BA Hons. Pol.Sc.First Sem.

SGTB Khalsa College, North Campus, Delhi University

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Colonialism and Nationalism in India

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Unit -I

Perspectives on Colonialism: Liberalism

Provided by Amanpreet Singh Gill on 20/12/2022

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J.A Hobson is the most important name in Liberal

perspective on colonialism.
J.A. Hobson was eminent British economist and liberal
thinker. In 1902, he published his book ‘Imperialism : A
Study.’ This book is the most significant statement in the
liberal approach to understanding colonialism. It
presented a very powerful critique of colonialism .
Hobson exposed the myth of Imperialism as something
necessary for economic interest of Britain.
He stated that it was capitalism , not nationalism, which
gave birth to imperialism. It was the project of a class
which was being propagated as the project of a nation.

By the late 1890s, he became convinced that the “new”

imperialism, unfolding mainly in Africa and Asia,
represented an overriding danger to British democracy. It
threatened “peace, economy, reform, and popular self-
government,” catalyzing instead militarism, reaction, and
jingoism.
Imperialism presented a multicausal explanation for the
emergence of the “earth hunger” that had gripped the
imperial powers since roughly 1870. Its “leading
characteristic” was competition between great capitalist
empires.
Investment :
The main stimulus was investment. Oversaving among
capitalists and underconsumption by the masses meant
that the rich could not invest their money profitably in the
domestic market. In search of a high rate of return, they
pushed for the opening of foreign markets, which in turn
required territorial acquisitions. This system benefitted
the few—chiefly financiers and their allies in the political
establishment—at the expense of the many.
The “business interests of the nation as a whole are
subordinated to those of certain sectional interests that
usurp control of the national resources and use them for
their private gain.” Employing a common radical
argument , he argued that imperialism was “irrational
from the standpoint of the whole nation,” although “it is
rational enough from the standpoint of certain classes in
the nation.”
Using various forms of manipulation and misleading
propaganda, this profit-driven imperialism was disguised
as necessary government policy. It was a “calculating,
greedy type of Machiavellianism” wrapped in the
language of “national destiny” and the spread of
“civilization.”
Like Hobhouse, he warned against the corrupting effects
of hypocritical language.

The World Hobson described is characterised by three

elements:
1) ‘a financial oligarchy’ dominates the rich countries;
2) the workers of these countries are employed in
‘personal services’ or ‘minor industrial services’;
3) the centre draws a ‘tribute’ from the peripheral
countries in the form of both profits and industrial and
agricultural products.
The financial profits that feed the upward concentration
of income in the rich countries are founded on the
exploitation of industrial labour and natural resources in
the countries of the Asia and Africa .
For, the existence of a "financial oligarchy" that
oversaves, and a mass of workers that under-consumes,
is for Hobson , not a natural fact as it might be taken to
be if one thinks it is the ordinary effect of monopoly
capitalism. But Hobson is quite clear that such over-
saving, "which is the economic root of Imperialism is
found by analysis to consist of rents, monopoly profits,
and other unearned or excessive elements of income,
which, not being earned by labour or by head or hand,
have no legitimate raison d'étre."
In particular, such monopoly profits are not themselves
the effect of market-forces, but the consequence of
"trust[s] or other combine[s].
In addition, monopoly profits are fueled by tariffs; this is
why, for Hobson it is self evident that:
"Imperialism repudiates Free Trade, and rests upon an
economic basis of Protection."

So, rather than seeing Imperialism as a natural outgrowth

of the ordinary development of capitalism, Hobson takes
imperialism to be the effect of a political corruption of
capitalism: it's the imposition of tariffs that create the
economic conditions for imperialism. For, without tariffs
and other anti-competitive policies, profits would be
lower and wages higher.
Once the state has been captured by protectionist
interests, which generates high profits, but
underconsumption, a military-financial-evangelical
complex (a parasatic class) can easily promote
Imperialism.
For Hobson, imperialism is the effect of political
decisions that are reversible if only Great Britain returned
to Liberal projects. He argued that in reversing imperial
projects, the working poor of Great Britain will be
wealthier, resources for public investment (in a public
education, public goods, and perhaps a welfare state) will
be opened up; the nation much richer, and also that it
would open the door to less dangerous forms of
nationalism, even the possibility of pacific international
federation.