What Lenin Got Right – The Monopoly Capitalism Problem

In 1916 Vladimir Lenin wrote his book Imperialism, the Highest Stage of Capitalism. In that book he asserts that successful and competitive capitalist enterprises work hard to become monopolies in their market areas. They each want to be the last man standing in their sector of the market.

Of course, Lenin wrote that book as a work of Marxist propaganda targeted to the ears of the Russian Intelligentsia and to those of the gullible workers and soldiers of czarist Russian.

A year later Lenin was funded by the German Kaiser’s government to leave his home in Zurich, Switzerland to travel to Helsinki, Finland. In Helsinki Lenin and his Bolshevik friends operated a huge commercial printing plant (again, paid for by Russia’s World War I enemy, Germany), producing Marxist revolutionary literature for the soldiers and the people of the newly formed Russian Republic.

In the February Revolution, the Russian intelligentsia had forced the czar to resign and to abdicate his throne, and they had established a republican form of government run by a Russian parliament, known as the Duma.  All of the political factions in Russian got a seat at the table. Lenin and his German enablers wanted him to overthrow the new Russian Republic.

Germany’s goal was to get the Russian army to withdraw their troops from Germany’s eastern front so they could move their eastern front troops to the western front.  Germany hoped this would enable them to win the First World War.

Lenin’s Marxist rhetoric labeled WW-I as an imperialist’s war which Russia should never have gotten involved in, in the first place, which encourage his German conspirators.

Lenin’s efforts did in fact lead to the October Revolution, and to Germany’s goal of the Russian troops being withdrawn from their Eastern Front.

Gradually by fits and starts with much fighting, killing, and starvation of the Russian people, over several years and a Russian civil war, Lenin’s efforts led to the advent of the autocratic and authoritarian Russian Soviet Communist government in Russia.

That is the context in which Lenin asserted that capitalist wanted to establish monopolies so they could profit by the oppression of the consumers of their products. Lenin further asserted that the ultimate goal of capitalist governments was national imperialism, but that is not the subject of this discussion.

Lenin’s opinion was deeply cynical and unbalanced, but he was not wrong. The techniques used to accomplish capitalistic success are not limited to the idealistic concept of providing the end consumer with a better product at a cheaper price.

In 1939, Peter Drucker wrote his deeply insightful book The End of Economic Man. In that book he observes that capitalism failed in the European monarchies because the kings of those countries granted crown-controlled-monopolies to loyal patrons of the crown. The best examples of this practice are the Dutch East India Company’s monopoly on Dutch trade with Asia and the British East India Company which was effectively given all of India by the English crown.

However most of the crown-controlled-monopolies granted by the kings of those countries granted national monopolies to patrons which only applied to their home markets, and which allowed those patrons to overcharge their own citizens.

Hence Europe never really knew free market capitalism in any form. Monopolies are vastly more profitable than free market economic competition. Thus European capitalism was a substantially different form of capitalism from that seen early on during the Second Industrial Revolution in America which was mostly of the free market type.

Even American entrepreneurs soon understood that competition is costly. The wise capitalists in America were focused on mergers, acquisitions, and the formation of business trust organizations to control specific markets. Yankee capitalist soon learned not to compete, but rather to buy out and acquire (merge) or unite with their competition in a Trust.

A few progressive politicians sought and obtained anti-trust laws, but those laws were hard to enforce, and often resulted prolonged legal battles in which little was actually accomplished at the end of the day.

Other progressive politicians favored the Hegelian idea of disinterested and independent professionally staffed government regulatory agencies to try to control the monopolies. The capitalist soon learned that nobody is ever actually disinterested.  They also quickly figured out how to use the agency-capture technique of staffing those agencies with their allies and thereby co-opting and controlling those agencies to the advantage of the very industries those agencies were formed to regulate.

Once in a controlling position those organized capitalists persuaded their politician friends in government to over-regulate the markets they controlled, which in turn raised a barrier which makes it harder for competitive start-ups to thrive or even to survive.

Once capitalists are in control of a market they soon “forget” the better product at a cheaper price mantra and they raise their prices to whatever the market will bare.  Where else can the consumer go to get the things he needs? In America railroad freight rates were the first big example of this process. Every railroad line is a de facto monopoly in the geographic region it serves.

Since republican democracy based governments do such an abysmal job of regulating themselves, it is no surprise that the politicians of these governments “of the people” who should be regulating the monopolistic practices and tendencies of the financier based power-elite capitalist, have also failed in their moral-duty to regulate the financier class’s grip over the vital interests of the common people.

In 1885, the US Congress established the nominally politically “independent” Interstate Commerce Commission to regulate freight rates “for the good of local farmers and rail passengers.” As Samuel Huntington’s later doctoral thesis clearly shows it took about 20 year for the railroad interest to complete their agency-capture of the ICC, and to convert the actual mission of that bureaucracy to one that made sure railroad rates were not set so low that the railroad would go broke. This monopoly protecting role for captured regulatory agencies, has been the outcome of every subsequent independent regulatory agency the US Congress has ever established. Hegel’s disinterested independent and professionally staffed regulatory agency concept has never actually worked anywhere.

The judicial actions of US anti-trust courts have also been a sad failure.  They have almost universally failed to act for the good of the common man, and they have remained a virtue signaling farce all the days of their existence.

The 10 most wealthy American entrepreneurs in 2025 are:

1. Elon Musk – Co-founded seven companies, including Pay-Pal, electric car maker Tesla, reusable rocket producer SpaceX and artificial intelligence startup xAI.

2. Larry Ellison – Founder and chief technology officer of Oracle

3. Mark Zuckerberg – Founded Facebook in 2004

4. Jeff Bezos – Founded Amazon in 1994

5. Larry Page – Co-founder of Alphabet (The parent company of Google)

6. Sergey Brin – Co-founder of Alphabet (The parent company of Google)

7. Steve Ballmer – The high-energy former CEO of Microsoft

8. Jensen Huang – Co-founded graphics-chip maker Nvidia in 1993

9. Warren Buffett – Known as the “Oracle of Omaha,” Warren Buffett is one of the most successful investors of all time.

10. Michael Dell – Michael Dell is chairman and CEO of Dell Technologies

Everyone of these successful entrepreneurs have made their wealth by developing absolute or relative monopoly empires in every business they run.

THE ONLY POSSIBLE SOLUTION:

Everyone of these super-wealthy power-elites is also a globalist. The rise of populist/nationalist movements around the world, is an example of classical democracy in action. The people (the demos) must un-relentingly demand vigorous anti-trust actions from their elected officials in Congress, and more importantly from the presidential executive who controls the judiciary.

The Democrats abandoned their traditional populist rhetoric as part of Clinton’s so called third way. Trump got the message and surfed the populist movement into the White House twice, however his version of populism doesn’t really restrict the action of the globalist financier power-elites, who funded his election.

This ugly mess will never get better without vigorous and sustained political action by the people.