Bill Warren, Imperialism: Pioneer of Capitalism (London: Verso, 1980).

It is important to see Bill Warren’s work in the context in which it arose. In the late 1960s he began teaching a course on imperialism at the School of Oriental and African Studies where I was a student at the time. The course was a study of the classic Marxist texts on imperialism and an attempt to apply them to the Third World. The political climate of that period was marked by a strong belief in the possibilities of Third World revolution and socialism. It was the era of Vietnam, China’s Cultural Revolution, and the rise of the PLO. Bill Warren’s work emerged from an attempt to develop Marxist theory critically in the light of established forces and of new approaches, of the rediscovery of unknown or neglected aspects of Marxist theory.

Certain underlying themes apply both to this book on imperialism and to his other writings. Coming from a working class background, Bill Warren joined the Young Communist League in Scotland in his teens, and always thought of himself as a communist. When he left the British Communist Party in the early 1970s, he did not regard himself as reneging on Marxism, but rather as having a consistent political and intellectual role to play in the defense of historical materialism. The first text of his that I read, published in New Left Review in 1970, was a trenchant critique of the political program of the Communist Party of Great Britain. One can know a lot about Bill Warren’s intellectual formation and what he was subsequently trying to say by reading that critique. It was a forceful attack on what he saw as the evasions, the populist confusions, the economic unreality and the concessions to the right contained in that document.

As Warren developed his theories in the late 1960s and early 1970s, one can single out three underlying political themes. One was a reassertion of a classical Marxist position on the nature of capitalism, taken in its clarion form from the relevant sections of the Communist Manifesto itself, a reassertion of the progressive historical role of capitalism and of the need for socialists not just to defeat capitalism, but to better it, to transcend it in economic achievement, in culture, in human emancipation and in democracy.

A second current, not so much present in Marx and Engels as in Gramsci, was the need for working class and socialist forces to assume responsibility for directing the affairs of the economy, and to assume values and modes of practice which were consonant with exercising state power in a responsible way. He had no time for sloppy thinking, for what he saw as the liberal indulgence of the left in its personal as well as its political activities. Much of his empirical work in the Third World was on the subject of wages in urban Africa: he had done field work in Nigeria and Sudan. One conclusion he came to was that the struggle by African trade unions could lead to substantial increases in their real wages, in the percentage of the total surplus which they appropriated for themselves. It was a validation of mass struggle. But it also led him to emphasize the need for responsibility in politics, and that brought him to the concept of the “workers incomes policy.”

When the concept of incomes policy was advocated in Britain in the early 1970s by Social Democrats and conservatives, the left’s reaction was to reject this entirely in favor of free collective bargaining. Bill’s response was to emphasize the need for socialists to think in a practical manner. He particularly denounced what he saw as an effloresence in Marxist thinking at this time, marked by neglect of facts, and by an engagement in abstruse theorizing which bore no relation to the tasks of the proletariat.

A third important tendency in Warren’s work is his implacable hostility to any dilution of the class character of socialism. That is evident in his critique of populist confusions he identifies in the Communist Party of Great Britain’s program and his critique of Third World nationalist movements.

These themes, to some extent, went against the grain of current left political and intellectual fashion; there was a definite “left counterpoint” in his approach to political and intellectual questions. But while that “left counterpoint” can have a very healthy and positive character, there are at least three dangers present in it, which are evident in Imperialism. First, an automatic counterpoint can lead to alignment with reactionary positions. The left is not always wrong. Some of Warren’s asides about women’s liberation are definitely reactionary and incorrect. This is accompanied by a curious absence in his writing of that moral outrage about capitalism which you will find, for instance, in the most pro-capitalist sections of the Communist Manifesto.

Second, Bill Warren’s work reflects, in a certain form, the problem of teleology, of historical trends. For example, the sections on agriculture and on diminishing mineral resources display an underlying optimism that capitalism, or the human race in general, devoid of any class specification, will resolve the problems it confronts. That optimism, while leading him to perceive substantive industrialization in the world, is not adequately tempered by a realization of the regressions and obstacles which exist. There is, against left catastrophism, a tendency to bend the stick in the opposite direction.

Third, the correct emphasis upon the positive, transforming character of capitalism is not adequately balanced by an emphasis on the uneven development of capitalism. There is a need to disaggregate the data and understand the specific experiences of different societies.

Warren’s Theses and the Middle East

In the Middle East, one is dealing with a huge aggregation; over 25 countries, with a great variety in GNP, natural endowment, population size, and so on. There is a growing integration of the economies of the Middle East—except Israel’s—due to flows of capital and of labor resulting from the oil boom of the last ten years. Even though their most important economic relations, except for labor, are not with each other but with the advanced capitalist countries, one is not talking about 25 utterly discrete economies. In such a perspective, it is possible to illustrate how the Warren thesis can be applied to the Middle East.

First of all, there has been a transformation of all Middle Eastern societies by the capitalist mode of production over the last century and a half, and increasingly so since World War II. In one of the poorest and most important of the Arab countries—Egypt—the agricultural sector has been capitalist for well over a hundred years. In the post-war period, even the most isolated countries—Yemen, Oman—have been opened up to capitalist relations. There have been great flows of labor from the countryside to the towns and from one country to the other. Over 3 million inhabitants of the Middle East are now working in states where they are not citizens. Monetary relations predominate in every Middle East country today.

Second, this spread of capitalist relations has been accompanied by substantial increases in GNP. This is obviously so in the oil states, where GNP has risen several times over since 1973. The distribution of oil money from oil producers to non-oil producers has created a rise in GNP in other countries as well. Very few people in the Middle East are in per capita terms poorer now than they were ten or 20 years ago. In the World Bank statistics, you won’t find any Middle Eastern states in the lowest income sections. The figures for industrialization in the 1970s are at least as good, if not better, than the Third World average. In the period 1970-1978, average per capita rise in manufacturing output, excluding oil, is: Egypt, 7.6 percent per year; North Yemen, 12.2 percent; Morocco, 6.6 percent; Syria, 13.6 percent; Tunisia, 11 percent; Turkey, 8 percent; Algeria, 6.9 percent; Iran, 16.1 percent—up to the revolution of course—and Libya, 18.4 percent. However low the initial starting point, these are respectable rates of annual growth that should not be ignored.

A third feature of Middle Eastern countries on which Bill Warren laid considerable emphasis is the growing power of Third World states via-à-vis international capital and the advanced capitalist states. We have seen, since the rise of the OPEC states in late 1973, the assertion of unprecedented influence over some of the most powerful international corporations. These states have nationalized the oil companies, they control the level of production, they have considerable say in the level of pricing. Whatever qualifications one makes, this is a striking contrast to 30 or 40 years of domination by international oil companies. In addition, in all of the oil-producing countries and increasingly in the non-oil producing countries, the state is able to determine the conditions under which foreign firms invest. Warren, for one, was critical of the prevalent left anlaysis which he thought exaggerated the influence of the multinational corporations.

Fourth, the argument that international capitalism wishes to retard the development of the Middle East to promote underdevelopment finds very little confirmation in the last decade and a half. You only have to open up any edition of the Financial Times or the Economist to see international capital falling over itself seeking opportunities for investing and boosting production and demand in the Middle East. Except for nuclear energy, there’s no limit on what the advanced capitalist countries are willing to produce in or to sell to the Middle East.

Fifth, while left theory stresses the external constraints on growth, the obstacles to industrialization are, in Warren’s view, predominantly internal. In the case of the Middle East, these internal obstacles are prolific. The most material of them all is the absence of water, a basic limit on all economic and especially agricultural development. Then there are the social limits. In Saudi Arabia and Iran, at most 30 percent of people are literate. There’s a much greater shortage of skills—not just technical skills, but managerial and other skills. There is the prevalence of pre-capitalist values—on work, cooperation, time, women—all inimical to industrialization.

Nationalism and Progress

Then you come to straightforward political problems. Bill Warren had very little time for nationalism, and he certainly had as little time for Arab nationalism as for Catholic Irish nationalism. He considered that the Arab peoples should settle their dispute with Israel: Palestinians should be given their own rights, their own state; Israel should be recognized. Then people should get on with the task of building up their national economies. He regarded the Palestine conflict as a serious deviation from the main material task—social and economic development—of the Arab peoples. This, he would argue, is the choice of the Arab peoples, not the choice of imperialism. I’m sure he would have said that the Iran-Iraq war was another such diversion. Increasing chauvinism within Middle Eastern societies against other minorities—Kurds, Eritreans or others—he would have regarded as further internal obstacles, not ones created by imperialism.

This raises the question of whether a nationalist regime, whether it calls itself socialist or not, is more progressive than a straightforward capitalist regime, and whether the nationalism of the masses should be endorsed. Here Bill Warren was firmly in the tradition of Marx and Engels: they supported French colonialism in Algeria; Engels supported the British and French intervention in Egypt in 1882. He said that the Arab leader, Arabi Pasha, was just a reactionary and the European workers shouldn’t have any truck with such people. Bill Warren would have been intransigently hostile to the Ayatollah Khomeini or to the Afghan rebels. Fm sure he would have regarded the civil war in Lebanon as the fault of people obsessed with communal or nationalistic ideologies. If you’re arguing for the reactionary nature of some Third World nationalism, you could certainly find plenty of vindication in the Middle East.

Warren advanced a particular critique of Third World socialist regimes. He was hostile to the naive views about delinking and decoupling associated with Samir Amin. He opposed the notion that if people cut off their links with imperialism and develop indigenously, all will be well. We would now say in light of Kampuchean events that this is a caricature of Amin, but this belief in decoupling was very basic in much of the literature of the early 1970s. It went together with considerable indulgence about the economic and social achievements of “delinking” countries, whether Cuba, China or Tanzania. In the case of the Middle East, there were not in Bill Warren’s lifetime any communist countries, but there were, for want of a better word, state capitalist countries: Egypt, Algeria, the Baathist regimes, in Syria and Iraq. He did have some trenchant things to say about the economic failures of Nasser’s Egypt. At first sight, the figures would certainly seem to bear him out. In the 1960s, manufacturing output rose by 3.3 percent per year in Egypt, more or less keeping pace with population. In the 1970s it was double that. I’m sure he could have conjugated that argument vis-à-vis Iraq, Algeria, and many other countries. He did say that there should be no nonsense about it: Nasser’s Egypt was a capitalist country and it was better to have an efficient and forthright capitalist country than one pretending to be socialist but not meeting the needs of its people.

Finally, Warren would have drawn great attention to the fact that despite all the emphasis on national as opposed to class solidarity in the Middle East, there was a large and growing working class there with an expanding political role. Indeed, you can reinterpret many key events of modern Middle East history to give the working class an impressive role. Who made the Iranian revolution? In one sense, this beturbaned ayatollah. In another sense, it was the Iranian working class acting politically through general strikes and massive demonstrations. Who are the major opposition forces in Egypt? The very large Cairo working class. In many countries of the Middle East, we can reinterpret certain events—strikes, demonstrations—to give them a higher proletarian and class content than is normally perceived. It is crucial to restate, to vindicate as it were, the role of the working class in recent Middle East history against nationalist obfuscation—in the revolution in South Yemen, in the modern histories of Sudan and Turkey, to name but a few cases.


Those are some general perspectives on the Middle East prompted by Bill Warren’s work. There are, of course, counter-arguments which also arise. The first concerns the spread of capitalist relations in the last two decades. In the period up to 1960 or so, the survival throughout large areas of the Middle East of pre-capitalist relations, especially in agriculture, has been striking. Warren’s argument fails to periodize when capitalism does and does not transform particular societies, an essential task for historical analysis. For 50 or 100 years, capitalism, far from diffusing itself and transforming Middle East society, failed to do so. In the oil state, the inputs into the oil industry were not derived from those societies. Even the labor was brought in from outside when it didn’t need to be. Profits were not reinvested. When Aden was a prosperous British colony in south Arabia, the profits from the port sat in the bank; they were not reinvested in local industry, fishing or agriculture.

Even in the present period, the spread of capitalist relations is not thorough. The Shah’s land reform in Iran was certainly designed to be a capitalist land reform, but the majority of peasants in 1973—ten years after the land reform—were not marketing any substantial percentage of their product, and were not employed in wage labor. This is not a contradiction of Warren’s argument; but the pace, the periodization, the lags require greater emphasis. The process also has to be related to the extent to which productive forces and skills were destroyed by the spread of capitalist relations. In Iran, for instance, the viable underground canal qanat system of traditional irrigation has been allowed to break down over the last 15 years. Now Iranian agriculture has to rely on a system of irrigation which requires much greater technical attention and external input.

In analyzing increases in GNP and rates of industrialization in the region, two points are obvious but important. One is that oil production will not last forever. The exhaustion of oil resources is within the lifetimes of many people now living in those countries. For Algeria and Iran it is within 20 years. In Bahrain, output has virtually come to an end. Saudi Arabia may go on for another 100 years, but even this is a wasting asset. The levels of income generated by oil are a transient gain, a form of rent, which has to be transferred into forms of productive activity. To what extent has some kind of permanent threshold been crossed by these rises in GNP and industrial output? Many of the industries developing in these countries are either directly related to the availability of cheap gas and cheap oil, or are uncompetitive on an international scale and are heavily subsidized from oil earnings. The investment of rent in production has at best been partial.

It is not enough to say that income inequality in these countries is stupendous. It is determined by the manner in which oil revenues are distributed through the state. Those who control the state may be in a family business, as in Saudi Arabia, or may be a ruling class, as they were in Iran. The prevailing inequalities of wealth in Third World countries are greatly exaggerated by the fact that this oil revenue is paid through the state. It is paid disproportionately, officially and through corruption, to those at the top. This has many political consequences: income inequality was one of the factors behind the Iranian revolution. There is no obvious self-correcting mechanism. Here Bill Warren is quite careful in what he says, but there is still an element of unwarranted optimism as to the extent to which income inequality will in itself lead to permanent increase in productive capacity in industry or agriculture.

Underlying these problems lies the crisis of agriculture. In the year before the revolution, Iran was spending $3-4 billion a year, out of an oil revenue of $20 billion, on food imports. Iraq is doing similarly. In the present war, they’re importing even more food in order to establish political dividends. Roughly 50 percent of all the food consumed in the Middle East is imported food—a very high percentage. Bill Warren would stress that it is not enough to cite the growing imports of food by Middle Eastern states. If people’s incomes increase by 10 or 12 percent a year, there’s no way that food output can increase by 10 or 12 percent a year. A country which increases its food output regularly by five percent a year is doing pretty well. The mere fact of large food imports is not in itself a significant argument. The problem lies elsewhere.

In the case of the Middle East, though, because the revenues with which they are importing the food are a temporary benefit, near-stagnation of large areas of agriculture is a serious problem. It is not merely that rising income has meant a greater reliance on food imports. The development of the urban economies and the very great growth in the service sector both in the oil and non-oil producing states have led to a net decline in food output in some countries and the destruction of not only the fundamental asset of any country—its ability to feed itself—but also of important skills of the population. In the Iranian case, it is the loss of the physical infrastructure and of capital which has accumulated over a very long time.

We come now to the role of the multinational corporations. The oil states push up the price, but in reply to Warren one can argue that the oil companies are not going to let the Middle East producers control where the real profit is, at the point of distribution. For every dollar that the price of oil went up in the Middle East, the multinational corporations benefited. This is true to a considerable extent, but there has still been a definite shift in power and in control which should not be underestimated. Where Warren’s position is more misleading is in regard to the hierarchy of power which still exists between the developed capitalist countries and the Third World countries. The developed capitalist countries indeed wish to see more development of Third World countries, including the Middle East. It is also true that many of the obstacles are internal. But there is still an important set of political controls which are understated in Warren’s book, operating between the developed and Third World countries: Imperialism does still exist.

To this day, for instance, the producing countries have not been able to get the United States to budge one inch on the question of Israel, though with their enormous purchasing power, they should have a lot of influence. You have this, in economic terms, puny little state of less than three million people, with the highest level of per capita indebtedness in the world, completely dependent on the United States for its military and economic wellbeing. Yet Israel can hold the rest of the Arab world to ransom. That is a striking illustration of the hierarchy of political and military power between the money-rich states in the Middle East and the imperialist countries.

Internal Obstacles

One has to see the question of the internal obstacles in the context of the class character of these states, which are a product of the historical pattern of political domination. To give just one example in the realm of ideology: It is very common in Iranian politics for people to allege that this or that event was the result of a foreign hand. Many Iranians believe that the Ayatollah Khomeini is a CIA agent, and Khomeini levels the same charge against his opponents. Is this to do with the fact that Iran is the home of Manicheanism and has been like this for 3,000 years? In the past, in Iran, British envoys were going around bribing people. Iran was ruled by conspiracy and by foreign hands to a considerable extent. Funny events did happen because of Russian czarist or British imperialist maneuvers at the court—not to the extent that people imagine, but that did happen. A past pattern of semi-colonial domination and maneuver, coupled with a general sense of political and cultural interference from outside, has produced, in a psychologically compelling way, this paralyzing conspiracy culture which in no way contributes to the liberation of the Iranian people. Bill Warren would say, well it is the nature of the local ruling class and of the local state, not imperialism, that prevents economic development. But why are those local ruling classes there? How was the state and the prevailing political culture formed? The dividing line between what is internal and what is an external restricting factor is much less clear in the Middle East, as elsewhere, than might at first sight appear. So much of the internal is an historical product of the external.

Warren’s argument has political implication in the Middle East. Warren stresses the need for a proletarian line. I agree with him entirely that the stick has been bent far too much towards Third World nationalism and indulgence of the specificity of individual countries. The justified critique of imperialist and Western ideologies should not obscure the mystifying nature of many indigenous Third World ideologies. But I think he underestimates the need for multi-class alliances. Any revolutionary movement has to come to terms with the existing culture and history of the country in which it is operating. In Warren’s critiques of the class mystifications of some nationalist movements, the need for this specific attention is sometimes understated.

Finally, there is the matter of decoupling. Iran since the revolution is a case of costly decoupling. Iranian agriculture has been neglected. Forty percent of Iranian industry’s raw materials and spare parts were imported, so when they were cut off, Iran couldn’t even have protected industrialization. The Iranians made absolute fools of themselves over the hostage affair by allowing the Americans to impound all their assets. Unlike any other revolution in the world, they had to pay back their debts 100 cents on the dollar within a few years of the revolution. The pursuit of that kind of decoupling, far from emancipating the economy, led in the first two years after the revolution to a 10 percent fall in GNP, over 50 percent unemployment in the cities, probably over 50 percent inflation in the cities and the destruction of billions of dollars worth of capital and plant. The war with Iraq, provoked and sustained by the clerics in Tehran, has made matters worse.

On the other hand, the argument for a selective delinking still stands. If you have a revolution, some of the skilled people are going to leave and there are inevitably going to be disruptions. But the Iranians have shown how not to do it. The need to lower oil output, to cut back on consumer imports, to have a greater degree of egalitarian distribution of the oil revenue, all of these things are perfectly reasonable and, from a socialist point of view, valid aims. Complete isolation from international economic contacts is a dangerous chimera, but the building up of neglected domestic potential, the reduction of unnecessary imports and the imposition of state control over foreign trade are all unavoidable aspects of socioeconomic transformation in the Third World. Warren’s critique of overstated theories and practices of self-reliance should not obscure the need for a realistic program of breaking the grip of imperialism.

Assessment of Warren’s work must to some degree await the verdict of history: Can capitalism sustain the levels of growth of the 1970s, and in particular the levels of industrialization? His empirical arguments are substantial, yet the poorest countries have experienced zero growth in the 1980s. Will these processes produce the political conditions in which working class and socialist movements can emerge and eventually take power? The great merit of his work is, however, already clear: It presents a forceful theoretical and empirical challenge to the prevailing conceptions of underdevelopment which have become orthodoxy among the Middle Eastern left, and among those who study the Middle East. Warren stressed the transformative character of capitalism, where others laid greatest emphasis on its retarding impact. He sought to ground the analysis of imperialism and of the conflicts it generated in the material processes of production and class formation, rather than in the realms of ideology alone where some recent anti-imperialist criticism has been located. Those of us concerned with analyzing the Middle East, where the struggle against both external and internal forms of oppression continues to demand so much, can learn a great deal from a critical investigation and application of his work.

How to cite this article:

Fred Halliday "Imperialism and the Middle East," Middle East Report 117 (September 1983).

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