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The debate about the nature of the former Soviet Union: Who was right?

Moscow 2008.

[For more discussion on the nature of the Soviet Union click HERE. See also the related discussion on Stalinism HERE.]

By Chris Slee

July 30, 2012 – Links International Journal of Socialist Renewal -- The nature of the former Soviet Union was an issue which divided the left for many decades. Now that the Soviet Union no longer exists, differing analyses of its class nature should no longer be a reason for maintaining separate socialist organisations.

Nevertheless, this historical debate has relevance to current politics, since the theories developed to explain the nature of the Soviet Union were subsequently applied to other countries, including Cuba. In particular, the theory of state capitalism, of which British Socialist Workers Party leader Tony Cliff was a leading exponent, is applied to Cuba by many groups today, including Solidarity and Socialist Alternative in Australia.

Cuba is not the same as the former Soviet Union, despite the apparent similarity of political forms (both are/were “one-party states”). Cuba is not ruled by a privileged bureaucratic layer. That is why it did not collapse (as some predicted) when the Soviet Union was dismantled. Instead, Cuba has made further gains in areas such as health and education.

Hence even if Solidarity and Socialist Alternative members continue to believe that the Soviet Union was state capitalist, they don’t have to apply the same analysis to Cuba. But in practice they continue to do so.

The following article takes the form of a review of books by Leon Trotsky, Tony Cliff and Stalinist sympathiser Albert Szymanski, who represent three different currents of thought among socialist analysts ofthe former Soviet Union. It is a version of an article first published in The Activist (the internal discussion bulletin of the Democratic Socialist Party) in 2003.

* * *

The Revolution Betrayed
By Leon Trotsky
Pathfinder Press 1972

State Capitalism in Russia
By Tony Cliff
Bookmarks 1988

Is the Red Flag Flying?
By Albert Szymanski
Zed Press 1979

The Soviet Union, created following the 1917 Russian Revolution, was formally dissolved in 1991. It had played a crucial role in world affairs. But what kind of state was it? The three authors reviewed here agree that it began as a workers’ state. But they disagree on how to analyse its subsequent evolution.

Leon Trotsky, writing in 1936, argued that the Soviet Union had undergone a process of bureaucratic degeneration during the 1920s. A privileged bureaucratic layer had seized political power.

However, Trotsky did not believe that the socialist revolution had been totally reversed. He regarded the Soviet Union as "a contradictory society, half way between capitalism and socialism" (The Revolution Betrayed, p. 255), which could go either way. If the bureaucracy was not overthrown, it would eventually restore capitalism. This would result in a "catastrophic decline of industry and culture" (p. 251). But another outcome was also possible -- a political revolution leading to the restoration of proletarian democracy.

Tony Cliff, who wrote the first edition of his book State Capitalism in Russia in 1948, argued that the Soviet Union had already become capitalist by the end of the 1920s. The fact that industry was still state owned was irrelevant. In Cliff's view, what existed was "state capitalism".

Albert Szymanski, writing in 1978, argued that the Soviet Union had remained a socialist state since its inception. In his view, the state was necessarily harsh in its early decades due to the threat of invasion, but became progressively more democratic as the Soviet Union became stronger.

Trotsky's analysis

Trotsky argued that after a revolution, society cannot go straight from capitalism to communism. It must pass through a transition period. During this period, the state has "a dual character: socialistic, insofar as it defends social property in the means of production; bourgeois, insofar as the distribution of life's goods is carried out with a capitalistic measure of value..." (The Revolution Betrayed, p. 54)

Hence a degree of social inequality is inevitable in the transitional society; but a workers’ state should aim to limit the extent of inequality and reduce it over time. However, this is not a smooth process: “Economic contradictions produce social antagonisms, which in turn develop their own logic". (p 48) This situation tends to result in the emergence of a bureaucracy -- a layer of privileged government and party officials.

Trotsky believed that: "The basis of bureaucratic rule is the poverty of society in objects of consumption, with the resulting struggle of each against all" (p. 112). Bureaucratisation is always a danger in a transitional society, but "the poorer the society ... the more crude would be the forms assumed by bureaucratism, and the more dangerous would it become for socialist development" (p. 55). Hence the poverty and backwardness of Russia created fertile ground for the bureaucratic degeneration of the Soviet state.

The isolation of the Soviet Union in a capitalist world increased the pressure towards bureaucratisation. But in turn, the bureaucracy sabotaged revolutionary opportunities in other countries, prolonging the isolation of the Soviet Union.

The Soviet bureaucracy, which was "nationally limited and conservative, ignorant and irresponsible" (p. 191), dictated policies to communist parties around the world, and purged these parties of any independent-minded leaders. The Communist International became "a completely submissive apparatus in the service of Soviet foreign policy, ready at any time for any zigzag whatever" (pp. 186-7). This led to defeats for communist parties in several countries, notably China and Germany.

Trotsky did not think that capitalism had been restored in the Soviet Union in the 1930s, because the bureaucrats had not converted the means of production into their own private property. He argued that, "The nationalisation of the land, the means of industrial production, transport and exchange, together with the [state] monopoly of foreign trade, constitute the basis of the Soviet social structure. Through these relations, established by the proletarian revolution, the nature of the Soviet Union as a proletarian state is for us basically defined" (p. 248).

Trotsky believed that the bureaucrats would eventually seek to convert state assets into their own private property. "One may argue that the big bureaucrat cares little what are the prevailing forms of property, provided only they guarantee him the necessary income. This argument ignores not only the instability of the bureaucrat's own rights, but also the question of his descendants... Privileges have only half their worth, if they cannot be transmitted to one's children. But the right of testament is inseparable from the right of property" (p. 254).

However, they were held back by fear of the reaction of the workers. In Trotsky's opinion the bureaucracy "continues to preserve state property only to the extent that it fears the proletariat" (p. 251).

He added that: "As a conscious political force the bureaucracy has betrayed the revolution. But a victorious revolution is fortunately not only a program and a banner, not only political institutions, but also a system of social relations. To betray it is not enough. You have to overthrow it. The October revolution has been betrayed by the ruling stratum, but not yet overthrown" (pp. 251-2). He argued that the revolution “still exists in property relations and in the consciousness of the toiling masses” (p 255).

Trotsky believed that the bureaucratic regime was unstable. Either the workers would overthrow the bureaucracy and restore soviet democracy, or capitalism would be restored.

Summing up, Trotsky said:

The Soviet Union is a contradictory society halfway between capitalism and socialism, in which: (a) the productive forces are still far from adequate to give the state property a socialist character; (b) the tendency toward primitive accumulation created by want breaks out through innumerable pores of the planned economy; (c) norms of distribution preserving a bourgeois character lie at the basis of a new differentiation of society; (d) the economic growth, while slowly bettering the situation of the toilers, promotes a swift formation of privileged strata; (e) exploiting the social antagonisms, a bureaucracy has converted itself into an uncontrolled caste alien to socialism; (f) the social revolution, betrayed by the ruling party, still exists in property relations and in the consciousness of the toiling masses; (g) a further development of the accumulating contradictions can as well lead to socialism as back to capitalism; (h) on the road to capitalism the counterrevolution would have to break the resistance of the workers; (i) on the road to socialism the workers would have to overthrow the bureaucracy. In the last analysis, the question will be decided by a struggle of living social forces, both on the national and the world arena (p. 255).

Tony Cliff's analysis

Tony Cliff agreed with Trotsky that the Soviet Union had undergone a process of bureaucratic degeneration during the 1920s. However, he believed that the resulting bureaucratic regime was in no sense a workers’ state. Cliff pointed to the lack of workers’ control over production; the lack of any right for workers to organise in defence of their own interests; the growth of inequality; and the lack of democracy in the soviets and the Communist Party, and concluded that what existed was state capitalism.

Cliff saw state capitalism as the inevitable outcome of any attempt at rapid industrialisation following a revolution that remained isolated in a backward country surrounded by a hostile capitalist world. He argued that the goal of rapid industrialisation required rapid accumulation of capital, which could only be carried out through putting heavy pressure on the working conditions and living standards for the masses. "Under such conditions, the bureaucracy, transformed into a personification of capital ... must get rid of all remnants of workers’ contro l... must atomise the working class, must force all social-political life into a totalitarian mould" (State Capitalism in Russia, p. 165).

The bureaucracy, having freed itself from all control by the working class, uses its position of power for its own benefit. "Thus, industrialization ... in a backward country under conditions of siege transforms the bureaucracy from a layer which is under the direct and indirect pressure and control of the proletariat, into a ruling class ..." (pp. 165-166).

Cliff claimed, "What is specific to capitalism is accumulation for accumulation's sake, with the object of standing up to competition" (p. 180). He concluded that: "the Russian bureaucracy, ‘owning’ as it does the state and controlling the process of accumulation, is the personification of capital in its purest form" (p. 181).

In Cliff’s view, the decisive turning point in the creation of "state capitalism" in the Soviet Union was the start of the first Five-Year Plan in 1929. He claimed that this plan “signifies the transformation of the bureaucracy into a ruling class” (p. 164) because: “It was now, for the first time, that the bureaucracy sought to create a proletariat and to accumulate capital rapidly" (p. 165).

An implication of Cliff's theory is that an isolated workers state cannot survive for very long. If it does not industrialise, it will fall further and further behind the capitalist countries, both economically and militarily, and risks being invaded. But if it does try to industrialise, it will become "state capitalist" for the reasons explained above. Hence, Cliff asks rhetorically: "Can a workers’ revolution in a backward country, isolated by triumphant international capitalism, be anything but ‘a point in the process’ of the development of capitalism, even if the capitalist class is abolished?" (p. 164).

This outcome can only be avoided if a “series of new revolutions ... break out immediately or after a certain interval” (p. 158). The length of the “interval” is not specified, but the implication is that it is fairly short.

Cliff denied that the bureaucracy was interested in the restoration of private ownership of the means of production. He claimed that private capitalism could not be restored without military occupation by “external forces” (p. 326) because “internal forces are not able to restore individual capitalism in Russia" (p. 324). This assertion was not backed by a clear argument, but Cliff seems to have assumed that the bureaucracy, being the “owner” of state property, would always oppose any attempt to restore private property.

Szymanski's analysis

Szymanski argues that "the Soviet Union is a socialist society, albeit a somewhat distorted one", because "no exploiting class controls the means of production nor dominates the state and party" (Is the Red Flag Flying?, p. 199).

As evidence of its socialist character, Szymanski cited a range of statistics, mainly derived from Western academic studies of the Soviet Union, showing that the Soviet Union in the 1970s was much more egalitarian than Western countries and was continuing to become more economically and socially equal. For example, in 1956 the highest paid 10% of employees in the Soviet Union received 8.1 times the income of the lowest paid 10%. By 1975, this ratio had fallen to only 4.1, whereas in the United States, the similar ratio was 12 times (p. 64).

Szymanski added that factors such as free health care and education, and subsidised housing and child care, also had an equalising effect. Another indication of the "relative egalitarianism" of the Soviet Union was the fact that it was normal for government and enterprise officials to live in the same apartment buildings as production workers (p. 68).

He did however admit that there were some exclusive neighbourhoods where leading officials of the Communist Party lived. He also admitted that managers had privileged access to fringe benefits such as cars and summer houses. But he argued that overall the Soviet Union was much more egalitarian than Western countries.

Szymanski also argued that the Soviet Union had a high level of political participation. While Soviet elections were often criticised in the West as a farce, because there was only one candidate for each position, Szymanski argued that the electoral process “must be taken seriously as one means of exerting influence on the decision making process" (p. 81). He claimed that "the very real decision making process occurs before the final casting of ballots. Candidates are nominated at meetings of workers and members of mass organisations after sounding out their opinions and evaluation of the candidates by local election committees and Communist Party members. Anyone at a meeting has the right to propose or oppose a candidate" (p. 81).

Szymanski did however admit that "I could find no hard evidence on the extent to which the nomination process was authentically democratic" (p. 82).

Whereas the Soviet Union was criticised in the West for repressing freedom of speech, Szymanski claimed that there was “very widespread involvement both among the professional intelligentsia and the working class in the formulation and discussion of public issues, as well as in criticisms of state and Party performance" (p. 87). He pointed out that "the Soviet press is full of public debates on a very wide range of issues: literary policy, economic and legal reform, military strategy, the relation between the Party and the military, city planning, crime, pollution, farm problems, the role of the press, art, women's role in the economy, access to higher education, incompetent economic management, bungling bureaucrats" (p. 83).

However, he admitted that certain topics were "taboo" (p. 84) -- for example, the press did not publish criticism of the Communist Party as an institution or its top leaders.

Szymanski claimed that the regime was popular, pointing out that "even harsh domestic critics of the system bemoan the fact of the unpopularity of their own ideas among working people" (p. 88). He claimed that the CP was becoming "increasingly proletarian and democratic" (p. 95), citing statistics on the party's social composition and information about debates within it.

Szymanski acknowledged that these positive trends would not necessarily continue in a linear way. "It is possible that at some point the power elite and the professional intelligentsia will attempt to reverse the egalitarian trend" (p. 96). However, workers would strongly oppose any such attempt. He claimed that a "transition to capitalism ... seems an increasingly remote possibility" (p. 221).

Szymanski claimed that in the 1930s and 1940s, a harsh regime was necessary to ensure the Soviet Union's survival in the face of the danger of foreign invasion. "Material incentives" involving a high level of economic inequality were also necessary. But once industrialisation was carried out and the external pressure eased, society was able to become more egalitarian and democratic.

Szymanski claimed that despite some "abuses of power", and even at times "collective paranoia", "the USSR was in fact a socialist society in the 1930s and 1940s" (p. 209). He argued that the transition from a harsh regime in the 1930s and 1940s to a more democratic one after the 1950s was "a product of the logic of Soviet society and the international situation" (p. 210).

Who was right?

The statistics quoted by Szymanski, showing a relatively low and declining level of inequality in the Soviet Union in the 1970s, are interesting. But the picture he painted was too rosy. Szymanski downplayed the power and privileges of the bureaucracy under the Soviet system. While their official incomes were relatively low by Western standards, the bureaucrats had privileged access to scarce consumer goods. Corruption was also a significant factor in making society more unequal than it appeared on the surface.

Nevertheless, Szymanski’s view that the Soviet Union was more egalitarian than the West (or became so in the years after Stalin’s death) seems correct. During the Gorbachev period some intellectuals complained about the supposedly excessive egalitarianism of Soviet society.

The fact that Szymanski's view was over-optimistic was proven by the restoration of capitalism in the Soviet Union in the 1990s, and the lack of strong resistance to it. Not only did the Communist Party of the Soviet Union, which Szymanski claimed was "increasingly proletarian and democratic", fail to lead any such resistance; high ranking party officials played a key role in bringing about capitalist restoration. Boris Yeltsin, for example, had been a senior party leader for many years before becoming a "democrat" and carrying out large-scale privatisation.

While Szymanski was too "positive" about the Soviet Union, Cliff was too "negative"; he ignored any information showing that the Soviet Union was in any way better than the West for workers. In the 1988 edition of his book, he continued to quote statistics from the 1930s and 1940s, not acknowledging any improvements such as the apparent decline in inequality during subsequent decades. (An appendix by Chris Harman does acknowledge some improvements in workers’ living standards, but does not take account of the information cited by Szymanski apparently showing that social inequality in the Soviet Union was relatively low and falling.)

Despite their limitations, the statistics quoted by Szymanski tend to support Trotsky's view that the Soviet state still had a “socialistic" aspect, despite its bureaucratic degeneration.

Cliff failed to anticipate the drive of the bureaucracy to restore private ownership of the means of production -- in fact he denied that this could occur. Trotsky's view that the bureaucracy would try to restore private ownership of the means of production was proven correct, even if the transitional regime lasted much longer than he anticipated.

While Trotsky's theory enabled him to anticipate subsequent developments more correctly than Cliff or Szymanski, it is still necessary to consider some of Cliff's criticisms of Trotsky's analysis.

Who controlled the Soviet state?

Cliff said that the Soviet Union could not be a workers’ state because the workers did not control it: "If the state is the repository of the means of production and the workers do not control it, they do not own the means of production, i.e. they are not the ruling class" (State Capitalism in Russia, pp. 311-312).

But how do we judge who "controls" a state?

Liberal political theory says that in a parliamentary democracy the voters control the state by electing members of parliament to supervise it on their behalf. If the MPs don't do what the voters want, they can be replaced at the next election. If most voters are workers, in theory the working class should be able to control the state by electing a majority of pro-worker MPs. But in reality voting every three or four years does not give citizens control over the state.

Government ministers and senior civil servants make the key decisions on matters of government policy. Often they go against the wishes of the majority of voters. (For example, in Australia the privatisation of public utilities and other government enterprises was carried out by both Labor and Liberal governments, despite public opinion surveys showing most people opposed this.)

Does this mean that the state officials are a law unto themselves, not controlled by any outside force? Is the state controlled by its own bureaucracy? This is not the whole truth either. The state in capitalist society is ultimately controlled by those who own the means of production -- the capitalist class.

The capitalists can influence state policy by many channels. They give election campaign funding to parties that carry out pro-capitalist policies. They offer seats on company boards to retired politicians and civil servants as a reward for implementing pro-capitalist policies. They threaten to withdraw their investments from countries where the government fails to carry out their wishes. Hence, while officials of the state bureaucracy make many of the key decisions, they do so in the interests of the capitalist class. Thus the capitalists control the state, even if indirectly.

What about the former Soviet Union? Who controlled the state there? The bureaucrats certainly made the key decisions. But in whose interests were these decisions made?

Cliff gave a simple answer: The bureaucrats made decisions in their own interests. Trotsky gave a more complex answer: insofar as the bureaucrats acted to maintain and increase social inequality, they were defending their own interests. But insofar as they acted to defend state property against attempts to restore private ownership of the means of production, they were defending the interests of the working class. He added that the bureaucrats defended state property only to the extent that they feared the working class.

Perhaps the best evidence in favour of Trotsky's view comes from looking at the consequences when the bureaucracy stopped defending nationalised property. When the Yeltsin regime began implementing a program of large-scale privatisation, poverty in the former Soviet Union increased markedly due to unemployment, inflation, cuts to social services and widespread non-payment of wages. The health and education systems deteriorated. Life expectancy declined dramatically.

The deterioration in conditions for workers after privatisation contrasts with the gains which they had previously made under a nationalised economy (free health and education, full employment, etc.)

Additional support for Trotsky's analysis comes from the statistics on income distribution quoted by Szymanski, showing a trend towards greater equality between the 1950s and 1970s. In part this was a result of concessions granted by the bureaucracy to the working class as a response to workers' struggles. There were large-scale outbreaks of working-class rebellion in several Eastern European countries in the 1950s and 1960s, as well as localised outbreaks in the Soviet Union itself. The net effect of these concessions was to make the Soviet Union a more egalitarian society.

The concessions were quite substantial, despite the very limited extent of working-class rebellion inside the Soviet Union itself. It seems that pressure from the working class was able to have more impact than we might have expected. Why was this?

In a capitalist economy, the logic of the market tends to generate ever-increasing inequality. Progressive taxation and the welfare state can counteract this only to a limited extent.

In a state-owned economy, the government can (if it chooses) take conscious decisions that tend to reduce the level of inequality. It may take such decisions, not because it wants to, but because it fears a possible rebellion if it does not. In such an economy workers' discontent is focused on the state, which cannot use "market forces" as an excuse to evade responsibility for workers' pay and conditions. In the absence of a powerful domestic capitalist class owning the means of production and able to influence state policy in an anti-worker direction, the state may be responsive to such pressure.

Hence the working class was able to exercise a certain degree of "control" over the state, despite the lack of real proletarian democracy.

Cliff ridiculed Trotsky's view that the bureaucracy was held back from privatisation by fear of working-class reaction: "The Russian proletariat was not strong enough to keep its control over the means of production, and was ousted by the bureaucracy, but it is strong enough to prevent the promulgation of this relation in law! The proletariat was not strong enough to check a most antagonistic distribution of the product, to prevent the bureaucracy from brutally depressing its standard of living and denying it the most elementary rights, to prevent the sentence of millions of its members to slave labor in Siberia; but it is strong enough to defend the form of property!" (State Capitalism in Russia, p. 325).

However, the idea that the bureaucracy was held back from privatising the means of production by fear of working-class response is not quite as ridiculous as Cliff suggests. At the time when Trotsky was writing The Revolution Betrayed, capitalism was in the middle of the Great Depression. If the state enterprises in the Soviet Union had been privatised at that time, the result would have been mass sackings. It was not unreasonable for the bureaucrats to fear that this would spark a workers revolt -- particularly given that many workers, as former participants in the October revolution, had practical experience of overthrowing an oppressive regime.

Maintaining and expanding state-owned industry meant providing workers with relatively secure jobs and maintaining the political loyalty of a section of the working class (mainly the more privileged layers). Thus the maintenance of state ownership of the means of production can be seen as a concession to the working class.

State ownership and the nature of the state

Cliff says that, “In Trotsky’s works we find two different and quite contradictory definitions of a workers’ state. According to one, the criterion of a workers’ state is whether the proletariat has direct or indirect control, no matter how restricted, over the state power: that is, whether the proletariat can get rid of the bureaucracy by reform alone, without the need for revolution… Trotsky’s second definition has a fundamentally different criterion. No matter how independent the state machine be from the masses, and even if the only way of getting rid of the bureaucracy be by revolution, so long as the means of production are statified the state remains a workers’ state with the proletariat the ruling class” (State Capitalism In Russia, pp. 310-11).

In fact, Trotsky saw the survival of state ownership in the Soviet Union as reflecting a form of “indirect control” (to use Cliff’s phrase, though with a somewhat different meaning) by the working class over the bureaucracy. Trotsky believed that the bureaucracy “continues to preserve state property only to the extent that it fears the proletariat” (The Revolution Betrayed, p. 251).

Trotsky saw state ownership in the Soviet Union as the product of workers revolution, and its survival as an indicator that the revolution was not totally dead: “the social revolution, betrayed by the ruling party, still exists in property relations and in the consciousness of the toiling masses” (The Revolution Betrayed, p. 255).

Trotsky made a sharp distinction between the partial measures of state ownership introduced by capitalist governments and “the expropriation of the class of capitalists” (The Revolution Betrayed, p. 247). In his view the latter could only be achieved “by the proletariat with the methods of social revolution” (p. 248).

Trotsky occasionally used the term “state capitalism” to describe state ownership of certain industries under capitalist governments. But he thought there were limits to how far capitalist governments could go in the direction of state ownership: “State capitalism means the substitution of state property for private property, and for that reason remains partial in character” (The Revolution Betrayed, p. 246).

Capitalist governments have often established state-owned enterprises. Less often have they nationalised existing privately owned enterprises (normally with compensation to the previous owners).

This may be done for a number of reasons.

  • A government may want direct control over an industry that is crucial to the needs of the state. For example, it may want to own a weapons factory to ensure that it has an adequate supply of weapons for its military needs, and that the products of the factory are not sold to its enemies.
  • Private companies may fail to invest in areas crucial to the economy as a whole, because the investment may be risky or may not pay off quickly enough. (e.g. railways in 19th century Australia). Similarly the service provided by private companies in a key area may be so poor that it hinders economic development (e.g. electricity supply in Victoria in the 1920s – see Kenneth Davidson, The Age, February 10, 2000). Public ownership of such industries may benefit the capitalists who use these services.
  • At times working-class pressure has been a factor in influencing bourgeois governments to carry out nationalisations. This was particularly the case in Western Europe after the World War II, when the bourgeoisie feared a communist revolution, and was prepared to make significant concessions to the working class, including most importantly introducing the welfare state, but also the nationalisation of certain industries.
  • Bourgeois nationalist regimes in Third World countries may take over foreign-owned enterprises to ensure that the profits remain in the country rather than flowing overseas. After nationalisation the profits go initially to the state, which in turn uses part of the money to give profitable contracts to local capitalists. Thus nationalisation of foreign-owned enterprises can strengthen the indigenous capitalist class.

In these cases nationalisation is carried out by capitalist governments in the interest of the capitalist class. But once the capitalists feel that public ownership of an enterprise is no longer necessary or beneficial to them, they will push for privatisation. They much prefer to own profit-making industries themselves rather than allow the government to own them, even if that government acts in the interests of the capitalist class.

Some non-working class regimes have carried out extensive nationalisation. For example, in Egypt in the 1950s and 1960s most large-scale industrial and commercial enterprises were nationalised by the Nasser regime, which came to power through a military coup. (This did not mean that the majority of the economy was nationalised, because most people continued to be peasant farmers, small traders or artisans. The petty bourgeoisie survived, as did small and medium-sized capitalists.)

How, if at all, did the situation in Nasser’s Egypt differ from the Soviet Union under the New Economic Policy in the 1920s, where large-scale industry was state-owned but most people were peasants?

One key difference was that in the Soviet Union, unlike in Egypt, millions of workers and peasants had been through the experience of making a socialist revolution. Furthermore, the country was still ruled by the party which had led the revolution. Despite the growth of bureaucracy and careerism, most Communist Party members were still committed to the socialist goal.

Explaining why Nasser’s Egypt was not a workers’ state, US socialist Joseph Hansen wrote:

A workers’ state is based not only on nationalizations but, among other things, on the revolutionary consciousness of the masses… The great school for the masses in achieving this level is a popular revolution – a profound collective experience in mobilizing against the ruling class and its system (“The Workers and Farmers Government”, by Joseph Hansen, in Education for Socialists bulletin, US Socialist Workers Party, 1974, p. 8)

Such a revolution had occurred in the Soviet Union, but not in Egypt.

In the Soviet Union, state ownership of industry had the potential to be a step on the road towards socialism. But this could only occur if the Communist Party leadership did not degenerate or make catastrophic mistakes, and if victorious revolutions occurred in other countries, breaking the isolation of the Soviet Union.

Stalinist totalitarianism and post-Stalin reform

In reality neither of these conditions applied. There were a series of defeats for the working class in other countries, while the bureaucratisation of the Soviet Union deepened and political repression intensified, culminating in the purge trials of the late 1930s.

Stalin’s policy of forced collectivisation of agriculture in the Soviet Union was disastrous. Because of the hasty, poorly planned and non-voluntary way it was done, it had a devastating impact on agricultural production, causing millions of deaths from starvation. Millions of people, the majority of them peasants, were sent to labour camps.

On the other hand, state ownership of the factories and mines enabled the rapid growth of Soviet industry during the 1930s, when the capitalist world was suffering from the Great Depression. Conditions for Soviet workers were grim, but at least they had jobs.

After the disaster of forced collectivisation, bureaucratic ultra-leftism gave way to bureaucratic conservatism. The bureaucrats wanted to avoid further dramatic changes. Hence they did not want to risk provoking a new wave of turmoil by privatising state-owned assets (causing mass sackings and potentially a working-class revolt).

Thus nationalised industry survived and expanded. After Stalin’s death, repression was eased and economic concessions were made to the working class. In this new context, state ownership of industry provided the basis for improvements in workers’ living standards and a tendency towards greater social equality.

During the Stalin era it was understandable that some socialists could see nothing positive in the Soviet Union for workers. The theory of state capitalism was an attempt to explain the oppressive nature of the Stalinist regime.

Cliff and Chris Harman acknowledged significant improvements in the post-Stalin era. Explaining the post-Stalin reforms, Harman said that Khrushchev “had pushed through reforms because, without them, there was the danger of revolution” (State Capitalism in Russia, p. 280). This recognition that fear of revolution could influence government policy contrasts with Cliff’s earlier dismissal of Trotsky’s view that the bureaucracy was held back from privatising state-owned industry by fear of the response of the working class.

Capitalist restoration

The privatisation of industry under Yeltsin led to growing social inequality, insecurity and poverty, which tends to support Trotsky’s view that state ownership had been a gain for the working class. Why then did the working class not resist privatisation more strongly?

First, the legacy of Stalinist repression meant the absence of a strong socialist party with a clear Marxist understanding of the situation. Many workers had a general sentiment in favour of democratic socialism, but this was not organised.

Second, the international political situation was unfavourable to the working class. US President Ronald Reagan, British Prime Minister Margaret Thatcher and other Western leaders had defeated key working-class struggles (e.g. the British miners’ strike) and successfully carried through the neoliberal offensive in the advanced capitalist countries, while also carrying out an offensive against revolutions in the Third World (e.g. Nicaragua, southern Africa), and stepping up the arms race which put pressure on the Soviet economy.

Third, the international economic environment was different from that in the 1930s. In the 1980s and 1990s, despite the end of the post-war boom, the advanced capitalist countries still appeared relatively prosperous. Soviet workers were increasingly aware of Western living standards, without being aware that these were based on the exploitation of the Third World. Hence, when privatisation was first introduced the workers (while not necessarily convinced of the supposed benefits) did not expect it to be a major disaster.

This international context created favourable conditions for the neoliberal offensive within the Soviet Union itself. Imperialist governments and institutions intervened very consciously to promote neoliberal ideology. For example, Margaret Thatcher went on Soviet television to argue the virtues of the "free market". The intelligentsia was won over to neoliberalism. The working class remained passive and depoliticised -- a legacy of Stalinist repression, reinforced by the global situation of working class defeat and retreat.

This context made possible the restoration of private ownership of the means of production with relatively little conscious political opposition. There were many fierce struggles around immediate economic issues such as unpaid wages, but no broadly based political challenge to the general direction of government policy.

Conclusion

Trotsky's view of the former Soviet Union as a transitional society ruled by a bureaucratic regime seems to explain the evolution and eventual dissolution of the Soviet Union better than either Cliff's theory of state capitalism or Szymanski's view that it was a socialist society ruled by an "increasingly proletarian and democratic" Communist Party.

Does it matter who was right, now that the Soviet Union is gone?

It is necessary to correctly understand the past in order to orient ourselves for the future. It is important to understand the problem of bureaucratic degeneration in order to prevent its recurrence. But it is also important not to assume prematurely that capitalism has been restored in a country that has made a revolution.

A crucial current example is Cuba. Cliff extended his theory of state capitalism to apply to other post-revolutionary societies, including Cuba. But this analysis is even more clearly wrong in the case of Cuba than the Soviet Union, since Cuba is not ruled by a privileged bureaucracy. "State capitalist" theory undermines the urgent task of building solidarity with the revolutionary Cuban government.

More generally, Cliff's argument that an isolated workers’ state in a backward country cannot survive for long is defeatist. It is true that there are strong pressures towards bureaucratic degeneration and capitalist restoration under such circumstances, but a revolutionary leadership that understands these pressures can do much to combat them.

[Chris Slee is an activist with the Socialist Alliance, in Melbourne, Australia.]

Comments

Who knew?

Who would have thought that 20 years after the demise of the Soviet Union we'd still be rehearsing these arguments?

I joined the socialist movement just after the socialist movement just after the collapse of the USSR and the whole movement was about 'rethinking' what happened. After a months of this - each sect decided that this proved that they had been right all along. It was perhaps excusable then given the shock of events but 20 years later? If you had known Chris's background you could have predicted his answer to this "question" back in 1990s - it is sad that we are still getting the same "answers" now.

How about we say that the Russia Revolurion happened in the cities when working class - fresh off the land and surrounded by an ocean of peasants - overthrew the Tsar and then an unstable bourgeois government. Beset by invasion, counter-revolution and world war the party apparatus substituted itself first for the organs of popular power in the cities and eventually carried out the tasks of modernisation usually thought of a 'bourgeois' with incalculable cost in human lives. In the end they carried through the transitional to capitalism, using the state.

The question is who controls the surplus? Its like any bureacracy - most large capitalist or state enteprises aren't run by the 'owners' of those businesses they are run by managers but from p.o.v of worker it means exploitive and disempowering.

there's more than three views on this ...

The British WRP, the former Healeyites whose partisan RAB now dominates the Usenet newsgroup alt. politics.socialism.trotsky, insist that the Russian Federation and the other successor states of the USSR are still degenerated workers' states.

Class nature of the Soviet Union

I'm grateful that this discussion is being undertaken: there is a lot of excellent analysis on the subject, some of which is referenced in this article, some of which remains to be addressed.

In addition to the authors quoted above, let me add a couple: Lenin and Raya Dunayevskaya.

Lenin's pre-Revolutionary analysis cumulated in "State and Revolution," written on the eve of the Russian Revolution: in it, he opined famously that the Soviets, or workers' councils, were the natural soil in which to grow socialism into communism...any attempt at that point to defer to the authority of any Constituent Assembly, in his view, would be an unnecessary step backward into bourgeois, parliamentary democracy.

This is not to say that only one party was represented on the floor of the Soviets on the eve of the Revolution: however, during its course, most of the parties abandoned it, the Soviets in the non-Russian areas operated independently from the All-Russian Congress of Soviets (which was moved from Petrograd to Moscow partly to accommodate them, partly to lessen the threat of foreign intervention), and finally, the leadership of the other party to remain within the All-Russian Congress of Soviets, the Social-Revolutionary Party (reflecting a social-anarchist tendency popular with agrarian revolutionaries of the period, most notably Emiliano Zapata) attempted to assassinate the Bolshevik leadership: this was part of the process of the Russian Civil War which resulted in a single party, the Bolsheviks, remaining on the floor of the Soviets. Lenin had famously formed a bureaucracy to enforce the decisions of its Congresses by means of restricting voting to fulltime, professional revolutionaries: he later loosened that requirement in order to more fully integrate the Bolsheviks into the revolutionary process, but the system of paid party cadres remained a powerful instrument, one that Stalin wielded with great skill in his capacity of General Secretary. Also, within that context, another bureaucracy, that of the Soviet State, grew, albeit ostensibly in the service of the Soviets: since the Bolshevik bureaucracy monopolised nominations to the Soviets, however, one had one bureaucracy capturing the Soviets, hence the State...and its authority was plenipotentiary.

As Lenin noted, however, even in this situation, capitalism still existed in the Soviet Union, albeit in a subordinate position: indeed, in "Left-Wing Childishness," he argued that capitalism and socialism would develop in parallel paths: capitalism from market-driven competitive forms into state capitalism, socialism into communism (please see http://www.marxists.org/archive/lenin/works/1918/may/09.htm) Indeed, he sought the help of the trade unions in promoting both processes (please see "Role and Functions of the Trade Unions Under The New Economic Policy," http://www.marxists.org/archive/lenin/works/1921/dec/30.htm): an analysis with profound implications, given that the Soviets were originally grounded in those very unions, especially in the context of the New Economic Policy, characterised as a retreat by Lenin, but also as one of two ways that he countered the twin Party and State bureaucracies (the other being the formation of the USSR as a prototypical "League of Socialist Nations" juxtaposed to what Woodrow Wilson had in mind).

Soon after Lenin died, however, the NEP went by the wayside, to be replaced by Five-Year Plans promulgated from within the Party and State bureaucracies by GOSPLAN increasingly at the direction of Stalin (it was Stalin, for instance, who usurped even GOSPLAN when, in "Vertigo of Success," he swept aside voluntary collectivisation, and foreshortened the Five-Year Plan by a year: he knew that he already had dictatorial power).

Looking at these developments, one had two currents of critique: 1) Trotsky's, which claimed that the Soviet Union was stuck in the transition between capitalism and socialism; 2) the state-capitalist school, which countered that the life had been squeezed out of the Soviets by the Party and State bureaucracies: notable examples of this critique were Raya Dunayevskaya's "Union of Soviet Socialist Republics is a Capitalist Society" (1941, please see http://www.marxists.org/archive/dunayevskaya/works/1941/ussr-capitalist.... ) and Tony Cliff's "State Capitalism in Russia" (1947, please see http://www.marxists.org/archive/cliff/works/1955/statecap/). If one notes that a bureaucracy is but an expression of the employer-employee relation of production which defines capitalism, and that the organs of economic democracy, the Soviets, had become subordinate to the Party bureaucracy, one cannot argue that the development of economic democracy from socialism to communism as understood by Lenin was any longer taking place: instead one had a streamlined, state-capitalist locomotive which was growing and developing at a terrific pace: much faster than its Fascist or Social-Democratic competition (until it was interrupted by the Nazi attack of 22 June 1941). After the war, as the USSR continued to grow and develop, the disparity between the propaganda and the reality became ever greater: as a component of the capitalist world-system, the Soviet economy increasingly fell prey to that system, further exacerbating the contradictions of that system, until it finally imploded, to be replaced by a market-driven capitalist system by the various Republic governments, most notably the Russian Federation under Yeltsin (the Putin/Medvedev government has reversed that somewhat, but has not done so under any Socialist banner: instead it restores bureaucratic control of the Russian economy under the banner of national self-determination, not unlike the PRI in Mexico).

In Cuba, as in China, one sees a persistence of the dual Party/State bureaucratic model one saw in the USSR: in China the classic Maoist incarnation of Stalinism has been superseded by a model in which both internal and international market forces have a much greater role...but the spectre of economic democracy is raising its head in the form of wave after wave of strikes. In Cuba, the Castro brothers, like Mao, were always well-aware of the bureaucratic nature of the Party and State, and they devised ways to bypass that bureaucracy to see for themselves the actual situation of the country: having done that, however, they used those bureaucracies to promulgate their initiatives. A powerful counterexample, however, is now being put before the Cuban people, among others: that of Venezuela, which is still very much in transition between capitalism and socialism, but whose socialists are determined not to reproduce Stalinism. From the moment he declared himself a socialist, President Hugo Chavez Frias has opined that the transition from capitalism to socialism cannot be completed in any single country or even region, but must replace capitalism as a world system: on this point Trotsky and the state-capitalist school agreed, and differ from Stalin's "Socialism In One Country." Lenin, Stalin, Mao, the Castro brothers, even Hugo Chavez himself, as well as the movement they all claimed to lead, faced this reality: only Lenin and Chavez, however, continued to insist that the governments they led take this fact fully into account (indeed, Lenin worked closely with Trotsky during this time, and Chavez works closely with Venezuelan Trotskyists among others).

Does a political movement exist which can power a global revolution against capitalism? Let me submit for your consideration that our Occupy Movement, with its direct juxtaposition of the 1% vs. the 99%, has at least the potential to become that movement. Having such a broad base means that the Occupy Movement has both proletarian and petty-bourgeois elements in it: to the confused, contradictory petty-bourgeois notions, we who share a socialist perspective can counter with a well thought out analysis, and act upon that analysis, thus acting to minimise the entropy of the Occupy Movement even while the entropy of capitalism kills off its markets: if we fail in this, the result on the capitalist side, the revival, not only of state capitalism, but of Fascism as its political expression, will put many of us, and quite possibly life on Earth, in our graves. The stakes have never been higher: with great danger, however, comes great opportunity: we dare not fail this time!

nature of the Soviet Union

I dunno, something about the emancipation of the working class being the act of the working class comes to mind and I don't see that as having happened in Cuba, but I do see a bureaucracy making the collective decisions about the social surplus created. And I dunno either, but how about the rate of profit in the USSR? How was that going in the years after 1970?

And what about all those workers' rebellions against Stalinism? You know, like 1956 in Hungary and the possibility of workers there setting up their own democratic institutions of governance and production. That looks to me something more than a political revolution.

And if inequality/equality is your guide to socialism then how do or did the Nordic countries stack up? Its a funny sort of 'socialism' (socialism being a more equitable society on your view) if the exploitation of the working class continues apace as it did and does in those countries.

Re: Nature of the Soviet Union

"I dunno, something about the emancipation of the working class being the act of the working class comes to mind and I don't see that as having happened in Cuba..."

I guess if you don't look, you won't see.

Check out for instance: How the Workers and Peasants made the revolution.

More broadly, I think regardless of our differing theoretical backgrounds, we can all agree from looking at the early years of the Soviet Union that the struggle for socialism is a lot more than simply the struggle for power. That is, I would argue, that the struggle (by workers) against the counter revolution and the capitalist invasion, the struggle of the left opposition against Stalinism, and many other examples are all part of the workers' self-emancipatory struggle for socialism.

The same can be viewed in Cuba throughout its whole history where the workers have actively defended the revolutionary state and its campaigns (from: the Bay of Pigs; the critical role of grassroots efforts to thwart Washington's numerous assassination attempts against Castro; through to more recent campaigns such as: support for Elian Gonzales; and the campaign in support of the Cuban Five and ongoing mobilisations every May Day for instance.)

These are all ongoing (self-emancipatory) acts by the Cuban workers for the project of building socialism (in the world).

"but I do see a bureaucracy making the collective decisions about the social surplus created..."

Again, it does depend how you look at it. This could easily have been written: 'but I do see an elected leadership making the collective decisions (with the aid of extensive and institutionalised popular consultation mechanisms) about the social surplus created' (which would be an accurate way of putting it) and it wouldn't seem anywhere near as pejorative.

Again looking to the Soviet Union experience, an important part of our critique surely was that there was a "bureaucracy making decisions" in place of workers' democracy, but significantly more important (and in fact proof that workers' democracy was extinguished) was the content of those decisions and the interests they represented. That is they were decisions to privilege the bureaucratic stratum and to sacrifice the ongoing success of the world revolution at home and abroad in order to achieve that.

I've never seen anyone make a convincing case that the latter applies in Cuba. Among other things, the extremely high levels of popular support for the Cuban government among the population there are testament to that.

"but how about the rate of profit in the USSR?"

Yawn. Earnest Mandel has answered this many times over.

"And what about all those workers' rebellions against Stalinism? You know, like 1956 in Hungary and the possibility of workers there setting up their own democratic institutions of governance and production. That looks to me something more than a political revolution."

They look to me exactly like the political revolution that Trotsky advocated.

And it is an important fact that both your tendency and ours supports those workers' "rebellions against Stalinism" reflecting that we have a lot more in common that you like to make out.

"And if inequality/equality is your guide to socialism then how do or did the Nordic countries stack up? Its a funny sort of 'socialism' (socialism being a more equitable society on your view) if the exploitation of the working class continues apace as it did and does in those countries."

Equality/inequality is only one measure though an important one. It is clear that the "Nordic countries" are thoroughly capitalist even if they have a relatively low level (though increasing I believe) of inequality compared to other capitalist countries. (I'm not sure how they compare to the former Soviet Union nor to Cuba today.) No case that a post-capitalist society has come into existence can rest entirely on the level of inequality. I don't think Chris ever made that argument nor that "inequality/equality is [his] guide to socialism".

What about the capital relation?

Alex,

"The struggle for socialism is a lot more than simply the struggle for power"

Yet without workers' power, and workers' actual control of the state, what is "self-emancipatory" about the defence of these institutions? Workers in Argentina defended Peron and Peronism but it was a radical reformist struggle within the bounds of Argentine capitalism and its state, even if occasionally that struggle threatened to escape those bounds. Workers in Cuba may have defended gains of the revolution, but that doesn't axiomatically make the revolution one where workers came to power. It seems to me that the evidence regarding 1917 is pretty clear, but that regarding 1959 is thin on the ground; hence your need to argue in reverse -- that the subsequent defence of the Castro regime proves its socialist nature. It doesn't, and it's certainly not a Marxist way of looking at the question.

"They were decisions to privilege the bureaucratic stratum"

But this is a secondary issue regarding the class nature of the USSR or Cuba. Marx makes clear in Capital that the ideal capitalist would be personally frugal; accumulation of capital is the key. The benefit of this to members of the ruling class is a result and not a cause of their being the "personification" of the capital relation, as Marx puts it. The question which neither Chris nor you address is the nature of social relations of production in Communist countries. Does the law of value operate there or not?

Similarly, while levels of inequality are of interest in assessing the mode of production of a given society, they are again secondary to concretely analysing the social relations and motive forces of that society.

What strikes me about Chris' article and your response is that the central thrust of the "state capitalist" argument (whatever one may think of its predictive capacity for events four decades later) is that Cliff performs a "return to Marx". That is, he puts aside Trotsky's criteria for the USSR to start from scratch and ask again what defines capitalist social relations. Thus he has an entire chapter on the operation of the Law of Value; an important question anyone who has read Capital would think needed to be addressed. Cliff's argument is that the law of value operated via the mediation of military competition with the (far more industrialised) West, and that this forced a pattern of very rapid primitive capital accumulation, wherein the bureaucratic state raised the rate of exploitation massively and (this is very important) through coercive measures.

I think one area where Marx provides only basic tools for the analysis of Communism is in the theorisation of the capitalist state. But Lenin and, more so, Bukharin (among others) wrote a lot about the rise in importance of the state and its interpenetration with private capital in the era of classical imperialism. I'm always mystified why these tools, from Marx to Bukharin, are not deployed in the analysis of the Communist bloc.

Capitalism and “State Capitalism” — the Nature of the Soviet Eco

Taken from The Inconsistencies of “State-Capitalism”
http://www.marxists.org/archive/mandel/1969/08/statecapitalism.htm

Well worth reading in full!

Capitalism and “State Capitalism” — the Nature of the Soviet Economy

How does it happen that a trained and not talentless economist like Kidron, who has also read some Marx, can make such elementary blunders, constantly confusing use values and exchange values, physical goods and capital, absence of slumps of the 1929 type and absence of capitalist crisis of overproduction? The reasons obviously do not lie in his lack of analytical ability. They lie in his desperate attempt to cling to the myth of “state capitalism” existing in Russia, and to the need which flows from that attempt to show somehow that there is no “basic” difference between the functioning of “contemporary capitalism” and the functioning of the Soviet economy. That’s why he has to slur over or even deny fundamental aspects of capitalism and fundamental laws of motion of the capitalist mode of production.

Ever since social-democratic opponents of the Russian October revolution hatched the theory of “capitalism” continuing to exist in the Soviet Union, supporters of that theory have been faced with a difficult choice. Either they consider that Russian “capitalism” has all the basic features of classic capitalism as analyzed by Marx, to start with generalized commodity production, and that it also shows all the basic contradictions of capitalism, included capitalist crisis of overproduction and then they have a hard time discovering evidence for this. Or they admit the obvious fact that most of these features are absent from the Soviet economy, and they then have to contend that these features are not “basic” to capitalism anyhow, which in the last analysis only means exploitation of wage-labor by “accumulators”. This then implies unavoidably that there are qualitative differences between the functioning of capitalism as it exists in the West and the functioning of the Soviet economy, and that “state capitalism” is a mode of production different (i.e., corresponding to different laws of motion) from classical private capitalism. Bordiga is the outstanding representative of the first current, Tony Cliff of the second current. The peculiarity of Kidron is to try to have it both ways: he intends to eat his “state capitalist” cake and have it too!

He starts by conceding that Soviet economy is not subjected to the tyranny of profit nor to internal competition nor to crisis (p. 35). The explanation is that in Russia we are living under the regime of “a single capital”. But if there is no competition, if there is only a single capital, then, obviously; there is a “central, public arrangement to ensure that the process will go on in an orderly, continuous and predictable way” (Kidron’s definition of what does not exist under capitalism) and this “arrangement” is called central planning. Obviously, too, if there is no competition, “key choices about the deployment of resources” are not left to “individual capitals” (which do not exist), but are centrally determined in a coherent way, and we have continuous growth. And then, equally obviously, there is no capitalism, because all these “arrangements” are unattainable under capitalism.

But at the same time as he concedes all this, Kidron makes a series of statements which completely contradict this conception of the laws of motion of capitalism not applying inside Russia. We read that “nothing (!) in Stalinist (including post-Stalin) Russia defies analysis in terms of Marx’s model The process of pumping out surpluses from the mass of producers is as vulnerable in Russia to wild and random encroachments (!) from other capitals as it is anywhere else. The people, that organize and benefit from it, arc under as oppressive a compulsion to fast economic growth as any similarly placed class elsewhere” (p. 34). We wait for any substantiation of these breathtaking statements. There is none to come. And none can come because they are based on a crude conceptual sleight-of-hand. Here all the initial confusion between use-values and exchange values, between accumulation of machines and accumulation of capital, between conflicts of different social systems and capitalist competition, come finally into their own.

Let us take for a minute the concept of a “single capital” seriously and see where it leads us.

Inside General Motors there is of course no capitalist competition going on. The department producing car bodies does not “compete” with the department producing gear-boxes. Capital does not “flow” from one department to the other, when gear-box production is “more profitable” than car body production. General Motors normally can do nothing with gear-boxes in excess of cars produced (we leave aside the marginal case where a large corporation would actually sell parts to competitors; this does not change anything in the logic of our reasoning). Normally, the production of all parts is “planned” so that a maximum number of cars can be sold profitably.

Now if there is no “market economy” inside General Motors corporations; if the flow of goods between the departments of that “single capital” is not a flow of commodities but a flow of use-values, why then in General Motors a capitalist trust, why is the final product indeed a commodity, why are the owners of the corporation under the economic compulsion to exploit their workers and to accumulate more and more capital? Obviously because they have to sell their cars on a market, in competition with other car manufacturing corporations. If the wages in their firm go up quicker than productivity of labor, cost prices go up and then General Motors cars would be priced out of the market. If the rate of exploitation goes down, capital accumulation goes down, technology becomes obsolete compared to that of competitors with higher capital accumulation, and again the firm not only would quickly lose its share of the market, but would even be in danger of finding no market whatsoever for its goods. It is through the fact that the final products of General Motors are commodities, have to be sold on a market, and are therefore subject to capitalist competition, that the inner organization of the plant which appears at first sight as “planned economy” is subject to “wild and random encroachments from other capitals”, and that anarchy of production, increased exploitation, capital accumulation, periodic crisis, firing of workers, inflow and outflow of capital from the auto branch to other branches, in brief, all the laws of motion of capital discovered by Marx; assert themselves.

Now let us presume that through some “miracle” called the October Revolution the workers of General Motors expropriate their owners and reorganize production in such a way that they do not have to sell any commodities on the outside market (later, after some soul-searching, they decide to divert 1% of their annual output for such a sale, but this does not change anything decisively in the set-up; even if this 1% were to be suddenly suppressed, no basic change in the organization of their would occur).[20] Diversification of production tends to cover at least the elementary needs of all the manpower of the firm. Would this still be “capitalist” production? Of course not, no more than that of the “communistic” colonies of 19th century America. Do the laws of motion of the capitalist mode of production apply to that outfit? Evidently not. There would be no capital accumulation, only an accumulation of industrial equipment, produced according to plan, in the form of use-values. There would be no flow of capital from less to more profitable areas.[21] There would be no cyclical movement of investment, income and output, no periodic crisis, no periodic unemployment, but steady growth (provided the planning functions more or less adequately).

Would there be threat of encroachment by capitalism? Of course there would be such a threat; capitalism, by its very nature, is adverse to any part of the earth and any potential market being taken out of its grip. This threat would take the form of a threatening police action (or a military action) to restore private property and “free enterprise” in the domain of the collectivized outfit. It would take the form of trying to lure away the G.M. workers, by showing them at least that elsewhere they could enjoy a higher standard of living. These threats would, obviously, influence the behavior of whoever administers collectivized General Motors. Part of output would have to be diverted for arms production, for purposes of self-defense, and there would be a powerful incentive for technically more and more advanced arms production. Plans would also have to be drafted (and redrafted) in order not to fall too much behind capitalist production technique for consumer and investment goods too (or even for overtaking them). The division of total output inside the collectivized domain would be influenced by these challenges and the desired response to them. This would be true, incidentally, independently from the fact whether collectivized domain were administered under a perfect scheme of workers control and workers self-management, or whether it were administered by a hideous gang of foremen and engineers, who grabbed power inside the domain in order to reserve for themselves the cream of the output, achieving thereby a much higher standard of living than the modest average made possible by the given capacity of output, achieving thereby a much higher standard of living than the modest average made possible by the given capacity of output. And the possibility of political power and self-administration being taken away from the workers of the plant would in its turn depend on the degree by which general consumers needs would be satisfied (if they were, there would be no “incentive” for anyone grabbing power in order to satisfy consumer needs!), on the degree of political activity, awareness and socialist consciousness of the workers (in its turn depending at least partially on their standard of consumption, of leisure and of culture), and on their class cohesiveness (in part a function of the existence and leading influence of a revolutionary organization) .

But by no stretch of imagination, and especially, by no clever word-play (first using “wild and random encroachments” instead of pressure or threat of encroachments; then using “encroachment” instead of “competition for shares of a market”: and finally substituting accumulation of capital for accumulation of use-values, could these conditions be pressed back into the categories of Marx’s model of the inner logic, the laws of motion and the contradictions of generalized commodity production, i.e., of the capitalist mode of production.

So the conclusion is inescapable. There is no “single capital” in Russia (capitalist production under “single capital” was ruled out by Marx anyway). It is absurd to assume that capitalist production was somehow reintroduced because of “competition on the capitalist world market” (i.e., that the tail of 1 % of output imported from and exported to advanced capitalist countries is wagging the dog of the Russian economy).

And it is even methodologically wrong to assume a mechanical and automatic identity between the fact of a country being submitted to “encroachments” of foreign capital and the fact of that country becoming capitalist. Only if and when these encroachments change the internal mode of production do they lead to introduction (or reintroduction) of capitalism.

Marx made the point that India and China, although gradually drawn into the capitalist world market, did not for several centuries become capitalist countries (i.e., acquire a capitalist mode of production), because of the strong resistance which the basic mode of production of these countries continued to oppose to the “encroachments” of international capital. And if such was the capacity of resistance of a decadent and decaying Asiatic mode of production, surely the capacity of resistance against encroachments by the world market of a superior mode of production, based on collective property of the means of production and planned economy, could be understood to be a thousand times stronger. History proves that it has indeed been so.

Right Answer, Wrong Reasons

I do believe that Trotsky was more correct in his understanding of the evolution of the USSR than Cliff, and would therefore agree with companero Slee as far as that goes. However, the road the companero takes in getting to his conclusion is littered with some highly questionable assumptions. Several examples glaringly come to mind:

1. Companero Slee writes:

"More generally, Cliff's argument that an isolated workers’ state in a backward country cannot survive for long is defeatist. It is true that there are strong pressures towards bureaucratic degeneration and capitalist restoration under such circumstances, but a revolutionary leadership that understands these pressures can do much to combat them".

This argument was not formulated by Cliff. It was the argument which was put forward by Lenin, Trotsky and Rosa Luxemburg and which up until 1923 was the common coin of communist thought. Indeed, one of the central reasons for the creation of the Third International was the need for a revolution in Western Europe, specifically in Germany, which would form the basis for the advance of the world proletarian revolution. This is just a plain historical fact, which no one can deny.

Moreover,companero Slee crosses the line when he asserts that to advocate the position of Lenin, Trotsky and Luxemburg and other revolutionists is to join the ranks of the defeatists, puts him in the same camp as Stalin and his followers. Fot his accusation was exactly the same accusation made against the Left Opposition by Stalin and others in his bloc.

Lenin and Trotsky argued that without a series of revolutions in the more advanced Western European countries the Russian revolution would be strangled by the bureacracy. In that, they were right and the Stalinists were wrong. That is why the Stalinists must resort to a non-Marxist. a historical and not factually correct accounting of why capitalism was restored as the dominant economic set of social relations in the former USSR.

The companeros should remember, it was Lenin who first described the Russian state as a bureaucraticaly deformed one.

2. A second error which the companero makes is this:

"It is true that there are strong pressures towards bureaucratic degeneration and capitalist restoration under such circumstances, but a revolutionary leadership that understands these pressures can do much to combat them".

I agree with the companero that there are things that a revolutionary leadership can do to combat bureaucratic degeneration and capitalist restoration. However, one thing they cannot do is overthrow material reality, they cannot change the notion that being determines consciousness, they cannot substitute subjective intent for objective conditions. That is, at the level of the nation state, they ultimately cannot replace the inexorable over determination by world imperialism of the whole set of capitalist social relations (the objective conditions) with revolutionary political thought (the subjective factor). To think otherwise is to revert to a form of Hegelianism, not dialectical materialism.

There are at least two things which the Cuban leadership, which you should know extends well beyond Fidel and Raul Castro, could do to arrest bureacracy and fight corruption. The first of these is to democratise the Communist Party of Cuba by allowing the formation of formal tendencies to debate the various issues before the whole Cuban people. As it stands now, there are at least four major tendencies within the CPC, whose boundaries keep shifting on various issues and whose compositions are class, colour and generational based.

For example, the section of the CPC whose members were raised and developed after the revolution and who spent their formative years working on and managing the affairs of the Isla de Juventud, are an important part of, for want of a better name, the revolutionary left wing of the CPC. The program of this wing is to oppose the pro-capitalist reforms which they see as undermining the basis of social solidarity. They want a revolutionary Cuba along the lines of their experiences on the Island of Youth, which they proudly declare as "the first communist territory in the Western Hemisphere".

You could contrast these companeros with, for example, the section of the bureacracy and military linked to those sectors of the economy and state dealing with foreign relations and contacts and import-export, areas where the temptions of corruption is strong. Since this area of procurment is vital to the completion of projects and the distribution of goods, the opportunities for graft and fraud are rampant. Without oversimplifying it, many of the pro-market reforms in this new period emanates from this group and their academic collegues, who have been laying the political ground work for the reforms for the past decade. Since this group has first hand knowledge of the inefficancies and coruption and waste which presently exists, it is only natural that as technocrats they would offer up managerial solutions, despite the problems being political: cynicism and alienation.

But because there exists no right of tendency within the CPC, these clashes of ideas and political perspectives are not allowed to be dealt with in a socialist democratic framework. While, companero Slee might argue that the CPC is democratic "by other standards", the fact remains that there are no mechanisms to allow for the kind of unfettered debate which was the norm in the Bolshevik party, and which is the practise in the PSUV in Venezuela.

The second thing which a revolutionary leadership could do is to develop instances of workers control of the economy. There are no better watch dogs, whistle blowers and supervisors than workers with a revolutionary political consciousness. This was shown in a distorted form by the participation of thousands of class-conscious workers in the discussion of new economic reforms. Two major themes emerged from that participation. One was the demand that corruption at all levels be dealt with. The other was the necessary for social solidarity in the transition and that a program for the integration of alienated youth of working age be developed as part of that program.

With the emergence of a Latin American alternative to Yankee imperialism represented by ALBA, with the political ferment of ideas, discussions, analysis,and heightened class struggle througout our region; with the heroic and conscious people of Honduras readying themselves to take power and refound their nation-the five tendencies of LIBRE united as five closed fingers form a fist to smash the murderous oligarcy; within the context of this rising tide of revolution the objective conditions favouring the next stages of the Cuban revolution are ripening.

For those who are truly loyal to the Cuban people, it is not enough to wave the flag. Revolutionaries must speak their truth. The salvation of the Cuban revolution, as it will be for every proletarian revolution, depends upon the active and conscious exercise of power by the masses themselves. Socialist democracy is not just a moral imperative, it contains within itself a pragmatic utility which is the essence of workers' power. It is this utility which both overcomes the irrationality of the capitalist marketplace, and provides the distributive mechanism "from each according to their ability, to each according to their need".

Sol

Elena

isolated workers states

Elena Zeledon says:

"I do believe that Trotsky was more correct in his understanding of the evolution of the USSR than Cliff, and would therefore agree with companero Slee as far as that goes. However, the road the companero takes in getting to his conclusion is littered with some highly questionable assumptions. Several examples glaringly come to mind:

"1. Companero Slee writes:

"'More generally, Cliff's argument that an isolated workers’ state in a backward country cannot survive for long is defeatist. It is true that there are strong pressures towards bureaucratic degeneration and capitalist restoration under such circumstances, but a revolutionary leadership that understands these pressures can do much to combat them'.

"This argument was not formulated by Cliff. It was the argument which was put forward by Lenin, Trotsky and Rosa Luxemburg and which up until 1923 was the common coin of communist thought. Indeed, one of the central reasons for the creation of the Third International was the need for a revolution in Western Europe, specifically in Germany, which would form the basis for the advance of the world proletarian revolution. This is just a plain historical fact, which no one can deny."

I agree that Lenin and Trotsky did not think that a workers state in Russia could survive for long without a revolution in Western Europe.

However, reality turned out a bit differently than they expected.

The Bolsheviks won the civil war, despite the defeat of revolutionary upsurges in Western Europe. The Soviet state survived, but it was severely damaged, and subject to the pressures of the capitalist world. Writing in 1921, Lenin analysed it as a "workers state with bureaucratic distortions". (Lenin Collected Works, vol. 32, p.48)

He advocated policies which he hoped would enable it to survive until a new rise of revolution in Western Europe. These policies came to be known as the NEP (new economic policy).

Why do I direct the accusation of "defeatism" at Cliff, but not at Lenin or Trotsky?

Lenin and Trotsky, despite not expecting the Soviet Union to last very long without new revolutions, did what they could to make it last as long as possible. Cliff, on the other hand, seems to imply that any similar effort today would be futile. He asks: "Can a workers revolution in a backward country isolated by triumphant international capitalism, be anything but 'a point in the process' of the development of capitalism, even if the capitalist class is abolished?" (State Capitalism in Russia, p. 164)

I think that Cuba today, despite considerable differences from the Soviet Union in 1921, can also be considered as a "workers state with bureaucratic distortions".

The Cuban revolution was made by the workers and peasants. The revolutionary process included general strikes, mass demonstrations, the formation of a popular militia, the formation of committees for the defence of the revolution, and the seizure of factories by armed workers. For more details, see:
http://links.org.au/node/1451/

It is true that they did not form soviets during the revolution. But they did eventually establish the Peoples Power system of elections at the local, regional and national levels.

These elections are often criticised as undemocratic because there is only one party in Cuba. But in Russia too there was only one party in the soviets by 1921.

Cuba has survived for over 50 years in a hostile capitalist environment. It is not an ideal model of socialism, which can not exist in a capitalist world, but it has achieved quite a lot for its people.

Surely history is a brutal

Surely history is a brutal master. How is it that we can agree that capitalism in many countries triumphed by dint of revolutions regardless of the nature of the democracy and new states that was later established but seek to insert provisos on the later transitions such that we may seek to deny what actually happened?

We don't say that the French Revolution from 1789 was not a bourgeois revolution because Napoleon later crowned himself emperor --and we don't dismiss the English Revolution because of the Restoration...To insist on special criteria for the struggles of the 20th century before we accept that change did actually occur and was sustained is almost ahistorical.

Even Bonapart as Emperor carried out capitalist transitions in the countries his army invaded.

No one denies that 'real' socialism includes workers self management or whatever other positive criteria we want to argue for -- but history, like shit, happens and we have to deal with what we get.

John Milton or John Bunyan may have disliked what happened to their revolution, but it was still a revolution that proceeded to promote its own brand of capitalism. It just wasn't so democratic as they'd hope...and feudalism still survived to pester the emerging capitalist state.

We can't deny it despite what may be our disagreements with the consequences or inadequacies...and not being capitalist is the key historical marker DESPITE the fact that the level of democracy in these post capitalist countries may not have been as fulfilling as expected.

That's why these revolutions were 'unfinished.'

Was feudalism defeated in the US Civil War and wasn't that conflict a continuation of the historical tasks of 1776? Was the US state between 1776 and 1860 capitalist or not?

Of course no historical period is a pure form -- so how can we be so insistent that these 'workers states' be what we wish them to be rather than what they are?

The key difference, however, (and this is where I fear some folk stumble) -- is that Marx insisted that the ongoing creation of socialism is a conscious process. But how successful or how conscious that is going to be is not something that decides what it is.

An epoch doesn't know itself, humans do.

And it's true, that in the Soviet Union the prevailing ideology was that they had reached a socialist flowering when they obviously had not. But then, for most of the 20th century that did not mean that because of the lack of democratic momentum that these states were ipso facto returning to a hybrid capitalism or that they could not export their undemocratic brand of change by imposing it on Eastern Europe.

analysis without the voice of those who were there

Interviews with ordinary working people today in Russia and most particularly in Bulgaria (which in many respects may have been the most successful of the former state socialist economies) will find that many who grew in that world would agree largely with Symanski on many points. A huge segment of ordinary Bulgarians over the age of 40 will tell you in great detail how life was better in almost every respect under the socialist system, in terms of productivity, virtually total employment, cheap transport, quality of agricultural products, egalitarianism, quality of education, high quality of cost-free medical care, sense of personal safety and low crime, high levels of social interaction and community and neighborhood activity -- and yes, even income compared to today's high prices and extremely low salaries. Virtually all Roma, today largely unemployed as a subaltern ethnically despised
minority, had a job (despite high levels of anti-Roma prejudice then, today much worse). There was almost no 'brain drain' of professionals, today it is staggering. Bulgaria has lost 20% of its population in the past two decades.

Perhaps surprisingly, the levels of personal freedom most citizens believe that they had in the former socialist Bulgaria were quite high, comparing the situation with 20 years of endless 'transition' and mass impoverishment and rising neo-liberal ravages since. I listen to ordinary working people in Bulgaria and the stories about the way things were are quite extraordinary.

So research on people's actual lives under state socialism in Eastern Europe, across a spectrum of considerable difference say between SU, Bulgaria, Romania, GDR, seems needed in this discussion. The "danger of the single story" ( http://goo.gl/1iDDf ) needs to be avoided. Listen to Chimamanda.

Trotsky not only

Trotsky not only characterized the URSS correctly, but predicted correctly the burocracy appetits will be the agent of capital restoration. An enormous achievement for the science of marxism.

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