So what is designated as S in figure 1 is actually a relationship, S1–S2, between different subjects or subject groups.

Today most of these digital relations of production are shaped by wage labor, slave labor, unpaid labor, precarious labor, and freelance labor, making the international division of digital labor a vast and complex network of interconnected, global processes of exploitation. These range from the Congolese slave miners who extract minerals for use in ICT components, superexploited wage-workers in Foxconn factories, and low-paid software engineers in India to highly paid, highly stressed software engineers at Google and other Western corporations, precarious digital freelancers who create and disseminate culture, and e-waste workers who disassemble ICTs, exposing themselves to toxic materials.

Let us look at one example of digital labor. In 2015, according to the Fortune list of the largest transnational corporations, Apple was the world’s twelfth largest company.30 Its profits grew from $37 billion in 2013 to $39.5 billion in 2014 and $44.5 billion in 2015.31 That year, iPhones accounted for 56 percent of Apple’s net sales, iPads for 17 percent, Macs for 13 percent, and iTunes, software, and other services for 10 percent.32 The Chinese labor involved in manufacturing an iPhone made up only 1.8 percent of the iPhone’s price, while Apple’s profits from iPhone sales were 58.5 percent, and Apple’s suppliers, such as the Taiwanese company Foxconn, made a 14.3 percent profit.33 Thus the iPhone 6 Plus does not cost $299 because of labor costs, but rather because for each phone, Apple on average earns $175 in profits and Foxconn makes $43, while the workers assembling the phones in a Foxconn factory receive just $5. The high cost of iPhones and other products are a consequence of a high profit rate and a high rate of exploitation—direct results of the international division of digital labor. China is, as Foster and McChesney write, “the world assembly hub” in a system of “global labor arbitrage and…superexploitation.”34

According to the 2015 Fortune Global 500 list, Foxconn is the third-largest corporate employer in the world, with more than a million workers, made up mostly of young migrant workers from the countryside.35 Foxconn assembles the iPad, iMac, iPhone, and the Amazon Kindle, as well as video game consoles by Sony, Nintendo, and Microsoft. When seventeen Foxconn workers tried to commit suicide between January and August 2010, and most of them succeeded, the issue of dismal working conditions in the Chinese ICT assembly industry began to attract wider attention. A number of academic studies have subsequently documented the everyday reality at Foxconn factories, where workers must endure low wages, long hours, and frequent work schedule disruptions; inadequate protective gear; overcrowded, prison-like accommodations; yellow unions managed by company officials and distrusted by workers; prohibitions on talking during work; beatings and harassment by security guards; and disgusting food.36

Yet Apple boasts in its Supplier Responsibility 2014 Progress Report that the company requires its “suppliers to achieve an average of 95 percent compliance with our maximum 60-hour work week.”37 The International Labor Organization’s Convention C030 on work hours recommends an upper limit of forty-eight hours per work week, and no more than eight hours a day. That Apple prides itself on enforcing a sixty-hour work week for labor in its supply chain shows that contemporary imperialism’s international division of digital labor is not just exploitative, but also effectively racist: Apple assumes that for people in China, sixty hours is an appropriate standard.

Apple’s 2014 report also claims that the company audited the working conditions of more than a million workers. However, these audits are not conducted independently, nor are their results reported independently. Since Apple doesn’t rely on independent corporate watchdog organizations such as Students and Scholars against Corporate Misbehavior (SACOM), its reports must be considered inherently biased: workers being studied by their own employers will certainly not report their complaints, lest they lose their jobs.

As to the numerous labor-rights violations listed above, the report’s style and language suggest that the failings of suppliers and local agencies are the problem: “Our suppliers are required to uphold the rigorous standards of Apple’s Supplier Code of Conduct, and every year we raise the bar on what we expect….We audit all final assembly suppliers every year.” The report could never acknowledge that such behavior is really driven by multinational corporations’ own demand to produce cheaply and quickly. Apple’s ideological strategy diverts attention from its own responsibility for the exploitation of Chinese workers.

Conclusion: Ideology and Resistance

Apple has marketed the iPhone 5 as being made “for the colorful” and the iPhone 6 as “bigger than big.” Such slogans imply that the digital technological revolution has brought about a new and better society that benefits all. Similar ideological promises and claims can be found in the context of social media, cloud computing, big data, crowdsourcing, and related phenomena. Such assertions are forms of technological fetishism that assume that technology inherently fosters a good society without analyzing the social relations in which it is embedded. In technological fetishism, just as Marx wrote of classic commodity fetishism, the “definite social relation between men themselves” assume “the fantastic form of a relation between things.”38

Confronting the international division of digital labor with Lenin, Luxemburg and Bukharin’s classical concepts of imperialism helps us to unmask this technological fetishism. The example of Apple shows that digital technology and the ideologies that frame it in advertising and politics are obscured by a fascination with the new that necessarily overlooks the continuities of global exploitation.

Apple achieves high profits in the international division of digital labor by outsourcing manufacturing labor to China, where the Western strategy of “exporting capital abroad” achieves high profits because wages are low and the rate of exploitation is high.39 The exploitation of workers at Foxconn, Pegatron and other companies shows that “‘[s]weating blood and filth with every pore from head to toe’ characterizes not only the birth of capital but also its progress in the world at every step.”40 Through it all, Lenin’s and Luxemburg’s analyses remain as true in the twenty-first century as they were a hundred years ago.

Foster and McChesney argue that “capitalist contradictions with Chinese characteristics” include overinvestment in construction and urban real estate, weak consumption, extreme exploitation, rising inequality, unused infrastructure, discrimination against rural migrant labor, pollution, and environmental degradation.41 Yet media reports about China in the West tend to ignore the country’s active political culture of working-class and social struggles stemming from these contradictions. According to data from the China Labor Bulletin, 1,276 strikes took place in China in 2014.42 China is not a monolithic society, but one with active and vivid working-class struggles against exploitation. In October 2014, after earlier labor unrest in June, a thousand workers went on strike for wage increases at the Foxconn factory in Chongqing.43

The short and medium-term goal of digital working-class struggles should be the formation of worker-controlled companies in the digital and cultural industries, at all levels of organization and over the entire globe, no matter if it disturbs social media, software engineering, the freelance economy, mineral extraction, or ICT assembly. In the longer term, the aim should be to overcome the capitalist organization of these spheres, together with capitalist society itself. The question of what role the national or international dimension of social struggles against digital capitalism should play is a matter for strategic political debates. In an 1867 address to the International Workingmen’s Association, Marx argued that “in order to oppose their workers, the employers either bring in workers from abroad or else transfer manufacture to countries where there is a cheap labor force.”44 It is true today as it was then that if “the working class wishes to continue its struggle with some chance of success,” then the only adequate response to global capitalist rule is that “the national organizations must become international.”45

Notes

  1. For detailed analyses, see: Christian Fuchs, “Media, War and Information Technology,” in Des Freedman and Daya Kishan Thussu, eds.,Media and Terrorism: Global Perspectives (London: Sage, 2012), 47–62; Christian Fuchs, “Critical Globalization Studies: An Empirical and Theoretical Analysis of the New Imperialism,”Science & Society 74, no. 2 (2010): 215–47; Christian Fuchs, “Critical Globalization Studies and the New Imperialism,”Critical Sociology 36, no. 6 (2010): 839–67; and Christian Fuchs, “New Imperialism: Information and Media Imperialism?”Global Media and Communication 6, no. 1 (2010): 33–60.
  2. Vladimir I. Lenin, “Imperialism, the Highest Stage of Capitalism,” in Collected Works, vol. 22 (London: Lawrence and Wishart, 1927), 266–67.
  3. Nikolai Bukharin and Evgenii Preobrazhensky,The ABC of Communism (Monmouth, UK: Merlin Press, 2007 [1920]), 119.
  4. Nikolai Bukharin,Imperialism and World Economy (New York: Monthly Review Press, 1973), 140.
  5. Ibid., 158.
  6. Ibid., 120-121.
  7. Lenin, “Imperialism,” 269.
  8. Rosa Luxemburg,The Accumulation of Capital (New York: Routledge, 2003 [1913]), 426–27.
  9. Ibid., 343.
  10. Ibid., 427.
  11. Lenin, “Imperialism,” 300.
  12. Bukharin and Preobrazhensky, ABC of Communism, 143.
  13. Compare for example John Bellamy Foster and Robert W. McChesney,The Endless Crisis: How Monopoly-Finance Capitalism Produces Stagnation and Upheaval from the USA to China (New York: Monthly Review Press, 2012); David Harvey,The New Imperialism (Oxford: Oxford University Press, 2003); and Ellen Meiksins Wood,Empire of Capital (London: Verso, 2003).
  14. Lenin, “Imperialism,” 221–22.
  15. Ibid., 241.
  16. Bukharin,Imperialism and World Economy, 18, 21.
  17. Ibid., 19.
  18. Ibid., 20.
  19. Ibid., 22.
  20. Luxemburg,The Accumulation of Capital, 432.
  21. Ibid., 345–46, 433.
  22. See Paul Mattick’s 1935 essay “Luxemburg versus Lenin,” inAnti-Bolshevik Communism (Monmouth, UK: Merlin Press, 1978).
  23. Christian Fuchs,Digital Labor and Karl Marx (New York: Routledge, 2014).
  24. Ibid.
  25. Folker Fröbel, Jürgen Heinrichs and Otto Kreye,The New International Division of Labor (Cambridge: Cambridge University Press, 1981).
  26. Foster and McChesney,The Endless Crisis.
  27. Ibid., 114–15, 119.
  28. Ibid.
  29. Ibid.
  30. Fortune Global 500 list 2015, available at http://fortune.com.
  31. Apple Inc., 10-K Report 2014. Available at http://sec.gov.
  32. Ibid.
  33. Jenny Chan, Ngai Pun and Mark Selden, “The Politics of Global Production: Apple, Foxconn and China’s New Working Class,”New Technology, Work and Employment 28, no. 2 (2013): 100–15.
  34. Foster and McChesney,The Endless Crisis, 172.
  35. See Christian Fuchs,Culture and Economy in the Age of Social Media (New York: Routledge, 2015).
  36. See Jenny Chan, “A Suicide Survivor: The Life of a Chinese Worker,”New Technology, Work and Employment 2, no. 2 (2013): 84–99; Chan, Pun, and Selden, “The Politics of Global Production”; Foster and McChesney,The Endless Crisis, 119–20, 139–40, 173; Ngai Pun and Jenny Chan, “Global Capital, the State, and Chinese Workers: The Foxconn Experience,”Modern China 38, no. 4 (2012): 383–410; Jack L. Qiu, “Network Labor: Beyond the Shadow of Foxconn,” in Larissa Hjorth, Jean Burgess and Ingrid Richardson, eds.,Studying Mobile Media: Cultural Technologies, Mobile Communication, and the iPhone (New York: Routledge, 2012), 173–89; Jack L. Qiu,Goodbye iSlave: Rethinking Labor, Capitalism, and Digital Media (Champaign, IL: University of Illinois Press, 2016); and Marisol Sandoval, “Foxconned: Labor as the Dark Side of the Information Age,”tripleC 11, no. 2 (2013): 318–47.
  37. Apple Inc., Supplier Responsibility 2014 Progress Report, available at http://apple.com.
  38. Karl Marx,Capital, vol. 1 (London: Penguin, 1976), 165.
  39. Lenin, “Imperialism,” 241.
  40. Luxemburg,The Accumulation of Capital, 433.
  41. Foster and McChesney,The Endless Crisis, 157.
  42. China Labor Bulletin Strike Map, available at http://strikemap.clb.org.hk.
  43. Thousands of Foxconn Workers Strike Again in Chongqing for Better Wages, Benefits,”China Labor Watch, October 8, 2014, http://chinalaborwatch.org.
  44. Karl Marx, “On the Lausanne Congress,” inMECW, vol. 20 (London: Lawrence and Wishart 1984), 421–423.
  45. Ibid., 422.
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