International State-Monopoly Associations

economic unions created by international monopolies on the basis of intergovernmental agreements.

The international state-monopoly associations arose after World War II and represent a new way of dividing the world among the giant monopolies. The first such union was the European

Coal and Steel Community. It was founded in 1951 by six countries: Belgium, France, the Federal Republic of Germany (FRG), Italy, Luxembourg, and the Netherlands. It involved the removal of customs duties between the six countries for products of the coal and steel industries and the creation of a common market for these goods. The same countries decided to organize the European Economic Community (EEC, or Common Market). The treaty establishing the EEC, signed in 1957, went into effect on Jan. 1, 1958. At the same time another treaty was signed to create Euratom: the European Atomic Energy Community.

The process of integration among the Western European countries has led to the formation of a powerful new economic association that enjoys a number of essential advantages over its competitors. In the capitalist world it is rivaled by two other centers of world capitalism, the USA and Japan. The political and economic competition between these three centers is intensifying. Thus the rise and development of international state-monopoly associations has resulted in the creation of new forms of interimperialist contradictions.

The formation of these international communities gave a powerful new impetus to the integration of privately owned monopolies. Within only five years from the founding of the EEC, more than 40,000 cartel arrangements between monopolies of the Common Market countries had been registered. The monopolies of each country seek supports from their own governments, a process that in turn intensifies government intervention in the economy. The mergers between large companies in West Germany and in France that have occurred since the formation of the Common Market are the result of the competitive struggle of the French and West German monopolies. In the first five years of the EEC’S existence, there were 433 mergers of large companies in France, 189 in the FRG, and 378 in Italy and the Benelux countries.

In place of the old forms have come new ways of winning markets for sales, raw materials, and labor away from competitors through the concentration and centralization of capital and the consequent increase in economic power; the growth of economic power also means the speedier and broader introduction of scientific advances and the reduction of production costs. All this has facilitated the absorption not only of small and medium-sized companies but even of large ones by the giant monopolies. The combination of the two opposing principles of concentration and competition within the international state-monopoly associations counterposes the interests of the giant monopolies to those of small and middle-sized entrepreneurs, giving rise to sharp contradictions between them.