In this article, we aim to demonstrate that the low prices of goods produced in the global South and the attendant modest contribution of its exports to the Gross Domestic Product of the North conceals the real dependence of the latter's economies on low-waged Southern labor. We argue that the relocation of industry to the global South in the past three decades has resulted in a massive increase of transferred value to the North. The principal mechanisms for this transfer are the repatriation of surplus value by means of foreign direct investment, the unequal exchange of products embodying different quantities of value, and extortion through debt servicing.<p class="mrlink"><p class="mrpurchaselink"><a href="http://monthlyreview.org/index/volume-67-number-3" title="Vol. 67, No. 3: July 2015" target="_self">Click here to purchase a PDF version of this article at the <em>Monthly Review</em> website.</a></p>

This article aims to analyze the development of capitalism over a period of 500 years by the use of Mao’s concept: “The principal contradiction.” It is not an article about philosophy; the principal contradiction is presented as a working tool for analyzing and development of strategy. The article distills history into epochs characterized by changing principal contradictions. The correct identification of the principal contradiction and its interaction with secondary contradictions is the starting point of the development of a strategy, which can influence the aspect of the contradiction, in the desired direction. Finally is the relation between the contradiction in the capitalist mode of production and its expression in the changing principal contradictions discussed.

This article presents the theory of “the parasite state,” a concept originally formulated by Hobson and Lenin in the first decades of the twentieth century. It outlines the history of the parasite state and its present condition. It concludes that the parasite state is indeed a useful concept to describe the political consequences of imperialism in the global North, and the nature of the class struggle in this particular form of state. It raises many questions which have to be taken into consideration in the development of anti‐imperialist strategies.

This article discusses the reasons behind the occurrence of revolutions and the quest for socialism. This article is also an exercise in historical materialism using the main contradiction in capitalism between the development of the productive forces and the mode of production as a method of investigation into the Russian and Chinese revolutions and their subsequent attempts to construct socialism. Finally, I use the historical materialist perspective to assess the current state of capitalism and the prospects for the future transition to socialism.

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