Daum - The Life and Death of Stalinism

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The Life and Death

of Stalinism

A Resurrection of Marxist Theory

Walter Daum

Socialist Voice Publishing Co

!e" #or$

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Contents

&ore"ord by Sy Landy 0

Preface 1

,ntroduction Theories of Stalinism 2

Pseudo-Socialist Capitalism 9; Socialism Theories 11; Workers' StateTheories 12; State Capitalism Theories 14; Third-System Theories 16; TheCommon Theory 19; iddle-Class ar!ism 2"; This #ook 22$

Cha(ter 3 The Contradictions of Ca(italism

3 Value and Wage Labor 45

odes o% &!ploitation 26; The a(or Theory o% )alue 29; Contradictions

o% )alue *2; Wa+e a(or *,; The a o% .ne/uality *0$

4 The Accumulation of Ca(ital 02

elatie Surplus )alue 4"; Concentration and Centrali3ation 42;

Capitalist Communism 44; The uestion o% Competition 49; Com-

petition and )alue ,2$

0 Ca(italism6s Crises 5-

The Crisis Cycle ,4; 5nderconsumptionism ,0; isproportionality ,9;

The 7allin+ ate o% Pro%it 61; The )alue ilemma 6,$

Cha(ter 4 The Re+olutionary 7(och

3 The 7(och of Ca(italist Decay 89

The Theory o% ecay 68; The Sociali3ation o% Capital 01; ecay and the

as o% Capital 0,; State Capitalism 09$

4 ,m(erialism 90 eisionism 84; Theories o% .mperialism 8,; enin's .mperialism 88; .mperialism and the as o% Capital 9"; The imits o% :ationalism 94$

0 Permanent Re+olution 25

The Split in Socialism 9,; Trotsky's Theory 98; Permanent eolution and

the &poch 1""; The eolutionary Party 1"*; Petty #our+eoisie s$

Workin+ Class 1",; The ar!ism o% the .ntelli+entsia 1"0$

Cha(ter 0 The Transition to Socialism

3 Marxist Theory of Transition 333

Socialism and )alue 112; Socialist .ne/uality 114; The Workers' State

118; The Workers' State and Socialism 12"; ictatorship and emocracy

122; Political &conomy o% a Workers' State 124; an-del's Theory 120;Cli%%'s Theory 129; The Parado! o% a Workers' State 1*1$

4 The Struggle for the So+iet State 300

.nitial #olsheik Policies 1**; State Capitalism 1*6; The ri+inso% #ureaucratic ecay 14"; The e%t pposition 14*; Socialism in

ne Country 14,; Socialist <ccumulation 140; #ukharin's

Conseratism 149$

Cha(ter - The Stalinist Counterre+olution

3 The Political Counterre+olution 350

Social s$ Political Counterreolution 1,*; eolution %rom <(oe 1,0;

e%t .nterpretations 16"; The #ureaucratic an+er 161; Stalinism in

Crisis 16,; The :ature o% the Communist Parties 166; Soiet #onapartism

160$

4 The Counterre+olution Com(leted 31:

omestic i+ht Turn 101; Competition and .ne/uality in a(or 102;

Stalinist Plannin+ 10,; Soiet a 100; The =reat Pur+e 18"; The

:e #ureaucracy 181; Counterreolution Triumphant 18*$

0 Trots$y6s Last Analysis 395

Counterreolutionary Stalinism 18,; The Stalinist &conomy 188; <

:e Class Society> 191$

Cha(ter 5 Stalinist Ca(italism

3 Pseudo'Socialist Ca(italism 325

The Social =oal o% Production 196; Pseudo-Plannin+ 198; Consumer

=oods 2""; eclinin+ <ccumulation 2"2; The 7P and 7ictitious

Capital 2"4; erproduction and Crises 2"6; 5nemployment 2"9;Women Workers 211$

4 The La" of Value under Stalinism 434

Capital 7los 21*; The To-Sector Theory 21,; Production %or 5se 210;5se-)alue Theories 219; )alue ithout Wa+e a(or 22"; :on-Capitalist

Competition 224; The #ureaucrats' a o% )alue 226; &adin+ the a o%

)alue 2*"$

0 The Stalinist Ruling Class 404

#ureaucracy as ulin+ Class 2**; #our+eoisie and #ureaucracy 2*,; 7rom 7ascism to Senility 2*0; :ationali3ed Property and its eolution 24"$



Cha(ter 8 Stalinism and the Post"ar World

3 Defeat of the Wor$ing Class 4-0

.mperialism (eteen the Wars 24*; Stalinism and World War

..244; Stalinism a%ter the War 240; 7rom <lliance to Cold War

249; The Stalinist Parties 2,2; Permanent eolution &!tended2,4$

2. Post"ar ,m(erialism 458

The 5ne!pected #oom 2,0; 7ictitious Capital 2,9; The &nd o% the

#oom 262; enin's Theory eisited 264; Third Worldism 268$

0 Stalinist ,m(erialism 41:

The .mperialism o% #ackardness 201; Soiet .mperialism and enin's

Theory 204; <lternatie Theories 206; e%ense o% the Soiet 5nion> 208;

Stalinist :ationalism 28"; &mpire in etreat 282; &!perialist eali+nment

284$

Cha(ter 1 The Degeneration of Trots$yism

3 Theories of a !e" 7(och 492

The 7ourth .nternational 29"; Postar <daptations 292; :eo-

Capitalism 29*; The Permanent <rms &conomy 296; The &nd o%

.mperialism> *"1; ilitary State Capitalism *"4; #ukharinism s$ ?autskyism *"0$

4 Deformed Wor$ers6 State Theory 03:

The People's emocracies *1"; The ate uestion *12; The

Workers' =oernment *1,; #ureaucratic eolution *18;Trotsky on China *2"; The &nd o% the 7ourth .nternational *24;

The Petty-#our+eois )an+uard *20; Pa(loism Summed 5p *29$

Cha(ter 9 The ;rea$do"n of Stalinism

3 Programs for Reform 004

Solidarity and the ?S ***; Sel%-ana+ement Proposals **,;

Sel%-ana+ement in Practice **0; The :oosi(irsk eport *4";=or(ache's Perestroika *4*; Perestroika and =lasnost *40$

2. Post'Stalinist Ca(italism 0-2

The e%orms &lsehere *49; The 7uture o% Post-Stalinism *,1;

e%orms and the :ature o% Stalinism *,4$

0 Program for Re+olution 051

Social s$ Political eolution *,0; Transitional emands *6";

Workers' Soiets *64; .nternationalism *66; emocracy s$ eolution

*68; ank and 7ilism s$ eolution *0*; .n Conclusion *0,$

&ore"ord

<,n +ie" of the incredibly "ides(read nature of the distortions of

Marxism* our first tas$ is to restore the true doctrine of Marx<

Lenin/ The State and eolution

4he eyes of the orld are on the 5ast. +illions atch ith fascination and

e6hilaration as the 7socialist bloc7 cru!bles. Country after country has beensha2en by econo!ic crises/ !ass struggles for de!ocracy/ collapsinggovern!ents and popular revolutions. 8nce#!onolithic Co!!unist Partieshave discarded long#ti!e leaders/ fled the old party na!es and surrenderedgovern!ental positions. +i2hail orbachev and :eng ;iaoping/ the 5ast<s!ost poerful leaders/ are fa!ed not for their triu!phs but for their desperateatte!pts to overco!e the failures of the bureaucratic syste!. 74he Cold =ar isover and e have on/7 proclai! the rulers and theorists of capitalis!.

-or !any/ it is not only the Stalinist syste! but +ar6is! that has failed/ both as an interpretation of !odern society and as a guide for revolutionaryaction. 4he +ar6ist goal of co!!unis! is seen at best as the ideology of a feell#!eaning drea!ers and at orst as a euphe!is! for so!e of the !ostoppressive and suffocating societies on earth. +oreover/ since the alternativeoffered by the orbachevs and :engs is to i!port capitalistic !ethods thatrevolutionists once fought to overthro/ revolutionary +ar6is! see!s to havelost all validity.

4he anser presented in this boo2 is that only +ar6is! can account for there!ar2able turnabout in the Stalinist syste!. 8nly +ar6is! can probe to theroots of hat !a2es these societies function as they do> the struggle beteenthe e6ploited producing classes and the ruling class. 8nly +ar6is! couldforesee Stalinis!<s inevitable decay. 8nly +ar6is! can e6plain hy therefor!ist Stalinists< rescue plans ill not suffice/ hy they cannot repair thecontradictions at the heart of their syste!. And +ar6is! can sho as ell that

the collapse of Stalinis! presages a parallel crisis of orld capitalis!. &f the=est has on/ its triu!ph ill be brief.4his boo2 uses the tools of +ar6is! to analy?e the Stalinist syste!> the

social and econo!ic structure that arose out of the degeneration and defeat ofthe revolutionary Soviet or2ers< state. &t de!onstrates that Stalinist society isfunda!entally capitalist/ an integral but subordinate part of internationali!perialis!.



aturally the rulers of thepseudo#socialist states and their apologists re@ectany such analysis. 'ut so do !ost 7+ar6ist7 critics of Stalinis!. 4he Stalinistcounterrevolution perverted not only the Soviet revolution but +ar6is! itself.4he dialectical !ethod # to study the change and develop!ent of society anduncover the essence beneath every surface appearance # has been abandoned. Sohas the analytic base of +ar6is!/ the critiue of political econo!y that e6posesthe internal contradictions and the i!per!anence of capitalis!. 4hus7+ar6is!7 has been transfor!ed into its opposite/ a counterrevolutionaryideology.

4o understand Stalinis! it is necessary to understand capitalis!. -or thistas2 it is necessary to resurrect +ar6is! in its authentic for! as therevolutionary science of the or2ing class/ the only agency capable ofoverthroing capitalis! and thereby creating a orld fit for hu!an beings. 4his

boo2 is an i!portant eapon in the effort to revivify the +ar6is! of +ar6/ ofLenin/ of Lu6e!burg/ of 4rots2y/ of the thousands of proletarians ho havegiven their lives in the struggle for authentic co!!unis!.

4he boo2 destroys a hole series of !yths that have encrusted +ar6is!. -ore6a!ple/ it rips apart the no co!!onplace fallacy that the essence ofcapitalis! is co!petition. As +ar6 e6plained/ that as the theory of pettycapitalists/ not his. 4he boo2 also syste!atically deci!ates the fashionable

notion that Stalinis!/ despite its faults/ !aintained a centrali?ed plannedecono!y. 4hus for us orbachevis! is not an atte!pt to restore the7de!ocracy7 of the !ar2et but as a desperate bid to i!pose discipline and orderon an anarchic econo!y B a bid doo!ed to failure.

-or +ar6ists the test of theory is practice. 4he +ar6ist standpoint and!ethod defended in this boo2 already predicted/ over a decade ago/ the presentdevolution of Stalinis! in the direction of !ore traditional capitalist for!s. Atthe height of the Cold =ar e ere able to predict that the dividing line for afuture =orld =ar &&& ould be dran beteen apan/ er!any and the ,nitedStates rather than beteen the ,.S. and the ,SS. =hen other 7theories7treated the Soviet ,nion as a poerful syste!/ as the ave of the future Dforgood or for evilE/ e sa it as ea2 and collapsing.

4he i!portance of this boo2/ hoever/ does not lie in its predictiveness or inits reconstruction of the true !eaning of +ar6ist categories alone. &ts chiefcontribution is its de!olition of so#called +ar6ists ho have reduced +ar6istconceptions Dthe co!!odity/ e6ploitation/ state property/ the la of value/ thefalling rate of profit tendency/ planning/ accu!ulation/ the productive forces/

property relations/ property for!s/ etc.E to technical categories. 4hey havereified and ob@ectified the class and hu!an relationships hich for +ar6 eree!bodied in these categories. 4hey have turned +ar6 on his head and accepted

bourgeois political econo!y in his na!e.4he triu!ph of pseudo#+ar6is! did not co!e through any conspiracy.

4he victory of Stalinis! in the ,SS led to the corruption of Co!!unistPartie!ents7 throughout the orld. evolutionary or2ing#class upheavalsere chained to the preservation of capitalis! under the leadership of classcollaborationists. ationalis! replaced internationalis!. 4he authenticLeninists led by Leon 4rots2y ere !urdered or !arginali?ed.4he victory of the Stalinist bureaucracy in the Soviet ,nion sent a !essagehich @ibed ith the social attitude of large sections of the !iddle#class

professionals and bureaucrats everyhere. &!perialis!/ as described by Lenin/had given rise to a labor aristocracy hose viepoint reflected its !aterialsta2e in capitalist society. As ell/ there arose an allied layer/ the intelligentsia/hich !ushroo!ed especially during the prosperity boo! folloing theSecond =orld =ar. :edicated to a radical refor! of capitalis!/ !anye!braced the 7Soviet e6peri!ent7 hen it as safely divorced fro!

proletarian leadership.4he nu!erous defeats inflicted on the proletariat through the agency ofStalinis! DChina 19)$#)%/ er!any 1933/ Spain 193%/ the ,SS 193(#39

before the arF 5ast 5urope and elsehere afterardsE deepened the cynicis!of the intelligentsia toard the possibility of proletarian revolution B not onlya!ong pro#Stalinists but a!ong their opponents on the left too. 4he 7od that-ailed7 as not @ust the ,SS but the or2ing class as ell. =or2ers ere

recogni?ed not for their social poer but for their nu!bersF li2e peasants/ theycould be !anipulated 7for their on good.7 4heir salvation as the bright!an<s burden/ the tas2 of 7servants of the people/7 of social engineers.+ar6is! as the science of hu!an self#liberation as gutted.4his boo2 convincingly shos that the present collapse of Stalinis! isintricately lin2ed to the underlying crisis no facing orld capitalis! as ahole. ot by accident/ the nu!bers and strength of the !iddle strata are alsoeroding. At the sa!e ti!e/ the or2ing !asses are rising across the 75ast7 andthe 7South.7 Soon they ill !ove in the orth and =est as ell. As therevolution develops the or2ers ill de!onstrate not only their enor!oussocial poer but their groing revolutionary consciousness as ell. 4hey arein the process of re#creating their on class leadership # their on vanguard

parties and &nternational/ the e!bodi!ent of their advanced consciousness.4his boo2 is one ele!ent in that process.8nce again the or2ing class ill pronounce its conte!pt for the7condescending saviors7 ho really or2 to save capitalis!/ 2noingly or not.8nce again the or2ing class is co!ing to recogni?e itself as the inheritor ofthe entire history of hu!anity<s struggle for a better orld. Capitalis!/ throughthe bestial !eans natural to it/ has created the social and technical basis forfuture abundance. ,nder the leaderss and 7progressive !ovehip of the

4



or2ing class/ hu!anity ill be able to rid itself of proble!s no unnecessaryand idiotic # starvation/ ar/ e6ploitation/ racis!/ se6is!/ chauvinis! andhu!an degradation in all its for!s.

4he +ar6is! of this boo2 is the +ar6is! of those ho! today<s 7+ar6ists7have dis!issed as ,topian and naive. &t e!bodies the belief that the or2ersill be !otivated to produce abundance not by the hiplash of the !ar2et but

by a co!!on consciousness of their co!!on ability to build a hu!an/egalitarian orld in hich creativity and culture can flourish/ in hich7Gu!anity the +a2er7 can reach for the stars.

Can or2ing people today achieve this destinyH ot as they are/ but as theyill be hen in the course of !a2ing the socialist revolution they fit the!selvesfor such deeds. 4his is a sophisticated boo2 ritten to help destroy thesophisticated cynicis! about hu!an capacity that plagues our age. &t is rittenin defense of the intellect and in class defiance of those ho in their arrogancehave !isappropriated the liberating poer of ideas.

Sy Landy ational Secretary/ League for theevolutionary Party -ebruary 1990

Preface

4his boo2<s political standpoint is 4rots2yis! based on the vies of theLeague for the evolutionary Party DLPE of the ,nited States. =riting itould have been i!possible ithout the sti!ulation and collaboration of

co!rades of the LP and its fraternal organi?ation/ =or2ers< evolution ofAustralia. &n this sense the editorial 7e7 is entirely @ustified. +uch of the!aterial as or2ed out in articles published in Proletarian eolution

Dfor!erly Socialist )oice@A the LP<s !aga?ine.

So!e points of usage and ter!inology>1. 4he reader !ay already be fa!iliar ith basic +ar6ist vies. ever#

theless/ since +ar6is! has been so badly distorted/ e are careful to e6plainthe funda!ental categories and ideas. +ar6ist ter!s are printed in bold typehen first introduced.

). =e freuently cite translated or2s. =here possible/ citations areta2en fro! standard 5nglish translations. +any citations are !oderni?ed for

punctuation/ paragraphing and A!erican spelling and usage.3. =e categori?e political riters as +ar6ist/ Leninist or 4rots2yist if

they describe the!selves as such. ather than use !oc2ing uotation !ar2severy ti!e/ e let the conte6t !a2e clear hat e thin2.

*. 4he ord 7Soviet7 ith a capital S signifies the people/ society/govern!ent/ etc. of the Soviet ,nion. =ith a s!all s/ 7soviet7 refers toor2ers< councils li2e those created by the ussian or2ers in the revolutionsof 190$ and 191%.

$. 7Stalinis!7 !eans/ first/ the social syste! of state property and bureaucratic rule that originated ith Stalin<s counterrevolution and e6pandedafter =orld =ar && to 5ast 5urope/ China and elsehere. &t is not @ust thestrong#!an dictatorship that flourished during Stalin<s lifeti!e. 7Stalinis!7also refers to political !ove!ents and ideologies that defend the Stalinistsyste!.

(. =e use 7CP7 to abbreviate Co!!unist Party/ even hen the actualna!e of the party is different De.g./ the Polish ,nited =or2ers PartyE.

%. -or convenience e use 7third orld7 to refer to the countries ofAfrica/ Latin A!erica and Asia De6cept apanE. -or the !ost part/ these are thefor!er colonies of capitalist i!perialis!. 4he ter! is !isleading since itsuggests an unspecified funda!ental difference beteen the 7first7 and7second7 orldsF as ell/ it is often used to conceal the vast differ#

6



ences a!ong/ and class differentiations ithin/ the third#orld countries.". =e use 7=est7 and 75ast7 to denote the blocs of D!ainlyE 5uro

pean and orth A!erican countries allied/ respectively/ to the ,nitedStates and the Soviet ,nion after =orld =ar &&. A!ong the geographicaloddities that result is that apan/ Australia and e Iealand belong to the7=est.7 As ell/ 7A!erican7 ill so!eti!es refer to the ,nited Statesalone hen this !eaning is clear fro! the conte6t.

9. 7Proletariat7 as used here is synony!ous ith or2ing classF7bourgeoisie7 !eans the capitalist class of the traditional capitalistsocieties. 4he 7petty bourgeoisie7 is the class of s!all capitalists/ including

peasants/ ho e!ploy little or no non#fa!ily labor. =hereas the 7!iddleclass7 !eans not the bourgeoisie/ as it did in +ar6<s day/ but the variouslayers of professionals/ ideologists/ bureaucrats/ !anagers and supervisorsdescribed in later chapters.

-ebruary 1990

,ntroduction

Theories of Stalinism

4he 'olshevi2 revolution of 191% that created the Soviet ,nion as the

decisive event of our era. -or the first ti!e a !odern proletariat on state poer and raised the banner of socialist revolution for the e6ploited andoppressed of the orld. 4he possibility of ending hu!an degradation as

proved once and for all. o socialist can escape the responsibility of co!ing togrips ith the destruction of that !onu!ental or2ing#class achieve!ent.

4he 7ussian uestion/7 the class character of the Soviet ,nion/ has beenhotly debated ever since 191%. =e start fro! the understanding that the ,SSafter the revolution as a or2ers< state/ a society transitional beteencapitalis! and socialis! and therefore necessarily burdened ith !anycapitalist leftovers. 4he obstacles that any neborn or2ers< state ould havefaced ere particularly onerous in bac2ard ussia/ isolated by the defeats of

revolutions abroad.&n the after!ath of the revolution the Soviet or2ers< state degeneratedrapidly> or2ers< gains ere stripped aay and the international revolution asda!!ed up and defeated. 'y the !id#19)0<s the ,SS had beco!e a

bureaucratically degenerated or2ers< state/ and the orld revolutionary party B the Co!!unist &nternational # had beco!e counterrevolutionary. Stalinis!sabotaged the advance toards socialis! at ho!e and abroad/ leaving the,SS open to capitalist restoration.

PS7=D)'S)C,AL,ST CAP,TAL,SM

&n the !id#1930<s Leon 4rots2y/ ho together ith Vladi!ir Lenin had ledthe victorious revolution/ advocated a 7political revolution7 to restore

proletarian poer and preserve the socialist gains. 'y the end of the decade he believed that counterrevolutionary Stalinis! had ta2en the ,SS to the vergeof capitalist restoration. Still/ as a or2ers< state hoever defor!ed/ it !eritedthe unconditional loyalty and defense of the or2ing class against attac2 by thecapitalist poers.

=e agree ith 4rots2y<s outloo2 up to 1939. 'ut e hold that thecounterrevolution cul!inated on the eve of =orld =ar &&. &t created a neruling class by transfor!ing the state apparatus and destroying the

9



'olshevi2 partyF contrary to 4rots2y/ the restoration of capitalis! asco!pleted. Acco!panying the ell#2non centrali?ed poer of the Staliniststate ere ualitative steps toard the effective decentrali?ation of state

property/ forerunners of the 7!ar2ets7 and anarchy clearly visible today.Since then the Stalinist societies have been capitalist in the !ost

funda!ental sense> they are based on the e6ploitation of age#labor by rulingclasses alien fro! the proletariat. &n this epoch of decay/ capitalis!<s internaland e6ternal operations are everyhere distorted fro! the traditional bourgeoisnor!s. 'ut nohere are they as defor!ed as under Stalinis!/ here they arearped by the socialistic re!nants of the or2ers< state that thecounterrevolution usurped.

'y the end of the ar the Stalinist Soviet ,nion had beco!e a orld poerdedicated to the survival of capitalis!. &t ensnared !illions under its ondo!ination. As ell/ in the interests of the do!inant =estern i!perialists/ its!ashed or2ers< revolutions in 5urope and betrayed liberation struggles in thecolonies. 'ecause of this orldide defeat of the or2ing class/ e live todayin a orld of poverty enslaved to ealth and of fa!ine a!id plenty. Capitaliste6ploitation/ hich once stood on the brin2 of e6tinction/ no see!s anunchallengeable fact of life everyhere. 4he i!!ense forces of productionhave great potential for hu!an use/ but under capitalist rule they continue to

foreshado i!!iseration/ ecological doo! and nuclear ar.-or decades the ,SS and its satellites ere outcasts fro! the fa!ily ofnations. Goever !uch they e6ploited their or2ers and helped stabili?ei!perialis!/ the orld bourgeoisie refused to e!brace the!. 4heir clai! tosocialis!/ their nationali?ed property and the ,SS<s proletarian history allinspired bourgeois !istrust. evertheless/ henever there as a prospect of

proletarian revolution in the Stalinist orld/ fro! the Polish or2ers< councilsand the Gungarian revolution of 19$( to the present/ =estern authoritiessalloed their hatred and called for refor!s and stability/ not the overthro ofthe threatened Stalinist regi!es. &n the crunch/ class tells.

8ur analysis of Stalinis! contrasts ith all the ould#be +ar6ist theories.4hese divide into four descriptive categories> that the Stalinist states are 1E

socialist/ )E transitional beteen capitalis! and socialis! Dor2ers< statesE/ 3Estate capitalist/ and *E a third syste! antagonistic to both capitalis! andsocialis!. 4his classification is only a beginning/ since there are disputes ithineach of the categories as i!portant as those beteen the!. 4heorists ithin thesa!e category often disagree/ for e6a!ple/ on hen the ,SS turned into its

present for! and hether the sa!e characteri?ation applies to all the Soviet#type states.

+ore deeply/ e ill sho that the see!ingly ide#open debate over

the ussian uestion is in reality uite narro. :espite their surfacedifferences/ the four theories share a co!!on orld outloo2> they deny the

proletarian class struggle at the center of +ar6is!. 4herefore/ although ehold Stalinis! to be capitalist/ e have no funda!ental agree!ent ith thestandard state capitalist analyses. And/ precisely because e are 4rots2yist/ ere@ect the 7orthodo6 4rots2yist7 position that ussia is still a degeneratedor2ers< state.

=e ta2e up the four categories in turn. 8ur introductory survey assertsconclusions that are proved in depth later in the boo2.

S)C,AL,SM T>7)R,7S

4he idea that the Soviet#type states are socialist usually depends on thesi!ple observation that their econo!ies have been nationali?ed. 5ngels longago countered the notion that socialis! can be identified ith state onership>

7ecently/ hoever/ since 'is!arc2 ent in for state onership ofindustrial establish!ents/ a 2ind of spurious socialis! has arisen # here andthere even degenerating into a 2ind of flun2eyis! # that uite straightforardlydeclares all state onership to be socialist.71

4he title 7socialis!7 as aarded to the ,SS by Stalin after theeli!ination of private entrepreneurs in the !id#1930<s. &t startlingly

contradicted the early 'olshevi2 understanding that the Soviet revolution hadachieved not socialis! but rather a or2ers< state Dor 7dictatorship of the proletariat7E governing a society transitional to socialis!. Socialis! itself/ aspecific stage in the develop!ent of classless society/ as i!possible even forisolated countries that ere econo!ically advanced B and therefore all the!ore so for the bac2ard and internationally uarantined ,SS.

4oday the 7socialist7 thesis is upheld/ of course/ by the Soviet and alliedCo!!unist Parties. 4heir chief argu!ent is that nationali?ed property creates aualitatively different !ode of production fro! capitalis!. 4hey regard theirsocialis! as a society that/ hatever its proble!s/ is progressive in to senses>it defends the interests of the or2ing people/ and it develops the productiveforces beyond the capacities of capitalis!. &n the Soviet#type societies hu!an

consciousness is said to do!inate blind lasF social planning reigns over thela of value that governs capitalist econo!y. 4he evidence usually cited is thatthese countries have little or no une!ploy!ent/ no !ass !isery co!parable tocapitalis!<s/ no e6cessive differences of ealth and no asteful duplication oflabor through co!petition.

BBBBBBBBBBBBBBBBBBBB

1. 5ngels/ Socialism 5topian and Scienti%icA Part &&& D1"%%E.

3:



&n the 1930<s one could point to Soviet industrial e6pansion Ddespite thecontraction of Soviet or2ers< rights and living standardsE and co!pare itfavorably ith depression#ridden capitalis!. ot today. Poland<s collapse in theearly 19"0<s as the orst of any country since =orld =ar &&F ugoslavia leadsall 5urope in une!ploy!ent and inflationF Soviet leaders openly spea2 of theecono!ic disasters they have to deal ith. 4he Stalinist states< technologicaland financial subordination to =estern capitalis! renders absurd the clai! thatthey represent a ne stage in hu!an progress.

&n the 19(0<s so!e leftists applied the socialist thesis to China out ofsy!pathy ith the Chinese bureaucracy<s efforts to align ith revolutionarynationalist struggles. Calling China socialist/ hoever/ reuired a particularlyvoluntaristic and anti#!aterialistic approach/ since revolutionary China aseven !ore retarded by i!perialis! than early Soviet ussia. A leading theoristrote that 7=hat is ta2ing place in China de!onstrates/ in effect/ that the <lolevel of develop!ent of the productive forces< is not an obstacle to the socialisttransfor!ation of social relations.7 4he ruling party<s 7correct political line7 issufficient.) 'y this logic hu!an !isery could have been avoided fro! the start #if only Ada! and 5ve had found a Little ed 'oo2 instead of an apple.

A different sort of 7socialist7 thesis is that of acade!ic +ar6ists ho acceptDor are unilling to challengeE prevailing bourgeois conceptions. Such people

rite erudite articles on 7+ar6ist econo!ics7 hich spea2 of socialis!<s7syste!ic7 crises # ithout the slightest ual! over hat this says about theirgrasp of the +ar6ist theory of socialis!.

Stalin first proclai!ed 7socialis!7 in the ,SS in order to deny its proletarian character and decree it a 7people<s7 state. 4he anti#or2ing class!eaning of the ter! e6tends to all current usages.

W)R?7RS6 STAT7 T>7)R,7S

After 4rots2y<s death the !a@ority of 4rots2yists for!ally !aintained hisappraisal of the ,SS as a degenerated or2ers< state heading for eithercapitalist restoration or a ne or2ers< revolution. 'ut hen the dust of =orld=ar && settled/ Stalinis! had proved itself capable of carrying out revolutions in

5astern 5urope/ China and elsehere. 4o !aintain 4rots2y<s ter! Dbut ithoutits contentE/ !ost of neo#4rots2yists added the ualification/ i!plied if notstated/ that Stalinis! as not really counterrevolutionary. -or !any years theleading theorist of this position has been 5rnest +andel.

Si!ilar positions are held by 5uroco!!unist figures li2e Santiago Car#


). Charles 'ettelhei!/ Class Stru++les in the 5SSA 1st period D19%*E/ p. *)

rillo and authors influenced by +aois!.3 4hey differ fro! the 4rots2yists inthat they do not call for revolution in the Stalinist statesF as ell/ their !ainargu!ents are !ade in less sophisticated fashion.

Against the socialist thesis/ the or2ers< statists argue that nationali?ation ofthe !eans of production does not in itself !ean socialis!. 'ut they ea2entheir case by insisting that Stalinist nationali?ation is not only progressive initself but also enough to !a2e genuine sociali?ation possible/ ithout furthertransfor!ation of the econo!ic base. Such conclusions stand out as ildlyopti!istic today/ in the light of the collapse of so !any Stalinist regi!es.+oreover/ they ere never dran by 4rots2y/ ho understood that the ,SS<s

bac2ardness and isolation sub@ected it to the las of capital operatinginternationally/ and that value relations applied internally despite nationali?ed

property. 4o achieve sociali?ation the ,SS ould have to achieve ualitativeecono!ic progress over capitalis!. 4he bac2ardness and crises no typicalof the Stalinist countries vitiates the 7or2ers< state7 thesis @ust as !uch as7socialis!.7

&n addition/ these theories face an overhel!ing contradiction. After =orld=ar && Stalinist rule spread across 5ast 5urope by !ilitary force Dand in severalcountries/ notably China/ through ar!ed revolutionE. 4hese ne states in ti!eadopted the Soviet !odel/ although in !ost cases they called the!selves so!e

for! of 7ne7 or 7people<s7 de!ocracy. 4hat is/ they clai!ed Dat firstE to benot proletarian but si!ply !ore de!ocratic versions of capitalis!/ leaningtoards socialis!. +ost of the or2ers< state theorists of the ,SS chose tolabel the ne states 7defor!ed7 or 7bureaucrati?ed7 or2ers< states. * 'ut notonly had these states been established ithout or2ing#class revolutionsF !ostere for!ed only after or2ers< atte!pts to control factories and set upgoverning councils had been s!ashed by the Stalinists. Styling such creations7proletarian7 ith hatever !odification flies in the face of history.

4he proletarian label for the Stalinist states a!ounts to a cynical re@ection ofthe +ar6ist conclusion that a or2ers< state can be established only through theor2ers< on conscious activity> 7the e!ancipation of the proletariat is the tas2of the proletariat itself.7 4he neo#4rots2yist concep#


3. Santiago Carrillo/ &urocommunism and the State D19%%EF Philip Corrigan/ Garviea!say and :ere2 Sayer/ Socialist Construction and ar!ist Theory D19%"EF+ichael oldfield and +elvin othenberg/ The yth o% Capitalism e(orn D19"0E.

*. 8ne e6ception is the -rench group Lutte 8uvriere/ hich holds that ussia re!ainsa or2ers< state hile the other Stalinist states are capitalist. 4his classificationleaves unsolved the proble! of hy such si!ilar societies have different dyna!ics.4he apanese -ourth &nternational group also distinguishes beteen the ,SS andthe other Stalinist states/ in a ay not clear to us.

34



tion also calls into uestion Lenin<s teaching that a or2ers< socialist revolutionreuires the guidance of a vanguard party. 4he Stalinist parties that sei?ed

poer hile denying that socialis! as their intention could hardly beconsidered vanguards of proletarian consciousness.

+ar6<s principle of proletarian self#e!ancipation is no abstract dog!a. &tderives fro! his analysis of capitalis!> the syste! organically creates a classhose inherent struggle forces it to try to overthro it and establishco!!unis!. &n granting another class this proletarian characteristic/ thedefor!ed or2ers< state theorists re@ect a +ar6ist understanding of capitalis!as ell as of Stalinis!. &n later chapters e ill analy?e the !aterial roots and

practical conseuences of their !isconception.

STAT7 CAP,TAL,SM T>7)R,7S

4his broad category has several subdivisions. 7,ltra#leftists7 describe the,SS as capitalist because of its retention of capitalist for!s li2e age laborFthey see Soviet capitalis! originating ith Lenin<s e 5cono!ic PolicyD5PE of 19)1/ or even earlier. Along ith the anarchists ho re@ect +ar6<stheory of the state/ they deny the need of a or2ers< state to retain capitalisthangovers for a ti!e. 4heir best 2non theorist/ Paul +attic2/ denies that thela of value/ the underlying la of !otion of capitalist society/ applies under

Stalinis!. 4hus his is really a third#syste! theory.

$

A second subdivision consists !ainly of for!er 4rots2yists ho do notaccept the degenerated or2ers< state category for any period of Soviet history.4hey typically date the restoration of state capitalis! to the start of the first-ive#ear Plan in 19)"/ hich initiated Stalin<s forced industriali?ation policyand the e6propriation of the peasantry. 4ony Cliff is the leading advocate of thisvie.(

Li2e +attic2/ Cliff believes that value is not the !otor of the Sovietecono!y<s internal relations. ussia is tanta!ount to 7one big factory7governed internally by the rulers< conscious ill/ not the anarchy of co!petitivecapitalis!. Capitalis!<s las of !otion are induced into the econo!y onlythrough !ilitary co!petition ith =est/ hich drives the Stalinists to underta2e

!assive capital accu!ulation. 'y introducing the la of value only fro!outside/ this argu!ent effectively denies that the syste! is capitalist in the+ar6ist sense/ so Cliffs too is at botto! a third#syste! theory.

Another current ithin the e6#4rots2yist fra!eor2 as the 7Socialis!


$. Paul +attic2/ ar! and ?eynes D19(9E.(. 4ony Cliff/ ussia < ar!ist <nalysis D19$$E. A shortened version/ State

Capitalism in ussiaA as reissued in 19""

or 'arbaris!7 tendency in -rance in the years after =orld =ar &&. 4heyadopted the na!e 7bureaucratic capitalis!7 for the ,SS and its satel#lites/ even though they held that t+e la of value could not possiblyapply in a country here planning had eli!inated the unconsciousfunctioning of the econo!y. 4his !ay be the !ost e6plicit for!ulationof non#capitalist 7capitalis!.7%

A stronger atte!pt at a capitalist analysis as !ade by the ohnson#-oresttendency led by aya :unayevs2aya and C.L.. a!es in the ,.S. in the19*0<s." ohnson#-orest did regard the la of value in the ,SS as generated

by age labor/ a point funda!ental for our on theory. 'ut li2e +attic2 andCliff they re@ected the idea that capitalist for!s are inherent in a or2ers< state.-urther/ they sa state capitalis! as the result of a 7orld tendency tocentrali?ation7 applying to the ,.S. and all capitalist countries. 4hey thoughtthat co!plete centrali?ation of the ,.S. econo!y as possible ithout a

proletarian revolution/ a position shared ith several ultra#left tendencies Dasell as ith Jarl Jauts2y<s 7ultra#i!perialis!7E. A central point of this boo2 isto sho that Stalinis!<s ina(ility to centrali?e the econo!y and therefore to

plan scientifically !ar2s it as a for! of capitalis!.A third subdivision of state capitalists is !ade up of +aoists ho bro2e

ith the Soviet ,nion after Jhrushchev<s repudiation of Stalin<s 7proletarian

line.7 Since for the! the party<s correct line is all that a country needs tooverco!e desperate econo!ic circu!stances and achieve socialis!/ it iseually logical that a change in that line could alter its class character again.4hus +aoists asserted that the class nature of 7socialist7 ussia sitched bac2to capitalis! after the death of Stalin # ithout the slightest change in classrelations or econo!ic conditionsF so!e reasoned li2eise about China after+ao died. 4he +aoists< idealist theory of Soviet capitalis! in realitycorresponded to an opportunist turn of their political line> toardacco!!odation ith =estern i!perialis!. 4hat the ,SS is capitalist and a7greater danger7 than the =est as 2ey to this goal.

So!e e6#+aoists have reconsidered/ reacting against such sleight of handand against China<s collaboration ith i!perialis!. 4hey no longer sallo

+ao 4setung<s dictu! that the ,SS beca!e capitalist hen Jhrushchevdenounced Stalin/ but they hold the eually sterile conception that the ,SS!ust again be considered socialist.9


%. See the reprints fro! Socialisme ou #(arie in Cornelius Castoriadis/ Political

and Social Writin+s Vol. 1 D19""E/ especially pp. 9/ 39/ 13".". aya :unayevs2aya/ ussia as State-Capitalist Society D19%3EF C.L.. a!es/

State Capitalism and World eolution D19$0E.9 onathan Aurthur/ Socialism in the Soiet 5nion D19%%EF Albert S?y!ans2i/ .st he

ed 7la+ 7lyin+> D1909@; Eerry Tun+A The Socialist oad D1981@$3-



4he Chinese Co!!unist Party originated the idea that Jhrushchev<s changeof line !ade ussia capitalist/ leaving to others the tric2y tas2 of giving theiranti#!aterialist position theoretical support. 4his as acco!plished chiefly by

pretending that decentrali?ation of the Soviet econo!y and deproletariani?ationof the state had begun only after Stalin<s death. 10

Charles 'ettelhei! as the !ost sophisticated +aoist theorist and a riterith genuine insight into the operation of capitalis!<s las in stati#fied for!.'ut his funda!ental idealis! overhel!ed his atte!pts to hold to any re!nantof a +ar6ist analysis. At the start of his four#volu!e opus on the ,SS/ he

i!plied that the 7proletarian line7 had been abandoned in the late 19)0<s henStalin destroyed the or2er#peasant alliance e!bodied in the 5P. 'y the endhe chose to re@ect the revolution as ell as the counterrevolution Doffering

pathetically little @ustification> a fe paragraphs in a total of al!ost tothousand pagesE. Ge no clai!ed that the 'olshevi2 revolution brought to

poer a 7radicali?ed fraction of the intelligentsia/7 so that it as 7essentially a<capitalist revolution< leading finally to the radical e6propriation of the direct

producers.711 4he +aoist !ethod of deter!ining !aterial reality by assertingthe correctness of the party line/ previously used to re@ect Stalin<s heirs and then+ao<s/ led hi! to the repudiation of Lenin as ell.

+attic2/ Cliff et al/ in denying the central functioning of the la of value

under state capitalis!/ in effect define a capitalis! ithout a true proletariat/the class that produces value.1) 4he idealist +aoist versions e6tend this denialeven further> since the nature of the syste! depends on the ill of the rulers/or2ers are left only as a !oral category D7the deserving poor7E/ not a self#active class.

T>,RD'S#ST7M T>7)R,7S

4he idea that the Soviet syste! is neither capitalist/ socialist nor transitional beteen the to is an e!pirical/ co!!on#sense vie held by theorists hoagree only on hat the Soviet ,nion is not. 4hey observe that the ,SSobviously lac2s pro!inent features of both capitalis! and socialis!. Asopposed to capitalis!/ it has no private onership of the


10. +artin icolaus/ estoration o% Capitalism in the 5SS D19%$EF evolutionaryCo!!unist Party/ Fo Capitalism Fas #een estored in the 5SS D19%*EFProgressive Labor Party/ 7Soviet Capitalis!/7 P a+a3ineA Spring 19"1.

11. 'ettelhei!/ es uttes de Classes en 5SSA *eme periodeA to!e 1 D19")E/ p. 13.1). Cliff has been challenged on this by his co#thin2er/ Ale6 Callinicos. 'ut Callinicos

only a!ends Cliffs theory ithout ob@ecting to its full i!plications. See Chapter %

!eans of production and therefore supposedly no co!petition beteendifferent capitals. As opposed to socialis! or a or2ers< state/ it lac2s !ass

political poer and de!ocracy.iven their essentially negative analysis/ 7third#syste!7 riters naturally

differ over hether Soviet#type societies are progressive as co!pared to thecapitalis! they replace. 7Progressive7 versions are offered by udolf 'ahro/Paul See?y and ,!berto +elotti.13 An early theory of the nonprogressive2ind as the 7bureaucratic collectivis!7 of 'runo i??i and +a6 Shacht!an. 1*

DShacht!an originally sa bureaucratic collectivis! as progressiveF a !a@or

article in his boo2 as altered ithout notice to conceal this sin of the past.ESeveral 7non#progressive7 theories have been produced by riters fro! 5ast5urope/ starting ith +ilovan :@ilas.1$ 4here is also a strange variantdescribing the ,SS as a society ith no dyna!ic at all/ characteri?ed by thelac2 of any !ode of production and the predo!inance of syste!ic aste. 1(

Leftist third#syste! theorists face the danger that/ under the pressure of bourgeois opinion/ they ill find the 7de!ocratic7 =est to be progressive overthe 5ast. 4he classic e6a!ple is Shacht!an/ ho led a hole current fro!4rots2yis! to =estern i!perialis! on the grounds that the trade union rightsforbidden under Stalinis! are the decisive concern of the or2ing class. 4odaythe Shacht!anites guide several ings of the ,.S. trade union bureaucracy as

ell as the A-L#C&8<s international operations. &n this capacity theysancti!oniously help suppress trade union struggles at ho!e and abroad inorder to prevent or2ers fro! under!ining the profits that give the

bureaucracy its !aterial sta2e in capitalis!.+ost third#syste! theories present no scientific analysis # las of !otion #

that ould @ustify the discovery of a ne for! of class society. Perhaps theonly version that did propose las of !otion as that of the Polish +ar6istsace2 Juron and Jarol +od?eles2i. 4heir 78pen Letter to the Party7 in the19(0<s on the! @ail ter!s for advocating the


13. 'ahro/ The <lternatie in &astern &urope D19%%EF See?y/ 7Post#evolutionarySociety/7 onthly eieA ove!ber 19"0/ reprinted in Post-eolutionary

Society D19"1EF +elotti/ ar! and the Third World D19%%E.1*.i??i/ The #ureaucrati3ation o% the World D193"F 5nglish edition/ 19"$EFShacht!an/ The #ureaucratic eolution D19()F ritten in the 19*0<sE.

1$.:@ilas/ The :e Class D19$%EF +ar2 a2ovs2i/ Toards an &astern &uropean

ar!ism D19%"EF eorge Jonrad and &van Selenyi/ The .ntellectuals on the oad to

Class Poer D19%9E.1(. Criti/ue !aga?ine DlasgoE/ notably the articles by editor Gillel 4ic2tin. See also

:onald -ilt?er/ Soiet Workers and Stalinist .ndustriali3ation D19"(E. 4he theory of-ran2 -uredi DThe Soiet 5nion emysti%iedA 19"(E is si!ilarF see Proletarian eolution o. )9 D19"%E

38



overthro of the regi!e. 1% 4o the e6tent that their analysis succeeds ita!ounts to an inco!plete theory of statified capitalis!. So!e insights fro!their or2 have been incorporated into our on theory/ but it has serious

proble!s as ell DChapter $E.4he theoretical carelessness of third#syste! conceptions is e6e!plified by

to opposite variants. 8ne sees Soviet bureaucratic collectivis! starting toevolve peacefully into capitalis! in 19($ through deep econo!ic refor!s. 1"

4he other sees post#revolutionary but still capitalist Cuba transfor!ed into bureaucratic collectivis! under Castro<s rule.19 4o a +ar6ist/ either

transfor!ation should signify that a society hich can turn itself into or out ofcapitalis! ithout a revolution !ust have been capitalist all along. 4he sa!e/of course/ applies to the actual transfor!ations that the Stalinist societiesunderent in late 19"9.

A deep theoretical fla of third#syste! theories is that they label the syste!non#capitalist hile they call the !ain class of producers 7or2ers.7 4he

proletariat/ hoever/ is a class only in relation to capital. As +ar6 put it/7Capital presupposes age laborF age labor presupposes capital. 4heyreciprocally condition the e6istence of each otherF they reciprocally bring fortheach other.7 )0 &ndeed/ any relationship of e6ploitation reuires to specificclasses. A propertyless class that sells its labor poer can only be e6ploited by a

class that buys that labor poer/ a class of capitalists #those ho e!bodycapital.So!e third#syste!i?ers have recogni?ed the dile!!a. Shacht!an toyed ith

the idea that the Soviet or2ers ere slaves or 7a ne 2ind of state#serf/7 not proletarians. )1 'ut or2ers under Stalinis! behaved li2e or2ers undercapitalis!. &ndeed/ in their uprising of une 19$3/ the 5ast 'erlin or2ers!arched against the Stalinist regi!e chanting 7=e are or2ers/ not slaves.7Shacht!an retreated to calling the! hat they are # thereby surrendering to thedile!!a that destroys the basis of his or any other third#syste! theory. 4he'erlin or2ers had it e6actly right> the essence of their e6ploitation is its age#labor content/ not its superficial for!. 4hey


1%. Juron and +od?eles2i/ :e Politics D19($EF reprinted as < eolutionarySocialist ani%esto by &nternational Socialis! of 'ritain. An apparently !oreco!plete translation is in the +erit Publishers pa!phlet/ eolutionary ar!ist

Students in Poland Speak ut D19("E. 'oth authors ere pro!inent in the Solidarity!ove!ent of 19"0#"1F by then they ere no longer revolutionary.

1". Antonio Carlo/ Telos D-all 19%*EF the evolution as said to be co!pleted in the caseof ugoslavia GTelosA Su!!er 19%"E.

19. Sa!uel -arber/ eolution and eaction in Cu(a D19%(E.)0. +ar6/ Wa+e a(or and CapitalA Part &&&.)1. Shacht!an/ 74he Progra! of Stalinist &!perialis!/7 :e .nternational D19*3EF in

The #ureaucratic eolutionA p. 1)0

proved that third#syste! theories re!ain caught at the level of appearance.

T>7 C)MM)! T>7)R#

=ith such a variety of theories for describing the Stalinist syste!/ one!ight thin2 that so!e of the! ould have anticipated the pivotal historicalchanges no ta2ing place. After all/ the proof of a theory is practice/ and therehas been a great deal of practical opportunity for +ar6ist thin2ers to test theirideas. All the !ore re!ar2able/ therefore/ that none of the standard theories

predicted/ or could even e6plain/ the current crisis of Stalinis! and its

devolution toards traditional for!s of capitalis!.A fe years ago a pro!inent theoretician raised a challenge. Concerning

the 7post#revolutionary societies/7 See?y rote> 7& don<t 2no of anyone hoclai!s to be able to analy?e their develop!ent in ter!s of capitalis!<s <las of!otion<.< )) =e do so clai!F !oreover/ e ill sho that our use of +ar6<slas of capital predicted the present direction of Stalinis!. 'ut otheriseSee?y is right> !ost +ar6ists ignore +ar6<s las/ and ithout las of !otionit is no onder that their theories have no predictive capacity.

4he o!ission of las of !otion is especially glaring on the part of thoseho believe the Soviet syste! is capitalist. As already noted/ +attic2 and Cliffdo not recogni?e the la of value at the heart of the syste!/ and therefore theirstate capitalist analyses are little !ore than third#syste! theories in a !ore+ar6istical disguise.

4he transitional#state theories also deny las of !otion. &f these statesreally ere or2ers< states/ e ould see conscious planning replacing/ overti!e/ the blind las of capitalis!. 'ut the notion of 7post#capitalis!7 held by+andel and others asserts only that the Stalinist states are progressive ithrespect to capitalis! B it is not clai!ed that they undergo ualitative

progressive develop!ent. &n +andel<s ter!/ the transition to socialis! in the bureaucrati?ed or2ers< states is 7fro?en.7 &t ought to follo that ithout aninternal dyna!ic there is nothing transitional about the!F they cannot beor2ers< states at all. +andel is internally consistent only if e ta2e his to be atheory of a third#syste! positioned beteen capitalis! and socialis!.

4hus the !a@or theories of the Soviet syste! all reduce/ in effect/ to onecategory> a third syste! neither capitalist nor socialist. +oreover/ they

postulate a !ode of production that does not generate capitalis!<s las of!otion or any otherF it is governed by central decisions/ not blind las.4herefore there can be no inherent reason for its stagnation and brea2#


)). See?y/ 7Post#evolutionary Society7

39



don/ no funda!ental class conflict. 4he syste!#ide crisis can only be caused by bad planning or oppression.

4he conception of a static Stalinis! has serious political conseuences. Asociety hose internal !otion does not co!pel funda!ental change offers littlehope for socialis!. 4he !asses !ay rebel against hardship and despotis!/ butthey are not driven to develop revolutionary for!s of self#organi?ation andacuire socialist consciousness.

Contrast +ar6<s analysis of capitalis! as a society hose develop!ent andchange is poered by class struggle. 4his !otion leads to crises and decay/ on

the one hand/ and the strengthening of the proletariat<s consciousness andorgani?ation/ on the other. 4he las of !otion drive the proletariat both to resiste6ploitation and prepare itself to ruleF the dual poer councils Dor SovietsE ofevery or2ing#class revolt in this century confir! this urge. 4his is the reasonfor revolutionary +ar6is!<s characteristic opti!is!.

4he absence of revolutionary confidence in the proletariat is the 2ey to theuniversal choice of a third#syste! analysis under so !any pseudo#+ar6isticaldisguises. 4he progra! against Stalinis! offered by third#sys#te!ists Dand statecapitalists and or2ers< statistsE # 7revolutionary7 de!ocracy B is in realitynon#revolutionary. &t is a partial anser to oppression but none at all toe6ploitation. &t contributes to the belief that the proletariat consists solely of

heroic or !anipulable victi!s ho are capable of see2ing @ustice # but not poer. D=e ill see telling e6a!ples in Chapter ".E Such an analysis goes handin hand ith an un!ista2able cynicis! that pertains not only to Stalinis! but toordinary capitalis! as ell.

M,DDL7'CLASS MAR@,SM

4he defeatist attitude toards the revolutionary capacity of the or2ing classis a disease sy!pto!atic of the social outloo2 of 7ne !iddle#class7 layers thathave arisen ithin capitalis! in the last century. 4his is not si!ply because!ost leftists today co!e fro! the !iddle class Dalthough that is trueE. ather the

proble! is that/ !iddle#class or not/ they hold a !iddle#class vie of the orld/ pri!arily because of the defeats of the authentic proletarian co!!unist

tradition. 5ither/ li2e the traditional petty#bourgeois shop2eeper/ they regard thecutthroat struggle a!ong capitalists as para!ount. 8r/ li2e !any layers of theintelligentsia/ they see society do!inated by the poerful forces of the

proletariat and bourgeoisie and see2 to control the state as their on center of poer independently of the to !a@or classes. BBBBBBBBBBBBBBBBBBBB

)3. 4hese notions are e6plicit in the 7professional#!anagerial class7 of ohn and'arbara 5hrenreich/ hich serves both as the ho!e of the e Left and as theruling class of the ,SS. See Pat =al2er/ ed./ #eteen a(or and Capital D19%9E

+iddle#class +ar6ists believe that socialis! reuires a re@ection of the base!aterial considerations that corrupt capitalist society. =hat is needed is a 7nesocialist !an7 and o!an ho have overco!e the greed and !aterialis! ofold. Clearly capitalists ill not fill the billF but proletarians too/ also co!pelledunder capitalis! to co!pete a!ong the!selves to scrape out their e6istence/are largely ineligible. Socialis! reuires advanced/ socially conscious people #

planners/ scientists/ theorists/ etc. #in a ord/ the econo!ically disinterested!iddle class. elated to this outloo2 is the notion that +ar6is! has to beconveyed to or2ers by !iddle##class leftists/ an idea supposedly derived fro!

Lenin Dbut see Chapter )E. 4he !iddle#class +ar6ist version of socialis! is asociety ruled by the benevolent for the benighted.

8f course/ people ho regard the!selves as +ar6ists are not conscious ofthe underlying class roots of such ideas. 4hat they cast their progra!s as

proletarian tas2s shos that they have no desire for a !ythological orlddo!inated by s!all businesses. -or !ost/ their goal instead is so!e for! ofde!ocracy here stability is achieved through the countervailing poers of!ass institutions controlled by the or2ers or 7the people.7 :espite theirintentions/ they fit the sa!e !old as liberals ho fight !onopoly by trust#

busting or decentrali?ation. 'oth urge local control #or in its or2erist for!/shop#floor control # to counterpose de!ocracy to the poer of a leviathan state.

4he superficiality of this vie co!es to a head in revolutionary periods/hen !iddle#class leftists/ confronted ith the great poer that the proletariatcan ield/ end up appealing to the authority of the old rulers. 4hus the+enshevi2s in 191% stood by the bourgeois Provisional overn!ent of ussia/the er!an Social :e!ocrats in 1919 crushed the or2ers on behalf of capital/the -rench Co!!unist Party in 19(" proved itself the last#ditch defender of:eaulle # even the Spanish anarchist leaders in 193( @oined the bourgeoisstate apparatus. Clai!ing to oppose concentrated poer/ they end up in thear!s of the anti#or2ing class bourgeois state. As 4rots2y once observed/ thatould#be +ar6ists ignore the dialectical develop!ent of capitalis! does not!ean that the dialectic ignores the!.

&n recent years a reneed crisis of capitalis! has reconfir!ed the urgency

of authentic co!!unis!. 4he proletariat has poerfully !ade its presence feltthroughout the orld. &n response/ !iddle#class leftists have cheered theor2ers< rebelliousness B but or2ed overti!e to detour atte!pts at classindependence and tie the! to their social#de!ocratic or Stalinist !isleaders.56a!ples> in Poland leftist advisers ere central in

4:



!a2ing the 19"0#"1 revolution 7self#li!iting.7 &n 'ritain/ instead of e6posing aLabour Party that helped bury the 'ritish !iners< stri2e of 19"*#"$/ the left dugitself ever !ore deeply into it. &n the ,.S./ hen esse ac2son astutely

perceived !ass discontent and de!agogically or2ed to corral it ithin thecapitalist :e!ocratic Party/ the left tice eagerly enlisted in the entrap!entca!paign.

4he left<s deadliest efforts ere in the third orld. &n Chile it helped preventthe proletariat fro! brea2ing ith the popular#front Allende regi!e that

preserved the bourgeois !ilitary in full force. &n &ran the left as instru!ental

in convincing the or2ers that Jho!eini<s &sla!ic epublic as a necessarystep in the fight against i!perialis! # hile in fact it led straight to a uasi#fascist defeat. &n icaragua the leftist Sandinistas held bac2 the or2ers< and

peasants< anti#capitalist struggles in a futile and disastrous atte!pt to curry favorith ,.S. i!perialis!.

-or the reaa2ening of +ar6is!/ the eary idea that co!!unis! is a,topia/ that the or2ing class has proved its incapacity for revolution/ !ust be

put to rest. &t is a cry for order by the frightened !iddle classes/ cushionedte!porarily by i!perialis!<s postar revival but no feeling the pressure ofcrises and class forces beyond their control.

T>,S ;))?

8ur analysis of Stalinis! is based on previous +ar6ist or2. As alreadyindicated/ any understanding has to start ith 4rots2y<s analyses of thedegeneration of the Soviet or2ers< state in the 1930<s. 8thers Da!esK:unayevs2aya/ JuronK+od?eles2iE too2 steps toard grasping the specificnature of capitalist property relations under Stalinis!. 4he decisive i!pulse forus to rethin2 previous theories as the revival of or2ing#class revolt in the19(0<s> notably the great -rench general stri2e/ continuing resistance of or2ersin the Stalinist countries Das in the Chinese cultural revolutionE/ and the blac2ghetto uprisings in the ,nited States. 4hese events brought ho!e the centralityof the proletariat in !odern society and forced us to see2 to reestablish itscentrality in +ar6is! as ell.

4o prove our analysis of Stalinis! as capitalis! e have to elaborate threefunda!ental the!es. 4hese are> 1E that the possibility of statified capitalis!flos fro! the +ar6ist theory of capitalis!F )E that a ruling class as for!edout of the decay of the state and party bureaucracy in the Soviet or2ers< stateof the 19)0<s and 1930<sF and 3E that the post#=orld =ar && Stalinist statese6hibit the las of !otion of capitalis! in operation.

4he boo2 is organi?ed historically but not alays chronologically. &t tracesthe develop!ent of +ar6ist theories of capitalis! and Stalinis! as these greout of historical reality itself. 8f course/ for every uestion

ta2en up/ e have also to contrast our analysis ith the standard !is#interpretations.

Chapter 1 presents +ar6<s labor theory of value as the underlying la of thesyste! deter!ining its surface appearances. =e sho that value is inherent inany syste! based on age labor # in contrast to the co!!on assu!ption that itis inapplicable to a !onopolistic Dand above all/ a statifiedE econo!y. As ell/in discussing capitalist crises e present a ne interpretation of +ar6<s la ofthe falling tendency of the rate of profit hich later is applied to the Stalinistecono!ies.

Chapter ) e6tends these las to sho ho the contradictions of capitalis! bring about its epoch of i!perialis! and decay. 4he ne epoch produced to proletarian perspectives hose intertined relationship is rarely understood>Lenin<s theory of i!perialis! and 4rots2y<s theory of per!anent revolution.

Chapter 3 presents the +ar6ist theory of the transition to socialis! as ellas the 'olshevi2s< use of it as a guide for the ussian or2ers< revolution. =ee!phasi?e the unavoidability of bourgeois for!s in the transitional or2ers<state/ in contrast to prevailing notions that such a state is either 7post#capitalist/7 on the one hand/ or necessarily non#proletarian/ on the other.

Chapter * analy?es the stages of the Stalinist counterrevolution/ shoing both its practical destruction of the or2ers< gains and its ideological

corruption of +ar6is!. =e disprove the notion that Stalin<s brea2nec2industriali?ation policy of the early 1930<s abolished the la of value. &nstead/a the ne capitalist bureaucracy as consolidated at the end of the decade. &nthis chapter e also consider in depth 4rots2y<s developing theory of Stalinis!.

Chapter $ is the pivotal chapter of the boo2/ illustrating hy the Stalinist bureaucracy is capitalist and ho the las of !otion operate in statifiedcapitalis!. Stalinis!<s 7violations7 of value reflect those inherent incapitalis!<s epoch of decayF its distortions of nor!al capitalist !ethods aredeter!ined by the re!nants of the or2ers< state it usurped.

Chapter ( e6a!ines the i!pact of Stalinis! on orld politics. =e e6tendthe theory of per!anent revolution to ta2e into account the !assive defeatsuffered by the or2ing classes during and after =orld =ar &&. =e reconsider

the conception of the i!perialist epoch and challenge 7ne epoch7 theoriesdeveloped under the influence of the postar econo!ic boo!. Lastly ee6plain Soviet i!perialis! as a subordinate but essential co!ponent of orldi!perialis!.

Chapter % loo2s at the degeneration of the 4rots2yist !ove!ent/ ithspecial attention to the theories of postar capitalis! and Stalinis! thatdeveloped ithin it.

Chapter " ta2es up the Soviet syste! today/ spectacularly in decline.

44



=e assess orbachev<s refor! ca!paign and other proposals fro! the bureaucracy/ the refor!ist !iddle class/ and or2ers< organi?ations. 4his leadsto a final section on the revolutionary progra! for the Stalinist countries.4hroughout the boo2/ of all the theorists e critici?e/ 5rnest +andel and 4onyCliff ta2e first place. 4hey are the !ost rounded> their positions on the ussianuestion are lin2ed to analyses of capitalis! as a hole. 4his is because theyare leaders of international tendencies clai!ing the !antle of 4rots2yis! andtrying to establish the!selves as leaders of or2ers< struggles. See!ing toattac2 old#style refor!is! fro! the left/ they have the potential to attract the

best ele!ents of our class.&t ould be a disaster of orld#historical proportions if the or2ing class ereonce again bloc2ed fro! reaching the +ar6ist consciousness it desperatelyneeds. Preventing this !eans cleansing +ar6is! of its Stalinist/ social#de!ocratic and centrist corruptions. At the present stage of history/ the Stalinistforces that 2ept orld capitalis! alive for half a century are in collapse. As the

proletariat ta2es center stage again/ the !iddle#class +ar6ists are the only forcethat can hope to ta2e up here Stalinis! left off. 'ut the !aterial base for theirillusions is cru!bling as ell. 4his boo2 is an effort to provide a theoretical/

progra!!atic and therefore practical basis for guiding the !ove!ent of classstruggle no beginning to rise.

Cha(ter 3

The Contradictions of Ca(italism

3 VAL=7 A!D WA7 LA;)R

4o understand any !odern society it is essential to probe beneath its surfaceand illu!inate its funda!ental econo!ic las of !otion/ as +ar6 did forcapitalis!. Since the Soviet syste! originated through the degeneration of asociety transitional fro! capitalis! to socialis!/ the las of capitalis! are anecessary starting point/ even if e did not consider that syste! today to becapitalist.

4he interesting fact ca!e to light hen ,.S. president eorge 'ush visitedGungary in 19"9 that Jarl +ar6 ,niversity in 'udapest no longer reuires thestudy of +ar6<s !a@or scientific or2/ Capital$ +ore !odern theories areneeded/ the public as told/ and in any case the econo!ic collapse of theStalinist countries has discredited +ar6is!. 4he Gungarian authorities !ayindeed need capital rather than Capital to salvage their econo!y. 'ut tounderstand hy such things have co!e to pass there is no alternative but toconsult +ar6.

+ar6 gave Capital the subtitle/ 7A Critiue of Political 5cono!y.7 &t isindeed a highly pole!ical or2/ directed against the vulgar econo!ists and

bourgeois apologists of his day. 'ut not only the!> it is also a critiue of the petty#bourgeois populists and anarchists ho found the source of capitalis!<sdrives and crises in the sphere of distribution rather than production. &t applies

eually ell to their !odern counterparts/ the !iddle#class +ar6ists ho seethe !otive force of capitalis! arising out of relations ithin the bourgeoisie.&n contrast/ e stress the funda!ental role of the struggle beteen classes

in production # the conscious transfor!ation of the !aterial orld # as the basisfor the las of !otion of bourgeois society. At the core of +ar6<s !ethod isthe recognition that society/ li2e !atter/ is alays in a process of change. 4helas of any society therefore also develop and change through its internalcontradictions. 4his too contrasts ith the static conceptions of !iddle#class+ar6is!.

4-



M)D7S )& 7@PL),TAT,)!

Capital opens ith this brief paragraph>74he ealth of those societies in hich the capitalist !ode of

production prevails presents itself as <an i!!ense collection ofco!!odities/< its unit being the single co!!odity. 8ur investigation!ust therefore begin ith the analysis of a co!!odity.7 1

+ar6 begins his analysis ith co!!odities/ and for !any +ar6ists that ishere it ends. 4he clue to +ar6<s real !eaning/ hoever/ is in the ording

presents itsel% - or in an alternative 5nglish translation/ appears$ +ar6 usedsuch ter!s deliberately/ to distinguish beteen appearance and essence. Gisvolu!es of econo!ic or2 are devoted to e6ploring the reality beneath theappearance. 4he deter!ining factor of capitalis! is not si!ply the e6istence ofco!!odities but rather the co!!odification of labor. 4his defines the syste!<sspecific !ode of e6ploitation/ the ay the ruling class appropriates the surplus

product created by the producers.4o see that this as +ar6<s vie/ e first note that the 2ey to any society

lies in the struggle beteen its ruling and producing classes. 4hus theCommunist ani%esto begins>

74he history of all hitherto e6isting society is the history of classstruggles. -ree!an and slave/ patrician and plebeian/ lord and serf/ guild#

!aster and @ourney!an # in a ord/ oppressor and oppressed #stood inconstant opposition to one another/ carried on an uninterrupted/ nohidden/ no open/ fight/ a fight that each ti!e ended either in arevolutionary reconstitution of society at large or in the co!!on ruin ofthe contending classes.74he !ain battlefield of the class struggle is the surplus product. =hat

distinguishes one for! of society fro! another is the ay in hich the rulingclass e6ploits the producing classF that is/ the ay the surplus product isappropriated>

74he essential difference beteen the various econo!ic socialfor!ations/ beteen for instance/ a society based on slave labor and one basedon age labor/ lies only in the !ode in hich this surplus labor is in each case

e6tracted fro! the actual producer.7)

ear the end of Capital +ar6 outlines the full significance of the difference beteen !odes of e6ploitation>

74he specific econo!ic for! in hich unpaid surplus labor is pu!ped out ofthe direct producers deter!ines the relationship of rulers and ruled/ as it grosdirectly out of production itself and in turn reacts


1. CapitalA Vol. &/ Chapter 1 Dp. 3$ in the &nternational Publishers edition/ to hich page references apply unless specified.E

). CapitalA Vol. &/ Chapter 9/ section 1 Dp. )1%E

upon it as a deter!inant. 'ut on it is based the entire for!ation of theecono!ic co!!unity groing out of the productive relations the!selves/ andthereith its specific political for! li2eise.

7&t is alays the direct relationship of the oners of the conditions of production to the direct producers # a relationship hose actual for! alaysnaturally corresponds to a definite stage of develop!ent in the ays and !eansof labor and hence its social productive poer # hich reveals the inner!ostsecret/ the hidden foundation of the entire social structure and hence also of the

political for! of the sovereignty#dependency relationship # in short/ of the

specific for! of the state in each case.74his does not gainsay the fact that/ due to innu!erable differente!pirical circu!stances Dnatural conditions/ racial relations/ outsidehistorical influences/ etc.E/ the sa!e econo!ic basis # the sa!e in ter!sof the !ain conditions # can sho infinite variations and gradations inthe pheno!enon/ hich can be grasped only by analy?ing these

e!pirically given circu!stances.73

4his !asterful su!!ation e6presses the inescapable bond lin2ing the for!of e6ploitation/ the social structure and the state. Applied to capitalis!/ it!eans that the age#labor relation is the foundation of the bourgeois state. &tnotes further that this state and its acco!panying social structure can ta2e

!any different for!s D7infinite variations and gradations in appearance7E. evertheless/ all ill be capitalist D7the sa!e econo!ic base ... ith regard toits principal conditions7E/ as long as the surplus labor is e6tracted through agelabor B hich !eans that the surplus product ta2es the for! of surplus value.

=ell 2non though this passage is/ it is all too often !isrepresented. =hen+ar6 rites of the 7specific econo!ic for! in hich surplus labor is pu!pedout/7 +ar6ist e6perts do not see that he is referring to the !ethod ofe6ploitation. 5rnest +andel/ for e6a!ple/ interprets the passage as a refutationof the clai! Dby +ilovan :@ilasE that the ,SS is state capitalist/ sincecapitalis! and Stalinis! appear to have different ays of e6tracting surplus

product>7-or hat is the %orm o% appropriation specific to capitalis!H :oes this

%orm still e6ist in the Soviet ,nionH ,nder capitalis!/ the surplus social product is appropriated by the oning class in the %orm o% money

folloing the sale of !erchandise. &n the ,SS the surplus product isappropriated by the state in the %orm o% merchandise through thereali?ation of the planF the %inancial ban2ruptcy of enterprises Dhichso!eti!es ta2es place in the ,SSE has no effect either on this


3. CapitalA Vol. &ll/ Chapter *%/ section ) Dp. %91E

48



appropriation/ or on accu!ulation.7*

=hereas for +ar6 the for! of surplus e6traction !eans the !ode ofe6ploitation # that is/ the relation beteen the ruling and producing classes # for+andel it !eans only the superficial for! ta2en by the surplus once it has beene6tracted> hether it is !oney or not. +andel says that the essence ofcapitalis! is 7generali?ed co!!odity production/7 hich he recogni?es onlythrough the sale of !erchandise for cash. 'ut although capitalis! is co!!odity

production/ the e6change of its products for !oney is only its appearance. &tsessence is age#labor e6ploitation.

+andel has also been beitched by a secondary Dand te!poraryE phe#no!enon/ the suppression of capitalist !onetary for!s in the ,SS. 'ut ti!eschange. 4he difference he perceived beteen 5ast and =est led +andel to aconclusion no easily seen to be rong. Since several 7socialist7 countries haverefor!ed their econo!ies to enlarge profit<s econo!ic role/ going so far as toforce unprofitable enterprises to shut don/ it is clear that financial ban2ruptcydoes disrupt appropriation and accu!ulation B and it has been a disruptivefactor all along. 4he policy of preserving unprofitable fir!s only hides thesyste!<s inefficiency under the surfaceF if obsolescent fir!s stay in operation/their bac2ardness da!pens accu!ulation. 'ypassing !onetary for!s does not!a2e the syste! non#capitalistF it only !as2s the operation of capitalis!<s las/

as e ill see in Chapter $.Another e6a!ple> 'ran2o Gorvat/ a leading ugoslav econo!ist and planner/ uses a si!ilar !isreading of +ar6 to @ustify his vie that the Sovietsyste! is not capitalist but a third syste! he calls 7dtatis!7>

74he basic difference beteen a society based on capitalist age labor andone based on Statist age labor lies in the !ode in hich surplus labor ise6tracted> in the for!er case/ private property/ and in the latter/ state property/deter!ine this !ode.7$

Gorvat ad!its that the to societies have age labor in co!!on but/ li2e+andel/ insists that the 7!ode in hich surplus labor is e6tracted7 !eans thefor! in hich the e6ploiters hold their property. Ge too has e6tracted a feords fro! +ar6 and left the content behind. 8ne self#serving conseuence of

denying that age labor characteri?es a particular !ode of e6ploitation is thatGorvat can then conclude that the ugoslav econo!y/ although also based onage labor/ is neither capitalist nor StatistF it is characteri?ed by 7social

property7 and therefore avoids


*. 5rnest er!ain D+andelE/ 74he 4heory of <State Capitalis!</7 7ourth .nternational

D19$1E.$. 'ran2o Gorvat/ The Political &conomy o% Socialism D19")E/ p. *"

e6ploitation co!pletely.(

Li2e bourgeois theorists/ +andel and Gorvat accept the idea of a orldfunda!entally divided beteen !ar2et and planned econo!ies. 4hat the to!odern variants of capitalis! differ in ho the rulers allocate the surplus valuea!ong the!selves is i!portant but secondary. 4hese differences are a!ong the7infinite variations and gradations in appearance7 # of the sa!e !ode of

production/ capitalis!. As e ill see/ they result fro! the fact thatcapitalis!<s las of !otion are not static and of necessity give rise to differentfor!s of distribution of surplus value at different historical stages of

develop!ent.+andel and Gorvat Dand !any othersE reveal their !isunderstanding of

ordinary capitalis! in distinguishing it fro! Stalinis!. 4he !ode of surpluse6traction in capitalis! for the! is defined by relations a!ong the capitalists/not the relation of class e6ploitation. =hat is !issing is the proletarian root of+ar6is!/ e6pressed at the very end of CapitalA 7&n vie of hat has already

been said/ it is superfluous to de!onstrate ane that the relation beteencapital and age labor deter!ines the entire character of the !ode of

production.7%

5vidently it is not superfluous for today<s +ar6ists.

T>7 LA;)R T>7)R# )& VAL=7

=e no trace the line of reasoning through hich +ar6 derived thefunda!ental i!portance of age labor.

4he study of co!!odities begins ith their value. Co!!odities are goods!ade by private # that is/ separate # producers in order to be e6changed forother goods. 56changing goods/ as opposed to producing the! in co!!on/

brings the producers into social relation ith one another. -or e6change tohappen each product !ust have a use +alue* a useful uality reuired by othersor by society generally # although utility is not hat deter!ines ho theye6change.

4he prices at hich co!!odities are bought and sold are perceived in bourgeois theory as their true values. -or +ar6/ hoever/ a co!!odity<s price

is only a se!blance of its underlying +alue* the labor ti!e reuired for its production. 4his value is first reflected in the for! of !oney by theco!!odity<s exchange +alueB this !uch labor ti!e corresponds to that !uch!oney/ leaving aside refine!ents to be discussed shortly. &n turn/ the ever#changing (rice of the co!!odity on the !ar2et fluctuates around e6change#value."


(. Gorvat/ p. )3(.%. CapitalA Vol. &ll/ Chapter $1 Dpp. "%9#"0E.". =hen calculating in !onetary ter!s/ +ar6 often said 7value7 for short instead of

e6change value/ and e do the sa!e49



+ar6 is so!eti!es critici?ed for failing to prove the labor theory of value. &nfact he !ade no atte!pt to provide a 7proof fro! abstract first principlesF thereal test as practice. Gis @ustification for using the theory as based/ first/ onits correspondence ith econo!ic reality/ as e ill see in discussing agelaborF and/ second/ on the las of capitalis!<s !otion and develop!ent that hederived fro! the la of value. o other theory has been able to e6plaincapitalis! and/ !ost i!portant/ its historical changes/ ith anything li2e thesuccess of +ar6<s.

4he theory that value is based on labor ti!e as not invented by +ar6F it

as the co!!on understanding of the classic bourgeois econo!ists. &t alloscapitalist apologists to declare the syste!<s basic principle to be euale6change> that is/ that co!!odities of eual value can be e6changed for oneanother. 'y this ideological self#@ustification capitalis! presents itself as asociety founded on euality # despite its great e6tre!es of ealth and privilege/

Capitalis! also clai!s to be the e!bodi!ent of econo!ic freedo!> onersof co!!odities are free in the sense that they have the right to find buyers oftheir choosing on the !ar2et in order to obtain the greatest possible value ine6change. &t as no accident that 7liberty7 and 7euality7 ere atchords ofthe great -rench bourgeois revolution/ or that the idea of de!ocracy asentined ith the spread of capitalis!.

+ar6 shoed hat as valid in these ideas> by overco!ing feudal re#strictions/ capitalis! set forces in !otion that brought the !asses onto the stageof history. &t is the progressive function of capitalis! to provide the !aterial

base for a society of genuine freedo! in the future. Goever/ a central purposeof +ar6<s analysis as to puncture the illusion that capitalis! itsel% couldliberate hu!anity.

Capitalis! in fact is a society of !onstrous ineuality. As ell/ especially inthe present epoch of i!perialis!/ it is the ene!y of liberty on a orld scale.'ehind this reversed reality stands the la of value. As 5ngels rote/ 74hevalue for! of products ... already contains in ger! the hole capitalist for! of

production/ the antagonis! beteen capitalists and age or2ers/ the industrial

reserve ar!y/ crises.79 =e ill s2etch ho +ar6 unraveled the i!plications

hich value contains 7in ger!.7-irst/ labor e!bodied in different co!!odities !ust be co!parable. So

labor in every specific line of or2/ as ell each different level of s2ill/ isevaluated by reducing it to units of sim(le Duns2illedE and abstract Das opposedto specific or concrete labor. 4he value of a co!!odity is deter!ined not bythe production of that one ite! alone but rather as the


9. 5ngels/ <nti-uhrin+A Part 3/ Chapter * D+osco/ 193*F p. 3*%E

fraction of society<s total si!ple/ abstract labor devoted to it.Second/ the labor ti!e deter!ining the value of a co!!odity !ust be

socially necessaryB value is not deter!ined individually. &f/ for e6a!ple/ aor2er ta2es tice as long as the nor! to produce a given co!!odity/ theco!!odity<s value is not doubled # on the contrary/ half the or2er<s labor ti!ehas been asted. Li2eise/ if capitalists in a given sphere of industry produce!ore of a co!!odity than can be sold/ the totality of labor ti!e e!bodied inthose products cannot be reali?ed as value. A portion of it has been asted

because it lac2s social necessity/ understanding that necessity in capitalist

society has to be bac2ed by !oneyF it does not !ean there are not people holac2 such products and could use the!.

8n the other hand/ if one capitalist finds a ay of producing a co!!odityusing less labor ti!e than is nor!al/ the value of that co!!odity need noti!!ediately decrease. &t re!ains the sa!e until other producers are able/ onthe average/ to reduce the necessary labor ti!e. &ndeed/ !uch of the inspirationfor innovation under capitalis! derives fro! entrepreneurs< te!poraryopportunity to sell co!!odities at their Dpreviously deter!inedE e6changevalue/ even though they !ay be able to produce the! for less.

&n brief/ the value of a co!!odity is really !easured by the labor reuiredfor its reproduction. So if production techniues i!prove during the useful lifeof a co!!odity/ its value declines/ since reproducing it reuires less ti!e thandid producing it originally ith less advanced !ethods. 4he value of aco!!odity is therefore not constant but is constantly changing Dnor!allydecreasingE/ according to the changing techniues of production and theavailability of or2ers/ !achines and !aterials.

-urther/ for co!!odities to beco!e e6changeable/ there !ust e6ist aspecial co!!odity hich represents their value directly as a universaleuivalent. 4hat is the function of !oney/ hich appears initially in the for!of a tangible/ value#e!bodying co!!odity li2e goldF it enables society to!easure the various concrete for!s of e!bodied labor as portions of theco!!on abstract labor.

People are often surprised to learn that the values of co!!odities tend to

decrease/ because the prices of !ost things they buy are alays rising. 'ut thatappearance is an illusion brought about by !oneyF it is not a direct reflection ofvalue. At ti!es hen currencies are stable/ if labor values decline so doe6change values and prices on the hole. 'ut noadays the operation ofcapitalis! deter!ines that currencies are continually debased/ so it ta2es !ore!oney to buy a given co!!odity than before/ even a co!!odity hose valueis falling. 8nly in special cases of rapidly reducing value/ as ith so!eelectronic goods today/ does the !onetary price actually decline despite thegeneral inflation of prices.

0:



4his illustrates an essential aspect of ar!'s theory of value. 56change valueDand therefore price as ellE reflects a co!!odity<s underlying value onlyi!precisely. ot only does the value of the !oney co!!odity change Das istrue of every co!!odityEF !oney has to be used not only as a si!ple valueeuivalent but also as a !ediu! for rapid and convenient e6change over greatdistances/ and for the storage of value over ti!e. 4hese functions necessitatethat !oney is constantly created artificially through the credit syste!. As ell/!oney has to be represented by paper and other sy!bolic to2ens # hich opensup relatively si!ple opportunities for !isrepresentation of its value Dboth legal

and illegalE. &nherent in the nature of e6change value/ therefore/ is the possibility of fictitious value> for!s of value not based on actual labor in production. 4he crude euivalence of e6change value to value orsens ascapitalis! decays in its epoch of i!perialis!/ as e ill see in the ne6t chapter.

&n contrast/ in a pre#capitalist society of si!ple co!!odity production herecraftspeople obtained tools and !aterials fro! fa!iliar sources/ values could beeasily !easured if not scientifically co!pared. 'ut as capitalis! e6tendedco!!odity production/ incorporated all other historical !odes of labor into itsreal! and created a orld econo!y/ the co!ple6ities of value idened. 4hee6change of co!!odities cannot be fully regulated by labor ti!e until labor

poer is treated as a co!!odity. As ell/ capital itself beco!es a co!!odity/and this distorts the e6change value of all co!!odities in various ays/ as eshall see. =hen e refer to the labor theory of value Dor la of valueE/ e !eanthe general point that the value of co!!odities is deter!ined by their e!bodiedlabor ti!e B ithout specifying distortions or co!ple6ities.

C)!TRAD,CT,)!S )& VAL=7

&t is unfortunately uite co!!on for theorists to accept +ar6<s categories butfill the! ith an entirely different content. 4he !ain source of illusions aboutcapitalis! is the 7co!!on#sense7 idea that value is deter!ined by the !ar2etrather than by production. 4his fallacy is nurtured by the fact that co!!oditiesare defined as such by the act of e6change. 'ourgeois theory holds that the!ar2et forces of supply and de!and govern the price at hich a co!!odity can

be sold and are therefore the basis of its value. +ar6 noted in response that evenhen supply and de!and are in euilibriu!/ the value of the co!!odity stillre!ains to be deter!ined/ and this depends on the a!ount of abstract labore!bodied in itF hen not in balance/ supply and de!and affect the price onlyithin li!its set by the conditions of production.

4he bourgeois vie is echoed by !iddle#class +ar6ists. -or e6a!ple>7An econo!y governed by the la of value is an econo!y in hich

production/ and therefore invest!ent/ is guided by effective de!and

=hat operates here pri!arily is not so !uch the difference in theintensity of different needs of different individualsF hat is decisive isthe difference in inco!es. 4hus production is directed toard satisfyingthe needs of the privileged layers first. Production of lu6ury ite!s issti!ulated before the ele!entary needs of the !ass of the population are!et.710

4his is the essence of a petty#bourgeois !uc2ra2er<s notion ofcapitalis!/ denouncing the syste! for the privileges it grants to 7!alefactors ofgreat ealth.7 Aping acade!ic sociologists/ +andel chooses inco!e

differentials as capitalis!<s !otive force/ not even the difference in classinterests that a +ar6ist loo2s for. &t is a standard !yth of petty#bourgeoisecono!ics that capitalis! is propelled by consu!er sovereigntyF +andel onlyadds that the !otivating desires are really those of the ruling capitalists. 4hisargu!ent can only !esh ith a populist and not a or2ing#class politicalchallenge to capitalis!.

+ar6 ansered +andel personally/ a century ahead of ti!e>7&t !ust never be forgotten that the production of this surplus value ... isthe i!!ediate purpose and co!pelling !otive of capitalist production. &till never do/ therefore/ to represent capitalist production as so!ethinghich it is not/ na!ely as production hose i!!ediate purpose isen@oy!ent of the !anufacture of the !eans of en@oy!ent for thecapitalist. 4his ould be overloo2ing its specific character/ hich isrevealed in all its inner essence.711

=hat 7!ust never be forgotten7 has long been erased fro! the !e!ories ofthe +ar6ist pretenders.

Another co!!on confusion over the 7la of value7 is hether it is the basisof capitalis!<s las of !otion as they actually operate/ or the guiding rule for arational social syste! that capitalis! can never attain. 4a2ing the second pointof vie/ the pro!inent left bourgeois econo!ist oan obinson rote>

7+ar6 believed that/ under socialis!/ the labor theory of value ouldco!e into its on. <8nly hen production ill be under the consciousand prearranged control of society/ ill society establish a direct relation

beteen the uantity of social labor#ti!e e!ployed in the production ofdefinite articles and the uantity of the de!and of society for the!. ...4he e6change/ or sale/ of co!!odities at their value is the rational ay/the natural la of their euilibriu!.< 71)


10. +andel/ 75cono!ics of the 4ransition Period/7 in 7i%ty Hears o% World eolution

D19("E/ pp. )"1#).11. CapitalA Vol. &ll/ Chapter 1$/ Part & Dpp. )*3#*E. -or 7surplus value/7 see belo.1).obinson/ <n &ssay on ar!ian &conomics D19*)E/ p. )3. 4he passage fro! +ar6

is in CapitalA Vol. &ll/ Chapter 10 Dpp. 1"%#"E04



obinson here distorts +ar6 in order to argue that/ for hi!/ the labor theoryof value is the rational regulator of socialis!. 'ut that is in fact a total!isunderstanding of +ar6<s intention.

4he first sentence she uoted fro! +ar6 offers a gli!pse of socialistsociety> conscious control of production establishing a scientific connection

beteen the supply of goods and the de!and for the!. 5ven though +ar6spea2s of the uantity of social labor ti!e/ hoever/ e can be sure he is notreferring to value/ because the la of value has nothing to do ith the7conscious and prearranged control of society.7 &t is a blind la operating

behind the bac2s of individuals ho cannot control it. D=hat does happen undersocialis!/ as e ill sho in Chapter 3/ is that the %orm of value #the transfer ofeual uantities of labor ti!e # is retained/ hile its content based one6ploitation is abolished.E

4his sentence about socialis! is a parenthetical re!ar2 inserted into adiscussion of capitalis! in order to e!phasi?e that under capitalis! the a!ountof labor ti!e e!bodied in a co!!odity need not correspond to the socialde!and. 4he second sentence uoted/ torn out of its original conte6t/ is part ofthis discussion of value under capitalis!F it si!ply asserts that the capitalistgoal is to e6change according to De6changeE value. 'ut the intervening part of+ar6<s argu!ent Dhich obinson chooses not to uoteE shos that this goal/rational though it is/ is only achieved accidentally under capitalis!. 13

4hat is because capitalis! cannot regulate the supply of co!!odities inadvance> supply and de!and inevitably !ove in and out of their rationalrelation. 4he la of value as the syste!<s 7natural la of euilibriu!7 governsnot the day#to#day relations a!ong people but only the aera+e behavior of

prices/ supply and de!and. Price constantly fluctuates around value/ hich inturn alays changes.

As +ar6 concluded the passage hich obinson cites> 7&t is this la thate6plains the deviations/ and not vice versa/ the deviations that e6plain the la.74he la of value regulates a class#ridden/ anarchic syste! by indicating therational goals that individual e6changers under capitalis! can only achievete!porarily/ if at all/ and by chance. &t does not eli!inate the syste!<s anarchy

but only accounts for it.4he fact that capitalist econo!y inevitably diverges fro! its rational

pretenses reflects hat +ar6 called the contradictions of the for! of value.4hese are tensions beteen to inherent aspects of value # concrete and abstractlabor/ for e6a!ple/ or use value and e6change value # that propel


13. A distortion of +ar6 identical to obinson<s as co!!itted by oseph Sey!our inthe Spartacist League pa!phlet Why the 5SS is :ot Capitalist D19%%E/ p. 31

capitalis! to change and develop. 4hey also drive the syste! to the periodiccrises as ell as long#ter! decay hich have shaped its turbulent history.

4he pri!ary contradiction of capitalist society is beteen social productionand private appropriation. iven the universal interchange of co!!oditiesgenerated by production for value/ econo!ic relations beco!e thoroughlysociali?ed. o or2er/ no co!!unity/ no country can possibly be self#sufficient. 5very co!!odity contains e!bodied labor contributed to it/ directlyand indirectly/ by or2ers throughout the globe. et even at the highest stagesof sociali?ation under capitalis!/ the organi?ation of production and the

appropriation of life<s goods re!ain private/ separated fro! social control.Closely related is the contradiction beteen use value and e6change value.

4his e6ists because the value and use value of a co!!odity are ratified by 7the!ar2et7 only after the act of production/ as e have already seen in part.Production is in the hands of separate capitals/ but the goods produced aredestined for social use> consu!ption or further stages of production by otheragents. 4he individual capitalist<s production of value and use value does notguarantee their acceptance by capital as a hole. A co!!odity !ay have been

produced through the e6penditure of labor Dand therefore !ay see! to be a bearer of valueE/ yet if it has no use/ or has been produced in uantities beyondhat can be used/ its value is asted and beco!es null. Alternatively/ aco!!odity !ay have use value/ but if the value and therefore the profit ityields is insufficient/ its production ill cease.

4hese contradictions reflect the fact that the to funda!ental classes ofcapitalist society are loc2ed in a struggle over the allocation of value. 8n theone hand/ the drive for value !a2es capitalist production social and co!pelsthe contending classes to beco!e national and then international. 8n the other/capitalist relations not only separate society into rival classesF they also divideeach class into individual/ local and national co!petitors. 4hat the or2ingclass<s struggle against capital i!pels it toard unity indicates that the syste!<slas drive the proletariat to overco!e capitalist relations.

WA7 LA;)R

+ar6 introduced a useful distinction to analy?e value !ore precisely. 4helabor ti!e e!bodied in a co!!odity can be divided into to parts> the li+ing

labor e6pended by the or2ers ho produce it directly/ and the dead labor

previously e!bodied in the !eans of production D!aterials/ tools/ factories/etc.E/ used by the i!!ediate producers but produced in the past. 4he valuecontained in such !eans of production is transferred to

0-



the co!!odities being produced ithout creating any additional value. evalue can be created only as living labor brought into production by the

proletariat.4o illustrate the distinction/ !a2ing a productive i!prove!ent generally

!eans introducing a techniue that produces co!!odities at a faster rate/ sothat the living labor reuired for each co!!odity declines. &f the value of theliving labor saved is !ore than the additional dead labor that the ne techniuecosts/ then the overall value of the co!!odity has decreased.

8ne essential co!!odity under capitalis! is not produced in the usual ay.

Since capitalis! assigns an e6change value to every co!!odity/ it does so ithlabor too. Labor # or !ore accurately labor (o"er* the or2ers< capacity tolabor # beco!es a co!!odity oned by or2ers hich they sell to capitalists inreturn for pay!ent> their age. ,nderlying the age/ hich is precisely thee6change value of labor poer/ is the value of labor poer. 4his is based on thevalue of the co!!odities Dfood/ clothing/ shelter/ training/ etc.E needed by theor2ers and their fa!ilies to reproduce the or2ing class. 4he fact that agesare nor!ally paid per hour or day B that is/ according to the duration of ti!eor2ed #illustrates the reality of the labor theory of value> the value ofco!!odities produced depends on the labor ti!e they contain.

As ith all co!!odities/ the value of labor poer is constantly changing. &tdecreases because of advances in the techniues of producing the or2ers<necessities. 'ut it also tends to increase because it contains hat +ar6 called a7historical and !oral ele!ent/7 the degree of training/ education and civili?ationthat society reuires of its or2ers. 4his ele!ent is largely deter!ined throughclass struggle/ even hen i!prove!ents in the or2ers< conditions benefit thecapitalists as ell by !a2ing higher productivity possible.

4he co!!odity labor poer has a uniue use value> it creates ne value.+oreover/ the value that the laborer creates !ust be greater than the value ofhis or her labor poer. &n the process of capitalist production/ therefore/ thevalue of the or2ers< living labor divides into to categories. 8ne portion/ (aid

labor* corresponds to the value of labor poer and is ta2en by the or2ers inthe for! of ages. 4he re!aining portion/ un(aid labor or sur(lus +alue* goes

to the capitalistsF it is the source of their profit/ interest and rent. 4he e6tractionof surplus value is the uniuely capitalist for! of e6ploitation.

,nli2e in pre#capitalist societies/ capitalis!<s surplus is disguised by theeual e6change of value> labor poer for ages. 56ploitation of slaves by their!asters as na2ed> hat the slaves produced as oned by the !aster hochose hat to give bac2/ nor!ally @ust enough for the slaves to subsist. ,nderfeudalis!/ the serf had so!e rights against the lord/ but

here too e6ploitative class relations ere transparent. 'ut under capitalis! therelations beteen people are hidden beneath ob@ects and for!s and appear to

be beteen things # co!!odities.+ar6 rote Capital to reveal the syste!<s inner essence behind its outer

trappings. 4he co!!odity is the necessary for! of appearance of capitaliste6ploitation. evertheless/ e have seen ho !iddle#class +ar6ists believethat the co!!odity for! rather than the class struggle is the 2ey to the syste!Dand therefore that Stalinist societies/ here co!!odity !ar2ets aresuppressed/ cannot be capitalistE. As +ar6 pole!ici?ed against their ancestors>

7&t is a definite social relation beteen !en that assu!es in their eyesthe fantastic for! of a relations beteen things. &n order/ therefore/ tofind an analogy/ e !ust have recourse to the !ist#enveloped regions ofthe religious orld. &n that orld the productions of the hu!an brainappear as independent beings endoed ith life/ and entering intorelation both ith one another and the hu!an race. So it is in the orldof co!!odities ith the products of !en<s hands. 4his & call thefetishis! hich attaches itself to the products of labor/ as soon as theyare produced as co!!odities/ and hich is therefore inseparable fro!

the production of co!!odities.71*

4he co!!odity is not si!ply a thing e6changed beteen separate oners.

&t is the product of age labor/ the outco!e of a particular for! of e6ploitation.4hat is hat defines the nature of capitalis!.

T>7 LAW )& ,!7=AL,T#

As capitalis! developed out of feudal society/ it forcibly separated thedirect producers fro! their !eans of production. 5ventually the buying andselling of labor poer ca!e to govern the labor of the !a@ority of producers.&ndustrial capital depends on creating a class of proletarians ho possess no!eans of productionF the !aterials/ !achines and factories are oned by aseparate class/ the bourgeoisie.

+ar6 noted ironically that the bourgeois ideal of freedo! applies to the proletarians as ell. 4he or2ers are 7free7 in a dual sense. 8n the one side/

they are no longer part of the !eans of production oned by their !astersF thecapitalists buy labor poer/ not labor. 8n the other side/ they are dispossessedof any !eans of production and are therefore free to sell their labor poer toho!ever they li2e. 8bviously they are obliged by the threat of starvation tosell the!selves to some boss on the !ar2et. 4he petty#bourgeois drea! of acapitalist society !ade up of eual/ independent and self#sufficient propertyoners is a fantasy concealing the


1*. CapitalA Vol. &/ Chapter 1/ Section * Dp. %)E

08



e6ploitation and freuent !ass !isery of the or2ers.&n addition to the class#based ineuality inherent in capitalis!/ the syste!

has developed other for!s of oppression B based on se6/ race/ nationality/ etc.Fso!e of these it inherited fro! previous class societies and turned the! to itson ends. 4hey serve not only to preserve social structures useful to capitalis!# for e6a!ple/ the nation and the fa!ily #but also to institutionali?e divisionsithin the or2ing class and thereby ea2en its resistance to e6ploitation.

4he 7free7 character of age labor !a2es e6ploitation collective. o longerare the producers of society<s surplus product tied to individual oners/ as ere

slavesF nor to specific landed property/ li2e serfsF nor to their on property andspeciali?ed trade/ li2e the petty#bourgeoisie descended fro! guilds!en andartisans. 4he proletarians are e6ploited as a class/ by the e6ploiters as a class.:espite the evident co!petition beteen capitals/ the labor !ar2et createssocial classes hich represent as a hole the opposite sides of the e6ploitationrelation.

=ith the creation of the !odern proletariat by industrial capitalis!/ agelabor underent a transfor!ation. &ndividual crafts!en ere replaced bylaborers forced to sell the!selves to the highest bidder in hatever trade.=or2ers< labor poer beca!e increasingly interchangeable and unifor!. Asell/ technological advances robbed the or2ers of their traditional s2ills.4hese processes helped create the actual category of abstract labor.

4hus the la of value first ca!e to genuine fruition under industrialcapitalis!F it could only be prefigured in a partial sense under earlier for!s ofco!!odity production. As +ar6 rote>

74he secret of the e6pression of value/ na!ely/ that all 2inds of labor areeual and euivalent/ because and so far as they are hu!an labor in general/cannot be deciphered until the notion of hu!an euality has already acuiredthe fi6ity of a popular pre@udice. 4his/ hoever/ is possible only in a society inhich the great !ass of the produce of labor ta2es the for! of co!!odities/ inhich/ conseuently/ the do!inant relation beteen !an and !an is that of

oners of co!!odities.71$

Gence the funda!ental lin2 beteen age labor and the la of value. 8n the

one hand/ capitalist production # the operation of the la of value # !a2es labor poer a co!!odityF labor is necessarily age labor. 8n the other hand/ under pre#capitalist co!!odity production/ e6change value e6isted but could only be based on concrete labor/ not on a true underlying value. 8nly capitalist production/ hich e!ploys labor !easured


1$. CapitalA Vol. &/ Chapter 1/ Section 3.A.3 Dp. (0E

according to ti!e/ creates the genuine value category of e!bodied abstractlabor. 4hus the e6istence of a proletariat and the validity of the la of value areeuivalent conditions. +ar6ists ho deny that the la of value applies toStalinis! but nevertheless ac2noledge the e6istence of a Soviet proletariat!a2e a funda!ental error. 4o deny one is to deny the other.

+ar6 transfor!ed the labor theory of value in to ays> he distinguishedlabor fro! the co!!odity labor poerF and he uncovered the e6traction ofsurplus value through age labor. Gis analysis revealed the class nature ofthe la. Since onership of capital do!inates the possession of !ere labor

poer/ dead labor do!inates living. Capitalists assu!e the right to appropriatenot only a value euivalent to the or2ers< ages Dand to the dead labor theysupplyE but also the surplus value produced. 4hus the las of capital 7beco!e

by their on inner and ine6orable dialectic changed into their very opposite.4he e6change of euivalents/ the original operation ith hich e started/ hasno beco!e turned around in such a ay that there is only an apparente6change.71( As the gulf beteen bourgeoisie and proletariat evolved ande6panded/ the la of value as transfor!ed fro! a principle of euality to thee!bodi!ent of ineuality. =e ill sho in Chapter * that a si!ilar process ofintensification of ineuality too2 place during the Stalinist counterrevolution inthe ,SS. -ar fro! overco!ing the la of value/ Stalinis! enforced it.

4 T>7 ACC=M=LAT,)! )& CAP,TAL

Capital originated historically in pre#capitalist societies as !oney hich!erchants and ban2ers invested in trade or usury for profit. 'ut @ust as thevalue of co!!odities did not fulfill its on las until labor poer beca!e anavailable co!!odity/ so too capital ca!e into its on only as property in the!eans of production through hich surplus value as e6tracted fro! agelaborers.

4he age relation allos for a far greater degree of e6ploitation than asever possible in the past. ,nder previous !odes of production/ the surplus

product appropriated by the e6ploiters as deter!ined by custo! as a !ore orless fi6ed a!ount in advanceF the direct producers lived if they could on hatre!ained. 4he e6traction of surplus as li!ited by 7the alls of the lord<ssto!ach.7 4he rulers ould at ti!es need to


1(. CapitalA Vol. &/ Chapter )*/ Section 1 Dp. $"3E

09



relative increase of surplus value/ is the 2ey to the i!!ense e6pansion ofcapitalis!. And once the accu!ulation of relative surplus value begins/ itscontinuation is forced on the bourgeoisie by the internal pressure ofco!petition. &n 1"*% +ar6 and 5ngels rote in the Communist ani%esto that7the bourgeoisie/ during its rule of scarce one hundred years/ has created !ore!assive and !ore colossal productive forces than have all precedinggenerations together.7

4he reverse side of this achieve!ent is that labor is conde!ned toenslave!ent by capital. 4he 7eual e6change7 of labor poer for ages allos

the capitalists to appropriate surplus value ithout returning an euivalent. &tresults in vast ineualities beteen classes Dand ithin the!EF capitalaccu!ulation only intensifies the disparity.

7Accu!ulation of ealth at one pole is/ therefore/ at the sa!e ti!eaccu!ulation of !isery/ agony of toil/ slavery/ ignorance/ brutality/ and !oraldegradation at the opposite pole/ i.e./ on the side of the class that produces itson product in the for! of capital.719

C)!C7!TRAT,)! A!D C7!TRAL,EAT,)!

&t is often stated by +ar6ist as ell as bourgeois theorists that the !otivationdriving the individual capitalist is to !a6i!i?e his rate of profit. 'ut this/ li2ethe goal of e6tracting the !a6i!u! of surplus value/ is only a !eans to the realend. As +ar6 put it/ the 7ai! Mof the capitalist !ode of productionN is to

preserve the value of the e6isting capital and pro!ote its self#e6pansion to thehighest li!it Di.e./ to pro!ote an ever !ore rapid groth of this valueE.7)0 4hisai!/ e shall see later/ is counterposed to capitalis!<s 7tendency toardsabsolute develop!ent of the productive forces/ regardless of the value andsurplus#value it contains ...7. 4hat is/ capitalis! strives to e6pand the value for!even at the e6pense of developing use values. 4he conflict of these tendencies/the !ost visible e6pression of the contradictions of value/ is the 2ey to theanalysis of capitalis!<s crises.

Accu!ulation occurs both through the of concentration of capital B thegroth of individual capitals through reinvest!ent of their on surplus value #

and through the centrali.ation of capital in the hands of feer and feercapitalists ho ta2e over the property of others. 4he ea2er capitalists ho areunable to e6pand or !oderni?e rapidly enough are driven out of business ande6propriated by the stronger. D4he to ter!s here are defined in +ar6<s sense/hich is not identical ith co!!on usage today.E


19. CapitalA Vol. &/ Chapter )$ Dp. (*$E.)0. CapitalA Vol. &ll/ Chapter 1$/ section ) Dp. )*9E

Several dangers for the bourgeoisie are inherent in both aspects ofaccu!ulation/ aside fro! the obvious destruction of capitalists. 8ne is thataccu!ulation is acco!panied by periodic crises that ea2en the !asses<confidence in the rulers< ability to run society. Another is that e6pansiondevalues capital and thereby counters the bourgeoisie<s goal of e6panding itscapital. Lin2ed to both of these is the increasing concentration and organi?ationof the proletariat/ unified and strengthened by capitalis!<s sociali?ation oflabor # a threat to the very e6istence of capitalis!. Gere is +ar6<s su!!ary ofthe process/ a concise dialectical !asterpiece>

7As soon as this process of transfor!ation has sufficiently deco!posedthe old society fro! top to botto!/ as soon as the laborers are turned into

proletarians/ their !eans of labor into capital/ as soon as the capitalist!ode of production stands on its on feet/ then the further sociali?ationof labor and further transfor!ation of the land and other !eans of

production into socially e6ploited and therefore co!!on !eans of production/ as ell as the further e6propriation of private proprietors/ta2es a ne for!.74hat hich is no to be e6propriated is no longer the laborer or2ingfor hi!self/ but the capitalist e6ploiting !any laborers. 4hee6propriation is acco!plished by the i!!anent las of capitalistic

production itself/ by the centrali?ation of capital. 8ne capitalist alays2ills !any. Gand in hand ith this centrali?ation ... develop on an ever#e6tending scale the cooperative for! of the labor process/ the conscioustechnical application of science/ the !ethodological cultivation of thesoil/ the transfor!ation of the instru!ents of labor into instru!ents onlyusable in co!!on/ the econo!i?ing of all !eans of production by theiruse by co!bined/ sociali?ed labor/ the entangle!ent of all peoples in thenet of the orld !ar2et/ and ith this the international character of thecapitalist regi!e.7Along ith the constantly di!inishing nu!ber of the !agnates ofcapital/ ho usurp and !onopoli?e all advantages of this process oftransfor!ation/ gros the !ass of !isery/ oppression/ slavery/ degrada#

tion/ e6ploitationF but ith this too gros the revolt of the or2ing class/a class alays increasing in nu!bers and disciplined/ united/ organi?ed by the very !echanis! of the process of capitalist production itself. 4he!onopoly of capital beco!es a fetter upon the !ode of production/hich has sprung up and flourished along ith and under it.Centrali?ation of the !eans of production and sociali?ation of labor atlast reach a point here they beco!e inco!patible ith their capitalistintegu!ent. 4his integu!ent is burst asunder. 4he 2nell of capi#

-4



variable capital plus the constant capital it e!bodiesE plus a proportionate shareof surplus value. A co!!odity produced ith a higher than average organicco!position of capital has a price of production higher than its actual e6changevalue.

4he dividing and sharing of surplus value ta2e place through the constantdaily haggling over !ar2ets/ prices and credit. &t is clearly a long#ter! process>capitalists cannot shift their invest!ents i!!ediately. 4hose ho try to !ovetheir capital face serious obstacles> capital is tied up in buildings/ !aterials andinstru!ents/ etc. And as the relative si?e of fi6ed capital tends to increase/ the

process of euali?ation beco!es even sloer. +ar6 co!!ents/ 7,ndercapitalist production/ the general la acts as the prevailing tendency only in avery co!plicated and appro6i!ate !anner/ as a never ascertainable average ofceaseless fluctuations.7)*

8ne conseuence of this 7euality7 a!ong capitalists is uneual e6change beteen industries and even countries. &n trade at prices of production beteenan advanced producer Dith a high organic co!positionE and a !ore bac2ardone/ there is a transfer of value fro! the bac2ard to the advanced # since theadvanced producer<s co!!odity sells at a price above its value and the

bac2ard producer<s co!!odity sells for loer. 4his is a 7laful7 ay forecono!ically advanced countries to benefit disproportionately fro! trade iththeir colonies and dependencies.

4he euali?ation tendency of individual profit rates based on the !ar2et forcapital illustrates capitalis!<s uniue co!bination of rationality andirrationality. 8n the one hand/ it allos the syste! to e6pand/ since ithout it acapitalist ho tried to advance technologically ould only receive the lo

proportion of surplus value directly produced. 8n the other hand/ it !a2ese6change value diverge !ore and !ore fro! the value underlying it/ so that

bourgeois society is less and less able to uantify scientifically its on inneror2ings. 4his is one reason hy value can only be !easured indirectlythrough the unstable !oney co!!odity and cannot be calculated directly inter!s of labor ti!e. &t also shos !ore deeply hy private Din the sense ofseparateE onership stands in contradiction to social production> privately

oned capitals reuire Dand/ in tendency/ obtainE their 7fair share7 of the socialsurplus value/ hether or not such a distribution corresponds to the interest ofsociety # even bourgeois society # as a hole.

So!e theorists critici?e +ar6 for giving an erroneous solution to the so#called 7transfor!ation proble!.7 4hey hold that +ar6<s replace!ent ofe6change values by prices of production is based on the assu!ption that eachround of production begins ith pure e6change valuesF therefore he


)*. CapitalA Vol. &ll/ Chapter 9 Dp. 1(1E

is rong not to notice that production costs/ as !uch as output/ have to be !easured according to prices of production. 'ut +ar6 as perfectlyaare of thisF he arned of 7the possibility of an error if the cost#price ofa co!!odity ... is identified ith the value of the !eans of productionconsu!ed by it.7)(

4he confusion is partly due to +ar6<s use of the ter! 7value7 to !eane6change value. 56change value is already an e6pression of value in !onetaryfor!F the price of production is only a !odification of e6change value after

profit rates have been euali?ed. 4he 7transfor!ation of values into prices of

production7 is not a change beteen categories Dvalue to priceE but anad@ust!ent ithin one category # e6change value. 4he error +ar6 cited isavoided if the initial cost#prices D7values7E of co!!odities are understood to bethe production prices D!odified e6change valuesE as they stand at the start ofthe production period. D4he sa!e holds for the organic co!position of capital.E

4he real proble! is that +ar6<s critics interpret hi! as trying to devise afor!ula for a rational price syste!. 'ut as e have seen/ the purpose of hiselaboration of the la of value as to discover capitalis!<s long#ter! las of!otion and de!onstrate its i!per!anence.

Another confusion is that the euali?ation of profit rates results fro! aconstant 7!igration7 of capital aay fro! spheres of industry ith highorganic co!position of capital to lo organic co!position spheres. As e illsee in Chapter $/ this convinces so!e that capitalis! does not e6ist in the5astern bloc. 'ut it is @ust an e6tension of the notion that +ar6 failed to solvethe transfor!ation proble!.

-irst of all/ the history of capitalist develop!ent shos the opposite> capitaldoes !ove beteen spheres/ but it tends to go to the !ore advanced Botherise there ould be no technological progress. D4he !ove!ent of capital

beteen countries in search of higher profits does not contradict this argu!ent.=hen capital !oves to an econo!ically bac2ard country having a high rateof profit because of lo ages/ this a!ounts to ta2ing advantage of a higherrate of e6ploitation # hereas +ar6 assu!ed that in a given society the rate ofe6ploitation as unifor!. &t therefore has the effect of raising the overall rate

of profitF it is a separate process fro! the balancing of the rate of profit beteen fir!s.)%

Secondly/ the !igration notion assu!es that capitalists first appropriate


)$. See?y/ The Theory o% Capitalist eelopment D19*)E/ p. 11$/ as one of the firstof !any to !a2e this argu!ent.

)(. CapitalA Vol. &ll/ Chapter 9 Dp. 1($E. A si!ilar argu!ent is on p. 1(0.)%. +ar6<s vie that foreign trade is a counteracting tendency to the falling rate of

profit GCapitalA Vol. G&/ Chapter 1*/ Part $E confir!s this argu!ent-8



7their on7 surplus value based on a pure value calculation/ and only laterdiscover through co!petition that their share is disproportionate. 'ut !oderncapitalists have never appropriated profits according to pure value.DConceivably pre#capitalist co!!odity producers could be said to e6changeaccording to values # but before labor poer as a co!!odity/ abstract laborand therefore value could not be !easured.E 8nce capitalist production has beenestablished/ there is no reason for the !ost profitable fir!s in any cycle ofinvest!ent to be those ith lo organic co!positions. +o!entary profitabilitycan be due to !any factors/ even accidental ones.

4he !igration theory !i6es up different levels of analysis. Calculation inter!s of values as +ar6<s first appro6i!ation to reality/ ith capital treated asa unified hole. 4he second appro6i!ation/ capitalist co!!unis!/ shos ho

profit rates euate at the level of co!peting capitals. &t is the e6tension of thela of value fro! co!!odities to capital> the capitalists get eual returns ontheir outlay # not of their on labor but of their capital. 4he price of productionof a co!!odity/ the !odified reflection of its value/ depends not si!ply on thecharacteristics of its production in isolation but rather on its production as a

product of a certain sphere of capital in relation to every other sphere.Although capitalist co!!unis! see!s to deny the la of value for

co!!odities/ it is a further 7violation7 of the la of value on the basis of thatla itself. As +ar6 noted/ 7ho little the deter!ination of value <directly<counts for in bourgeois society7 # its effects are indirect and unconscious.)"

4he rate of profit produces an illusion> the productive capacity of livinglabor appears instead to be the productive capacity of capitalF surplus valuecreated in production appears instead to be profit generated on the !ar2et.'ourgeois and !iddle#class theorists do not invent their illusions out ofnohereF they !erely invert for! and content/ presenting as the product ofscience hat appears on the surface of capitalist relations and in theconsciousness of the capitalists.

+ar6 critici?ed capitalists as ell as the 7bourgeois theorists/ the politicalecono!ists/7 for alloing the for!ation of the general rate of profit to obscurethe origin of surplus value in the e6ploitation of labor. 74his confusion of the

theorists best illustrates the utter incapacity of the practical capitalist/ blinded byco!petition as he is/ and incapable of penetrating its pheno!ena/ to recogni?ethe inner essence and inner structure of this process behind its outerappearance.7)9 Little needs to be added today e6cept that the 7politicalecono!ists7 no call the!selves +ar6ists.


)". ar!-&n+els CorrespondenceA anuary "/ 1"(".)9. CapitalA Vol. &ll/ Chapter 9 Dp. 1("E

T>7 =7ST,)! )& C)MP7T,T,)!

4he !ost co!!on !isrepresentation of the la of value concerns the drive behind capitalist accu!ulation. +iddle#class theorists stress the desires ofindividual capitalists and their co!petition in the !ar2et/ rather than theinterest of the bourgeoisie as a hole to resist the class struggle of the or2ers.4he position is !ost convenient for those ho deny the e6istence of capitalis!in the ,SS/ here !ar2et co!petition beteen enterprises is li!ited.

-or e6a!ple/ +andel rites> 7&t is co!petition that deter!ines the holedyna!ic/ all the las of develop!ent/ of capitalis!.7 30 +ore e6plicitly>

7=hat causes capitalist society to !oveH Competition$ =ithoutco!petition there is no capitalist society. A society here co!petition isradically or co!pletely eli!inated ould no longer be capitalist to thee6tent that there ould no longer be a !a@or econo!ic !otive foraccu!ulating capital and conseuently for carrying out nine#tenths of the

econo!ic operations hich capitalists e6ecute.7 31

4he notion is so pervasive that 4ony Cliff/ ho calls the Stalinist syste!capitalist/ argues si!ilarly>

7=hile in the traditionally capitalist countries co!petition beteendifferent factory oners causes the! to accu!ulate and increase theorganic co!position of capital/ in ussia this factor does not e6ist at all

as the factories are oned by one authority.7

3)

Li2eise/ 'aran and See?y/ ho hold that +ar6<s attitude toardco!petition is out of date/ use the standard assu!ption about co!petition todiscredit the relevance of +ar6<s hole analysis of capitalis!>

74he stagnation of +ar6ian social science/ its lagging vitality andfruitfulness/ cannot be e6plained by any si!ple hypothesis. ... 'ut thereis one i!portant factor ... the +ar6ian analysis of capitalis! still rests inthe final analysis on the assu!ption of a co!petitive econo!y.7 33 So!e even thin2 that co!petition produces the la of value itself> 74his

co!petition beteen individual capitals generates the la of labor value andconstitutes the driving force for the historic process of capital accu!ulation.73*


30. +andel/ ar!ist &conomic Theory D19()E/ Vol.1/ Chapter 11/ p. 3(3.31. +andel/ <n .ntroduction to ar!ist &conomic Theory D19(%E/ p. 3".3). Cliff/ ussia < ar!ist <nalysisA p. 1$(F State Capitalism in ussiaA p. )1(.33. Paul 'aran and Paul See?y/ onopoly Capital D19((E/ pp.3#*.3*. oseph Sey!our/ Why the 5SS .s :ot CapitalistA p. %1. A si!ilar vie is given

by Cliffs associate Chris Gar!an> 7=hat !a2es !an#produced ob@ects # and aboveall labor poer # into a co!!odity is precisely co!petition beteen producingunits ...7 D.nternational Socialism o. *1/ 19(9#%0E

-9



4hus the do!inant opinion a!ong a ide variety of +ar6ists is thatco!petition is the starting point for the analysis of capitalis!. Such theoristsoften turn for te6tual support to +ar6<s =rundrisseA an i!portant or2containing his private notes ritten in preparation for CapitalA Several of itsfor!ulations are !ista2enly sei?ed upon as authori?ation for the line thatco!petition is funda!ental. Gere is a co!!on citation>

7&n co!petition this inner tendency of capital Mthe drive to e6pand beyond all boundsN appears as a co!pulsion e6ercised over it by aliencapital/ hich drives it forard beyond the correct proportion ith a

constant +arch/ +archO ... Conceptually/ co!petition is nothing otherthan the inner nature of capital/ its essential character/ appearing in andreali?ed as the reciprocal interaction of !any capitals ith one another/the inner tendency as e6ternal necessity. Capital e6ists and can only e6istas !any capitals/ and its self#deter!ination therefore appears as their

reciprocal interaction ith one another.73$

&t is easy to read 7co!petition is nothing other than the inner nature ofcapital7 as an assertion by +ar6 hi!self that co!petition is the essence ofcapitalis!. 'ut the passage doesn<t say thatF it says that co!petition is theappearance of the inner nature of capital. =hat this inner nature is e havealready seen> the drive to accu!ulate/ the struggle beteen capital and labor/ at

botto! the e6ploitation of proletarians through the age syste!. 4he passageillustrates again the distinction beteen appearance and essence. &n everydaylanguage the ter! is easy to overloo2/ but hen +ar6 rote 7appear7 threeti!es in a fe lines he !eant it. eading the passage over as a picture of thesurface appearance of capitalis! reveals clearly hat he had in !ind/ if eunderstand that for +ar6 7appearance7 is not a !irage but a subordinate aspectof reality.

As for the 7capital e6ists and can only e6ist as !any capitals/7 +ar6 !eantthat capital is based on value/ hich presupposes co!!odities produced fore6change. Gence one capital can e6ist only in relation to others. Leftiststypically read this as !eaning that state capitalis! is theoretically i!possible.-or e6a!ple>

7Capital is a concept hose develop!ent and functioning are governed by certain las/ i.e./ it has a logic. =e ill argue/ along ith +ar6/ that<state capitalis!< ... is inco!patible ith +ar6<s analysis of capitalis!.4he pivotal point ... is co!prehending hy 1E Capital can only e6ist as!any capitals/ and/ )E Co!petition is the <inner nature of capital.< 4heseto closely related characteristics obviously e6clude the


3$. +ar6/ =rundrisse D19%3E/ pp. *1*#1$

possibility of one state#capital.73(

'ut +ar6 never argued that state capitalis! is i!possible De ill see in thene6t chapter that he and 5ngels believed uite the oppositeE # only that separatestate#oned capitals !ust produce for/ e6change ith and confront oneanother. &ndeed/ in its ordinary activity capital needs to ta2e the for! of 7!anycapitals/7 ith co!petition beteen the!/ precisely in order to get rid of itsinefficient sectors in ti!es of crisis. +onopoly and statified capitals face thesa!e need/ but since they interfere ith the 7auto!atic7 operation ofcapitalis!<s las they have a harder ti!e disposing of bac2ard sectors. 4he

current efforts to 7refor!7 Stalinist econo!ies by giving co!petition freer reinsho once again that co!petition is a necessary but subordinate category.

A second passage in the =rundrisse is even sharper>7Co!petition e6ecutes the inner las of capitalF !a2es the! intoco!pulsory las toard the individual capital/ but it does not inventthe!. &t reali?es the!. 4o try to e6plain the! si!ply as results of co!#

petition therefore !eans to concede that one does not understand

the!.73%

+ar6 differentiated beteen the drive to accu!ulate/ hich he ter!ed an7i!!anent la of capitalist production7 or the 7inner nature of capital7 # andits surface !anifestation in the for! of co!petition beteen capitals. 4he

!anifestation is perfectly real> individual capitalists/ especially s!aller ones/feel the pressure to !oderni?e and accu!ulate co!ing fro! co!petition/ fortheir rivals are constantly threatening to undercut the! by producing cheaperco!!odities. Capitalist A does not say to hi!self/ 7o that & 2no ho thesyste! or2s/ & ill invest in ne technology to accu!ulate capital anddeepen the e6ploitation of the or2ing class so that capitalis! can survive.7

o/ he thin2s instead/ 7Capitalist ' is getting ne !achines to drive !e out of business/ so & too had better loer !y labor costs in the sa!e ay.7

Co!petition is precisely the operation of surface pressure to enforce theinner las on the capitalists> it is capitalis!<s value#policing agent. 'ut it is notthe funda!ental drive for accu!ulation. &f it ere/ it ould not


3(. oldfield and othenberg/ The yth o% Capitalism e(ornA p. 9$.3%. rundrisseA p. %$). +ar6 leads up to this passage ith> 7AMda!N S!ith e6plained

the fall of the rate of profit/ as capital gros/ by the co!petition a!ong capitals. ...A. S!ith<s phrase is correct to the e6tent that only in co!petition # the action ofcapital upon capital # are the inherent las of capital/ its tendencies/ MfirstN reali?ed.'ut it is false in the sense in hich he understands it/ as if co!petition i!posedlas on capital fro! the outside/ las not its on.7 Dpp. %$1#).E 4he ord 7first7here is o!itted fro! the published 5nglish translation

5:



tend to heat up during the phase of the business cycle hen the pace ofaccu!ulation declines and recede hen accu!ulation accelerates Dsee thesection on crises beloE. As +ar6 noted>

7&t is easy to develop the introduction of !achinery out of co!petitionand out of the la of the reduction of production costs hich is triggered

by co!petition. =e are concerned here ith developing it out of the

relation of capital to living labor/ ithout reference to other capitals.73"

et another passage fro! the =rundrisse has been cited to argue that the ,SScannot be capitalist ithout co!petition> 7production founded on capital ...

posits itself in the for!s adeuate to it only insofar as and to the e6tent that freeco!petition develops.739 4his 7uotation7 deceptively o!its the crucial ords7for the first ti!e7 in the !iddle of the phrase/ a clue to the fact that for +ar67free co!petition7 is @ust one stage in the history of capitalis!/ an idea to bedeveloped fully in the ne6t chapter.

C)MP7T,T,)! A!D VAL=7

Let us loo2 at the standard error on co!petition fro! a different perspective.4he underlying las of capital Dvalue/ accu!ulationE operate at the !ostabstract level of 7capital in general/7 here the struggle beteen capital andlabor is considered in abstraction fro! conflicts ithin the bourgeoisie. 8n theother hand/ the effects of co!petition operate at the level of 7!any capitals/7here funda!ental las are i!posed upon the representatives of capital.*0

+ar6 used the !ethod of successive appro6i!ation to social reality in order tostrip aay the different layers of appearance and thereby lay bare the innerrelations of the syste!. 4he !isrepresentation of co!petition a!ounts to!i6ing up these to levels/ in effect o!itting capital in general in favor of therelations beteen individual capitals. 4his can be seen in a particularly baldfor!ulation by a co#thin2er of 4ony Cliffs>

7+ar6 distinguishes beteen <capital in general< and <!any capitals.< 4hefor!er is the e6ploitative relation beteen labor and capital/ the latter theco!petitive interaction of individual capitals. 4he theory of value isespecially concerned ith relations beteen <!any capitals/< since it is

co!petition hich co!pels fir!s to sell co!!odities at the


3". =rundrisseA pp. %%(#%.39. =rundrisseA p. ($0/ cited in the inco!plete for! presented by both the anti#Stalinist

4ic2tin DCriti/ue o. 1(/ p. )%E and the +aoists Corrigan/ a!say and Sayer Dp.1$1E.

*0. See o!an osdols2y/ The akin+ o% ar!'s CapitalA pp. *1#$3

socially necessary labor ti!e reuired to produce the!.7 *1 &f this ere true it ould be hard to see ho +ar6 as able to analy?e value

so thoroughly in Volu!e 1 of CapitalA hich stays at the level of capital ingeneral and barely !entions co!petition. &ndeed/ ansered the Cliffites inadvance>

7Co!petition !erely e!presses as real/ posits as an e6ternal necessity/that hich lies ithin the nature of capitalF co!petition is nothing !orethan the ay in hich the !any capitals force the inherent deter!inantsof capital upon one another and upon the!selves. Gence not a single

category of the bourgeois econo!y/ not even the !ost basic/ e.g./ thedeter!ination of value/ beco!es real through free co!petition alone...7*)

Cliffs conception of co!petition as the essence of capitalis! isfunda!entally the sa!e as that of the non#capitalis! theorists of the ,SSD+andel/ See?y/ Shacht!an/ et alE. As e noted in the introduction/ he holdsthat since age labor in the ,SS is not a co!!odity/ the capitalist las of!otion operate only because they are i!posed fro! outside by !ilitaryco!petition. 'ut he goes further> in Soviet society/ he clai!s/ the accu!ulationof alue is not the goal of productionF on the contrary/ 7ussia<s co!petitionith the rest of the orld is e6pressed by the elevation of use values into anend...7.*3

8f course/ each capitalist fir! and state reuires specific use values/ butCliffs reasoning elevates this ele!entary fact into a principle thateffectively thros out the +ar6ist analysis of capitalis!. +oreover/ he appliesthis logic not @ust to the ,SS but to capitalis! in general> 7Co!petition

beteen the capitalist poers has reached the stage here the internationaldivision of labor is disrupted and co!petition through buying and selling isreplaced by direct !ilitary co!petition. ,se values have beco!e the ai! ofcapitalist production.7 &t ould see! that for Cliff co!petition is so poerfulthat it has altered the drive to e6pand value as the !otive force of capitalist

production. ot only is Cliffs ,SS really a third social syste!/ different inessence fro! capitalis!F he also says in effect that !odern capitalis! as a

hole is also not really capitalist. 4his goes to sho that theorists ho denythat Stalinist society is capitalist have no !onopoly on turning +ar6 inside outand re!oving the capitalKlabor relation fro! its central position. Statecapitalists do it too/ under the co!!on assu!ption of !iddle#class +ar6is!that the la of value derives fro! e6change/ not production.


*1. Ale6 Callinicos/ Socialist Worker eieA ulyKAugust 19"$.*). =rundrisseA p. ($1.

-0 Cliff/ ussiaA < ar!ist <nalysisA p. 1(1F State Capitalism in ussiaA pp. ))3#*54



0 CAP,TAL,SM6S CR,S7S

+ar6 as one of the first to observe that the tendency toard cyclical crisesas an inherent/ laful characteristic of capitalis!. 'ut his theory of crises haslong been one of the !ost disputed aspects of his or2. 8ne reason is that it hasdirect political i!plications> each e6planation for crises i!plies a solution foravoiding the!/ and the political progra!s of the various +ar6ist tendenciesinevitably color their theoretical analyses. efor!ist and revolutionaryinterpreters of +ar6is! have !ade crisis theory into a !a@or battlefield.

Another reason for controversy is that +ar6 never got to treat the sub@ectith the detail and coherence he planned. Co!!ents are scattered about hisritings and !i6ed in ith other topics/ and short#ter! crises and long#ter!effects are not alays distinguished. =e begin ith the short#ter! crisesF ourinterpretation is designed to clarify their role in carrying out +ar6<s long#ter!

periodi?ation of capitalist develop!ent # the sub@ect of the ne6t chapter.

T>7 CR,S,S C#CL7

+ar6 lin2ed crises to the life cycle of fi6ed capital>7As the !agnitude of the value and the durability of the applied fi6edcapital develop ith the develop!ent of the capitalist !ode of

production/ the lifeti!e of industry and of industrial capital lengthens ineach particular field of invest!ent to a period of !any years/ say of tenyears on the average. =hereas the develop!ent of fi6ed capital e6tendsthe length of this life on the one hand/ it is shortened on the other by thecontinuous revolution in the !eans of production/ hich li2eiseincessantly gains !o!entu! ith the develop!ent of the capitalist !odeof production. 4his involves a change in the !eans of production and thenecessity of their constant replace!ent/ on account of !oral depreciation/long before they e6pire physically. ...74he cycle of interconnected turnovers e!bracing a nu!ber of years inhich capital is held fast by its fi6ed constituent part/ furnishes a

material (asis %or the periodic crises$ :uring this cycle business under#

goes successive periods of depression/ !ediu! activity/ precipitancy/crisis. 4rue/ periods in hich capital is invested differ greatly and farfro! coincide in ti!e. 'ut a crisis alays for!s the starting point oflarge ne invest!ents B therefore/ fro! the point of vie of society as ahole/ !ore or less/ a ne !aterial basis for the ne6t turnover cycle.7 **


**. CapitalA Vol. &&/ Chapter 9 Dpp. 1"$#(E/ e!phasis added

Let us ta2e a closer loo2 at the different phases of the industrial cycle cited by+ar6.

&n the recovery Dor 7!ediu! activity7E phase after a crisis/ labor is idelyavailable and relatively cheapF !ost spheres of production e6pand/ hiring !oreor2ers. Accu!ulation ta2es place in several ays> the concentration ofcapital in e6isting capitals/ the for!ation of ne capitals and the subdivision ofold capitals to ta2e advantage of profitable conditions. &n particular/ capitalistsinvest in the production of ne fi6ed capital/ hich not only ta2es ti!e to be

produced but also has the property that its full value is transferred to other

co!!odities only over the period of its or2ing life and therefore is noti!!ediately reali?ed on the !ar2et. 4he recovery phase is a period ofincreasing production by an increasing nu!ber of independent units and ofrelatively lo co!petition for !ar2ets/ because de!and by or2ers andcapitalists initially runs ahead of production.

Since fi6ed capital eventually enters into production and the availability ofor2ers is li!ited/ e6pansion reaches a point here labor begins to run short.4his is the e6pansion or boom D+ar6<s 7precipitancy7E phase/ in hichconditions are !ost favorable to the or2ersF they are able to increase ages

by ta2ing advantage of the co!petition a!ong capitalists for labor. 4his createsa short#ter! reduction in the surplus value e6tracted per or2er/ hence a fall inthe rate of profit.

4he unplanned nature of production/ co!bined ith the capitalist drive toaccu!ulate/ !eans that supply soon outpaces de!and. As the boo! nears its

pea2/ the products of the ne fi6ed capital reach the !ar2et. 'ecause of the!ultiplicity of producers in every sphere/ capitalists are co!pelled to co!petefor buyers as ell as for or2ers. 4hese conditions bring about overproduction/in producers< goods especially. 4he crisis is triggered hen a si?eable portionof the value produced cannot be reali?ed/ that is/ sold to buyers needing thegiven use values and able to pay the e6change value of the co!!odities.

&n the crisis phase/ increasingly !any capitals are forced to cut productionand even to halt it entirely. Production drops as the rate of profit headsdonard. 8verproduction in consu!ption goods can turn into shortage as

industries !anufacturing supplies shut don. 4he ar!y of une!ployedor2ers gros/ and this relieves the pressure for high ages. 5ven costs ofcapital goods go don.

=hen the rate of profit sin2s belo average/ the cycle !oves into its slum(

phaseF une!ploy!ent is ra!pant and !any capitals are iped out. 'ut then thedepressed conditions begin to reverse the situation. 4he rate

5-



of profit of surviving capitalists turns up/ since both labor and productiongoods have beco!e cheaper. 4his is the phase here the centrali?ation ofcapital flourishes/ for the surviving capitalists can buy out ban2rupt fir!s at

prices belo their usual value. And so/ ith labor ea2ened and capital furthercentrali?ed/ the cycle begins ane.

4hese syste!ic crises provide a catharsis for the capitalist econo!y/enabling the syste! to purge itself of obstructions li2e bac2ard enterprises and

poerful sectors of the or2 force. 4he purge co!es at the cost of socialinstability/ and this is hy capitalis! developed techniues for da!pening

crises. 4hese techniues/ hoever/ also ea2en the syste! in that obstructionsno are not so easily re!oved. =e ill see the results in our discussions of the

post#=orld =ar && orld in later chapters.4he theory outlined here is an overproduction theory of crises Das opposed to

underconsu!ptionis! described beloE. Crises result fro! the fact that each branch/ and indeed each separate capital/ !ust e6pand independently/ hateverthe needs or purchasing poer of society as a hole.

4he description @ust given of the crisis cycle is only a general outline of theforces that co!e into play. o actual crisis follos the !odel e6actly. &n fact/the i!!ediate causes that precipitate particular crises are usually obstructionsand i!balances in the !onetary syste!. &t as capitalis!<s !oney and creditsyste! that displaced direct barter as the !a@or !ode of e6change and createdthe possibility of selling co!!odities ithout buying others Dor vice versaEF thatis ho goods can be produced that don<t find a !ar2et. 4he vagaries of !oney!a2e each crisis appear different and disguise the underlying patterns.+oreover/ as statification and !onopoly play increasingly poerful roles/ thecycles beca!e increasingly arped. 4he e6tre!e distortion/ as e ill sho ina later chapter/ occurs in the Stalinist syste!.

Although overproduction under capitalis! is the source of crises/ arationally based socialist society ould need a different 7overproduction7 B ofuse values/ not value # for its on purposes. Since the a!ount of the various2inds of fi6ed euip!ent that have to be replaced in any given year cannot be

perfectly predicted and ill vary/ an oversupply has to be prepared for

insurance. As +ar6 put it/ the proble! 7can be re!edied only by a continuousrelative overproduction. ... 4his sort of overproduction is tanta!ount to control by society over the !aterial !eans of its on reproduction. 'ut ithin capitalistsociety it is an ele!ent of anarchy.7*$ =e ill see in Chapter $ that Stalinistoverproduction is a for! of capitalist anarchy rather than a reflection of socialcontrol over econo!ic forces.


*$. CapitalA Vol. &&/ Chapter )0/ Part 11 Dp. *(9E

=!D7RC)!S=MPT,)!,SM

A popular 7+ar6ist7 theory of crises is underconsu!ptionis!> the idea thatcapitalis! tends to produce insufficient de!and for consu!ption goods in

particular. &ts basic version argues that crises occur because of the e6cessivee6ploitation of the or2ers. Since or2ers are paid for only part of the valuethey produce/ they cannot possibly buy bac2 the hole product of their labor.+oreover/ the capitalists ho appropriate the 7e6cess7 surplus value are toofe to consu!e the re!ainder. Gence !any co!!odities cannot find buyers/and crisis ensues.

,nderconsu!ptionis! in this for! is a traditional theory of refor!ist socialde!ocrats and labor leadersF they deduce that paying or2ers higher ages isthe ay to prevent crises. Goever/ the fact that crises brea2 out at the point inthe cycle hen the or2ers have their highest ages/ as +ar6 noted/ !a2es theargu!ent for higher ages to avoid crises unconvincing # along ith the theoryof underconsu!ption as an e6planation.*(

+ar6 also responded that the !asses< underconsu!ption # the fact that theycannot afford the full range of co!!odities needed for a co!fortable livingstandard # is a constant of life under capitalis!/ through both boo! and bust.D&ndeed/ it as constant under all previous class societies as ell.E &funderconsu!ption ere the source of crises they ould be per!anent/ notcyclical.

Certain passages in +ar6<s or2 are often ta2en to @ustify the clai! that heas an underconsu!ptionist. -or e6a!ple>

74he conditions of direct e6ploitation and those of the reali?ation ofsurplus value are not identical. 4hey diverge not only in place and ti!e

but also logically. 4he first are li!ited only by the productive poer ofsociety/ the latter by the proportional relations of the various branches of

production and the consu!er poer of society. 'ut this last#na!ed is notdeter!ined either by the absolute productive poer/ or by the absoluteconsu!er poer/ but by the consu!er poer based on antagonisticconditions of distribution/ hich reduce the consu!ption of the bul2 ofsociety to a !ini!u! varying ithin !ore or less narro li!its. &t is

further!ore restricted by the tendency to accu!ulate/ the drive toe6pand capital and produce surplus value on an e6tended scale.7 *%

4here is no hint here that capitalis! could avoid crises by increasing theconsu!ption of the !ass of population. 8f course/ restricted consu!er poeris an essential basis of crises> they occur because the !ass of ealth is in thehands of capitalists/ ho can restrict its use hen profits are lo. Sincecapitalist production is driven to increase absolutely/ hich !eans


*(. CapitalA Vol. &&/ Chapter )0/ Part * Dpp. *10#11E.*%. CapitalA Vol. &ll/ Chapter 1$/ Part 1 Dp. )**E

58



that resources are constantly dran aay fro! consu!ption and toardaccu!ulation/ the consu!ption of society is necessarily li!ited. 4his ould betrue even if consu!ption ere !uch greater than in +ar6<s ti!e/ as it is in theleading capitalist poers today. So even this allegedly undercon#su!ptionist

passage is better interpreted in the light of the overproduction theory eoutlined> production tends to increase in unplanned fashion and thereby beyondthe social de!and/ no !atter ho great.

4he !ain point overloo2ed by the underconsu!ptionists is that even ifcapitalists !ade no profit at all/ or2ers ould not buy bac2 the entire product.

A portion of the value produced co!es fro! constant capitalF and that portion/along ith !uch of the surplus/ is repurchased by other capitalists for use in thene6t round of production. +oreover/ it is not even true that all value eentually

ends up e!bodied in consu!ption goods !eant for purchase by the or2ingclassF a !a@or ele!ent of constant capital alays is reproduced as constantcapital. 4he error here is that all production is 7!eant7 for eventualconsu!ption. &t i!plicitly accepts the idea that the ai! of capitalist productionis use values rather than value/ and therefore that the proletariat is a deprivedconsu!ing class hose goals are achievable ithin the syste!.

4he i!plication of underconsu!ptionis!/ plainly apparent hen e6pressed by refor!ists/ is the idea that capitalis! can be !ade rational

B that is/ it can save itself fro! deadly crises by learning to produce for

hu!an needs rather than for profit. 4his vie has nothing in co!!on ith+ar6/ ho held that production for value as the essence of the syste!

B in contradiction to satisfying the use value needs of the !asses.=e ill see in later chapters that one or another version of undercon#

su!ptionis! lies @ust beneath the surface of !ost +ar6ist theories of !oderncapitalis!. An influential vie is that of 'aran and See?y/ hose ideassayed the A!erican e Left of the 19(0<s. 4hey hold that capitalis!<s

proble! in !odern ti!es is an e6cess of 7surplus7 hich/ unli2e +ar6<s surplusvalue/ has no direct connection to the e6ploitation of the proletariat. 4he syste!cannot absorb the surplus ithout resort to ar!s spending and other artificialdevices. +oreover/ it suffers fro! a 7tendency of surplus to rise.7 5cono!ic

crises are obsoleteF instead e face long#ter! stagnation and social crisesD7disorientation/ apathy/ and often despair7E.*" See?y<s criticis! of statecapitalist theorists ho don<t base their analyses of the Soviet ,nion oncapitalis!<s las of !otion Dsee the &ntroductionE co!es ith ill grace fro! onehose analysis of capitalism isn<t based on capitalis!<s las of !otion.

'aran and See?y<s theory of a crisis#free capitalis!/ li2e their re@ection


*". 'aran and See?y/ onopoly CapitalA pp. "#10/ )"1

of surplus value/ as a convenient rationali?ation for political vies that re@ectthe proletariat in favor of third#orld nationalis!. &t as also the product of thegroing !iddle class<s illusions in endless prosperity that gave rise to theoriesof a bought#off and bourgeoisified or2ing class. =ritten in 19((/ the boo2<sthesis as decisively ansered in practice by the -rench or2ing classuprising of 19(". &t is also refuted by the prolonged decline in living standardsthat has characteri?ed =estern capitalis! since the late 19(0<s Dsee Chapter (E.

4he logic of underconsu!ption theories is very close to Jeynesianis!/ a!a@or force in bourgeois econo!ics during the past half century. &t holds that

state intervention into the econo!y can forestall the outbrea2 of crises byregulating consu!er de!and/ in part by doling out so!e sops to the or2ingclass. 4his idea conceals the fact that or2ers< gains are alays achievedthrough !ilitancy against capital/ as in the ,nited States during the 1930<s.Jeynesianis! is a theoretical cover that clai!s credit for hat the !asses onfor the!selves. &t also @ustifies the class#collaborationist progra!s of socialde!ocrats Dand !any acade!ic +ar6istsE ho argue that their 7anti#!onopoly7 policies are in the interest of all society/ not @ust the or2ers. 8ncein office/ hoever/ hen there is less fat on the econo!y to offer for sops/social de!ocrats find that 7the general interest7 reuires austerity for theor2ers so that profits Dthe real goal of the syste! and its 2eepersE can recover.

D,SPR)P)RT,)!AL,T#&n contrast to underconsu!ptionis!/ disproportionality is the theory that

capitalist anarchy leads to the overproduction of so!e co!!odities and theunderproduction of others/ in essentially rando! fashion. 4his too is based oncorrect observations that reflect the ato!i?ed character of capitalist onership.'ut li2e underconsu!ptionis!/ disproportionality is a constant fact ofcapitalist life that cannot account for periodic crises. +ar6<s analysis shosthat capitalis!<s drive to accu!ulate creates cyclical overproduction in allareas/ even assu!ing disproportions beteen spheres. &n his ords>

7&f it is said that there is no general overproduction but si!ply adisproportion beteen the various branches of production/ this again

!eans nothing !ore than that/ ithin capitalist production/ the proportionality of the particular branches of production presents itself asa process of passing constantly out of and into disproportionality Bsince the interconnection of production as a hole here forces itself onthe agents of production as a blind la/ and not as a la hich/ beinggrasped and therefore !astered by their co!bined reason/ brings the

59



productive process under their co!!on control. *9

'efore =orld =ar &/ disproportionality as the chief alternative tounderconsu!ptionis!. &t as held by theorists ho hoped that the develop!entof capitalis! ould !oderate tendencies toard crises. Lenin held an anti#refor!ist version of the theory/ as e ill see in the ne6t chapter. 4oday itsi!plications are clearer> it is favored by Stalinists and social de!ocrats ho seethe solution to capitalis!<s crises as state econo!ic intervention/ hich cansupposedly overco!e the anarchic disproportions arising fro! an unplanned!ar2et.

A leading classical disproportionalist as the 'olshevi2 i2olai 'u2harin/ho argued that a crisis#free capitalis! as possible. 7Let us i!agine/7 herote/ 7the collectie-capitalist social order Dstate capitalis!E in hich thecapitalist class is united in a unified trust and e are dealing ith an organi?ed/though at the sa!e ti!e/ fro! the standpoint of the classes/ antagonisticecono!y.7 Ge ent on>

7&s accu!ulation possible hereH 8f course. 4he constant capital gros/ because the capitalists< consu!ption gros. e branches of production/corresponding to ne needs/ are continually arising. 5ven though thereare certain li!its to it/ the or2ers< consu!ption increases.

otithstanding this <underconsu!ption< of the !asses/ no crisis canarise since !utual de!and of all branches of production/ and li2eiseconsu!er de!and/ that of the capitalists as ell as of the or2ers/ aregiven fro! the start. &nstead of an <anarchy of production< # a plan that isrational fro! the standpoint of capital.7$0 'u2harin assu!ed that a 7planned7 capitalist econo!y in hich relations

beteen classes are hostile can introduce har!onious relations ithin the rulingclass. 4his is false fro! a theoretical standpoint> Lenin<s analysis of i!perialis!DChapter )E shoed that statification and !onopoly do not eli!inateco!petition beteen capitals but ulti!ately heighten it. &t has also beenfalsified in practice> Stalin<s ussia in the 1930<s shoed that intensifiede6ploitation of the or2ing class could not ta2e place ithout rivalry andco!petition ithin the bureaucracy DChapter *E. 8nce again e are dealing ith

the anti#+ar6ist idea that capitalis! can be !ade rational. 'u2harin concludedhis analysis of state capitalis! by clai!ing that hile that syste! ould be freeof ordinary crises/ it ould still decay into


*9. CapitalA Vol. &ll/ Chapter 1$/ Part 3 Dp. 3($ in the VintageKPenguin editionE.$0. 'u2harin/ .mperialism and the <ccumulation o% CapitalA Chapter 3/ D19%) edition/ p.

))(E. &n this translation the last ord/ 7capital/7 is italici?ed and capitali?ed as if itrefers to +ar6<s boo2 # 7rational fro! the standpoint of Capital - but this see!srong in the conte6t. 8ur interpretation agrees ith the translation of the passage inCliff/ ussia a ar!ist <nalysisA p. 1(9.

stagnation. Loo2ing at the Soviet#type econo!ies today/ 'u2harin<s insight!ay see! re!ar2able. 'ut e ill sho in Chapter $ that the apparent absenceof recurring crises under Stalinis! is deceptive/ and that there is a far bettere6planation of its stagnation.

T>7 &ALL,! RAT7 )& PR)&,T

+ar6<s 7la of the tendency of the rate of profit to decline7 is anotherreason often given as the basis for capitalis!<s periodic crises. =e ill use theabbreviation 7-P7 to refer to +ar6<s falling rate of profit la/ both for

si!plicity and to distinguish it fro! other factors hich cause the rate of profitto decline.

4he rate of profit does of course decline cyclically on the verge of eachcrisis/ as outlined above/ because of intensified accu!ulation and higherages. 4heories that point to such a 7profit suee?e7 can easily beacco!!odated ithin bourgeois ideology/ since in effect they conde!n thegreedy or2ing class as the cause of crises. =hen raised by leftists/ theories ofthis genre usually i!ply a 7solution7 through state planning to co!pelinvest!ent even here less than fully profitable. Such panaceas cannot lastlong unless the bourgeois state itself is overthron.

4he falling rate of profit la is one of the !ost controversial sub@ects in+ar6ist literature. +ar6 hi!self gave it the highest standing>

74his is in every respect the !ost i!portant la of political econo!y/and the !ost essential for understanding the !ost difficult relations. &t isthe !ost i!portant la fro! the historical standpoint. &t is a la hich/despite its si!plicity/ has never before been grasped and even less/

consciously articulated.7$1

8n the other hand/ leading +ar6ists li2e 'u2harin and 4rots2y see! neverto have !entioned the -P/ hile Lu6e!burg referred to it !oc2ingly andLenin only in passing. =e ill sho that the falling rate of profit tendency hasan inti!ate relation ith the crisis cycle # but is not the cause. &ts i!portance isits lin2 to capitalis!<s epoch of decay.

According to +ar6/ the -P derives directly fro! the groing do!ination

of dead labor DcapitalE over living B the rising organic co!position of capital.4he basic argu!ent is si!ple. 8n the one hand/ only living labor producessurplus value/ and the a!ount of surplus value that can be produced by oneor2er in a or2ing day is li!ited by the nu!ber of hours in the day. 8n theother/ the value of the !eans of production that the or2er e!ploys canincrease ithout li!it. &t follos that the surplus value produced decreases as a

proportion of the total capital Dconstant plus variableE. 4hat is/ the ratio ofsurplus value Dfro! hich profits are


$1. =rundrisseA p. %*"

8:



derivedE to invested capital # the rate of profit # falls. As an algebraic for!ula/the rate of profit is e6pressed as

SC V

here S stands for surplus value/ C for constant capital and V for variablecapital. 4he theory is that over ti!e C increases faster than S ith respect to V.4herefore the overall ratio decreases.

'efore +ar6/ bourgeois econo!ists had already observed the fallingtendency of the rate of profit # it aroused their concern over the future health of

capitalis! # but they could not e6plain it. 4oday al!ost all econo!ists as ellas !any professed +ar6ists dispute the la/ arguing that there is neither any

@ustification for it in theory nor/ hatever the conditions in the 19th century/any sign of a general decline in capitalist profit rates. 4o provide a historicalde!onstration of the -P ould ta2e us too far afield.$) Gere our tas2 is tosho ho the la or2s in theory. -irst/ e note that +ar6 foresa so!e ofthe proble!s>

7&f e consider the enor!ous develop!ent of the productive forces ofsocial labor in the last 30 years alone as co!pared ith all preceding

periods ... in particular the enor!ous !ass of fi6ed capital/ aside fro! theactual !achinery/ hich goes into the process of social production as ahole/ then the difficulty hich has hitherto troubled the econo!ist/

na!ely to e6plain the falling rate of profit/ gives place to its opposite/na!ely to e6plain hy this fall is not greater and !ore rapid.7$3

4here are countertendencies to the -P/ +ar6 noted/ hich tend to raise profits. 4hey 7cross and annul the effect of the general la/ and give it !erelythe characteristic of a tendency.7 4hese include 1E the increasing intensity ofe6ploitation/ hich increases surplus valueF )E the cheapening of units ofconstant/ and especially of fi6ed/ capital # hich loers the value of investedcapital and therefore raises the profit rate as a percentage of itF and 3E foreigntrade/ hich enables capitalists to invest here profits are high because of lo#

paid or2ers.+ar6 believed that the -P ould nor!ally do!inate the counteracting

tendencies/ because of both e!pirical evidence and his overall understanding ofthe i!per!anence of capitalis!. Although he tried to or2 out a convincingde!onstration by !eans of the las of !otion of the syste!/ the argu!ent ashe left it as inco!plete. 4he door re!ained open for +ar6ist clai!s that the-P is false/ as ell as for interpretations that


$). -or evidence see 74he 4endency of the ate of Profit to -all in the ,nited States/7 by :u!enil/ lic2 and angel/ Contemporary ar!ism o. 9 D19"*EF and our 7Jarl+ar6 and the =orld Crisis/7 Socialist )oice o. 19 D19"3E.

$3. CapitalA Vol. &ll/ Chapter 1* Dp. )3)E

!a2e the -P purely a cyclical pheno!enon in hich the countertenden#cies periodically catch up ith the !ain tendency and restore the syste!<s healthand profitability Dsee beloE. 4hus the crises cycles could be eli!inatedthrough directive state planning of not only production but long#ter!invest!ent policy # another refor!ist !yth under capitalis!. 8ne ele!entaryargu!ent against the -P is that no capitalist ould ever invest in neeuip!ent if he e6pected that doing so ould lead to a loer rate of profit.+ar6 replied that the initial investor in a ne !achine usually reaps a indfall

profit by producing co!!odities belo their average value Dand belo their

operative selling priceEF only hen the ne techniue is standardi?ed does thehigher organic co!position bring don the average profit rate. 8pponentsretort that such reasoning !ay have or2ed at one ti!e/ but no thatcapitalists have centuries of e6perience they could see ahead that netechnology leads to loer profit ratesF if +ar6 ere right/ therefore/ no neinvest!ent ould occur. A +ar6ist reply at this level reuires a concreteanalysis.

=e begin to fill in the gap in +ar6<s argu!ent by considering the rate of profit as it varies beteen capitals and over the crisis cycle.

4he fall in the overall profit rate due to the rising organic co!position ofcapital or2s out differently for different fir!s. A co!pany using netechniues of production can charge loer prices for its goods and thereby

undercut obsolescent rivals. .ts rate of profit does not fall/ but rises #despite itson higher organic co!position/ since it has engineered a te!porarydivergence beteen value and price. As for the rivals/ in theory their old fi6edcapital has been devalued Dsince the reproduction of their use value noreuires feer hours of labor because !ore !odern !ethods e6istEF but theyare still co!pelled to calculate their profit rates on hat they originally paid fortheir euip!ent. 4hus the out#of#date capitals have to sell at less than hatthey anticipated at the ti!e of invest!entF so they suffer a loss in e6pectedinco!e and therefore profits. Their rate of profit fallsF the valueKpricedivergence or2s against the!.

4he point that the -P affects different capitals differently is !issed/ for

e6a!ple/ in a 'ritish refor!ist<s argu!ent against the revolutionaryi!plications of the -P>7+ar6<s theory does not apply to the situation in 'ritain in recent years.'ritain today is not the country here the productive forces undercapitalis! have been pushed to their !ost advanced li!it. ... &t is clear/fro! a casual e6a!ination of the statistics/ that the <social productivity oflabor< in 'ritain is !uch loer than in -rance/ =est er!any or the,nited States. -urther!ore/ the a!ount of !achinery per or2er/!easured in either value or volu!e ter!s/ is !uch loer in 'ritain thanits !ore advanced capitalist co!petitors. 4he scenario

84



e6pansion to the highest li!it Di.e./ to pro!ote an ever !ore rapid grothof this valueE. ... 4he !ethods by hich it acco!plishes this include thefall of the rate of profit/ depreciation of e6isting capital/ and develop!entof the productive forces of labor at the e6pense of already created

productive forces. ...74he real (arrier of capitalist production is capital itsel%$ &t is that capitaland its self#e6pansion appear as the starting and closing point/ the !otiveand the purpose of productionF that production is only production forcapital and not vice versa/ the !eans of production are not !ere !eans

for a constant e6pansion of the living process of the society of producers.7$(

Let us illustrate +ar6<s analysis by !eans of an i!aginary construction. &fthere ere such a thing as a universal capitalist ruling body deter!ining theinterests of the syste! as a hole/ it ould be torn beteen the horns of thedile!!a i!plied by +ar6. 4o accu!ulate intensively by revolutioni?ing

production through ne for!s of capital !eans devaluing the old e6istingcapitalF but to hold bac2 accu!ulation !eans retreating in the battle for poeragainst the or2ing class.

8f course/ there can be no universal capitalist authority/ so in reality thedile!!a is faced only by capitalists controlling narro sectors of capital. 4heoner of an individual factory !ust !oderni?e as rapidly as he can afford/ lest

his capital be devalued. +onopoly oners !ay hesitate to !oderni?e toorapidly/ lest other sections of their capital be pre!aturely devalued. As e illsee in Chapter $/ the rulers of the Stalinist state have adopted yet anotheralternative/ an e6tension of the !onopoly strategy/ hich also fails to rescuethe! fro! the inherent contradiction. 4he la of value e6presses the essence ofthe capitalist dile!!a. Value per!its a s!ooth crisis#free econo!y only underthe con@uncture of to conditions> unfettered co!petition to guarantee that the!ost efficient production !ethods triu!ph/ and conscious planning to avoidoverproduction by independent producers. 5ach of these conditions is i!pos#sible/ and the to cannot hold even appro6i!ately at the sa!e stage of history.4he 7invisible hand7 of Ada! S!ith operates only hen the syste! is in its

infancy and no fir! is big enough to do!inate the !ar2et. =hereas social planning is conceivable only in an advanced stage/ hen !onopoly and thestate do!inate. 4he contradictory logic of capital accu!ulation shos that thela of value is the e!bodi!ent of the syste!<s internal contradictions.

&n +ar6<s description Duoted aboveE of the ulti!ate contradiction of capital/it is not the increase of use alues that is contradictory but the


$(. CapitalA Vol. &ll/ Chapter 1$/ Part ) Dpp. )*9#$0E

unbounded increase of alueA hich necessarily acco!panies the groth of usevalues under capitalis!. 56isting values cannot be preserved if ne values are

produced that render the! obsolete. Accu!ulation of value is thereforecounterposed to production of use values essential for the proletariat and futuresociety. Capitalis!<s increasing consciousness of this contradiction/ and the!easures it too2 on the basis of its on las to forestall the revolutionary!aturation of the proletariat/ brought an end to its epoch of progressivedevelop!ent.

4he fact that the crises and decay of capitalis! are inherent in the nature of

value refutes all atte!pts to treat value calculation as an e6pression ofrationality. 4he anti#+ar6ist theories re!ain popular as e6pressions of !iddle#class aspirations to find Dor engineerE stability in a syste! hose funda!ental

basis is class conflict.

88



higher scale/ and finally to its violent overthro.7)

Short#ter! crises and epochal decay are inti!ately intertined/ but it isnecessary to distinguish the! clearly for the purpose of analysis. -ro! ti!e toti!e +ar6 predicted that the epoch of decay had actually arrived/ that the

productive forces of capitalis! had been per!anently fettered in the course ofone of the syste!<s periodic crises # only to find his e6pectation falsified by ane burst of productive activity. +ar6 had in effect already e6plained these!is@udg!ents>

7o social order ever disappears before all the productive forces for

hich there is roo! in it have been developedF and ne higher relationsof production never appear before the !aterial conditions of theire6istence have !atured in the o!b of the old society.73

Capitalis!<s recurrent resurgences after its crises/ the fact that it as notcrippled by the bonds that regularly held bac2 the productive forces/ proved thatthis old social order as not yet used up> econo!ic crises are not the sa!e asthe epoch of social revolution. +ar6 did not live to see the fulfill!ent of therevolutionary epoch he predicted.

o to the second distinctive aspect of capitalis!. Class society e6ists becauseof the prevalence of econo!ic scarcityF that is its historical @ustification.Capitalis!<s productive drive has the potential to do aay ith this

@ustification> it points to the real! of abundance/ the abolition of scarcity. =hen

econo!ic e6pansion reaches the point here there is no longer any need forclass divisions/ here e6pansion can continue ithout e6ploitation by a rulingclass/ then class society Dand of course capitalis! in particularE beco!essuperfluous # and reactionary. Capitalis! is therefore the last class societynecessary in hu!an history.&n addition to the ell#2non passage here +ar6 outlines his vie of thedifferent epochs of social syste!s in general/ elsehere he describes the turning

points of capitalis! in particular. Ge brings out the epoch of decay through ahistorical develop!ent of capitalis! in three stages>

7As long as capital is ea2/ it still itself relies on the crutches of past!odes of production/ or of those hich ill pass ith its rise. As soon as

it feels strong/ it thros aay the crutches/ and !oves in accordance ithits on las. As soon as it begins to sense itself and beco!e conscious ofitself as a barrier to develop!ent/ it see2s refuge in for!s hich/ byrestricting free co!petition/ see! to !a2e the rule of capital !ore

perfect/ but are at the sa!e ti!e the heralds of its dissolution and of thedissolution of the !ode of production resting on it.7*

). =rundrisseA p. %$0.3. Preface to the Criti/ue o% Political &conomy.*. =rundrisseA p. ($$

4hat is/ hen capitalist production first arose ithin feudalis!/ it asha!pered by barriers li2e the guild syste!/ but it also depended on thesestructures to get itself off the ground. =hen capitalis! reached its adult stageand ca!e to do!inate production/ co!petition flourished and e6ecuted theinner las of capital !ore fully. -inally/ in its epoch of decay/ capitalis! hasto rely on for!s other than free co!petition B chiefly !onopoly and the state

B hich see! to strengthen it. 'ut these also distort its las and erect barriersto the e6pansion of the productive forces.

+any +ar6ists ta2e the !ature progressive epoch of capitalis! Dthe second

of the three stages +ar6 describedE as its nor!al/ per!anent condition/hereas +ar6 2ne that the classical features of free co!petition and free!ar2ets ere not per!anent. As e ill sho/ Stalinist society is an e6tre!ecase of the restriction of co!petition and other las !a2ing capital a barrier toits on develop!ent. +ar6 obviously could not foresee the uniue history ofrevolution and counterrevolution that created present#day statified capitalis!/

@ust as he could not predict the precise outlines of the i!perialist epoch that beca!e clear to Lenin and others after the turn of the century. 'ut hat hecould see testifies to the clarity of his theory/ in sharp contrast to therationali?ations that pass for +ar6is! today. =e no ta2e a closer loo2 atthese 7heralds7 of capital<s dissolution.

T>7 S)C,AL,EAT,)! )& CAP,TAL

&n the 1"%0<s +ar6 and 5ngels added a further ele!ent to their analysis ofcapitalis!. 4hey observed that the tendency for capital to centrali?e/ presentthroughout the history of capitalis!/ as bringing about a ualitative changeith the develop!ent of @oint stoc2 co!panies and the increasing role of the

bourgeois state. &n the 1"90<s 5ngels added the ele!ent of trustification and!onopoli?ation. Gere he su!s up the !atter in detail>

78n the one hand/ therefore/ the capitalistic !ode of production standsconvicted of its on incapacity to further direct these productive forces.8n the other/ these productive forces the!selves ith increasing energy

press forard to the re!oval of the e6isting contradiction/ to the

abolition of their uality as capital/ to the practical reco+nition o% theircharacter as social productie %orces$

74his rebellion of the productive forces/ as they gro !ore and !ore poerful/ against their uality as capital/ this stronger and strongerco!!and that their social character shall be recogni?ed/ forces thecapitalist class itself to treat the! !ore and !ore as social productiveforces/ so far as this is possible under capitalist conditions. 4he period ofindustrial high pressure/ ith its unbounded inflation of credit/ not

1:



less than the crash itself/ by the collapse of great capitalist establish#!ents/ tends to bring about that for! of the sociali?ation of great !assesof !eans of production hich e !eet ith in the different 2inds of

@oint#stoc2 co!panies. ... At a further stage of evolution this for! also beco!es insufficient. 4he producers on a large scale in a particular branch of industry in a particular country unite in a trust/ a union for the purpose of regulating production. ...7&n the trusts/ freedo! of co!petition changes into its very opposite #into !onopolyF and the production ithout any definite plan of

capitalistic society capitulates to the production upon a definite plan ofthe invading socialistic society. Certainly this is so far still to the benefitof the capitalists. 'ut in this case the e6ploitation is so palpable that it!ust brea2 don. o nation ill put up ith production conducted bytrusts ith so barefaced an e6ploitation of the co!!unity by a s!all

band of dividend#!ongers.7&n any case/ ith trusts or ithout/ the official representative ofcapitalist society # the state # ill ulti!ately have to underta2e thedirection of production.7$

=e note only a fe of the ealth of ideas here> the sociali?ation of the productive forces/ the organi?ation and planning of production and the groingrole of the state # all pointing to the danger to the continued e6istence of

capitalis!/ as class rule beco!es increasingly na2ed. +oreover/ the passage isan e6uisite portrayal of the contradictory connection that is possible beteenfor! and content. 4he invading socialist for!s pose a lethal threat to capitalis!/

but are nevertheless initially used by capitalis! to preserve itself.4he entire analysis is a frontal challenge to the notions that capitalis! can

e6ist only as a regi!e of free co!petition and that state planning is a definingcharacteristic of so!e ne non#capitalist society. Life ould be a lot si!pler iftoday<s +ar6ists understood as !uch about their on epoch as did +ar6 and5ngels before it arrived.

'ecause it has beco!e co!!on on the left since the ti!e of Stalin tocounterpose econo!ic planning and the las of capitalis! as if they ereinco!patible/ it is orth noting that 5ngels/ in his Criti/ue o% the &r%urt

Pro+ram of er!an social de!ocracy D1"91E specified that 7=hen e passfro! @oint#stoc2 co!panies to trusts hich control and !onopoli?e hole

branches of industry/ it is not only private production that ceases/ but also

planlessness.7( &n place of 7trusts7 today e ould say !ultinational $. 5ngels/ Socialism 5topian and Scienti%icA Chapter 3.(. 5ngels/ 7Iur Jriti2 des so?ialde!o2ratischen Progra!!enturfs 1"917/ in +ar6

and 5ngels/ =esammelte WerkeA Vol. ))/ 'erlin 19(3/ p. )3).

corporations # or/ for that !atter/ the i!perialist state.Lenin<s co!!entary on the sa!e point is also relevant to present#day

discussions of the 7ussian uestion7>74he trusts/ of course/ have not created/ do not create no/ and cannotcreate full and co!plete planning. 'ut to hatever e6tent they do plan/to hatever e6tent the capitalist !agnates calculate in advance thevolu!e of production on a national and even on an international scale/and to hatever e6tent they syste!atically regulate it/ e still re!ainunder capitalism - capitalis! in its ne stage/ it is true/ but still

undoubtedly capitalis!. 4he <pro6i!ity< of such capitalis! to socialis!should serve the genuine representatives of the proletariat as proof of the

pro6i!ity/ ease/ feasibility and urgency of the socialist revolution/ andnot as an argu!ent in favor of tolerating the repudiation of such arevolution or in favor of !a2ing capitalis! loo2 !ore attractive/ an

occupation in hich all the refor!ists are engaged.7%

Although capitalis! e6ists under conditions of 7creeping socialis!/7 thecircu!stances of the ne epoch !a2e it a reactionary social syste!. 4hecentral factor that brings the change in epochs about is the groth anddevelop!ent of the proletariat. 4he ne epoch can be said to be inauguratedhen the industrial or2ing class approaches its !a6i!u! strength in society/hen it beco!es organi?ed and disciplined both through its enforced role inindustry and through its on parties and trade unions # hen/ in short/ it

beco!es a threat to the property of the bourgeoisie. 4he proletariat<sdevelop!ent is the !a@or factor that drives capitalis! to beco!e a barrier to itson productive forces # but it also !a2es possible a ualitative advance

beyond capitalis!.8nce the developed proletariat appears on the scene as a potential

alternative/ the bourgeoisie turns to centrali?ation in the political sphere as ellas the econo!ic. Surplus value has to be turned aay fro! productiveaccu!ulation and e6pended increasingly on !eans of repression. +easureshave to be ta2en to forestall ne crises/ lest turbulence and additional !iserydrive the !asses to revolutionF these !easures inevitably ea2en the syste!<s

groth. 4he state apparatus e6pands to control and Din partE buy off the !assesF!ilitari?ation and nationalis! are stepped up to divert the class struggleFideologies li2e racis! and the sanctity of the fa!ily are broadcast to 2eep the

proletariat dividedF ulti!ately the bourgeoisie turns to orld ar and fascis!.All this is not a bourgeois plot/ although capitalists do conspire. &t derives fro!capital<s las of !otion. 4he deepening role of the state in the epoch ofcapitalist decay is not @ust a conseuence of the syste!<s econo!ic las> it alsoeffects the %. Lenin/ The State and eolutionA Part &V.3.

14



operation of these las. -or e6a!ple/ the state intervenes into the econo!y inorder to ensure the production of specific use values for its on purposes/ aboveall the eapons of repression and conuest. 4his does not !ean/ as Cliff says/that use values have replaced value in general as the ai! of capitalist

production. 8n the contrary/ the state !a2es use of a variety of econo!ic leversDcontracts/ ta6es/ etc.E to !otivate the capitalists to produce hat it needs.Production for value is by no !eans abolished/ even though hole sectors no

produce for the state.+oreover/ hatever the use#value !otivations of social engineers/ value

inevitably operates behind their bac2s and frustrates their intentions. 4he ,nitedStates/ for e6a!ple/ ould love to be the only =estern poer producing ar!s

B it ould !a2e fortunes selling the! and ould not have to fear !ilitarythreats fro! its present allies # but four post#=orld =ar && decades of unrivaledar!s production have under!ined its econo!ic strength in co!parison to apanand =est er!any. D=e ill say !ore on this in Chapter (.E As 5ngels andLenin observed/ the bourgeoisie can plan/ but its planning is still sub@ect to theuncontrollable las of value.

Another significant effect of the trustification and statification of capital isthe groth of the industrial and state bureaucracy. 4his layer of society is partof the e6panding 7!iddle class7 of salaried e!ployees standing beteen

proletariat and bourgeoisie. As the centrali?ation of capital gradually reduces

the proportionate eight of the traditional petty#bourgeoisie/ the capitalistsincreasingly have to rely on hired subordinates to !anage businesses anddiscipline or2ers. 4he sa!e happens as the state e6pands its econo!ic poersand develops a vast apparatus of functionaries. 4hese bureaucracies arestructured as rigid hierarchies in order to !aintain their subordination to higherauthority. &t is not the advance of technology that !a2es the! indispensable butthe class struggle> the need to !aintain e6ploitation as the ruling class itselfdi!inishes. 4he state and industrial bureaucracies are !atched by a developinglabor bureaucracy/ of hich e ill see !ore later.

4he rise of bureaucracy is not the trans#historical pheno!enon perceived by bourgeois sociologists/ occurring no under capitalis! @ust as it did under theo!an and Chinese e!perors. Capitalist bureaucracy represents the

bourgeoisie<s atte!pt to organi?e society and production in a planned ayF it isa historically specific relationship ithin late !odern capitalis!/ flourishing

@ust hen the syste! turns fro! its entrepreneurial heyday to its sociali?ing butanti#socialist epoch of decay. &t substitutes organi?ational hierarchy and ruling#class discipline for the voluntary hu!an consciousness that ill be the centraldeter!inant of planning under socialis!. D4he Stalinist nomenklatura is thee6tre!e e6a!ple of such bureaucratic hierarchy.E 'ut bureaucracy cannot helpreflect capitalis!<s underlying social anarchy. &t is an ob@ect of hatred andridicule because/

despite its rigid structure and regi!en/ it is inevitably asteful/ inefficient and parasitical on productive labor.

DECAY AND THE LAWS OF CAPITAL

&n a passage that further illustrates capitalis!<s cyclical crises prefiguring itsepochal decay/ 5ngels rote>

74heir political and intellectual ban2ruptcy is scarcely any longer asecret to the bourgeoisie the!selves. 4heir econo!ic ban2ruptcy recursregularly every ten years. &n every crisis/ society is suffocated beneath

the eight of its on productive forces and products/ hich it cannotuse/ and stands helpless/ face to face ith the absurd contradiction thatthe producers have nothing to consu!e because consu!ers are anting.4he e6pansive force of the !eans of production bursts the bonds that thecapitalist !ode of production had i!posed upon the!.7... 4he socialist appropriation of the !eans of production does aay/not only ith the present artificial restrictions upon production/ but alsoith the positive aste and devastation of the productive forces and

products that are at the present ti!e the inevitable conco!itants of

production/ and that reach their height in the crises.7"

4he fact that sociali?ation of the !eans of production is the !ethod fordoing aay ith periodic crises of overproduction confir!s that for thefounders of +ar6is! the cause of such crises is the independence of capitals/the uncoordinated nature of production # that is/ the 7anarchy7 of capitalis!/ its

private and parochial nature.+ar6 lin2ed the epochal change directly ith the falling rate of profit

tendency. After presenting the -P as 7the !ost i!portant la fro! thehistorical standpoint7 DChapter 1E/ he elaborated>

74he develop!ent of the productive forces brought about by the his#torical develop!ent of capital itself/ hen it reaches a certain point/suspends the self#reali?ation of capital instead of positing it. 'eyond acertain point the develop!ent of the poers of production beco!e a

barrier for capitalF hence the capital relation a barrier for the develop#

!ent of the productive poers of labor. =hen it has reached this point/capital/ i.e. age labor/ enters into the sa!e relation toards the de#velop!ent of social ealth and of the forces of production as the guildsyste!/ serfdo! MandN slavery/ and is necessarily stripped off as a fetter.4he last for! of servitude assu!ed by hu!an activity/ that of age laboron one side/ capital on the other/ is thereby cast off li2e a s2in74he groing inco!patibility beteen the productive develop!ent of

". 5ngels/ Socialism 5topian and Scienti%icA Chapter 3.

1-



society and its hitherto e6isting relations of production e6presses itself in bittercontradictions/ crises/ spas!s. 4he violent destruction of capital not by relationse6ternal to it/ but rather as a condition of its self#preservation/ is the !oststri2ing for! in hich advice is given it to be gone and to give roo! to a higherstate of social production.79

+ar6 did not spell out the connection beteen the falling rate of profit andthe epoch of decay/ e6cept to observe that declining capitalist profits ledunderstandably to violent crises. 8ur interpretation of the -P provides atheoretical lin2.

=e sa that the -P do!inates its countertendencies during the e6pansion periods of the business cycle/ hereas during crises the chief countertendencyDthe cheapening of constant capitalE ta2es over/ and the rate of profit<s fall isoffset. 4o recapitulate> fir!s calculate the value of their capital according tohat they originally paid for it/ !inus depreciation due to its physical ear andtear. 'ut there is also the 7!oral7 ele!ent of depreciation # capital has beendevalued because rival capital serving the sa!e use has since been producedith less labor/ and therefore the reproduction of the sa!e capital reuires less.As a result/ the old capital is overvalued.

So the value of older/ obsolete capital has a fictitious co!ponent> its value isnot based solely on labor ti!e socially necessary for reproduction. 4he

capitalists involved/ hoever/ bought their capital at its old/ higher/ value andhave to suffer the conseuences/ a loer rate of profit. +ar6 studied the pheno!enon of fictitious capital in Volu!e 3 of Capital in connection ith thegroth of credit/ but he did not connect it to the falling rate of profit. -or +ar6/the -P tendency depended only on the actual/ !aterial value of capital and didnot reuire ta2ing fictitious valuation into account.

,nder classical co!petitive capitalis!/ a fir! hose capital had a largefictitious co!ponent ould have a lo profit rate and ould lose the co!#

petitive struggle to survive. 'ut in the ne epoch it is the big !onopolies thatcreate fictitious capital/ and they are not so easily disposed of. -or one thing/they can use their si?e/ cartel arrange!ents and govern!ental influence to!aintain their !ar2et position even at the cost of holding bac2 technical

progress in so!e sectors. 4heir incentive to do so is the fear of self#co!petition>if they ere to allot ne invest!ents to a sphere of industry here they arealready active/ that could !ean co!peting ith

9. +ar6/ =rundrisseA pp. %*9#%$0. ote the casual assu!ption in this passage that

capital and age labor are one and the sa!e relation. +ar6<s e6plicit state!ents onthis have already been cited in Chapter 1/ but the point has been so obscured that itdeserves repeating.

their on units. 8f course/ co!petitive pressures a!ong !onopoly fir!sco!pel !oderni?ation. 'ut their poer over the !ar2et prolongs the life ofeuip!ent that ould otherise be destroyed as obsolete.

&n the e6tre!e/ if a !onopoly fir! as a hole faced collapse/ it ouldthreaten to bring others don too/ even efficient ones # since such a fir!e!ploys thousands of or2ers and is financially and co!!ercially tied toevery !a@or sector of the capitalist class. Alloing it to go under ould addgreatly to social instability and threaten the national econo!y. Gence the stateoften has to revive large fir!s in danger of collapseF 7survival of the

econo!ically fittest7 is replaced by survival of the politically strongest. 4he!onopoly epoch destroys capitalis!<s last self#@ustification> that despite itsra!pant ineuities it is the only ay to produce goods efficiently. 4hus theepoch is indeed one of decay. As +ar6 noted>

7... as soon as for!ation of capital ere to fall into the hands of a feestablished big capitals/ for hich the !ass of profit co!pensates for thefalling rate of profit/ the vital fla!e of production ould be altogether

e6tinguished.710

Analogously/ under Stalinis! unprofitable enterprises are alloed to re!ainin operation. Gere too the fratricidal drives of capital conflict ith the syste!<sdesperate need for stability in the face of an organi?ed and co!bative

proletariat. 4hat is hy Stalinis!/ no forced to ban2rupt fir!s that have long been unprofitable/ faces a real peril.

&n the !odern epoch of capitalis!/ therefore/ the syste!<s traditional crisescannot so easily be used to restructure capital and counter the falling rate of

profit tendency. 'ut crises hose resolution is suppressed on the national levelor postponed by state action reappear in !ore frightening for! internationally.4he result is that the )0th century has itnessed a ne for! of crisis cycle> the

buildup of contradictions that e6presses itself in the e6plosion of orld arsand great depressions.

4he las of capital in the !onopoly epoch interfere in particular ith thetendency for profit rates to euali?e. Surplus value is no longer shared in

proportion to the value of each capital<s invest!entF !onopolies get a

disproportionate share/ hatever their relative organic co!position. D+ono# poli?ation in the !odern era is co!!on in the !ost capital#intensive industries/here the sheer cost of fi6ed capital is a poerful barrier to the entry ofco!petitors.E +onopolies that do not 2eep up ith technical progress arenevertheless able to clai! a share of total surplus value reflecting the price theyoriginally paid for their capital # not @ust a price proportional to its presentvalue/ its cost of reproduction.

4his does not !ean/ hoever/ that the !onopolies< rate of profit ill 10. CapitalA Volu!e &&&/ Chapter 1$/ Part 3 Dp. )$9E.

18



necessarily appear on the boo2s as higher than average. So!e +ar6ists havechallenged the idea of 7!onopoly profits7 by citing statistics shoing that

!onopoly fir!s< profits are no higher than others<.11 4heir figures !ay beaccurate/ but they are irrelevant. Capital !ar2ets evaluate a given capital chieflyaccording to its e6pected return. So hen a !onopoly appropriates adisproportionate share of surplus value/ the price of its stoc2 goes up/ out of

proportion to the capital<s !aterial value. 4hus its rate of profit appears to be nohigher than average/ because higher surplus value is balanced by a highercapitali?ation Dthe fictitious value given the capital in the !ar2etE. As a

conseuence the overall rate of profit leans toard an apparent average/ not thegenuine average that characteri?es the epoch of 7capitalist co!!unis!.7 8fcourse/ the chief oners of such !onopoly fir!s did not pay inflated prices fortheir shares/ and their rate of profit/ accordingly/ is !uch higher.

Another argu!ent against the ineuality of profit rates is the folloing> true/!onopolies obtain a !onopoly profit rate higher than average and conseuentlyforce don the profit rate of non#!onopoly capitals belo average. 'ut iththe further develop!ent of capitalis!/ the degree of !onopoly control of the!ar2et increasesF as the !onopoly sector gros and approaches 100 percent of

production/ its average rate of profit do!inates the overall average profit rateand eventually the to rates coincide # bringing the !onopoly profit rate bac2

don to the average.1) 4his argu!ent presupposes a tendency for the si?e andstrength of capitalist fir!s to euali?e/ a virtual i!possibility in the epoch ofdecay. =hile !onopoli?ation does affect !ore and !ore spheres of capital/ thestrongest fir!s continue to e6pand/ branching fro! one sector and fro! onecountry to another. At the sa!e ti!e/ s!all capitals continue to co!e into e6ist#ence/ hile so!e !onopolies and cartels brea2 don under the pressure ofco!petition that is never totally eli!inated. 4he tendency toard groingineuality of poer Dand of profit ratesE is by no !eans over.

&n su!/ in the !odern epoch the -P tendency is not regularly balanced bythe cheapening of constant capitalF rather this countertendency conflicts ithanother/ the fictitious valuation of fi6ed capital. Gence the -P ins out overits !a@or countertendency. 8ne i!portant result is that the rate of econo!ic

groth Daccu!ulationE declines> in the non#!onopoly sectors because they haveless surplus value to invest/ and in the !onopoly sectors because furtherinvest!ent contains the threat of self#

11.-or e6a!ple/ Steve Ieluc2/ 78n the 4heory of the +onopoly Stage of Capitalis!/7

<+ainst the CurrentA -all 19"0.1).Ale@andro :abat/ 7La nivelacion de la tasa de ganancia en el capitalis!o

conte!poraneo/7 e(ateA +ay#une 19%9

co!petition !entioned above.4he falling rate of profit la reflects the contradictions beteen use and

value/ as ell as beteen the e6pansion and the preservation of value. &t is notthe cause of the epoch of decayF rather/ in this epoch capitalis!<s onresistance to the contradictions of capital brings the -P tendency to fullfloer. 4he -P therefore sy!boli?es the barrier to the e6pansion of the

productive forces that capitalis! has erected in this epoch. 4he violentconseuences that +ar6 foresa Dand reality confir!sE rest on a solidtheoretical foundation.

STAT7 CAP,TAL,SM

4he analysis of centrali?ation and the state leads to the pheno!enon of statecapitalis!. =e sho here that state capitalis! is inherent in the syste!<s epochof decay and has an a!ple heritage in +ar6ist theory. -irst an observation by+ar6>

7&n any given branch of industry/ centrali?ation ould reach its e6tre!eli!it if all the individual capitals invested in it ere fused into a singlecapital. &n a given society the li!it ould be reached only hen theentire social capital as united in the hands of a single capitalist or a

single capitalist co!pany.713

5lsehere +ar6 characteri?ed @oint#stoc2 co!panies as 7the abolition of thecapitalist !ode of production ithin the capitalist !ode of production itself/7

or 7private production ithout the control of private property.71* +ar6<s parado6ical language !ade clear that he did not regard such sociali?ation ofonership as the abolition of capitalis!. &t is only the capitalist !ode in thenarroest sense that is transcended/ the age hen the individual oner as

boss. 4he parado6 as the contradictory and unstable relationship !aturingithin capitalis! itself.

+ar6 also observed that the co!bined capitalist function of onership and!anage!ent had bro2en don into separate tas2s for different individuals/ andthat profit beca!e 7!ere co!pensation for oning capital that no is entirelydivorced fro! its function in the actual process of reproduction/ @ust as this

function in the person of the !anager is divorced fro! onership of capital.71$

4he divided role of the capitalist arises again hen e study the econo!y ofthe !odern ,SS.

5ngels too2 the analysis further by bringing in the state>74he transfor!ation either into @oint#stoc2 co!panies and trusts or

13.CapitalA Vol. &/ Chapter )$ Dp. ()%E.1*.CapitalA Vol. &ll/ Chapter )% Dpp. *3(/ *3"E.1$.CapitalA Vol. &ll/ Chapter )% Dpp. *3(#%E. Li2eise> 7the capitalist e6ists in a dual

for! # @uridically and econo!ically/7 Theories o% Surplus )alueA Vol. &ll/ p. *$".19



into state onership does not do aay ith the capitalist nature of the productive forces. &n the @oint#stoc2 co!panies and trusts this is obvious. Andthe !odern state/ again/ is only the organi?ation that bourgeois society ta2es onin order to support the e6ternal conditions of the capitalist !ode of productionagainst the encroach!ents of individual capitalists as ell of the or2ers.

74he !odern state/ no !atter hat its for!/ is essentially a capitalist!achine/ the state of the capitalists/ the ideal personification of the totalnational capital. 4he !ore it proceeds to the ta2ing over of productiveforces/ the !ore does it actually beco!e the national capitalist/ the !ore

citi?ens does it e6ploit. 4he or2ers re!ain age#or2ers B proletarians. 4he capitalist relation is not done aay ithF it is rather brought to a head. 'ut brought to a head it topples over. State onershipof the productive forces is not the solution of the conflict/ but concealedithin it are the technical conditions that for! the ele!ents of that

solution.71(

5ngels< e6planation for the groth of 7the !odern state7 o!its one cause. ot only is a poerful state needed to age the class struggle against theor2ers and discipline individual !e!bers of the bourgeoisieF it is also neededto protect the capitalists at ho!e fro! those abroad. 8f course/ the state todayco!!ands even greater poer than in the late 19th century hen 5ngels rote.4hat is both a result of the epoch of decay and a deter!inant of certain of its

characteristics.Capitalis!<s tendency toards centrali?ation and therefore statification

brings out the social character of !odern production # but in bourgeois for!/ because the !eans of production re!ain in private hands/ those of the ruling bourgeoisie or its state. 4he 7solution7 of the conflict that 5ngels refers to is thesocialist revolution that places industry/ already largely sociali?ed/ into thehands of the or2ers< state.

5ngels< re!ar2 that capitalis! hen 7brought to a head7 through statification7topples over7 Dor in another 5nglish translation/ 7turns into its opposite7E has

been interpreted to !ean that full statification auto!atically !eans the end ofcapitalis! and therefore the e6istence of a or2ers< state # even here the

or2ers had little directly to do ith the transfor!ation Das in 5ast 5urope after=orld =ar &&E. 5ngels effectively denies this !eaning in the ne6t sentence/ buthat then does he !ean by the cryptic phrase 7topples over7H 4o decide/ efirst note that the bringing to a head has never actually occurred> no bourgeoisiehas gone so far as to abolish 1(. 5ngels/ Socialism 5topian and Scienti%icA Chapter 3.1%. -or e6a!ple/ 4ed rant Dthe leader of the 'ritish ilitant tendencyE/ The ar!ist

Theory o% the State - < eply to Tony Cli%% D19%3E

private property by co!pletely entrusting its onership function to thestate. 4rots2y e6plained hy>

74heoretically/ to be sure/ it is possible to conceive a situation in hichthe bourgeoisie as a hole constitutes itself a stoc2 co!pany hich/ by!eans of its state/ ad!inisters the hole national econo!y. 4heecono!ic las of such a regi!e ould present no !ysteries. ... Such aregi!e never e6isted/ hoever/ and/ because of profound contradictionsa!ong the proprietors the!selves/ never ill e6ist # the !ore so since inits uality of universal repository of capitalist property/ the state ould

be too te!pting an ob@ect for social revolution.71"4hat is/ ta2ing capitalis!<s centrali?ation and statification tendency to its

li!it ould be conceivable theoretically but not practically B not because ofany structural barrier inherent in the organi?ation of capital/ but because of theopposing classes< antagonistic relations and the fratricidal nature of the

bourgeoisie. 5ngels< re!ar2 undoubtedly !eant the sa!e thing> if the capitalistclass ere to ta2e the road of co!plete statification/ that ould uic2ly lead tothe proletarian 7solution7 of abolishing/ not e6tending/ capitalist poer. Gesaid as !uch in the discussion of trusts already uoted> 7the e6ploitation is so

palpable that it !ust brea2 don. o nation ill put up ith ... so barefaced ane6ploitation of the co!!unity by a s!all band of dividend#!ongers.7

4he e6propriation of the capitalist e6propriators is both an ob@ectively

de!anded conseuence of historical develop!ent and a proletarian tas2reuiring sub@ective revolutionary consciousness. =ithout the latter/ theob@ective tendency ould inevitably be blunted and hu!anity ould fall into

barbaris!.=e have seen that +ar6 considered a !ultiplicity of capitals to be a

necessityF as he said/ 7a universal capital/ one ithout alien capitals

confronting it/ ith hich it e6changes ... is therefore a non#thing.719 4he possibility of a lasting 7single capital7 e6ists only under a or2ers< state in thecourse of its transition to socialis! # that is/ on the road to finally abolishingcapital in the course of abolishing itself Dsee Chapter 3E. 8nly in this senseould a society of one capital !ean the end of capitalis!. 8f course/ capitalist

states have been able to !ove far don the road to state capitalis! hen theyneeded to/ especially in arti!e. 5ven that bastion of private property/ the,nited States/ i!posed national planning during =orld =ar &&> fir!s ere toldhat and ho !uch to produce/ so!e ere forced out of business and suppliesere regulated centrally. =hen the ar e!ergency as over the planning

poers of the state

1".4rots2y/ The eolution #etrayedA Chapter 9/ pp. )*$#(.19.+ar6/ =rundrisseA p. )1.

9:



declined/ although of course the state retained a !a@or econo!ic role.:espite the clear anticipation of state capitalis! by +ar6 and 5ngels/ !any

+ar6ists have argued that such a syste! is i!possible # not @ust as an analysisof the Soviet econo!y but in theory as ell. 4hey overloo2 that the las ofcapital/ even under state capitalis!/ are perfectly co!patible ith stateonership of enterprises. 4hey only reuire a !easure of practicalindependence/ as e ill see in Chapter $.

A basis for the 7i!possibility7 reasoning as provided by the 'olshevi2econo!ist 5vgeny Preobra?hens2y in the 19)0<s/ in a discussion of er!an

state !onopoly capitalis! in =orld =ar &>74he regulation of the hole of capitalist production by the bourgeoisstate reached a degree unprecedented in the history of capitalis!.Production hich for!ally re!ained co!!odity production astransfor!ed de %acto into planned production in the !ost i!portant

branches. -ree co!petition as abolished/ and the or2ing of the la ofvalue in !any respects as al!ost co!pletely replaced by the planning

principle of state capitalis!.7)1

Preobra?hens2y dre bac2 fro! concluding that the near#replace!ent of thela of value in er!any had abolished capitalis!/ or even nearly so. 'ut hisclai! that state capitalist planning cancels the la of value relies on the!isconception e encountered earlier> that the la of value is defined by

co!petition rather than si!ply being carried out through it. Preobra?hens2y<s!isunderstanding of value in relation to state capitalis! set the tone forothers. A co#thin2er of +andel rites that 7=hen this co!petition Mbeteen

private capitalsN slac2ens as a result of concentration of capital or state

protection/ the la of value loses so!e of its strength.7)) And Cliff says that7+onopoly capitalis! !eans a partial negation of the +ar6ian la of value buton the basis of the la of value itself. ... 4he partial negation of the la of

value (orders on its total negation.7)3 Cliffs theory of use values as the ai! ofcapitalist production DChapter 1E shos that he !eans the total negation of thela of value. 'ut the la of value is not negated in the epoch of decay/ not even

partially # not/ that is/ in the sense of Preobra?hens2y and Cliff of being

)0. A te6tual analysis of +ar6 !a2ing clear that this as his vie can be found in

Paresh Chattopadhyay/ 78n the +ar6ian Category of <Co!petition of Capitals< andits elevance for the <Postrevolutionary< 5cono!y/ esearch in Political &conomyA

Vol. 10 D19"%E.)1. Preobra?hens2y/ The :e &conomicsA p. 1$3.)). Catherine Sa!ary/ 7Plan/ +ar2et and :e!ocracyF 4he e6perience of the so#called

socialist countries7/ :ote(ooks %or Study and esearch o. %K" D19""E/ p. *%.)3. Cliff/ ussiaA < ar!ist <nalysisA p. 1$3F State Capitalism in ussiaA p. )1)

al!ost co!pletely erased or replaced. ust as under capitalist co!!unis! Da pheno!enon that predates this epochE/ it is apparently violated/ but that is adifferent !atter. As Cliff recogni?es/ the change in the appearance of the laoccurs on the basis of the la itself # hich ought to !ean Dbut does not forCliffE that value is still the do!inant principle of capitalist production.Co!!odity production is still decisive/ and the value of a co!!odity is stilldeter!ined by the socially necessary labor ti!e it e!bodies/ despite thegroing variety of distorting factors.

&n fact/ if e understand the la of value to be the basis of capitalis!<s

ineuality/ violent contradictions and crises # and that in this epoch thecapitalist syste! of e6ploitation e6tends itself across the globe through thedestruction of co!peting !odes of production B then it is clear that the la ofvalue still operates/ and if anything !ore intensively. 4he abolition of the laof value or even its ea2ening ould a!ount to a tre!endous victory for theoppressed and e6ploited of the orld. 'ut that it not hat happened in theJaiser<s arti!e er!any or Stalin<s ussia.

&n su!/ the possibility of state capitalis! flos fro! the operation ofcapitalis! in its epoch of decay. Although none of the great +ar6ists could

possibly foresee the specific co!bination of revolution and counterrevolutionthat led to Stalinist capitalis!/ their theoretical analysis of the nature ofcapitalis! allos us to see it for hat it is. 4rots2y/ in his discussion of state

capitalis!/ discounted the li2elihood of the bourgeoisie nationali?ing theentirety of capitalist property itself. 'ut the !odern ,SS arose through adifferent historical process. 4he incredible parado6 is that only the victorious

proletariat could ta2e the centrali?ing drive of capital to its unified conclusion.4hrough the Stalinist counterrevolution that victory as turned into a statifiedcapitalis! that no bourgeoisie could ever have achieved on its on.

4 ,MP7R,AL,SM

After 5ngels< death in the 1"90<s/ socialists continued to analy?e the nestage of capitalis! and in particular to ta2e account of its groing international

di!ension. 4he theory reached its pea2 in Lenin<s or2 under the i!pact of the-irst =orld =ar/ hen the epoch of capitalist decay as finally understood asthe epoch of i!perialis!. 4he revolutionary events of the period alsoco!pelled +ar6ists to elaborate ne strategies> Lenin<s efforts to build arevolutionary vanguard party and international/ and 4rots2y<s theory of

per!anent revolution.

94



R7V,S,)!,SM

At the turn of the )0th century/ socialists noted ith interest the rise ofinternational cartels that controlled production across national boundaries #supple!enting the @oint stoc2 co!panies/ trusts and statification that +ar6 and5ngels had already observed. As ell/ fro! the late 1"%0<s on/ the 5uropean

poers co!pleted the coloni?ation of Asia and AfricaF the capitalist !ar2etno e!braced the orld. At first sight all this could be regarded as si!ply thee6tension across national borders of the las of capital accu!ulation andcentrali?ation # but no uantitative develop!ent had resulted in the ualitative

changes that +ar6 and 5ngels had foreseen. 4his had to be incorporated into thetheory/ and a debate ensued hose issues are still controversial.

4he first to ta2e up the ne situation as the 7revisionist7 current of openrefor!ists ithin the er!an Social :e!ocratic Party Dthe SP:EF they arguedthat the develop!ent of capitalis! itself ould beco!e socialis! if pushed bythe or2ers< !ove!ent. 4he SP: as decisively influenced by the trade union

bureaucracy/ gron poerful through the rapid industriali?ation that had !adeer!any a orld poer. A period of prosperity starting around the turn of thecentury and a li!ited acceptance of the socialist opposition by the bourgeoisstate had created illusions in capitalist stability and social peace. 4he refor!istshoped that the bourgeoisie/ hich had once tried to e6clude the unions andsocialist politicians fro! the de!ocratic fra!eor2/ ould no elco!e the!.

7:e!ocracy7 as the price the 5uropean bourgeoisie had had to pay for thesupport of laborers and artisans in the bourgeois revolution against feudalis!.'ut its original pro!ise of rule by the !asses had been transfor!ed. ,ndercapitalis! it !eant instead the !utual acco!!odation and rivalry of variousspheres of capital/ a or2ing arrange!ent that !aintained the syste! ithoutconstant internal arfare. &t also alloed the incorporation of the !asses<de!ands in order to prevent further revolutions. &n the er!an or2ing class/the de!and for de!ocratic rights accelerated at the very ti!e hen theirapparent opposite/ bureaucracy/ as groing inside the unions and the party.&ndeed/ the call for a purely de!ocratic progra! ca!e precisely fro! the

bureaucratsF it as their countereight to the +ar6ist tradition of revolution. &t!eant not !ass control of the state or even of the or2ers< organi?ations/ butrather the latter<s 7institutionali?ation7 DparticipationE ithin the capitalist stateapparatus.

evisionis!<s leading intellectual spo2es!an/ 5duard 'ernstein/ gave this progra! a theoretical cover. Ge argued that the concentration and centrali?ationof capital had enabled capitalis! to overco!e its tendency toard crises.Socialis! could no be achieved progressively/ not by revolution but throughor2ers< pressure for refor!s and the for!ation of 7cooperative associations/7hich ould 7transfor! the state in the direction of de!ocracy.7 4his as notonly possible but also necessary/ since capitalist centrali?ation ould lead to

authoritarian poer unless the or2ers< !ove!ent added the de!ocraticele!ent. 'ernstein said>

7&t is !y fir! conviction that the present generation ill see thereali?ation of a great deal of socialis!/ if not in the patented for! then atleast in substance. 4he steady enlarge!ent of the circle of social dutiesand of the corresponding rights of the individual to society and ice

ersa; the e6tension of the right of supervision over the econo!ye6ercised by society organi?ed either as nation or state/ the develop!entof de!ocratic self#govern!ent in co!!unity/ county and provinceF and

the enlarge!ent of the tas2s of these bodies # all these signify for !egroth into socialis!/ or/ if you ish/ piece!eal reali?ation ofsocialis!. 4he transfer of econo!ic enterprises fro! private to public!anage!ent ill/ of course/ acco!pany this develop!ent/ but it ill

proceed only gradually.7)*

'ernstein challenged the SP:/ the strongest section of the Socialist&nternational/ to 7appear as hat it in fact no is/ a de!ocratic socialist partyof refor!.7 4his appraisal as correct in the sense that refor!is! as thedo!inant trend in er!an social de!ocracy/ despite the presence of arevolutionary left ing and the continued adoption of revolutionary platfor!s

by the party as a hole. &n +ar6ist ter!s/ the SP: as centristB its refor!ist practice belied its revolutionary procla!ations. Socialis! for the party had

already beco!e a goal for the future or !erely a !oral ideal. 4his a!bivalencein its centris! ca!e to an end and refor!is! proved to be do!inant hen the

party fell in behind the er!an bourgeoisie in support of the ar effort in191*.

T>7)R,7S )& ,MP7R,AL,SM

osa Lu6e!burg/ a leading figure in the er!an and Polish parties/ asthe !ain left opponent of the er!an revisionist trend. She not only believedthat the ne stage of capitalis! had placed socialis! on the political agenda/

but also insisted in response to 'ernstein that the tendencies toard crisis andcollapse ere even !ore poerful than in capitalis!<s previous epoch. She

pointed out that de!ocratic rights could easily be reversed once the classstruggle heated up/ that the refor!s alloed by capital are only thoseco!patible ith the production of profits/ and that one genuine trend Dhich'ernstein did not stressE as the rapid

)*. 'ernstein/ n the Fistory and Theory o% Socialism D1"9"E/ cited in Peter ay/ The

ilemma o% emocratic Socialism D19()E/ p. ))1. 8ther uotations fro! 'ernsteinhere are fro! &olutionary Socialism Doriginally The Presuppositions o% Socialism

and the Tasks o% Social emocracyA 1"99E.

9-



capitalists generated by the industrialists< desire for control over agrariancolonies/ not as an innate drive of capitalis!. Gence it could be transcended and

pacified ithout socialist revolution.

L7!,!6S <,MP7R,AL,SM<

4he best 2non +ar6ist or2 on i!perialis! is Lenin<s pa!phlet/ .m-

perialismA the Fi+hest Sta+e o% Capitalism$ &t as ritten in 191( as a 7popularoutline7 and dre far#reaching political conclusions/ but C?arist censorship

prevented Lenin fro! !a2ing his revolutionary progra! e6plicit. Later the

deification of Lenin by the Co!intern turned his ritings into sacred te6ts>observations hose conte6t Lenin had carefully li!ited have been echoedunthin2ingly for decades/ hile his real contributions are !ost oftenoverloo2ed.

Lenin described five basic features of the ne stage> !onopoly/ financecapital/ the e6port of capital/ international cartels and the territorial division ofthe orld a!ong the great poers. Ge also folloed Gilferding incharacteri?ing i!perialis! as a ne reactionary epoch of capitalis! in hichthe bourgeoisie ai!ed at orld do!ination/ not its early goal of freedo! fro!feudal restraint. 'ut he treated this insight dialectically> the transfor!ation tothe ne epoch also reflected progressive changes. -or Lenin/ as for 5ngels/ the

!onopolist and statist tendencies i!!inent in decaying capitalis! are not class#neutral for!s/ adaptable eually ell to bourgeoisie and proletariat. 4hey areanti#capitalist even under bourgeois rule in that they reflect the future

proletarian societyF they thereby pose a threat to the bourgeoisie>7Co!petition beco!es transfor!ed into !onopoly. 4he result isi!!ense progress in the sociali?ation of production. &n particular/ the

process of technical invention and i!prove!ent beco!es sociali?ed. ...Capitalis! in its i!perialist stage leads right up to the !ost co!#

prehensive sociali?ation of productionF it/ so to spea2/ drags thecapitalists/ against their ill and consciousness/ into so!e sort of a nesocial order/ a transitional one fro! co!plete free co!petition to

co!plete sociali?ation.730

Lenin too used 7sociali?ation7 in the capitalist conte6t to indicate that production beco!es social hile appropriation re!ains private. 'ut the !eansof production are no ready for the proletariat to ta2e over and harness/ therebyfreeing the productive forces fro! the restraints of bourgeois relations.

7Capitalis! only beca!e capitalist i!perialis! at a definite and very highstage of its develop!ent/ hen certain of its funda!ental charac#

30. Lenin/ .mperialismA the Fi+hest State o% CapitalismA Chapter 1

teristics began to change into their opposites/ hen the features of theepoch of transition fro! capitalis! to a higher social and econo!ic

syste! had ta2en shape and revealed the!selves in all spheres.731

4he arrival of the epoch of !onopoly and i!perialis! !eant thatsociali?ation as on the agenda/ and not only in the li!ited sense possibleunder capitalis!. Capital as internationali?ing the division of labor andcentrali?ing econo!ic lifeF as +ar6 and 5ngels had foreseen/ the productiveforces had no developed to the point here scarcity could be abolished andtherefore a classless society as achievable. 'ut this reuired an

internationally centrali?ed econo!y. -or Lenin/ i!perialis! as 7the higheststage of capitalis!7 not @ust because it as the !ost recent but because it stoodat the doorstep of socialis!.

=e note/ by the ay/ that Lenin used 7i!perialis!7 not in the ord<severyday !eaning of do!ination of ea2 countries by the strong. 4he co!!onusage is absolutely true but is not the hole pictureF even before the i!perialistepoch there had been capitalist i!perialis! in the everyday sense. &t first too2

place through outright plunder/ then through trade relations that devastated the pre#capitalist artisans and or2shops of the colonial countries. &n contrast/ thene epoch sa the all#out e6port of capitalist relations of production and theconuering of the hole orld for the production of surplus value.

Against Jauts2y/ Lenin argued that the giant bloc2s of capital created in thene epoch ould inevitably battle each other rather than !ergeF !onopoly didnot negate co!petition. &ntensified co!petition for the redivision of the orld/not international unification/ defined the !onopoly epoch. 4herefore socialis!as not only possible but also necessary. 4here as no other ay out ofcapitalis!<s crises and !isery/ because the ne epoch of ar and decaythreatened to hurl hu!anity bac2 to barbaris!. Lenin<s vie sharply contrastedith refor!is!<s portrait of capitalist sociali?ation as inherently progressive.

ust as the i!perialist epoch produced not a unitary capital but co!petition beteen !assive rivals/ so on the orld scale it produced not si!ply theinternationali?ation of capitalis! but the e6pansion of the hege!onic poersat the e!pense o% others$ =ith the e6port of capital/ capitalist invest!ent no

do!inated econo!ics and politics everyhereF the surplus value of the entireorld as siphoned into the i!perial treasuries. So!e of the i!perial surplusas ploed bac2 for the capitalist develop!ent of the coloniesF !ore of itunderrote the financial and service econo!ies of the i!perialist poers.&!perialis! !eant not @ust super#e6ploiting labor/ although that created !iseryenough/ but also

31. .mperialism $$$A Chapter %

99



depriving the colonies and se!i#colonies of their resources.&n the i!perialist epoch/ therefore/ the countries of the orld ere divided

into to categories> i!perialists and their victi!s. Capitalist oppression of the proletariat and peasantry as no intensified by the super#oppression of theor2ing people of the 7i!periali?ed7 countries/ ith the assistance of their onrulers.

=hile disagreeing ith Lu6e!burg<s theoretical e6planation/ Lenin sharedher vie that the ne epoch !ade inevitable i!perialist ars to redivide andsub@ugate the orld/ and that such ars could in no ay be progressive. 'ut in

contrast to Lu6e!burg he believed that national oppression ould sti!ulate progressive liberation !ove!entsF !oreover/ the or2ers< defense of the rightto national self#deter!ination ould help in the oppressed !asses to the sideof the 5uropean proletariat in the fight against capitalis!. 4his to#sidedstruggle by the or2ing class characteri?ed Lenin<s revolutionary progra!.

:espite the disputes beteen Lenin and Lu6e!burg over ho to fightnational oppression/ neither thought to abandon internationalis! and e!bracenationalist ideology as such # or to defend i!perialis!<s conuests as so!eho

beneficial. 'ut !any a social de!ocrat held both vies/ including the anti#

authoritarian 7de!ocrat7 'ernstein.3)

,MP7R,AL,SM A!D T>7 LAWS )& CAP,TAL

Lenin never fully elaborated connection beteen the las of capitalistdevelop!ent and capitalis!<s transfor!ation into a decadent i!perialist syste!.Gence the theoretical basis of his analysis of i!perialis! has beencontroversial. Ge did/ hoever/ give a brief e6planation for the e6port ofcapital. 4his has co!e to be seen as the pri!e characteristic of his theory ofi!perialis! Din particular/ by theorists ho deny that the Soviet ,nion of todayis i!perialistE/ so it !erits investigation.

78n the threshold of the tentieth century e see the for!ation of a netype of !onopoly> first/ !onopolist capital co!bines in allcapitalistically developed countriesF secondly/ the !onopolist position ofa fe very rich countries/ in hich the accu!ulation of capital hasreached gigantic proportions. An enor!ous <superabundance of capital<has arisen in the advanced countries.7&t goes ithout saying that if capitalis! could develop agriculture/hich today frightfully lags behind industry everyhere/ if it could raisethe standard of living of the !asses/ ho are everyhere still half#starvedand poverty#stric2en/ in spite of the a!a?ing technical progress/ therecould be no tal2 of a superabundance of capital. 4his <argu!ent<

3). 'ernstein/ &olutionary SocialismA p. 1%3

is very often advanced by petty#bourgeois critics of capitalis!. 'ut ifcapitalis! did these things it ould not be capitalis!F for both unevendevelop!ent and a se!i#starvation level of e6istence of the !asses arefunda!ental and inevitable conditions and pre!ises of this !ode of

production. As long as capitalis! re!ains hat it is/ surplus capital ill beutili?ed not for the purpose of raising the standard of living of the !asses in agiven country/ but for the purpose of increasing profits by e6porting capitalabroad to the bac2ard countries.

7&n these bac2ard countries/ profits are usually high/ for capital is

scarce/ the price of land is relatively lo/ ages are lo/ ra !aterialsare cheap. ... 4he necessity for e6porting capital arises fro! the fact thatin a fe countries capitalis! has beco!e <overripe< and Doing to the

bac2ard stage of agriculture and the i!poverished state of the !assesE

capital cannot find a field for <profitable< invest!ent.733

Lenin did not spell out hat he !eant by the superabundance of capital orthe overripeness of capitalis!/ and this has left his theoretical vies open toide interpretation. 4o so!e critics the above passage shos hi! to be an

underconsu!ptionist because of his stress on the poverty of the !asses.3* 'utthis is doubtful> despite his erroneous insistence on capitalis!<s inability todevelop agriculture profitably/ Lenin had long been an opponent ofunderconsu!ptionis!. 5arly in his political life he defended a

disproportionality theory against it/3$ and at another point in .mperialism itself/he argued against Jauts2y and Gilferding/ a!ong others>

74he state!ent that cartels can abolish crises is a fable spread by bourgeois econo!ists ho at all costs desire to place capitalis! in afavorable light. 8n the contrary/ !onopoly hich is created in certain

branches of industry increases and intensifies the anarchy inherent incapitalist production as a hole$ $$$ 4he privileged position of the !osthighly carteli?ed/ so#called heay industry/ especially coal and iron/causes <a still greater lac2 of coordination< in other branches of industry... At the sa!e ti!e the e6tre!ely rapid rate of technical progress givesrise to increasing ele!ents of disparity beteen the various spheres of

33. .mperialism $$$A Chapter *.3*. -or e6a!ple/ Ale6ander 5rlich in Politics and SocietyA -all 19%3.3$.74he various branches of industry/ hich serve as <!ar2ets< for one another/ do not

develop evenly/ but outstrip one another/ and the !ore developed industry see2s aforeign !ar2et. 4his does not !ean at all <the i!possibility of the capitalist nationreali?ing surplus#value<... &t !erely indicates the lac2 of proportion in thedevelop!ent of the different industries.7 DLenin/ The eelopment o% Capitalism in ussiaA Collected =or2s/ Vol. 3/ p. ((.E

2:



national econo!y/ to anarchy and crises.73(

4his surely reflects a theory of disproportionality/ not underconsu!p#tionis! # but one very different fro! Gilferding<s refor!ist version.

4he previous passage on the e6port of capital/ carefully read/ also leads tonon#underconsu!ptionist conclusions. -irst/ bac2ard agriculture and !ass

poverty are given as factors additional or subordinate to 7overripe#ness7 that produce the pressure to e6port capital # not its causes. Second/ ifi!poverish!ent 2eeps the !asses at ho!e fro! buying bac2 the full product oftheir labor/ the !asses are even !ore i!poverished in the bac2ard countries.As ell/ Lenin notes that the capitalists are 7increasing profits by e6portingcapital abroad to the bac2ard countries.7 &f e6cessive profits ith fe outletsfor invest!ent ere the proble!/ as underconsu!ptionis! i!plies/ hy ouldcapitalists search for ays to create !oreH

+oreover/ Lenin as arguing against ohn Gobson/ the non#+ar6istunderconsu!ptionist econo!ist ho had ritten a !a@or or2 on i!perialis!Dhe is one of the 7petty#bourgeois critics of capitalis!7E. Lenin places7superabundance of capital7 in uotation !ar2s not only to e6press the ironythat hat is abundant for capital is !iserably deficient for the !asses/ but alsoto sho that capital is e6cessive for the capitalists only in a specific sense. As+ar6 noted/ capital is sent abroad 7not ... because it absolutely could not be

applied at ho!e/ but because it can be e!ployed at a higher rate of profit in aforeign country.73

4his passage fro! +ar6 as cited by 'u2harin in a or2 preceding Lenin<s .mperialism hich uses si!ilar ter!inology>

74he e6port of capital fro! a country presupposes an overproduction ofcapital in that country/ an overaccu!ulation of capital. ... &t is only in thelast decades that capital e6port has acuired an e6traordinary

significance/ the li2e of hich it never had before.7 3"

'u2harin ent on to give to !a@or reasons for capital e6port> 1E the bloc2ing of invest!ent by cartels and trusts in the sectors they control/ togetherith the loer profit rate discouraging invest!ent in the sectors they don<tcontrolF )E the need to overco!e tariff barriers to goods entering foreigncountries.

&t has also been suggested that Lenin<s analysis of i!perialis! as based on

+ar6<s falling rate of profit theory.39 'ut this is uestionable/ since Lenin neverused the -P in his ritings on capitalist econo!y. And

3(. .mperialism .../ Chapter 1.3%. +ar6/ CapitalA Vol. &ll/ Chapter 1$/ part 3 Dp. )$(E.3". 'u2harin. .mperialism and World &conomyA p. 9(.

39. -or e6a!ple/ by eil Garding/ enin's Political Thou+htA Vol. )/ pp. (3#(*

hen 'u2harin lin2ed 7overproduction7 of capital to a high organic co!# position of capital/ he as referring to the differences beteen organic

co!positions that lead to profit euali?ation/ not to the -P.*0 evertheless/the -P and i!perialis! theories are consistent ith one another> the forcesthat bring about the -P account for the drive to e6port capital as ell/ and

both reach fulfill!ent in capitalis!<s epoch of decay.-irst/ as already !entioned/ higher profits can often be !ade in bac2ard

econo!ies here production costs/ notably ages/ are loer. 4he opportunityto ta2e advantage of these loer costs by force Dand 2eep the! loerE

increases under i!perialis!/ hich idens the !ilitary gap beteen advancedand bac2ard countries.

Second/ because of the -P and the groing si?e of capital invest!ents/ thevalue available to a given fir! for invest!ent is often less than the a!ountreuired to invest at the frontier of ne technology/ especially during cyclicaldonturns. D7A drop in the rate of profit is attended by a rise in the !ini!u!capital reuired by an individual capitalist for the productive e!ploy!ent of

labor.7*1E Gence surplus value searches for !ore bac2ard sectors in theundeveloped countries ith loer organic co!positions of capital andtherefore loer capital reuire!ents.

4hen there are the reasons given by 'u2harin. Although traditionalcapitalist fir!s are driven to invest in ne production henever they can affordto/ !onopolies that do!inate an industry in their ho!e country are protectedfro! co!petitive pressures to reinvest profits at ho!e/ and ill avoid suchinvest!ent henever this !eans undercutting their on e6isting production.As ell/ in order to sell in countries hich have erected high protectionistalls Dincluding tariffsE/ production ithin those countries is necessary. At

present/ for e6a!ple/ apanese co!panies are building plants in the ,.S. inorder to bypass A!erican protectionis!.

&n su!/ through the e6port of capital/ the do!inant i!perialist countriese6tract !ore surplus value. :o!estic !onopoly and foreign i!perialis! are

parallel !ethods of super#e6ploitation in hich one sector of capital feeds onanother. &n both/ the do!inant capitals appropriate surplus value

disproportionately. As a result the ea2er capitalists hose 7fair share7 ofsurplus value is e6propriated are held bac2F their groth is stifled by thecannibalis! of the strong.

&!perialis! is the last stage of capitalis!/ and both !onopoly and capitale6port reflect it> no further all#sided advance of the productive forces is

possible. 56pansion of the productive forces in one country or

*0. 'u2harin/ .mperialism and World &conomyA pp. *$#(. &n the passage above/7overproduction of capital7 is not used in +ar6<s cyclical sense.

*1. +ar6/ CapitalA Vol. &ll Dp. )$0E.24



sector of capital is possible only at the e6pense of other sectors. 4his is notsi!ply a geographical point/ although the division of the orld into a do!inant

orth and a dependent South is its !ost stri2ing illustration. Value relationshave beco!e the fetter on the develop!ent of the productive forces that +ar6foresa. As alays/ capitalis! is driven to develop the processes ofsociali?ation of capital/ in this case internationali?ation of the econo!y/ anduse the! against the proletariat. &t is the laful operation of capitalis!<s las inthe epoch of decay.

T>7 L,M,TS )& !AT,)!AL,SM4he perception of a ualitative change in capital e6port reflects the epoch of

decay fro! another angle> the productive forces had reached the li!it ofe6pansion possible ithin the boundaries of single states. Gence e!pires andsupranational capitals beca!e necessary. 4his resulted not only in colonialsuper#e6ploitation but also in the e6tension of econo!ic relations a!ong thei!perialist poers. 'ut hile capital can cross national boundaries/ it cannottranscend nationalis!. =henever supranational unification occurs/ it brea2sdon> 'ritain during the 19th century/ er!any during the to orld ars andthe ,nited States after =orld =ar && reached levels of do!ination they couldnot !aintain. As 4rots2y su!!ed up the -irst =orld =ar>

7=hy did the ar occurH 'ecause the productive forces found the!selvestoo constricted ithin the fra!eor2s of the !ost poerful capitaliststates. 4he inner urge of i!perialist capitalis! as to eradicate the state

boundaries and to sei?e the entire terrestrial globe/ abolishing tariffs andother barriers hich restrict the develop!ent of the productive forces.Gerein are the econo!ic foundations of i!perialis! and the root causesof the ar. =hat ere the resultsH 5urope is no richer in boundariesand tariff alls than ever before.7Capitalis! is still rooted in the nation/ once a progressive institution

enabling the bourgeoisie to overco!e feudal barriers to production. 4he nation#state as also critical for preserving the ho!e !ar2et for indigenous capitalistsagainst co!petitorsF ithout it capitalist develop!ent in the progressive epoch

ould have been li!ited to a handful of countries. 'ut no that capitalistecono!y has been internationali?ed/ the nation#state is funda!entallyreactionary. ather than advancing production/ it retards itF rather than

pro!oting cultural and econo!ic intercourse/ it pro!otes ar. 4he onlysolution is internationalis!/ and the only social force hose

*).4rots2y/ 7eport on the =orld 5cono!ic Crisis and the e 4as2s of theCo!!unist &nternational7 D19)1E/ The 7irst 7ie Hears o% the Communist

.nternationalA Vol. 1/ p. )1$

basic interest is not tied to the nation#state is the proletariat. Gence prole#tarian internationalis! as the practical policy of the 'olshevi2 revolution inorder to brea2 out of i!perialist confines.

As e 2no/ i!perialis! stands for an ineuality even !ore brutal thanthat of early capitalis!. Although !ilitary conuest/ fictitious capital/!onopolies and uneual e6change e6isted throughout the history of capitalis!/in this epoch they are the syste!<s nor!al !ode of operation. 4he ea2ercountries are deprived of !uch of their surplus value and hence have no hopeof reaching the econo!ic level of the i!perial poers.

4hus no capitalist country has been able to reach advanced ran2 under itson poer since apan !ade it in the last decade before i!perialis! asconsolidated. one of the for!erly bac2ard countries/ not even those that

prospered during the post#=orld =ar && boo! or through their !onopoly of oil production/ have risen to the ran2 of i!perialist poers. 4he old poers haveestablished so!e @unior partners to help in the e6ploitation of parts of the

orld/ but not even these are independent centers of capital accu!ulation.*3

4his is the final proof that our epoch re!ains that of i!perialist decay. 4heineuality beteen nations has been set once and for all/ so long as capitalistrule survives.

8ne country/ hoever/ did cli!b out of bac2ardness to beco!e asuperpoer> Soviet ussia. 4he 2ey to its transfor!ation is that this too2 place

hen the ,SS as a or2ers< state/ a product of the socialist revolution itself produced by the contradictions of i!perialis!.

0 P7RMA!7!T R7V)L=T,)!

Lenin or2ed out his theory of i!perialis! under the i!pact of the -irst =orld=ar/ an unprecedented holocaust that shattered drea!s of continuing capitalist

progress. 5ven bourgeois historians regard the ar as the great divide of!odern historyF it led straight to the horrors and tragedies of the tentiethcentury. 4he i!!ediate i!petus for Lenin<s or2 as the treachery of5uropean social de!ocracy/ hose national parties led the or2ers into the

trap of folloing 7their7 bourgeoisies into the i!perialist ar. 4he result asor2ing#class fratricide.

T>7 SPL,T ,! S)C,AL,SM

4he social de!ocrats< behavior as no accident. ot that the refor!istsanted ar> their goal as peaceful co!petition/ or 7de!ocracy.7 'ut

*3.&srael/ the apparent e6ception to these state!ents/ prospered because it assubsidi?ed by =estern i!perialis!.

2-



tt b i t th t @ it f th i l ti hi th d ti t 2 till f lfill d 4h t t ld



petty#bourgeois peasants/ the vast !a@ority of the ussian population.

TR)TS?#6S T>7)R#

4he 'olshevi2 for!ula e!bodied a deep contradiction> the class struggle beteen bourgeoisie and proletariat ould inevitably intensify if the bourgeoisie held the econo!ic reins and the proletariat controlled the state.4rots2y had already pointed out/ in the after!ath of the 190$ revolution/ that ifa revolution ere successful the contradiction ould have to be resolveduic2ly> either the or2ers ould discipline and ulti!ately e6propriate the

bourgeoisie/ or the or2ers< and peasants< govern!ent ould have to concede tothe capitalists and abandon its defense of the !asses.

Along ith the 'olshevi2s and against the +enshevi2s/ 4rots2yrecogni?ed that the bourgeoisie as incapable of leading a revolution againstC?aris!. &ts fa!ilies and property ere far too interpenetrated ith the nobilityand landlords for it to encourage land sei?ures or other encroach!ents on pre#capitalist privileges. As for the rights of the !asses of the oppressed/ thegroing proletariat in the cities as too great a threat to arrant any looseningof autocratic repression. 4rots2y retrospectively su!!ed up his differencesith the +enshevi2 leader Ple2hanov> 7Ple2hanov obviously and stubbornlyshut his eyes to the funda!ental conclusion of the political history of thenineteenth century> henever the proletariat co!es forard as an independentforce the bourgeoisie shifts over to the ca!p of the counterrevolution. 4he !oreaudacious is the !ass struggle all the sifter is the reactionary degeneration ofliberalis!. o one has yet invented a !eans for paraly?ing the effects of thela of the class struggle.7 4hat is/ hen the proletariat not only gros in eight

but also goes into social !otion # hen it beco!es an 7independent force7 #then all property is threatened/ not @ust pre#bourgeois property. o onder the

bourgeoisie runs fro! revolution.74he !asses can rise to an insurrection only under the banner of their on

interests and conseuently in the spirit of irreconcilable hostility toard thee6ploiting classes beginning ith the landlords. 4he <repulsion< of theoppositional bourgeoisie aay fro! the revolutionary or2ers and peasants as

therefore the i!!anent la of the revolution itself...7 4his as the basis of4rots2y<s theory of per!anent revolution. 'ecause capitalis! had beco!ereactionary/ socialist revolution as needed to

*$. 4rots2y/ 74hree Conceptions of the ussian evolution/7 Writin+s 19*9-4"A p. (1

achieve even the de!ocratic tas2s still unfulfilled. 4he peasantry too ouldrebel against the e6ploiting classes but it as incapable of ielding poerindependently. Still/ because of its i!!ense nu!bers in ussia/ it ould be thedecisive force in deciding the outco!e of the revolution/ depending on hichurban class it supported. 4he proletariat had no alternative but to carry out thede!ocratic tas2s of the revolution under its on banner ith the peasantry<ssupport.

-urther/ under conditions of ussian bac2ardness/ the or2ers< stateould have to spread the revolution across the continent to the !ore advanced

countries. ussia badly lac2ed the !aterial productivity and abundancenecessary for co!!unis!. 4ogether ith the capitalist threads tying ussia tothe orld econo!y/ this fact !eant that socialis! could be achieved there onlythrough an international proletarian revolution. 4he traditional +ar6istunderstanding that the proletarian revolution had to be internationalist as forussia reinforced by glaring necessity.

4he or2ers and peasant#soldiers overthre the C?ar in -ebruary 191%.,nder the leadership of the +enshevi2s and Social evolutionaries DSsE/ theyhanded poer to the bourgeoisie. 'ut they also !aintained a volatile 7dual

poer7 by setting up Soviets> !ass#based de!ocratic councils representingor2ers/ soldiers and peasants hich held an effective veto poer over allgovern!ent acts. &n the countryside/ here poverty and the ar had devastated

the peasantry/ the bourgeoisie<s betrayal of de!ocratic aspirations on the vastsea of landless peasants to the progra! of e6tending the revolution under

proletarian leadership.4he contradiction in 'olshevi2 theory had co!e to a head. =orld =ar & and

his understanding of i!perialis! co!pelled Lenin to change his strategy. Gerecogni?ed that ussia/ even under a 7de!ocratic7 capitalist govern!ent led bythe proletariat/ ould inevitably re!ain subordinated to the =estern poers.'ut he had to fight against the entire social#de!ocratic tradition and even theleaders of his on party to convince the 'olshevi2s to renounce support for theclass#collaborationist Provisional overn!ent Dhich included bourgeois/+enshevi2 and S !inistersE and stand for a socialist/ not @ust radicalde!ocratic/ revolution>

74he person ho no spea2s only of a <revolutionary#de!ocratic dic#tatorship of the proletariat and the peasantry< is behind the ti!es/ conseuentlyhe has in effect gone over to the petty bourgeoisie against the proletarian classstruggleF that person should be consigned to the archive of <'olshevi2< pre#

revolutionary antiues.7*( Led by the 'olshevi2s/ the or2ers sei?ed state poer in 8ctober. 4he central soviet i!!ediately supported sei?ure of the land by the peasantryF

*(. Lenin/ 7Letters on 4actics/7 April 191%29

li2 i it t d lf d t i ti t th ti l i iti i th C i t i t t f th i i li t h D= ll thi t i d t il i Ch t (



li2eise/ it granted self#deter!ination to the national !inorities in the C?arist7prisonhouse of nations.7 'ac2ard ussia/ Lenin<s 7ea2est lin2 in thei!perialist chain/7 had opened the road to socialis!. Lenin later su!!ari?edthe revolution<s acco!plish!ents/ ac2noledging in effect that the 'olshevi2strategy during 191% had shifted to per!anent revolution. 7'eginning ithApril 191%/ hoever/ long before the 8ctober evolution/ that is/ long beforee assu!ed poer/ e publicly declared and e6plained to the people> therevolution cannot no stop at this stage/ for the country has !arched forard/capitalis! has advanced/ ruin has reached fantastic di!ensions/ hich Dhether

one li2es it or notE ill de!and steps forard/ to socialis!. -or there is no otheray of advancing/ of saving the ar#eary country and of alleviating thesufferings of the or2ing and e6ploited people.

74hings have turned out @ust as e said they ould. 4he course ta2en by therevolution has confir!ed the correctness of our reasoning. -irst/ ith theRhole< of the peasants against the !onarchy/ against the landoners/ against!edievalis! Dand to that e6tent the revolution re!ains bourgeois/ bourgeois#de!ocraticE. 4hen/ ith the poor peasants/ ith the se!i#proletarians/ ith allthe e6ploited/ against capitalis!/ including the rural rich/ the 2ula2s/ the

profiteers/ and to that e6tent the revolution beco!es a socialist one.7 Per!anentrevolution depended on the fact that capitalis! had turned reactionary. 4his tiedit inti!ately to Lenin<s theory of i!perialis!. &t as no accident that/ under the

i!pact of revolutionary events/ Lenin sa through the errors of his theory of a7de!ocratic dictatorship7 that ould uphold capitalist relations.

Capitalis!/ once the chief force in brea2ing don feudal obstacles andadvancing both the productive forces and de!ocratic rights/ as no the chief

barrier to their e6tension. 4he property for!s beueathed by feudal anddespotic societies could survive/ but their content ould beco!e capitalist. 4heussian revolution proved in practice that capitalis! could no longer be

progressive/ even in a vast country hich/ despite its bac2ardness/ as theorld<s fifth industrial poer.

P7RMA!7!T R7V)L=T,)! A!D T>7 7P)C>

-or all its profound i!plications/ per!anent revolution as originally

regarded by 4rots2y as specific to ussian conditions. enerali?ing it reuiredfurther revolutionary proletarian upsurges/ especially the Chinese revolution of19)$#)%. &t as e6tended not @ust to other econo!ically bac2ard countries butto all> per!anent revolution beca!e the proletar#

*%. Lenin/ The Proletarian eolution and the ene+ade ?autsky D191"E

ian strategy for the i!perialist epoch. D=e spell this out in detail in Chapters (and ".E

4he poer of the co!bined theories of per!anent revolution and thei!perialist epoch as illustrated by 4rots2y<s application of the! fro! anegative angle in 19)"> hat ould happen if the proletarian revolution asnot forthco!ingH

74he e6plosive character of this ne epoch/ ith its abrupt changes ofthe political flos and ebbs/ ith its constant spas!odic class struggle

beteen fascis! and co!!unis!/ is lodged in the fact that the

international capitalist syste! has already spent itself and is no longercapable of progress as a hole$ 4his does not !ean to i!ply that indi#vidual branches of industry and individual countries are incapable ofgroing and ill not gro any !ore/ and even at an unprecedentedte!po. evertheless/ this develop!ent proceeds and ill have to pro#ceed to the detri!ent of the groth of other branches of industry and ofother countries. 4he e6penditures incurred by the productive syste! oforld capitalis! devour its orld inco!e to an ever increasing degree.And inas!uch as 5urope/ accusto!ed to orld do!ination/ ith theinertia acuired fro! its rapid/ al!ost uninterrupted groth in the pre#ar period/ no collides !ore sharply than the other continents ith thene relation of forces/ the ne division of the orld !ar2et/ and the

contradictions deepened by the ar/ it is precisely in 5urope that thetransition fro! the <organic< epoch to the revolutionary epoch as

particularly precipitous.74heoretically/ to be sure/ even a ne chapter of a +eneral capitalist

progress in the !ost poerful/ ruling/ and leading countries is note6cluded. 'ut for this/ capitalis! ould first have to overco!e barriersof a class as ell as of an interstate character. &t ould have to stranglethe proletarian revolution for a long ti!eF it ould have to enslave Chinaco!pletely/ overthro the Soviet republic/ and so forth. =e are still a

long ay re!oved fro! all this.7*"

4his as a far#sighted prognosis/ !ade hen such events ere onlytheoretical possibilities. 'ut the isolation of revolutionary proletarian ussia/the continued treachery of the social de!ocrats and the bureaucrati?ation of theSoviet state paved the ay for all 4rots2y arned of> the strangulation ofor2ers< revolutions/ the subordination of China to i!perialis!/ the triu!phsof fascis! and/ crucially/ the 7overthro MofN the Soviet republic/7 na!ely thedestruction of the or2ers< state fro! ithin. Capitalis!/ incapable offlourishing in the face of a !obili?ed or2ing class/ did succeed in reneingitself on the basis of a series of or2ing#

*". 4rots2y/ The Third .nternational a%ter eninA pp. "0#"1.3::

class defeats 5 ents of recent decades ha e also negati el confir!ed the ad anced po ers o er the rest of the orld 8f co rse 4rots2 <s o n leading



class defeats. 5vents of recent decades have also negatively confir!ed the per!anent revolution strategy> non#proletarian revolutions Din China/ 5ast5urope/ Africa/ etc.E ere not able to brea2 fro! the i!perial stranglehold orestablish the basic bourgeois#de!ocratic rights.

4he lin2 beteen the epoch of i!perialis! and the strategy of per!anentrevolution has been challenged on to sides. 8ne starts fro! the social#de!ocratic theory of the continued progressiveness of capitalis!>

7&t is parado6ical and ironic that 4rots2y has accepted Lenin<s analysis ofi!perialis! based on !onopoly capitalis! and then gone on to proclai!

the revolutionary epoch based on the irreversible donard slide ofcapitalist develop!ent. -or the ascension of !onopoly capitalis! hadre!oved the inevitability of any underlying donard slide/ and it hadenlarged the possibility of effective govern!ent intervention to sti!ulate

capitalist e6pansion.7*9

4his assess!ent could have been ritten only under the i!pact of the post#=orld =ar && boo! and/ !oreover/ fro! ithin one of the prosperousi!perialist poers. &t is 'ernsteinis! brought up to date and thereby !ade allthe !ore absurd> 'ernstein at least didn<t have to account for fascis!/ orldars and the !isery of hundreds of !illions in the underdeveloped orld ininsisting on the bourgeois state<s capacity to overco!e capitalis!<s ineuities.4he social de!ocrats< inability to perceive the econo!y<s donard slide even

in 19%$ reflects their abandon!ent of +ar6is! and their role as apologists for bourgeois interests.

4he other challenge to per!anent revolution co!es fro! 7third#orld#ist7analysis/ hich recogni?es !ore of the reality of the !odern orld but is little

better fro! the point of vie of political strategy than the social#de!ocrats. -ore6a!ple>

74rots2y<s theory of the <per!anent revolution< ... involves an analysis inter!s of uneual develop!entF but this theory is not lin2ed directly to the

proble! of i!perialis! and the role of the periphery in the socialistrevolution/ because 4rots2y re!ains <econo!istic< and retains a <=est#centered< outloo2/ underesti!ating the i!portance of the peasant and

colonial uestion.

$0

4rots2y is labeled econo!istic and =est#centered because he holds/ alongith +ar6 and Lenin/ that proletarian revolution in the advanced countries isnecessary to provide the !aterial base for the achieve!ent of authenticsocialis!. 4herefore he is bla!ed for !a2ing the role of the 7third orld7 lesscentralF li2eise for his insistence that i!perialis! !eans the epoch ofcapitalist decay and not @ust the do!ination by the

*9. eoff Godgson/ Trotsky and 7atalistic ar!ism D19%$E/ p. )(.$0. Sa!ir A!in/ .mperialism and 5ne/ual eelopment D19%%E/ p. )$"

advanced poers over the rest of the orld. 8f course/ 4rots2y<s on leadingrole in the ussian revolution/ as ell as the theory he developed/ belie thecontention that he underesti!ated the i!portance of socialist revolution in

bac2ard countries. 4hose ho argue in this ay are burying the classuestionF they re@ect proletarian revolution in the oppressed countries in favorof bourgeois national revolutions.

4he +enshevi2s of 191% and the third#orld Stalinists of today representthe sa!e political current> both stress a bourgeois#de!ocratic 7stage7 instead of

proletarian socialis!. 4hese anti#or2ing class revolutionists also have !uch

in co!!on ith the see!ingly opposite progra! of i!perialist socialde!ocracy. All agree that the proletariat has no @ustification for its onrevolution and should instead support the nationalist revolution or refor!s ofthe petty bourgeoisie.

T>7 R7V)L=T,)!AR# PART#

&n spite of his 7de!ocratic dictatorship7 theory/ Lenin fought for theindependent organi?ation of the or2ers fro! even the anti#C?arist

bourgeoisie. Ge steadily attac2ed the +enshevi2s for tailing bourgeoisrepresentatives. Ge denounced the Ss for trying to build a !ulti#class party ofor2ers and petty#bourgeois peasants. 'ut his on understanding of the partyof the proletariat had to develop and change before it beca!e the instru!ent of

socialist revolution.4he proletarian revolution as possible in bac2ard ussia because uneven

and co!bined capitalist develop!ent had created a centrali?ed proletariat itha high level of organi?ation and political consciousness. 'ut it as not a unitedclass. ust as euality a!ong capitalists is violated in the epoch of decay/ so toocapitalis! creates ineuality a!ong the or2ers. evolutionary consciousnesscould not develop in unitary fashion through the traditional social#de!ocratic

party of the hole class that tried to represent both the aristocratic layer as ellas the !ass of super#e6ploited or2ers.

4he long struggle beteen 'olshevi2s and +enshevi2s for leadership of theussian or2ing class as a conflict beteen distinct layers of the proletariat.4he refor!ists accepted the class struggle ithin the confines of the la of

value/ in order to bargain over the sale of labor poer in the interest of thehighest#paid layers of or2ers. 4he 'olshevi2 party/ in contrast/ as for!ed inconscious opposition to capitalis! and as dedicated to fulfilling the needs ofthe class as a hole/ especially the !ost oppressed or2ers ith no sta2e in thesyste!.

'ut even though the revolutionary party represents the real interests of theentire or2ing class/ it cannot contain all or2ers. =or2ers< consciousnessdevelops at different rates/ especially in this epoch hen

3:4

capitalis! is co!pelled to deepen old and create ne divisions a!ong the! P7TT# ;)=R7),S,7 VS W)R?,! CLASS



capitalis! is co!pelled to deepen old and create ne divisions a!ong the!.Spontaneity/ the reliance on !ilitancy ithout conscious leadership/ is noanser. &f those ith socialist consciousness do not intervene to lead the

bac2ard layers ho are under the ideological do!ination of the bourgeoisieDthrough the inter!ediary of the petty#bourgeois bureaucracyE/ the class as ahole ill never reach revolutionary consciousness.

Lenin taught for years that bourgeois rule/ no !atter ho decadent it beca!e/ ould not rot to death of its on accord> a disciplined fight asnecessary to destroy it. 4he vanguard of the proletariat not only had to increase

their fello or2ers< social understandingF they also had to be independentlyand tightly organi?ed in order to have a significant !aterial i!pact. 4herevolutionary party e!bodying advanced consciousness and de!ocraticcentralist discipline as therefore a necessity. 4his is another critical issue onhich Lenin opposed Lu6e!burgF despite her early insight into the refor!is!of the SP:/ Lu6e!burg only began the construction of a revolutionary cadre

party after the er!an revolution had begun.:e!ocratic centralis!/ of course/ has nothing in co!!on ith the travesty

understood by both Stalinist proponents and bourgeois critics. &t does not !eantop#don dictatorship but rather syste!atic and scientific functioning.8pposing points of vie ithin the party are debated # that is de!ocracyF the!a@ority vie beco!es the party line/ and all !e!bers or2 to carry it out #

that is centralis!. 4he positions decided on are thereby tested in practice by the party as a hole. =hether or not they prove successful/ they continue to bediscussed ithin the party/ and if necessary can be changed by the sa!e

process. &ndeed/ the 'olshevi2 party until its bureaucratic degeneration hadroo! for ide#ranging and vociferous debates/ even in the !idst of revolutionsand civil ar. &n contrast/ the indecisive debates ithin the social#de!ocratic

parties !a2e the! little but tal2#shops/ here actual decisions are !ade by ahandful of officials behind the bac2s of the !e!bers and the or2ing class.

4he creation of Soviets by the ussian or2ers during the revolutions of190$ and 191% as the great test of the revolutionary party. 4he Soviets eretheaters of interaction beteen the different layers of or2ers. 4he great!a@ority of the or2ers participated in the! and in other class institutions>

!ilitias/ factory co!!ittees/ trade unions/ etc. 5ven though all or2ers erenot fully conscious of it/ the Soviets represented a direct challenge to the

bourgeoisie<s right to hold state poer. &n the!selves they ere instru!ents ofdual poer but not necessarily of revolutionF hat !ade the! revolutionary in191% as the victory of the !ost advanced and far#seeing or2ers/ the'olshevi2s/ in their struggle for leadership. =ithout that the Soviets ouldeventually have succu!bed to the retreats and betrayals of the Provisionalovern!ent and the refor!ist parties.

P7TT# ;)=R7),S,7 VS W)R?,! CLASS

&t is i!portant to dispel one of the standard !yths about Leninis!> that the proletarian party depends funda!entally on the efforts of non#proletarianrevolutionaries. 4his !yth is based on a 2ernel of truth> in 190) Lenincritici?ed those ho 7i!agine that the labor !ove!ent pure and si!ple canelaborate/ and ill elaborate/ an independent ideology for itself/ if only theor2ers Rrest their fate fro! the hands of the leaders<.7 Ge ent on to !a2ethe point e6plicit by citing the 7profoundly true and i!portant7 ords of JarlJauts2y>

7Socialis! and the class struggle arise side by side and not one out of theotherF each arises under different conditions. +odern socialist consciousnesscan arise only on the basis of profound scientific 2noledge. &ndeed/ !odernecono!ic science is as !uch a condition for socialist production as/ say/!odern technology/ and the proletariat can create neither one nor the other ...F

both arise out of the !odern social process. 4he vehicle of science is not the proletariat/ but the (our+eois intelli+entsia it as in the !inds of individual!e!bers of this stratu! that !odern socialis! originated/ and it as they hoco!!unicated it to the !ore intellectually developed proletarians ho/ in theirturn/ introduce it into the proletarian class struggle here conditions allo thatto be done. 4hus/ socialist consciousness is so!ething introduced into the

proletarian class struggle fro! ithout and not so!ething that arose ithin it

spontaneously.7 -urther/ Lenin co!!ented/ if the intelligentsia does notintroduce socialist ideas into the proletariat/ the or2ers ill be left ith onlytrade union consciousness> 74he spontaneous or2ing#class !ove!ent is tradeunionis!/ is :ur-=eerkscha%tlereiA and trade unionis! !eans the ideological

enslave!ent of the or2ers by the bourgeoisie.7$

4hat is/ the choice is beteen the or2ers< trade unionis! and theintellectuals< socialis! # or beteen refor!is! and revolution. Lenin as neverone for !oderating his ords to conceal his vies/ and that is hat he rote. &tis not so ell 2non that he changed his !ind. 5ven a!ong 4rots2yists/Lenin<s @udg!ent of the inherently refor!ist nature of spontaneous

proletarian consciousness is often ta2en for orthodo6y. So it is orth citing4rots2y to de!onstrate that Lenin reversed his opinion. 7According to Lenin<srepresentations/ the labor !ove!ent/ hen left to its on devices/ as inclinedirrevocably toard opportunis!F revolutionary class#consciousness as

brought to the proletariat fro! outside/ by +ar6ist intellectuals. ... MGeN hi!selfsubseuently ac2no#

$1. Lenin/ 7=hat is to be :oneH7/ Collected WorksA Vol. $/ pp. 3"3#*.$). 4he er!an ords !ean roughly 7trade union only#is!.7

3:-

ledged the biased nature and thereith the erroneousness of his theory hich petty bourgeoisie is fated to be increasingly sub@ect to the big bourgeoisie as



ledged the biased nature/ and thereith the erroneousness/ of his theory/ hichhe had parenthetically in@ected as a battery in the battle against <5cono!is!<

and its deference to the ele!ental nature of the labor !ove!ent.7$3 Anotherre!ar2 along the sa!e lines as !ade al!ost in passing/ as if all understood it>7Lenin/ at ti!es/ erred not only in !inor but in !a@or issues. 'ut he correctedhi!self in good ti!e.... Ple2hanov as right in his criticis! of Lenin<s theory of

the develop!ent of socialis! <fro! the outside<.7$*

4rots2y<s opinion on the uestion is clear. 4here are also several state!ents by Lenin that sho the accuracy of 4rots2y<s conclusion. 8ne is in a su!!ary

article about the 190$ revolution>7At every step the or2ers co!e face to face ith their !ain ene!y Bthe capitalist class. &n co!bat ith this ene!y the or2er beco!es a

socialistA co!es to reali?e the necessity of a co!plete reconstruction ofthe hole of society/ the co!plete abolition of all poverty and all

oppression.7$$

An earlier reference ca!e during the 190$ upsurge itself>74he or2ing class is instinctively/ spontaneously Social :e!ocratic/and !ore than ten years of or2 put in by Social :e!ocracy has done a

great deal to transfor! this spontaneity into consciousness.7$(

4hese passages reflect the ne understanding that Lenin gained as a result of

the or2ers< actions in 190$. 4he fact that the or2ers< revolution taught thislesson itself is a dialectical proof that socialist consciousness develops notoutside the proletariat but through its on !otion. Lenin operated on the neunderstanding for the rest of his life and e6panded on it hen he ca!e toanaly?e the transfor!ation of capitalis! into i!perialis!. efor!is! !ayindeed be an outloo2 ithin the or2ing class at any ti!e/ even the

predo!inant one. 'ut this is a con@unctural !atterF it does not represent thehistoric/ laful outloo2 of the proletariat as it co!es face to face ith the drivefor surplus value of its capitalist ene!y. 8n the other hand/ the petty

bourgeoisie does have !aterial interests deeply rooted in bourgeois society. &tsinevitable perspective is to refor! the syste!<s ineuities and or2 for class

peace through class collaboration. 4hese are ,topian hopes/ given the syste!<s

co!pulsions/ and the

$3. 4rots2y/ StalinA Vol. 1/ Chapter 3/ p. 9%.$*. Trotsky's :ote(ooks 19**-*,A Philip Po!per/ ed. D19"(E/ p. "*.$$. Lenin/ 74he Lessons of the evolution/7 Collected WorksA Vol. 1(/ p. 30).$(. Lenin/ 74he eorgani?ation of the Party/7 ibid./ Vol. 10/ p. 3). Gere 7Social

:e!ocratic7 refers to the revolutionary party as it as called before 191%/ afterhich Lenin ould have said 7Co!!unist.7

petty bourgeoisie is fated to be increasingly sub@ect to the big bourgeoisie ascapital centrali?es. evertheless/ given the decay of capitalis!/ battered petty#

bourgeois !asses can be on to proletarian leadership. 'ut in the i!perialistepoch petty bourgeois leaders co!e to play an increasingly influential role inthe !ass organi?ations of or2ers. As Lu6e!burg noted against 'ernstein>

74he uestion of refor! and revolution/ of the final goal and the !ove!ent/is basically/ in another for!/ only the uestion of the petty#bourgeois or

proletarian character of the labor !ove!ent.7$% Lu6e!burg<s insight is profound. -or decades since/ the class character of the parties that the !ass of

or2ers adhere to has been the decisive uestion in every revolution. 8n thisuestion she as years ahead of Lenin/ ho only fully understood the role ofthe petty#bourgeois bureaucracies ithin the or2ing#class parties and unions!uch later/ hen they betrayed proletarian internationalis! at the start of=orld =ar &. &t as this shoc2 that inspired his reneed study of capitalistchange and thereby his theory of i!perialis!.

T>7 MAR@,SM )& T>7 ,!T7LL,7!TS,A

Latter#day Leninists< !isrepresentations of Lenin are of to 2inds. -or one/Cliff in his biography uotes both of the passages by Lenin cited above. 'ut hecuts the second one off so that it says/ 74he or2ing class is instinctively/

spontaneously Social :e!ocratic.7$ 4hus he dishonestly turns the leader and

patient teacher of the proletariat into a spontaneist.Cliff has a vested interest in clai!ing that the or2ing class is inherently

socialist and not refor!ist # not because of any faith in the class<s capacity toreach revolutionary consciousness/ but for the opposite reason. Gis onstrategy is to tailor his progra! for or2ers to the refor! de!ands theyspontaneously raise. 4he idea is that trade union !ilitancy/ even thoughintertined ith anti#revolutionary political vies/ ill lead to socialis! ifcarried out consistently. Such a !ethod is a cover for tailing or2ing#class

bac2ardness.4he Cliff tendency advocates a revolutionary party ith centrist

inconsistency. 4he progra!!atic conclusion of a 2ey or2 on Stalinis! does

not !ention the revolutionary party at all.$

Cliffs boo2 on ussia brings it upas an afterthought ithout elaboration/ literally the very last ords of the lastchapter. -or years the tendency<s founders based the!selves on a uasi#spontaneist theory of organi?ationF their taste shifted

$%. Lu6e!burg. e%orm or eolutionA &ntroduction.$". Cliff/ eninA Vol. 1/ p. 1%(.$9.Chris Gar!an/ #ureaucracy and eolution in &astern &urope D19%*E/

pp. )(9#%).3:8

to 7Leninis!7 ith the political inds in the 19(0<s 4he consistent thread is aspirations of the or2ing class for a decent life are euated ith the very real



to Leninis! ith the political inds in the 19(0 s. 4he consistent thread istheir notion of the party as an organi?ational netor2 hich could lin2 up ith!ilitant class struggles and gain their support. =hen student and youthactivities predo!inated/ the notion as spontaneistF hen or2ers< strugglesheated up/ a 7'olshevi27 netor2 ca!e to the fore. 4hroughout/ an organi?ationthat e!bodies a political progra! and fights for that progra! against alltendencies in the or2ers< !ove!ent #Lenin<s theory and practice # has beenabsolutely foreign to the!.

8n the other hand/ !ore 7orthodo67 4rots2yists rely on Lenin<s 190)

position to @ustify their belief that the or2ers cannot be trusted ithoutintervention fro! outside the class. 4hus the 'ritish group =or2ers Poerasserts that 7ne leaders/ often of a !ilitant left refor!ist variety/7 as ell as7the entrenched/ conservative bureaucracy/7 both 7reflect the consciousness ofthe or2ers ho elect the!. As such they represent/ and beco!e the !eans of!aintaining/ the refor!ist li!itations of the consciousness of these or2ers.7 &n

plain ords/ the benighted or2ers get the leaders they deserve.4ypically/ the !ost e6tre!e presentation of this position co!es fro! the

Spartacist tendency/ self#identified as an alien class ele!ent> 7Socialistconsciousness is based on 2noledge of the history of the class struggle and/therefore/ reuires the infusion into the class#struggle process of socialistconceptions carried by declassed intellectuals organi?ed as part of the vanguard

party. Socialist revolution does not occur through the intensification oftraditional class struggle/ but reuires a leap fro! a vantage point outside

bourgeois society altogether.7 othing in Lenin can @ustify the incredible clai! that socialist consciousness

arrives on the historical stage as a deus e! machina fro! outside bourgeoissociety. 4his is only the petty#bourgeois conceit that its on altruistic concernsfloat far above the earthly appetites and selfish interests of all classes undercapitalis!/ the or2ers included. 4he !aterial

(0. See &an 'irchall<s 7Gistory of the &nternational Socialists/7 .nternational Socialism

os. %( and %% D19%$E. As an illustration/ the original version D19$9E of Cliffs

pa!phlet on osa Lu6e!burg argued that her non#cadre 7conception of thestructure of the revolutionary organi?ation ... fits the needs of the or2ers<!ove!ent in the advanced countries !uch !ore closely than Lenin<s conception of190)#*/7 a passage that as dropped in the 19(" edition Dithout !ention ore6planationE.

(1. 74heses on efor!is!/7 Permanent eolution o. 1 D19"3E. -or our reply see7=or2ers Poer> A Poerless Anser to efor!is!/7 Proletarian eolution o.)3 D19"$E.

(). Spartacist League/ 74rade ,nion +e!orandu!/7 ar!ist #ulletin o. 9/ Part &&&D19%)E

aspirations of the or2ing class for a decent life are euated ith the very realgreed of the bourgeoisie for surplus value. &t as no leap at all for such anoutfit to delight in the suppression of !illions of Polish or2ers by thearu?els2i regi!e in 19"1/ on the grounds that they ere 7de!anding the

biggest free lunch the orld has ever seen.7(3

&t is significant that none of the orthodo6 4rots2yists ever try to co!e togrips ith their re@ection of the considered opinions of both Lenin and 4rots2y.=e don<t say they !ust auto!atically agree/ of course/ but they are obliged toe6plain hy they disagree and here the +ar6ist tradition ent rong. 4he

essential reason for their failure is that the uestion at issue is one of class/ a!atter on hich they are understandably very sensitive about !a2ing theirdisagree!ent public.

4he anti#or2ing class conceptions of the !iddle#class +ar6ists areso!eti!es e6plicit/ often hidden. 'ut all i!plicitly accept the co!!on#sense

belief that the proletariat is inherently refor!ist. And all conseuently envisagea gulf beteen their revolutionary selves and the or2ing class. Lenin/ on thecontrary/ learned that the leadership that the revolutionary party fights for is arelation ithin the or2ing class/ not beteen intellectuals and proletarians.Gi!self a !an of !iddle#class origins ho @oined his life to the proletariat/ hechanged his vie on spontaneity through the lessons taught by therevolutionary proletariat itself.

Lenin and 4rots2y did recogni?e that the proletariat could !a2e use of the2noledge and abilities of !iddle#class intellectuals. 'ut as 4rots2y pointedout/ ithout +ar6 and Lenin 7the or2ing class ould have or2ed out the

ideas it needed/ the !ethods that ere necessary to it/ but !ore sloly.7(* 4heuestion for us today is not si!ply hether the or2ing class !ove!ent needsintellectuals in its ran2s ho are ready to fight the capitalis! that trained the!as its servantsF that re!ains true. =e also have to deal ith the proble! of agreatly e6panded !iddle#class layer that chooses to betray not capital but the

proletarian revolution # in its on interests but in the na!e of +ar6is!.As e have seen/ the 7ne !iddle class7 intelligentsia arose out of the

needs of state !onopoly capitalis!. &t plays i!portant roles in society/

e6tending fro! the hite#collar or2ing class to the labor bureaucrats/acade!ics/ literati/ lo#level !anagers and technicians B the trouble#shooters/!ediators and ideological !yth!a2ers. 4he e6panding state is a !a@or sourceof e!ploy!ent/ but this is not the sole reason for intellec#

(3. Spartacist pa!phlet/ Solidarnosc Polish Company 5nion %or C.< and #ankers$

-or the truth/ see Chapter ".(*. 4rots2y/ 74as2s of the 4elfth Congress of the ussian Co!!unist Party/7 D19)3EF

in eon Trotsky SpeaksA p. 1%03:9

tuals< infatuation ith state poer 4he intelligentsia is ea2 and Ch t 0



tuals infatuation ith state poer. 4he intelligentsia is ea2 andunorgani?ed ithin capitalis!/ ith no independent role in the process of

production. 4hreatened by giant !onopolies on the one hand and by the vast/dissatisfied or2ing class on the other/ !iddle#class ele!ents loo2 to the stateas an institution above society that under their guidance can act rationally forthe general good.

4he desire for rationality in a orld spinning out of control is central.ational allocation of resources is superior to cutthroat co!petition/ so !iddle#class ideology !irrors the state and the !onopolies< atte!pts to eli!inate

anarchy Ddespite their 7free !ar2et7 propagandaE. 'ecause the intellectual oftenopposes the co!petitiveness and narro self#interest of the old petty bourgeoisie/ he sees hi!self as altruistic/ the good citi?en independent ofnarro special interests. Ge does not understand that he is acting in his onsocial interest derived fro! his role in capitalis!/ or that his i!age of aco!petition#free rational society is false consciousness/ precisely the ideologyneeded to defend state !onopoly capitalis! and especially its statified sectors.

Gaving no alternative/ the intelligentsia<s only road to poer is to attachitself either to the bourgeoisie/ as do liberal intellectuals # or to the proletariat/in the case of radicali?ed ele!ents. Gence the popularity of refor!is!/ !i6ed#econo!y socialis!/ Stalinis! Duntil recentlyE and a do?en other petty#bourgeois7socialis!s7 hich strive to harness the class struggle against capitalis!. 4hese

ideologies have nothing to do ith the interest of the or2ing class/ hich is tooverco!e all the or2ings of capitalis!/ including the las dee!ed rational bythe intelligentsia. Anything else serves to prolong the agonies of a syste! insenile decay.

Cha(ter 0

The Transition to Socialism

3 T>7 MAR@,ST T>7)R# )& TRA!S,T,)!

4he 'olshevi2 revolution as an overhel!ing confir!ation of +ar6is!>the proletariat/ even under the bac2ard conditions of ussia in 191%/ proved

capable of overthroing bourgeois state poer. et the subseuent history ofthe Soviet ,nion raises the doubt> ho could the liberating revolution havecreated such a regressive society as Stalinis!H -ro! the beginning/ there have

been socialists ho challenged the very basis of the revolution/ clai!ing thatthe Soviet state as never proletarian # @ust as there are those ho proclai!against all reason that it still is. &n this chapter e analy?e the e6pectations andhopes engendered by the revolutionary Soviet state as ell as the causes of itsinitial defor!ation.

+ar6 sa the need for a transitional society beteen capitalis! andco!!unis! because he understood that no society departs this earth before itfulfills its capacity to develop the forces of production. Capitalis! in its epochof decay bloc2s its on potential> bourgeois rule/ capitalist relations and

nationalist rivalries stand in the ay of productive advance. &t re!ains for the proletariat to start fro! the unfulfilled potential of capitalis! and to co!pleteand go beyond the bourgeois tas2s. 8nly thus can hu!an productive forces beraised to the level here a classless society free of scarcity is possible.

4he 'olshevi2 revolution/ therefore/ as dedicated to the achieve!ent ofco!!unis! through the or2ers< state Dor 7dictatorship of the proletariat7E.+ar6 and 5ngels never provided a descriptive plan for such a transitionalsocietyF this could only be done by the or2ing class in practice under concretecircu!stances. et certain general features could be outlined in advance bystudying the dyna!ics of capitalist develop!ent. 4here as also the briefe6perience of the Paris Co!!une for co!parison. ecovering these lessons isnecessary because the counterrevolution buried the very !eaning of a or2ers<

state/ as ell as its e!bodi!ent in the early ,SS/ under tons of lies and socialdebris.

33:

S)C,AL,SM A!D VAL=7 hand nothing can pass to the onership of individuals e6cept individual



S)C,AL,SM A!D VAL=7

Analysis of the transitional or2ers< state depends on first characteri?ing thesociety it is transitional to. +ar6<s analysis of co!!unis! begins ith asignificant distinction> there are to stages of co!!unist society. 4he final goalis a society of !aterial abundance in hich the oft#cited progra!/ 7fro! eachaccording to his abilities/ to each according to his needs/7 can be achieved. 'utabundance cannot arise overnight. 4he higher stage of co!!unis! ould be

preceded by a loer stage in hich the uestions of planning and scarcityould have to be solved.

5ngels and Lenin referred to the loer stage of co!!unis! as socialis!/and for clarity e ill do so too. 4he virtue of +ar6<s or2 on socialis! is thatit illustrates hat life ould be li2e free fro! its subordination to value/ hichis so do!inant under capitalis! that it colors our perceptions of all othersocieties/ past and future. &n particular/ +ar6 gave a description of thedistribution of goods under socialis! hich has been so variously interpretedthat e need to uote it at length>

7=ithin the cooperative society based on co!!on onership of the!eans of production/ the producers do not e6change their productsF @ustas little does the labor e!ployed on the products appear here as the alue

of these products/ as a !aterial uality possessed by the! # since no/ incontrast to capitalist society/ individual labor no longer e6ists in anindirect fashion but directly as a co!ponent part of the total labor. ...7=hat e have to deal ith here is a co!!unist society/ not as it hasdeeloped on its on foundations/ but on the contrary/ @ust as it emer+es

fro! capitalist society/ hich is thus in every respect B econo!ically/!orally/ intellectually # still sta!ped ith the birth !ar2s of the oldsociety fro! hose o!b it e!erges. Accordingly/ the individual

producer receives bac2 fro! society # after the deductions have been!ade # e6actly hat he gives to it. =hat he has given to it is hisindividual uantu! of labor. -or e6a!ple/ the social or2ing dayconsists of the su! of the individual hours of or2F the individual laborti!e of the individual producer is the part of the social or2ing day

contributed by hi!/ his share in it. Ge receives a certificate fro! societythat he has furnished such and such an a!ount of labor Dafter deductinghis labor for the co!!on fundsE/ and ith this certificate he dras fro!the social stoc2s of !eans of consu!ption as !uch as costs the sa!ea!ount of labor. 4he sa!e a!ount of labor hich he has given society inone for! he receives bac2 in another.7Gere obviously the sa!e principle prevails as that hich regulates thee6change of co!!odities/ as far as this is e6change of eual values.Content and for! are changed/ because under the altered circu!stancesno one can give anything e6cept his labor/ and because/ on the other

hand/ nothing can pass to the onership of individuals e6cept individual!eans of consu!ption. 'ut as far as the distribution of the latter a!ongthe individual producers is concerned/ the sa!e principle prevails as inthe e6change of co!!odity#euivalents> a given a!ount of labor in onefor! is e6changed for an eual a!ount of labor in another for!.7Gence/ e/ual ri+ht here is still in principle # (our+eois ri+htA although

principle and practice are no longer at loggerheads/ hile the e6changeof euivalents in co!!odity e6change only e6ists on the aera+e and

not in the individual case.71

ote the assu!ption that the or2 of society and the co!pensation ofindividual producers ill be scientifically organi?ed> the ti!e ta2en by

particular tas2s and the ti!e contributed by each or2er ill be calculable and2non. 4his !eans that value has been abolished/ for as e have seen value isan i!precise/ indirect and after#the#fact !easure!ent of or2 perfor!ed. &nsocialist society/ hen labor and production are genuinely collectivi?ed/

production can be consciously organi?ed for use rather than for an unseen!ar2et. oods are no longer co!!odities/ and in the absence of privilegedclasses and e6ploitation/ the labor ti!e e!bodied in production is !easureddirectly rather than through the obfuscating for!ulas of value and !oney. &t isdirectly social laborF it does not have to ait for the reali?ation of co!!oditieson the !ar2et.

As ell/ no one ons property e6cept for the needs of individual con#su!ptionF therefore/ no special rate of return for private onership has to beincluded in the 7value7 of products. So the labor ti!e e!bodied in a productundergoes none of the distortions that prevail under capitalis!. evertheless/+ar6 observes that the 7sa!e principle prevails7 in this first stage ofco!!unis! as in capitalist society/ here co!!odity e6change and value aredo!inant. =hat is this principleH 7A given a!ount of labor in one for! ise6changed for an eual a!ount of labor in another for!.7 4his is of course thela of value in its pure for!ulation> the principle of eual e6change. 'ut valueitself no longer e6ists/ and in this society 7producers do not e6change their

products7O 4his is no !ystification. +ar6 is si!ply pointing out that the

genuine principle of eual 7e6change7 of labor ti!e can only be achieved henvalue itself is done aay ith/ hen science rather than blind la governssociety # hen in fact there is no e6change of separately produced products/ no

barrier beteen individual and social production.4he principle of euality/ even after the abolition of capitalist value/ is still

one of 7bourgeois right7 Dor bourgeois laE/ because it represents

1. Criti/ue o% the =otha Pro+ramA Part &/ section 3

334

uneual distribution despite the !as2 of an eual standard. D+ore on this is !ade ith an e/ual standardA labor.



uneual distribution despite the !as2 of an eual standard. D+ore on this belo.E 4his highest degree of bourgeois right can be achieved only hen bourgeois rule has been overthron. Gere e have an une6pected e6a!ple of per!anent revolution> only the overthro of the bourgeoisie can achieve the bourgeois progra! of de!ocracy and euality.

Lenin/ riting during the 191% revolution/ elaborated +ar6<s point thatele!ents of bourgeois econo!y survive under socialis!/ noting especially thatthis occurs in distribution but not in property rights over production>

7And so/ in the first phase of co!!unist society Dgenerally called

socialis!E/ <bourgeois right< is not abolished in its entirety/ but only in part/ only in proportion to the econo!ic transfor!ation so far attained/i.e./ only in respect of the !eans of production. <'ourgeois right< recog#ni?es the! Mthe !eans of productionN as the private property of separateindividuals. Socialis! converts the! into common property. To that

e!tentA md to that e6tent alone/ <bourgeois right< disappears.7Goever/ it continues to e6ist so far as the other part is concernedF itre!ains in the capacity of regulator Ddeter!ining factorE in the distri#

bution of products and allot!ent of labor a!ong the !e!bers of

society.7)

4hus the la of value as the regulator of production has been eli!inated because production has beco!e consciously/ scientifically planned by the

associated producers. =e are therefore @ustified in calling this societyco!!unist despite its bourgeois survivals. &neualities of various 2inds re!aina!ong the producers at the loer stage of co!!unis!/ but there e6ist noseparate classes that institutionali?e ineuality. Classes e6ist in pre#co!!unistsociety because of the need for distinct/ opposed/ relations to production. 'uthen property is held in co!!on/ the basis for class differentiation disappearsand the classes the!selves disintegrate. 4he hole people # the associated

producers # share the sa!e relation to production. 4he re!aining ineualitiesill die out hen planned sociali?ed production succeeds in achieving thenecessary abundance.

S)C,AL,ST ,!7=AL,T#

+ar6<s re!inder that bourgeois rights in distribution ill still e6ist undersocialis! opened up a dispute over hat these bourgeois rights are. =e uotethe controversial passage fro! the Criti/ue o% the =otha Pro+ram as a holeF itdirectly follos the long passage previously uoted. 7&n spite of this advance/this e/ual ri+ht is still constantly stig!ati?ed by a bourgeois li!itation. 4heright of the producers is proportional to the labor they supplyF the eualityconsists in the fact that !easure!ent

). Lenin/ State and eolutionA Chapter $/ part 3

is !ade ith an e/ual standardA labor.7'ut one !an is superior to another physically or !entally/ and sosupplies !ore labor in the sa!e ti!e/ or can labor for a longer ti!eF andlabor/ to serve as a !easure/ !ust be defined by its duration or intensity/otherise it ceases to be a standard of !easure!ent. 4his e/ual ri+ht isan uneual right for uneual labor. &t recogni?es no class differences/

because everyone is only a or2er li2e everyone elseF but it tacitlyrecogni?es uneual individual endo!ent and thus productive capacityas natural privileges. .t is there%ore a ri+ht o% ine/ualityA in its contentA

like eery ri+ht$ ight by its very nature can consist only in theapplication of an eual standardF but uneual individuals Dand theyould not be different individuals if they ere not uneualE are !ea#surable only by an eual standard insofar as they are brought under aneual point of vie/ are ta2en fro! one de%inite side only/ for instance/in the present case/ are regarded only as orkers and nothing !ore isseen in the!/ everything else being ignored. -urther/ one or2er is!arried/ another notF one has !ore children than another/ and so on andso forth. 4hus/ ith an eual perfor!ance of labor/ and hence an eualshare in the social consu!ption fund/ one ill in fact receive !ore thananother/ one ill be richer than another/ and so on. 4o avoid all thesedefects/ right instead of being eual ould have to be uneual.7

7'ut these defects are inevitable in the first phase of co!!unist societyas it is hen it has @ust e!erged after prolonged birth pangs fro!capitalist society. ight can never be higher than the econo!ic structureof society and its cultural develop!ent conditioned thereby.7:espite the high social consciousness of socialist society/ so!e degree of

ineuality ill necessarily re!ain. =e note/ hoever/ that the e6tent to hicheven the shado of the 7la of value7 applies under socialis! depends onspecific historical conditions. +ar6 rote that in socialis!>

74he !ode of ... distribution ill vary ith the productive organi?ationof the co!!unity/ and the degree of historical develop!ent attained bythe producers. =e ill assu!e/ but !erely for the sa2e of a parallel iththe production of co!!odities/ that the share of each individual

producer is deter!ined by his labor ti!e.73

4hat is/ as the loer stage of co!!unis! further !oves toard abundance/the need for bourgeois right ill be to that e6tent di!inished. 8f all the

bourgeois leftover +ar6 !entions/ the clearest e6a!ple of this develop!ent isin the last. :espite eual shares in consu!ption per or2er/ +ar6 says thatso!e persons ill receive !ore than others because

3. CapitalA Vol. &/ Chapter 1/ Section * Dp. %"E

33-

or2ers ill still have different needs resulting fro! the si?e of their 7-or socialis!/ hich ill e!ancipate hu!an labor poer fro! its



gfa!ilies/ conditions of health/ etc. 4oday e can add that !uch of thisineuality ould be !itigated by !easures such as supple!ents for childrenand social benefits distributed publicly/ independent of the labor contribution ofindividuals. 4he possibilities of a 7social age7 are !ore visible in our day thanin +ar6<s.

4he !ost controversial aspects of bourgeois right under socialis! derivefro! differences a!ong labors over s2ill and intensity. Stalin/ for e6a!ple/during the course of the counterrevolution/ sought to @ustify the groing

ineuality of Soviet society and i!pose stricter capitalistic restraints on theor2ing class. Ge argued for higher age differentials for s2illed or2ers>74he conseuence of age euali?ation is that the uns2illed or2er lac2sthe incentive to beco!e a s2illed or2er and is thus deprived of the

prospect of advance!ent ... that the s2illed or2er is obliged to anderfro! factory to factory until he finds one here his s2ill is properlyappreciated. ... &n order to put an end to this evil e !ust abolish ageeuali?ation and discard the old age scales.... =e cannot tolerate asituation here a rolling#!ill hand in a steel !ill earns no !ore than aseeper. =e cannot tolerate a situation here a railay loco!otivedriver earns only as !uch as a copying cler2. +ar6 and Lenin said thatthe difference beteen s2illed labor and uns2illed labor ould e6ist even

under socialis!/ even after classes had been abolishedF that only underco!!unis! ould this difference disappear and that/ therefore/ evenunder socialis! <ages< !ust be paid according to or2 perfor!ed and

not according to needs.7*

Stalin<s thin2ing as pure !anage!ent rationali?ation # appropriatelyenough/ since this speech as !ade to a conference of Soviet 7businesse6ecutives.7 'ut his audience in 1931 as still largely !ade up of old#ti!e

party !e!bers/ so he invo2ed the authority of +ar6 and Lenin. &n contrast toStalin/ of course/ hen +ar6 and Lenin said that under socialis! ineualitiesould e6ist/ they !eant that these ould be re!nants of capitalis! hich theor2ers< state as dedicated to eli!inate/ not preserve. As for the distinction

beteen s2illed and uns2illed labor that so concerns Stalin/ 5ngels had !oc2edthe idea that under socialis! there ould be differences in co!pensation. =hensociety has ta2en over the responsibility of training and educating or2ers fro!the individuals the!selves/ there ill be no @ustification for disproportionatelyrearding those ho are using the s2ills society has supplied. 5ngels asaddressing his conte!porary :uhring but could have been spea2ing straight toStalin>

*. Stalin/ 7e Conditions/ e 4as2s in 5cono!ic Construction7 D1931E/ Pro(lems o% eninismA pp. )0(#%

/ p p position as a commodityA the discovery that labor has no value and canhave none is of great i!portance. =ith this discovery all atte!pts ... toregulate the future distribution of the necessaries of life as a 2ind of!ore e6alted ages necessarily fall to the ground. And fro! it tooco!es the further conviction that distribution/ insofar as it is governed

by purely econo!ic considerations/ is regulated by the interests of production/ and production is !ost encouraged by a !ode of distributionhich allos all !e!bers of society to develop/ !aintain and e6ert their

capacities in all possible directions. &t is true that/ to the !ode of thoughtof the educated classes hich Gerr :iihring has inherited/ it !ust see!!onstrous that in ti!e to co!e there ill no longer be any professional

porters or architects/ and that the !an ho for half an hour givesinstructions as an architect ill also push a barro for a period ... . &t is a

fine sort of socialis! hich perpetuates the professional porterO7$

And/ e !ight add/ it is no socialis! that preserves the professionalseeper or cler2 # or/ conversely/ the professional !anager and bureaucrat.4hat in Soviet ussia in the 1930<s capitalistic nor!s ere being sustained andad!ired/ rather than regretted and co!batted/ de!onstrates the consciouscynicis! ith hich the Stalinist officials stepped up e6ploitation under theguise of having achieved socialis!.

4he !ost difficult uestion posed by +ar6<s analysis of bourgeois rightarises over the intensity of labor. Should or2ers having the sa!e s2ills andtraining and or2ing the sa!e nu!ber of hours still get the sa!e return if oneor2s harder than anotherH &n the first passage fro! +ar6 cited above # 7thesocial or2ing day consists of the su! of the individual hours of or2F theindividual labor ti!e of the individual producer is the part of the socialor2ing day contributed by hi!/ his share in it7 B +ar6 suggests that or2ersunder socialis! ould be co!pensated for their hours of labor only> thestandard ould be the uantity and not the uality of their labor.

'ut the second passage is !ore a!biguous. &f labor is !easured by its7duration or intensityA if 7uneual individual endo!ent7 is recogni?ed as anatural advantage/ then the !ore intense or capable or2er ho contributes!ore effort in the sa!e ti!e could then receive greater co!pensation. 4hat isone ay to interpret 7uneual right for uneual labor.7 8n the other hand/ the7right of ineuality7 can also be read as a right to eual co!pensation eventhough the or2 done is uneual/ as long as its duration is euivalent. 4helatter interpretation is in 2eeping ith the

$. 5ngels/ 7Si!ple and Co!bined Labor/7 <nti-Ihrin+A pp. ))"#9

338

abolition of the la of value under socialis!/ hen or2ers are !otivated defends bourgeois rights it is a bourgeois stateF but it is not run by capitalists/



/not si!ply by co!pensation but by their conscious participation in the socialistsociety.

4his interpretation is also that of 5ngels and Lenin. 5ngels observed that the7basic la of the ne econo!ic co!!une7 ould be 7eual ages for eual

labor ti!e.7( And Lenin noted that in the first phase of co!!unist society>74he ... socialist principle> <An eual a!ount of labor for an eualuantity of products/< is also already reali?ed. 'ut this is not etco!!unis!/ and it does not abolish <bourgeois right/< hich gives to

uneual individuals/ in return for an uneual Dactually uneualE a!ountof or2/ an eual uantity of products.7%

4hat is/ individuals of different capacities ho perfor! uneual a!ountsof or2 but do so in eual hours of labor ill nevertheless receive an eualshare of society<s output. &t also should be noted that under socialis! the laborreuired of society ill be carried out collectively to the e6tent possible inevery sphere. 4he ele!ent of co!petition a!ong fello#or2ers for higherco!pensation ill be reduced or eli!inated/ and the ele!ent of cooperation fori!proving or2 ill beco!e do!inant. Such conditions !a2e all the !oreunnecessary the retention of !ost for!s of ineuality in distribution.

&n su!/ the +ar6ist tradition postulates that the transition of society to thehighest state of co!!unis! necessarily passes through a socialist stage in

hich so!e bourgeois for!s of ineuality still re!ains. &n part these 7bourgeoisrights7 act in the opposite direction fro! hat the na!e suggests> certainuneual rights ill favor the orse#off sections of or2ers. 'ut since 7eual

pay7 ill still be the governing principle for or2ers ith uneual needs/ theor2ers ith greater needs ill suffer co!paratively. 'efore that stage/ ofcourse/ the !ore fa!iliar sort of bourgeois ineuality ould hold/ here higheruality of labor ould e6change for higher ages B to the degree that the laof value still operates. =e ill see this specifically in the early Soviet state/ butfirst e investigate the transitional or2ers< state in general.

T>7 W)R?7RS6 STAT7

,ntil the higher stage of co!!unis!/ bourgeois econo!ic re!nants illsurvive. So thought +ar6/ and Lenin ent a step further> since the e6istence of!aterial rights reuires their enforce!ent/ a state !ust still e6ist under the firststage of co!!unis!. =hat 2ind of stateH Since it

(. 5ngels/ p. ))9.%. Lenin/ State and eolutionA Chapter */ part 3

g g g F y p /since none e6ist/ nor even by a separate class of or2ers/ since all producersare no of the sa!e class. Lenin ter!ed this 7bourgeois state ithout a

bourgeoisie7" a parado6/ as indeed it is. &t is the last flic2er of the state before itis e6tinguished. 'ut if such a state/ hoever ithered/ is still necessary undersocialis!/ ho !uch !ore necessary is it in the transitional period beteencapitalis! and socialis!.

+ar6 postulated a state transitional beteen capitalis! and the first stage ofco!!unis! under hich the develop!ent of the ne conditions and social

relations ould be carried out>7'eteen capitalist and co!!unist society lies the period of therevolutionary transfor!ation of the one into the other. 4here corresponds tothis also a political transition period in hich the state can be nothing but the

reolutionary dictatorship o% the proletariat$ &n a draft of his essay 74he Civil=ar in -rance7 on the Paris Co!!une of 1"%1/ +ar6 outlined the tas2s of theor2ers< state>

74he or2ing class 2no that they have to pass through different phasesof class struggle. 4hey 2no that the superseding of the econo!icalconditions of the slavery of labor by the conditions of free andassociated labor can only be the progressive or2 of ti!e/ ... that theyreuire not only a change of distribution/ but a ne organi?ation of

production/ or rather the delivery Dsetting freeE of the social for!s of production in present organi?ed labor Dengendered by present industryE/of the tra!!els of slavery/ of their present class character # and theirhar!onious national and international coordination. 4hey 2no that thisor2 of regeneration ill be again and again relented and i!peded bythe resistance of vested interests and class egotis!s. 4hey 2no that the

present <spontaneous action of the natural las of capital and landed property< can only be superseded by <the spontaneous action of the lasof social econo!y of free and associated labor< by a long process ofdevelop!ent of ne conditions ... 'ut they 2no at the sa!e ti!e thatgreat strides !ay be !ade at once through the Co!!unal for! of

political organi?ation and that the ti!e has co!e to begin that !ove!ent

for the!selves and !an2ind.710

&n brief/ through its political control of the state/ the proletariat ill be ableto co!bat all the hangovers of capitalist rule/ above all the re!aining featuresof capitalist econo!y and in particular the la of value. Setting

". Lenin/ State and eolutionA Chapter $/ part *.9. +ar6/ Criti/ue o% the =otha Pro+ramA Part &V.10. +ar6/ -irst :raft of 74he Civil =ar in -rance/7 ar! and &n+els on the Paris

CommuneA Gal :raper/ ed./ pp. 1$*#$339

up a 7ne organi?ation of production7 along ith 7har!onious national and sitional or2ers< state. Si!ilarly/ the +ar6ist 'ertell 8il!an clai!s that 7+ar6



p g p ginternational coordination7 is no easy tas2/ especially hen there re!ain

bourgeois forces to defend their old interests. =e ill discuss the politicalecono!y of the or2ers< state in greater detail/ but first there are other !attersto ta2e up.

T>7 W)R?7RS6 STAT7 A!D <S)C,AL,SM<

&t is co!!on practice in describing +ar6<s theory of the transition tooverloo2 the or2ers< state entirely # for e6a!ple/ to assu!e that the or2ers<state is the sa!e thing as socialis!. 4he superficial reason for the confusion isthat both are transitional to the higher stage of co!!unis!. 'ut it is notdifficult to discern +ar6<s intention as ell as the lessons of Soviet history.

4he socialist stage refers to co!!unist society 7hen it has @ust e!ergedafter prolonged birth pangs fro! capitalist society.7 4his does not !ean thatsocialis! is created right after the socialist revolution/ hen the bourgeoisie isousted fro! state poerF that ould deny any transitional society beteencapitalis! and co!!unis!. o/ it i!plies that the or2ers< state that leads upto socialis! is still part of the capitalist stage of history. 4he proletariat is aclass that only e6ists ithin capitalis!/ as part of the age#labor relationship.Since it cannot be abolished and still rule its on state Dthe dictatorship o% the

proletariat@A that state is in that sense still bourgeois.

4he early Soviet state/ for these reasons/ as considered by its founders to be not socialist but rather a transitional proletarian state. -or e6a!ple/ the na!e7socialist7 as included in the 7,nion of Soviet Socialist epublics7 D,SSE toindicate the goal/ not a status already achieved. As Lenin e6plained/ 7o one/ &thin2/ in studying the uestion of the econo!ic syste! of ussia/ has denied itstransitional character. or/ & thin2/ has any Co!!unist denied that the ter!Socialist Soviet epublic i!plies the deter!ination of Soviet poer to achievethe transition to socialis!/ and not that the ne econo!ic syste! is recogni?ed

as a socialist order.711

evertheless/ 5.G. Carr/ the e!inent historian of the early Soviet state/contrasts +ar6<s 7eventual co!!unist society7 Dthe higher stageE ith his7transitional society hich <is @ust e!erging fro! capitalist society< and

continues to bear the <birth !ar2s< of its source.7 Ge is obviously uoting +ar6on the first stage of co!!unis! and euating this ith the tran#

11. Lenin/ 7Left#=ing< Childishness and the Petty#'ourgeois +entality/7 +ay 191"/Collected WorksA Vol. )%/ p. 33$.

1). Carr/ The #olsheik eolutionA Volu!e )/ pp. 1*#1$

y/divides the co!!unist future into halves/ a first stage generally referred to asthe <dictatorship of the proletariat< and a second stage usually called <fullco!!unis!<.... 4he dictatorship of the proletariat co!es in the a2e of therevolution and e6ists until the onset of full co!!unis!.7

Such riters obviously !ean that +ar6 never e6pected full#fledgedco!!unis! to e!erge the !orning after the revolution. 4heir i!plication isthat +ar6 understood the difficulties that the transitional society ouldencounter. 'ut the practical effect of confusing the to stages is to donplay

the proble!s faced by the transitional society hich hasnot yet

e!erged fro!capitalist conditions of production.&n a different spirit/ Stalin decreed in the !id#1930<s that the ,SS had

achieved socialis! and as therefore no longer a proletarian dictatorship. -orhi! nationali?ation of the !eans of production as the essential deter!inant ofsocialis!. Ge could not pretend that separate classes no longer e6isted Donlythat they ere 7non#antagonistic7E or that the state had ithered aay. As aresult he invented a hitherto unforeseen stage of 7co!!unis!7 in hichclasses continued to e6ist and the state gre stronger.

As e ill see in the ne6t chapter/ Stalinis! at this ti!e as drivingheadlong toard the restoration of capitalis! in the ,SS. 4he e!ergingruling class needed to !ove aay fro! the concept of a proletarian state and

or2ing#class rights. 4he Stalinists ca!e up ith the notion of 7soc ialis!7 as astate no longer belonging to the or2ers but to the 7hole people7> the rule ofthe ne intelligentsiaKbureaucracy as advertised as a stage (eyond the

proletarian dictatorship. 4he 193( Constitution !i!ic2ed the ideology of the7de!ocratic bourgeoisie7 in order to ce!ent the diplo!atic alliance ith the=estern poersF si!ilarly/ 7people<s poer7 in the ,SS fed into the strategyof building Popular -ronts ith bourgeois parties in the =est/ hich alsoe!braced the fiction of non#antagonistic classes.

4oday Stalinist and +aoist theorists conveniently forget that the Soviet,nion as not considered socialist at the start/ even by Stalin. 4hey use7socialis!7 instead of 7dictatorship of the proletariat7 to describe countriesthey consider transitional beteen capitalis! and co!!unis! B for one

reason/ because of the obvious lac2 of anything proletarian in theirdictatorship. 5ven so sophisticated a +aoist as 'ettelhei! praises Lenin for7renouncing7 +ar6<s 7idea that co!!odity categories ere destined to

disappear in the first phase of socialist society.71R 8bviously +ar6 as

13. 8il!an/ 7+ar6<s Vision of Co!!unis!/7 Criti/ue o. " D19%%E/ pp. 9/ 1$.1*. 'ettelhei!/ The Transition to Socialist &conomyA Chapter )/ p. 111

34:

referring to the first phase of co!!unis!/ hile Lenin as spea2ing of the geoisie7F even if it uses the !ost de!ocratic !echanis!s/ it safeguards



early or2ers< stateF Lenin never gave up the principle that socialis!/ a stage ofco!!unis!/ ould be a society here scientific planning/ not value/ reigned.

4he ter!inological !isrepresentation goes to the heart of the ussianuestion. &t is funda!entally a device for aarding +ar6ist authority to anti#or2ing class social structures. &n fact/ the Stalinists ho !odeled post#=orld=ar && 5astern 5urope on the Soviet ,nion never called their conuests7or2ers< states7 4hey clai!ed originally that their states had a !ulti#class or

popular character/ using ter!s li2e 7people<s de!ocracy.7 8nly later did theyapply the title 7socialist.7 'y avoiding an e6plicitly proletarian stage/ theysidestepped having to e6plain the lac2 of any genuine role for the or2ers. 8nlythe 7orthodo6 4rots2yists7 labeled the Stalinist states or2ers< states/ ith thead@ective 7defor!ed7 attached to try to bring theory closer to reality DseeChapter %EF the rulers never bothered/ and the !asses 2ne better.

4he theoretical eli!ination of the proletarian dictatorship fro! the transitionto co!!unis! fits into the !iddle#class +ar6ists< re@ection of the proletariat asthe self#e!ancipating revolutionary class. As long as rational thin2ers on top ofsociety are going to do all the planning and eventually carry society toco!!unis!/ hy orry about distinctions beteen popular fronts/ or2ers<states and socialis!H 4here<s no need to overthro anybody once e<re in

poer. 4hat is the real !eaning of +ao<s 7uninterrupted revolution7> e<re the

leadership all the ay. &t has nothing in co!!on ith 4rots2y<s per!anentrevolution/ a !aterialist assess!ent of the li!itations of bourgeois rule in thisepoch. =here 4rots2y<s strategy as ai!ed at inning the or2ers<independence fro! te!porary and unreliable petty#bourgeois allies/ +ao<s ai!as to prevent or2ing#class independence and +enuine proletarian revolution.

D,CTAT)RS>,P A!D D7M)CRAC#

4he ter! 7dictatorship7 in 7dictatorship of the proletariat7 has also been !uch!isinterpreted. +ar6 as not a partisan of the dictatorial for! of govern!entthat the ord no suggests and that bourgeois co!!entators love to use inorder to bla!e hi! for Stalinist totalitarianis!. -or +ar6/ eery state/ even the!ost de!ocratic/ as a dictatorship/ because every state as the instru!ent of

one class<s do!ination over all others # through every !eans necessary/ aboveall the !onopoly of ar!ed force. Any capitalist state/ for e6a!ple/ is a7dictatorship of the bour#

1$. -or a history of the controversy/ see :raper/ ?arl ar!'s Theory o% eolutionA )ol

* The ictatorship o% the Proletariat D19"(E

capitalist interests no !atter ho individuals are selected for state office. 4hus property ualifications have often been used as barriers to voting and toholding officeF they ere abandoned under !ass pressure but only hen !oresophisticated obstacles had been devised.

'y the sa!e to2en/ any or2ers< state is a proletarian dictatorship. +ar6and 5ngels so characteri?ed the 1"%1 Co!!une # despite/ on the one hand/ itstragic reluctance to use sufficiently dictatorial !ethods against the bourgeoisieFand/ on the other/ its re!ar2ably non#dictatorial innovations in the sphere ofor2ing#class de!ocracy. Li2eise/ in rough parallel to a bourgeois state<sfavoritis! toards ealthy property oners/ the early Soviet state deliberatelygave electoral advantages to the outnu!bered or2ing class. A significantsy!bol of the Stalinist counterrevolution as the abolition of these class

privileges in the 193( Constitution/ hich established 7de!ocratic7 Di.e./for!ally bourgeoisE parlia!entary for!s # on paper only/ since Stalinist realityas far fro! de!ocratic in any for!.

Gere e use the si!pler ter! 7or2ers< state7 interchangeably ith7dictatorship of the proletariat.7 'ut e do not !ean to suggest that theor2ers< dictatorship entails no conseuences that ould frighten a petty#

bourgeois de!ocrat. 4he ter! 7dictatorship7 does not !ean autocracy/ but itdoes reflect the highly centrali?ed character that a or2ers< state ould need in

order to ensure the do!ination of the or2ing class. :e!ocracy for the !any!eans suppression of the special privileges of the e6ploiters/ thereforesuppression of their bourgeois#de!ocratic rights. As opposed to bourgeois7pluralis!/7 decisions !ade for society as a hole by the proletariat ould bedecisively carried out/ since pro!ises are !eant to be 2ept and not bargainedaay to the highest bidder or lost in !a?es of corruption and poer#bro2ering.&t is no accident that !any socialistic opponents of Stalinis! re@ect not onlyStalin<s dictatorship but also centrali?ation/ hich is an authentic proletarianreuire!ent. 4heir alternative of decentrali?ation and 7de!ocracy7 !eans areturn to the class#based nor!s of the bourgeoisie.

4he bourgeois conception of de!ocracy as alays pluralist rather than!a@oritarian. enuine !a@ority rule in capitalist society ould obviously be

threatening to the !inority bourgeoisie in its struggle against the or2ingclassF hence the bourgeois propaganda today that labor is @ust one 7specialinterest7 a!ong !any. Li2eise/ the early republicans ho rote the ,nitedStates constitution deliberately tried to ha!per the for!ation of dangerous!a@orities. 4heir syste! as codified through the fa!ous 7chec2s and

balances7 and the 7separation of poers7 in the state. &n this ay theyinstitutionali?ed the inherent rivalry and suspiciousness beteen

344

the !ultiple centers and different for!s of capitalF they produced a !ar2et relations. Lenin put the proble! this ay>



version of the bourgeois state.5ven the refor!ist/ labor#bureaucratic notion of de!ocracy has nothing to

do ith the or2ers< de!ocracy e6e!plified by the Paris Co!!une. &t si!plye6tends the ruling#class understanding of pluralis! to incorporate the

proletarian !asses. 4he or2ers have to be convinced that they can share political poer and change the syste! # and si!ultaneously be prevented fro!doing so. efor!ists conseuently see2 all possible deterrents andcounterbalances to defend their on sta2e in society/ their local baronies for

bro2ering the sale of labor poer.&n contrast/ the or2ers< state enables the or2ing class as a hole to ield

state poer. As the Co!!une and the early Soviets de!onstrated/ or2ers<delegates are sub@ect to the intentions of/ and i!!ediate recall by/ theirconstituentsF they are given no special rightsF their age is no higher than thatof ordinary or2ersF and they are responsible for carrying out the !easures theyadopt. +oreover/ the Co!!une ar!ed all citi?ens/ including o!en/ capableof bearing eapons.

4he refor!ist vie of de!ocracy assu!es the absurd> that euality canreally e6ist in a society built on the division of the population into socialclasses. &n contrast/ the achieve!ent of proletarian de!ocracy depends onresolving the inherent contradictions of bourgeois#de!ocratic rights through the

steady advance of the productive forces/ centrali?ation of poer and dissolutionof the classes fro! hich ineuality springs. A or2ers< state is based on the

principles of proletarian de!ocracy and at the sa!e ti!e fulfills !any bourgeois#de!ocratic rights left over fro! capitalis!. &ts ai!/ hoever/ is notto preserve de!ocracy in any for! but to eli!inate the need for any state at all.

4he refor!ist<s de!ocracy is in fact a defense of the content of the la ofvalue underneath its egalitarian appearance> the la of uneual e6change anddeepening e6ploitation. D=e ill see this progra! !ade e6plicit in Chapter ".E=hereas proletarian de!ocracy points to the fulfill!ent of the original pro!isethat the la of value e!bodies> euality achieved through the ending of classes.At that point de!ocracy ill disappear as ell/ even proletarian de!ocracy/ forithout antagonistic classes there is no need for a separate state apparatus of

any 2ind/ de!ocratic or not. &n 5ngels< fa!ous phrase/ the state ithers aay.74he govern!ent of persons is replaced by the ad!inistration of things.7

P)L,T,CAL 7C)!)M# )& A W)R?7RS6 STAT7

4he founding +ar6ists all recogni?ed that co!!unist society reuires not onlya long period of ti!e before it can be established but also ne conditions hichhave to be constructed fro! scratch. Sociali?ed for!s of production alreadye6ist under capitalis!/ but not the reuisite social

78ne of the funda!ental differences beteen bourgeois revolution andsocialist revolution is that for the bourgeois revolution/ hich arises outof feudalis!/ the ne econo!ic organi?ations are gradually created inthe o!b of the old order/ gradually changing all the aspects of feudalsociety. 4he bourgeois revolution faced only one tas2 B to seep aay/to cast aside/ to destroy all the fetters of the preceding social order. 'yfulfilling this tas2 every bourgeois revolution fulfills all that is reuiredof itF it accelerates the groth of capitalis!.74he socialist revolution is in an altogether different position. ... 4hedifference beteen a socialist revolution and a bourgeois revolution isthat in the latter case there are ready#!ade for!s of capitalist relation#shipsF Soviet poer # the proletarian poer B does not inherit such

ready#!ade relationships ...71(

&n short/ the bourgeois revolution places the bourgeoisie in poer a%ter itsecono!ic poer has already been established/ after the bourgeoisie has longe6isted as an econo!ic class. =hereas the socialist revolution places theor2ers in poer (e%ore socialist econo!ic for!s e6ist B before/ for e6a!ple/there can be any generali?ed non#co!!odity production. &t is not enough/therefore/ for the proletariat to si!ply do aay ith capitalists and their

propertyF it !ust create fro! nothing the econo!ic organi?ation of socialis!.

4he socialist revolution/ unli2e the bourgeois/ is a conscious act of socialtransfor!ation. evertheless/ the or2ers< state inherits a capitalist econo!yand !ust therefore live ith it at the sa!e ti!e that it transfor!s it # it isindeed a bourgeois state ithout the bourgeoisie. &n order to overco!e the lasand relations inherited fro! capitalis!/ the or2ers !ust consciously plantheir econo!y. As increasingly !ore is produced and scarcity is conuered/ the

bourgeois las are gradually reduced in force. Planning beco!es fullydo!inant only hen scarcity is ended/ hen the higher state of co!!unis! isreached. After all/ there can be no ualitative change in production relationsithout a ualitative develop!ent of the productive forces.

4he econo!ic tas2 of the or2ers< state is therefore to carry out theaccu!ulative potential of capitalis! and destroy the social basis for continued

scarcity. 4he proletarian logic is to eli!inate value production/ since this!eans class e6ploitation and is therefore a barrier to the advance of the

productive forces. D&n contrast/ under capitalis! or2ers !ust often resist!oderni?ation in order to defend their or2ing and living conditions againstdeeper e6ploitation and une!ploy!ent.E

1(. Lenin/ 7Political eport of the Central Co!!ittee/7 +arch %/ 191"F Collected

WorksA Vol. )%. pp. "9#90

34-

4he proletarian state can accu!ulate value ithout the contradictions due to in<s !odel of state capitalis!.



the separate onership of capitalis! B hich !a2es e6change value and thelabor ti!e underlying it diverge. 4he reduction of scarcity under!ines thee6istence of classes/ as oners and petty oners are transfor!ed/ forcibly inso!e cases and sloly in others/ into producers. 4hus the groing use valuesgradually lose their aspect as capital. =hen the proletariat finally eli!inatesitself as a separate class/ the last re!nant of capitalis! is abolished in

production and socialis! begins.As e 2no/ +ar6 fro! ti!e to ti!e illustrated the contradictory nature of

capitalis! by co!paring it ith the future socialist society. 8ne uestion hedealt ith as hy the barriers to accu!ulation inherent in capitalis! ouldnot also apply to co!!unis! or the transitional or2ers< state. Gere he shosho one capitalist barrier to the introduction of ne !achinery ould be

bro2en through>74he use of !achinery for the e6clusive purpose of cheapening the

product is li!ited in this ay/ that less labor !ust be e6pended in producing the !achinery than is displaced by the e!ploy!ent of that!achinery. -or the capitalist/ hoever/ this use is still !ore li!ited.&nstead of paying for the labor/ he only pays the value of the labor poere!ployedF therefore the li!it to his using a !achine is fi6ed by thedifference beteen the value of the !achine and the value of the labor

poer replaced by it.71% &n +ar6<s algebraic notation/ here the value of co!!odities produced is C

V S/ the capitalist ill e!ploy ne !ethods only if they loer his costs/ C V Dconstant plus variable capitalE # that is/ only if the additional C he !ustspend is less than the V that he saves. &n contrast/ in a or2ers< state/ efficiencyould be less restrictive/ and of course ould e6clude efforts to loer ages.+achinery could be introduced si!ply if it loered the total costF that is/ if theadditional C ere less than V S #an easier condition to !eet.

8ur interpretation of +ar6<s falling rate of profit theory provides anadditional illustration of the greater efficiency of a or2ers< state. ,nderstandard interpretations/ the -P is an auto!atic conseuence of the risingorganic co!position of capital. 'ut the organic co!position ill continue torise in a or2ers< state> !oderni?ation and accu!ulation of capital to e6pandthe resources of society are a necessity/ hence e!bodied dead labor increasesfaster than living labor. &f the standard interpretation ere correct/ the risingorganic co!position ould !a2e the rate of profit fall and ould !ean thatsociety<s rate of groth !ust slo don as dead labor accu!ulates. 4hus theor2ers< state ould stagnate/ as in 'u2har#

1%. CapitalA Vol. &/ Chapter 1$/ Section ) Dp. 39)E

&n our interpretation/ on the contrary/ the -P co!es to do!inate itscountertendencies because of the disproportionate poer of the strongestcapitals that characteri?es the epoch of decay. &t depends both on the

preponderant role played by !onopolies in preventing euali?ation of the rateof profit and generating fictitious capital/ and on the international ineualitythat allos i!perialists the lions< share of surplus value. 'ut under a or2ers<state/ the !a@or industries ill be ta2en over fro! private capital/ the specialinfluence of poerful !onopolies and the role of fictitious capital ill end/ andnational li!itations ill be on their ay out. 4he devaluation of fi6ed capitalDin ter!s of labor ti!eE that co!es ith increased productivity ould !a2e iteasier/ not harder/ to invest in ne techniues of production. Conseuently/even during the period hen the or2ers< state has not yet succeeded inabolishing value and capital/ productive advances ould not cause it tostagnate.

4he early Soviet ,nion/ the only or2ers< state that has yet e6isted longenough to put theory to the test/ reflected these theoretical considerations onlyin part. &t suffered fro! the illnesses of bac2ard/ not advanced/ capitalis!Fstill it as able to overco!e the econo!ic stagnation do!inant in the capitalistorld in the 1930<s/ largely because of the centrali?ed poer of its state.4oday<s ,SS/ hoever/ e!bodying statified capitalis!/ does e6hibit the

stagnation tendencies i!posed by the -P DChapter $E.MA!D7L6S T>7)R#

4o e6a!ine the econo!y of a or2ers< state further e consider the viesof +andel and Cliff e6pressed in their theories of the Soviet syste!.

+andel defines the econo!y of the Soviet 7or2ers< state7 as 7!ar2ed bythe contradictory co!bination of a non#capitalist !ode of production and a still

basically bourgeois !ode of distribution.71" +ore recently he has used theter! 7post#capitalist.7 'ut since the only post#capitalist !ode of production isthe co!!unist or socialist one/ his i!plication is that the Soviet !ode of

production is socialist. +andel<s orthodo6y prevents hi! fro! calling Soviet production openly socialist/ so he invents ne ter!s.

+andel<s ording above echoes +ar6<s analysis in the Criti/ue o% the=otha Pro+ram$ Ge even cites +ar6 directly> 7=hat e have to deal ith hereis a co!!unist society/ not as it has developed on its on founda#

1". +andel/ ar!ist &conomic TheoryA Volu!e )/ Chapter 1$/ p. $($. &n later or2he argued that a or2ers< state !ust have specific 7relations of production/7different fro! both capitalis! and co!!unis!F this avoids the uestion of themode of production. D74en 4heses on the Social and 5cono!ic Las overningthe Society 4ransitional 'eteen Capitalis! and Socialis!/7 Criti/ue o.3/19%*.E

348

tions/ but/ on the contrary/ @ust as it e!erges fro! capitalist society.7 +ar6/ as +andel undoubtedly believes that in all this he is folloing 4rots2y/ ho



e have seen/ as spea2ing here of socialis!/ not the or2ers< state # furtherevidence that +andel<s underlying conception is that Stalinis! has a socialist!ode of production.

8f course/ if +ar6 could e6pect capitalist re!nants under socialis!/ surelye ill see the! under a or2ers< state. 'ut applying +ar6<s picture to Stalin<s,SS reuires a leap over logic and history. 4he e6change of eual a!ounts oflabor hich +ar6 discussed in no ay applies to Stalinis! Dor/ for that !atter/to the early ,SS of Lenin<s dayE. Stalinis! !ade ineuality of e6changeDespecially of age laborE the do!inant principle. 4his as not @ust the

parado6ical ineuality that arise out of eual rights under socialis!/ butineuality in the everyday decadent capitalist sense.

-urther> the bourgeois right that re!ains in socialist distribution is by no!eans a bourgeois Dor even 7basically bourgeois7E mode of distribution. As+ar6 e6plained>

7&f the !aterial conditions of production are the cooperative property ofthe or2ers the!selves/ then there li2eise results a distribution of the!eans of consu!ption different fro! the present one. Vulgar socialis!Dand fro! it in turn a section of the de!ocracyE has ta2en over fro! the

bourgeois econo!ists the consideration and treat!ent of distribution asindependent of the !ode of production and hence the presentation of

socialis! as turning principally on distribution. After the real relation haslong been !ade clear/ hy retrogress againH7 19

&n +ar6<s day/ of course/ the 7present7 conditions of distribution ere bourgeoisF hence the 7different7 distribution applicable to socialis! is not bourgeois/ basically or otherise. &t ill be basically socialist/ despite its bourgeois hangovers # in hat other society is distribution genuinely based onthe or2 done by the producersH 'ourgeois %orms ill re!ain ithout theirclass content$

+andel has ta2en +ar6<s analysis of distorted bourgeois rights undersocialis! as a license to discover socialist production here bourgeois for!sare distorted by state onership. And since he conceives that the Soviet ,nionfails to be socialist solely because of its bourgeois distribution/ he indeed

presents socialis! as 7turning principally on distribution.7 &t is only anotheraspect of standard !iddle#class populis! # or/ for +ar6/ 7vulgar socialis!.7

19.+ar6/ Criti/ue o% the =otha Pro+ramA Part &/ section 3.)0.+andel<s !isrepresentation of +ar6 is standard a!ong 7orthodo6 4rots2yists/7 even

his political opponents. 4he sa!e errors can be found/ for e6a!ple/ in ar!ism andthe 5SS D19%9E by Paul 'ellis/ pp. )0#)3/ and %%ie e+enerated eolution D19")E

by the +C&/ pp. *#$

rote/ for e6a!ple/ that 74he MSovietN state assu!es directly and fro! the beginning a dual character> socialistic/ insofar as it defends social property inthe !eans of productionF bourgeois/ insofar as the distribution of life<s goods is

carried out ith a capitalistic !easure of value... .7 )1

4rots2y as rong to suggest that the only bourgeois re!nants in theSoviet or2ers< state ere in distribution. 'ut there is a significant difference

beteen 4rots2y and +andel. 4rots2y called Soviet property social/ not thesocio#econo!ic syste! or !ode of production as a hole. Gis ter!

7socialistic7 # li2e Lenin<s 7,SS7 # referred to the goal to be achievedF he didnot clai! that socialist production already e6isted in the transitional state. 4hisis clear fro! his !ore e6act elaboration on 7social property7>

7&n order to beco!e social/ private property !ust as inevitably passthrough the state stage as the caterpillar in order to beco!e a butterfly!ust pass through the pupal stage. 'ut a pupa is not a butterfly. +yriadsof pupae perish ithout ever beco!ing butterflies. State property

beco!es the property of 7the hole people7 Mas Stalin clai!edN only tothe degree that social privilege and differentiation disappear/ andthereith the necessity of the state. &n other ords> state property isconverted into socialist property in proportion as it ceases to be state

property. And the contrary is true> the higher the Soviet state rises above

the people/ and the !ore fiercely it opposes itself as the guardian of property to the people as its suanderer/ the !ore obviously does it

testify against the socialist character of this state property.7))

-or 4rots2y/ Soviet property in the !id#1930<s as 7socialistic7 in that itas state#oned/ but it as hardly socialist$ +andel<s contrary conception goesa long ay toard accepting the Stalinist redefinition of the Soviet state associalist.

CL,&&S T>7)R#

:espite his for!al difference ith +andel over hether Stalinist production is non#capitalist/ Cliff agrees that a or2ers< state has no

funda!ental las Dalthough it does have so!e featuresE in co!!on ithcapitalis!. 4his shos up in his argu!ent i!plying that the la of valuecannot apply in a or2ers< state>

7&n a or2ers< state as ell as in the capitalist/ co!!odity econo!yeuivalents are e6changedF a product containing a certain uantity of

)1. 4rots2y/ The eolution #etrayedA Chapter 3/ p. $*.)). The eolution #etrayedA Chapter 9/ p. )3%

349

socially necessary labor is e6changed for another product containing ani l ' i 2 < hi l i hi d fi l h h

capitals sprouting ithin feudal society.7' i li i l & i l i hi h



euivalent a!ount. 'ut in a or2ers< state this result is achieved firstly throughthe conscious direction of the econo!y and not through the action of blindforces/ and secondly # and this is of funda!ental i!portance # the e6change ofeuivalents is based on the e6istence of the euality of rights of all direct

producers as regards the onership of the !eans of production. 4hisdescription of consciousness ruling over blind las clashes sharply ith thesevere conditions of Soviet ussia in the !id#19)0<s/ hich Cliff DcorrectlyEconsiders to have been still a or2ers< state. 'ut Cliff is rong even ithrespect to +ar6<s understanding of political econo!y in a !ore advancedor2ers< state. Ge is !a2ing the sa!e error as +andel of reading +ar6<sdescription of the first stage of communist society and applying it to theor2ers< state that still has to cope ith the la of value.

+andel and Cliff share the idea that the or2ers< state can abolishcapitalis!<s las of !otion before it yields the historical stage to co!!unis!.4his is another clue to the political outloo2 of !iddle#class +ar6ists. 4o denythe capitalist content of the or2ers< state !eans in reality to re@ect thetransitional stage co!pletely/ for the logic of the position is to insist that value

be i!!ediately abolished. 4he contrast ith +ar6<s vie could not be sharper.+oreover/ it follos that if or2ers cannot do the @ob of abolishing valuedirectly Dbecause they allegedly have interests too closely lin2ed to !oney#

grubbing capitalis!E/ then the tas2 falls on other shoulders/ the benevolent anddisinterested !iddle classes. 4he position is as self#serving as it is un#+ar6ist.

Cliff and +andel present a 7or2ers< state7 in hich the la of value has been abolished # at the sa!e ti!e that scarcity reigns. 4he idea is an idealistabsurdity/ a typically !iddle#class conception that asserts the pri!acy ofconsciousness D7planning/7 hoever !angledE over ob@ective conditions. &t is ofa piece ith their co!!on claptrap that use values are do!inant in the scarcity#ridden ussia of today. &t shos that the la of value for the! is not an inherentla !ediating scarcity but an optional tool hich society !ay or !ay notchoose to e!ploy # a notion they share ith the Stalinist planners.

Cliffs fore!ost theoretical co#thin2er for !any years/ +ichael Jidron/ entso far as to deny/ in a pole!ic against +andel/ that a transitional or2ers< state

as conceivable. 7'ut hat is a transitional society in +andel<s conte6t otherthan a verbal convenienceH &s such a for! possible beteen capitalis! andsocialis!H7 Ansering his on uestions/ Jidron alloed that transitionalsocieties had e6isted in the historical past/ citing

)3. Cliff/ ussiaA a ar!ist <nalysisA p. 9"F State Capitalism in ussiaA p. 1$3

7'ut socialis! is a total syste!. &t cannot gro piece!eal ithin theinterstices of a capitalist society. Go does or2ers< control of produc#tion coe6ist ith control by a ruling class hen the !eans of productionin dispute are one and the sa!eH ... 4here !ay be roo! for transitionalfor!s in distribution/ but at the level of production the only possible

transition is a sudden/ revolutionary one.7)*

Jidron thereby disavos a !a@or teaching of +ar6is!/ the chief @ustificationfor the 'olshevi2 revolution against charges of adventuris! and pre!aturity

fro! the +enshevi2s and other social de!ocrats. Ge also provides evidence forthe standard Stalinist slander of 4rots2yis!/ that per!anent revolution !eansthat the or2ers have to overthro capitalis! everyhere at once. Jidron<s

position is obviously at variance ith Cliffs. evertheless/ hen +andelreplied to Jidron<s article Dincluding an attac2 on this pointE and the Clifftendency responded at length/ their spo2es!an had nothing to say about

Jidron<s theoretical innovation.)$ 4he Cliffites< perfor!ance as anotherillustration of the !iddle#class +ar6ist vie that the uestion of the or2ers<state is a hairsplitting point that really doesn<t !atter very !uch.

T>7 PARAD)@ )& A W)R?7RS6 STAT7

Since production and distribution operate under a ne !ode in the socialist

stage of co!!unis!/ in the transitional or2ers< state before socialis! this!ode !ust be gradually overco!ing the capitalist heritage of value andscarcity. 5ven under the best of circu!stances this heritage bears a gravedanger for the or2ers< state. &t is the basis for restoration of capitalistrelations.

A genuine or2ers< state is truly parado6ical. -or e6a!ple/ the proletariat isthe ruling class/ ruling over the petty bourgeoisie and hatever re!ains of thecapitalists. +ost !a@or industry/ eventually all of it/ ill be oned by the state.4he proletarians or2ing for the state still produce value and therefore surplusvalue. 'ut they are not e6ploited/ because there is no e6ploiting class/ no

bourgeoisie/ to appropriate the surplus valueF it goes to the state to be used forthe collective good of the or2ers as deter!ined by the collective or2ingclass Dfor further accu!ulation/ insurance against disasters/ etc.E

)*. Jidron/ 7+aginot +ar6is!> +andel<s 5cono!ics/7 .nternational Socialism o. 3(D19(9E/ reprinted in Capitalism and Theory D19%*E.

)$. Chris Gar!an/ 74he &nconsistencies of 5rnest +andel/7 .nternational Socialism

o. *1 D19(9#%0E. +andel<s reply is in the &nternational +ar6ist roup<s pa!phlet/The .nconsistencies o% State Capitalism

30:

'ut in the early stages of a or2ers< state # especially one that re!ainsb 2 d i l t d i t ti ll f h t t t



bac2ard/ isolated internationally or for hatever reason cannot as yete6propriate the internal capitalists # capitalist relations survive. &ndustries stillneed to co!peteF planning is to that degree deter!ined by capitalist conditions

beyond the or2ers< control. 4he state allos so!e capitalists to e6ploitor2ers/ it itself produces and accu!ulates in part for sale to capitalists/

perhaps on uneual ter!sF in this sense the or2ers< state is co!pelled to act asan e6ploiting agent over its on or2ers/ even though it controls andsubordinates this 7e6ploitation7 to the ut!ost.

4his contradictory condition is possible only because it is te!porary andchanging. As the proletarian state develops toard socialis!/ as capitalis! isgradually under!ined and destroyed/ the or2ers< 7self#e6ploitation7 ithersaay. =hen the socialist revolution occurs in an industrially advanced group ofcountries the transitional period of or2ers< states could be short. 'ut as long asthe transitional state has not ithered aay/ there is alays the possibility ofslipping into reverse gear and !oving in the other direction/ bac2 toardscapitalis!. 4hat is hat e see in the initial years of the Soviet state.

Another parado6ical condition is that/ as the or2ers< state e6propriates the bourgeoisie and consolidates capital into its on hands/ it creates in effect asingle capital. 'ut as e sa in Chapter )/ a single capital is an i!possibility.,nder bourgeois rule/ it ould be prevented by the internal rivalries of the

bourgeoisie and their fear that it ould beco!e too te!pting a target for theor2ers< revolt. 5ven under a or2ers< state/ a 7single capital7 ould appear to

be a contradiction in ter!s/ because ith a genuine collective onership thereould be no need for a no artificial value to !easure uantities of products fordistribution.

4he resolution of this contradiction is that/ as the or2ers< state !ovestoard socialis!/ the separate enterprises develop toard a single capital #although to one degree or another they still are obliged to co!pete in order forsociety to evaluate production ith the greatest efficiency. =hen that level of

planning can be achieved/ then in effect the or2ers< state has reached its end #and ith it/ the 7single capital.7

ecall fro! Chapter ) that 5ngels rote that ith the statification of capital/

7the capitalist relation is not done aay ithF it is rather brought to a head. 'ut brought to a head it topples over.7 4his is true even if the state onership isacco!plished by the or2ers rather than the bourgeoisie. 5ngels< response #7state onership of the productive forces is not the solution of the conflict/ butconcealed ithin it are the technical conditions that for! the ele!ents of thatsolution7 # reflects the truth that statification under the orkers' centrali3ed

state poer is the active agency that can transfor! potential into reality bylaying the basis for the abolition of the capitalist relation

4 T>7 STR=L7 &)R T>7 S)V,7T STAT7

Contrary to +ar6<s e6pectations/ the proletarian revolution first occurred not inan advanced capitalist country but in the !ost pri!itive of the i!perialiste!pires. Although revolutionary uprisings spread across Central 5urope/ theyere everyhere defeated B above all because of the treachery of the social#de!ocratic politicians/ aided by the Jauts2yist centrists. As a result thedifficulties the 'olshevi2s faced in the transitional period ere far greater thanhad been foreseen.

4he full tragedy of the decay of the Soviet revolution cannot be depicted inan analytical or2. =hat e have to do here is e6plain the politicalsignificance of the strategies and progra!s to defend the Soviet or2ers< statethat ere adopted or re@ected by the contending forces.

,!,T,AL ;)LS>7V,? P)L,C,7S

4he ussian revolution faced the i!!ediate proble! of survival in anecono!ically bac2ard/ internationally isolated and ar#torn country. 4hese

burdens ere !ultiplied by the needs of !ilitary defense of the ne Sovietstate against i!perialist invasions and ho!egron counterrevolutionary

ar!ies. =hile the revolution<s !ilitary foes ere defeated/ so too as theinternational revolutionF the battered or2ers< state as left to deal ith its bac2ardness alone. 4he 'olshevi2 strategy as to sur!ount ussia<soverhel!ing li!itations enough to hold out until the proletarian revolutionerupted again abroad.

4he 'olshevi2s thre !uch of their li!ited resources into the tas2 of aidingrevolutions. &t !ay see! strange in co!parison to the nationalist assu!ptionsof !uch of today<s left/ but Lenin as no Soviet nationalist. Ge stressed thecentral i!portance of the revolution in er!any Dthe industrial country hereor2ing#class organi?ations ere strongestEF he said that if the ussianrevolution had to be sacrificed to bring about the er!an/ so be it. 4he !ainsignificance of the ussian revolution as the part it could play in triggering

the orld revolution. 4he 'olshevi2s< first ai!/ therefore/ as the creation ofthe Co!!unist 4hird &nternational to replace the 7yello7 social#de!ocraticSecond.

At ho!e/ in the first !onths of the revolution/ !a@or econo!ic steps ereta2en. 4he ban2s ere e6propriated/ a state !onopoly of foreign trade asestablished/ and in the countryside the land as nationali?ed and the largeestates bro2en up and distributed a!ong the peasants. 4he govern!ent at firstatte!pted to restore industrial production ith private fir!s operating underor2ers< control Di.e./ supervisionE/ but in the face

304

of capitalist hostility and the or2ers< pressure/ industries had to beti li d ll

such victories ere not co!ing did they reali?e that they ould have to liveith t iti l 2 < t t i i f t d d i d



nationali?ed as ell.As e have seen/ at the birth of a or2ers< state/ capitalist conditions !ay

yield only sloly to socialist !easures li2e state planning. 4his general proble!as ualitatively orse for the ,SS. Shortly after the revolution/ Leninobserved that it as easier to e6propriate capitalists than to organi?e theecono!y on proletarian lines. Co!pro!ise !easures ere introduced> highsalaries for bourgeois e6perts/ pieceor2 and 7!uch that is scientific and

progressive in the 4aylor syste!/7 and co!petitive ages to raise labordiscipline. Lenin noted honestly that the Soviet govern!ent had been obliged7to ta2e a step bac2ard/ or to agree to co!pro!ise ith bourgeois

tendencies.7)( 4en years later such !easures ould be hailed as the epito!e ofsocialis!.

:uring the strenuous/ heroic civil ar period/ hoever/ !any 'olshevi2s beca!e convinced that capitalis! had been truly abolished. 4he unfortunatereality as that acute arti!e conditions !ade necessary the policy of 7arco!!unis!7 # eli!ination of the !ar2et/ forced reuisitions fro! the peasants/

pay!ent of the or2ers in goods rather than orthless !oney. 'ut this asactually a step bac2ard/ not an advance toard the higher productivitycharacteristic of socialis!. Lenin noted retrospectively>

7=e e6pected # or perhaps it ould be truer to say that e presu!ed

ithout having given it adeuate consideration B to be able to organi?ethe state production and the state distribution of products on co!!unistlines in a s!all#peasant country directly as ordered by the proletarianstate. 56perience has proved that e ere rong. &t appears that anu!ber of transitional stages ere necessary # state capitalis! andsocialis! # in order to prepare # to prepare by !any years of effort # forthe transition to co!!unis!. ... Aided by the enthusias! engendered bythe great revolution/ and on the basis of personal interest/ personalincentive and business principles/ e !ust first set to or2 in this s!all#

peasant country to build solid gangays to socialis! by ay of state

capitalis!.7)%

=e ill discuss shortly hat Lenin !eant by state capitalis! under aor2ers< state. 4he 'olshevi2s !is@udged ar co!!unis! because theyanticipated # and 2ne that the future of the revolution depended on #earlyvictories of socialis! in =estern 5urope. 8nly hen it as clear that

)(. Lenin/ 7Si6 4heses on the &!!ediate 4as2s of the Soviet overn!ent/7 Collected

WorksA Vol. )%/ p. 31$.)%. Lenin/ 7-ourth Anniversary of the 8ctober evolution/7 Collected WorksA Vol. 33/

p. $"

ith a transitional or2ers< state in ussia for an e6tended period.=hen the civil ar ended in 19)1/ the 'olshevi2s had to deal ith a

situation orse than !ere survivals of capitalis!. 8n the one hand/ the vast!a@ority of the people ere peasants/ ho had acuired land through therevolution and conseuently deepened their petty#bourgeois consciousness. 8nthe other/ the country as devastated/ industry as producing at a fraction ofits pre#191* capacity/ and the or2ing class itself as shattered/ having !ovedout of the cities into the ar!y and countryside.

,nder Lenin<s direction the leadership sought a ay out> the personalincentives and business principles @ust cited. Gis 7e 5cono!ic Policy7D5PE of the 19)0<s legali?ed the !ar2et and encouraged private co!!ercialtrading and s!all bourgeois production Das ell as foreign invest!ents/ ofhich little as actually attractedE. At the sa!e ti!e/ the first steps toardstate planning ere underta2en in 19)1> a plan for electrification and theestablish!ent of the State Planning Co!!ission DosplanE. ecovery resulted/and by 19)( production had been restored to its pre#ar levels> people couldeat again. 8n the other hand/ the or2ers< state then had to co!bat the effectsof the s!all#scale capitalis! that had revived. So!e social benefits ereintroduced and others pro!ised/ but scarcity/ e6ploitation and ineualitydo!inated the econo!y. 4he la of value still retained its iron grip.

=e have noted that the funda!ental revolutionary tas2 in the econo!icsphere is co!batting the la of value> overco!ing its effects and replacing itith conscious planning to the e6tent possible. 'ut under the petty co!!odity

production that do!inated the early Soviet ,nion/ the las of capitalis!ielded far !ore control than they ould have under a !ore advancedor2ers< state. And because of the poer of the orld !ar2et/ the threat asever present that i!perialis! ould overhel! the or2ers< state/ penetratingthrough every concession !ade to capitalis!.

Go could there be conscious or2ers< planning hen the proletariat ass!all/ deci!ated and overburdenedH 8nly through a !a@or industrial andcultural advance and a rise in the standard of living could the or2ing class

beco!e genuinely do!inant. 'ut to increase the resources available to the

or2ers/ the Soviet econo!y had to first be put bac2 on its feet. And thisreuired resorting to capitalist !easures even beyond the restoration of tradeand petty#bourgeois production. 4hese dangerous but desperately necessary!easures could !aintain the ,SS as a or2ers< state only for a ti!e.evolutions in advanced countries ere critical to brea2 the i!perialistencircle!ent and allo revolutionary ussia to survive.

30-

<STAT7 CAP,TAL,SM<

Lenin<s sol tion as s !!ari ed as 7state capitalis! 7 4his ter! had beeniven Soviet conditions/ the planning that the or2ers< state sought to

nderta2e co ld not et be socialist planning based on the f ll scientific



Lenin<s solution as su!!ari?ed as 7state capitalis!.7 4his ter! had beenused by +ar6ist riters to !ean intervention by a bourgeois state into theecono!y/ up to and including state onership of !a@or !eans of production.4he er!an ar econo!y gave state capitalis! the concrete !eaning of

planning and organi?ation in the ar years preceding the revolutionF it as a poerful e6a!ple/ for Lenin especially. Ge rote in 191">

7=hat is state capitalis! under Soviet poerH 4o achieve state capitalis!at the present ti!e !eans putting into effect the accounting and controlthat the capitalist classes carried out. ... &f e had it in ussia/ thetransition to full socialis! ould be easy/ ould be ithin our grasp/

because state capitalis! is so!ething centrali?ed/ calculated/ controlledand sociali?ed/ and that is e6actly hat e lac2F e are threatened by theele!ent of petty#bourgeois slovenliness/ hich !ore than anything elsehas been developed by the hole history of ussia and her econo!y/ andhich prevents us fro! ta2ing the very step on hich the success of

socialis! depends.7)"

4he petty#bourgeois attitude against hich Lenin rote as that of7grabbing as !uch as possible for hi!self/ to e6ploit the fruits of victory Moverthe big bourgeoisieN for hi!self and for his on ends.7 4he ussian petty

bourgeois/ only recently e!erged fro! pre#capitalist rule/ acted as a capitalist

only in the pettiest sense of narro#!inded avarice/ not ith the goal ofecono!ic develop!ent. A peasant/ for e6a!ple ould not conceive of investinghis surplus in industries vital for producing the goods needed in agriculture/even if this as certain to be profitable. Ge ould rather see2 to e6tend his on

petty holdings/ perhaps hire labor to help or2 the land/ or hoard his surplus.&n contrast/ 7state capitalis!7 !eant the highest degree of planning and

centrali?ation yet attained by civili?ation. Lenin as not dealing here ith thedecadence of state and !onopoly capitalis! that he had stressed in his or2 oni!perialis!. 4he asteful and reactionary aspects of !onopoly ould beeli!inated by accounting and control in the interest of the or2er and peasant!a@ority. Since the revolution<s chief econo!ic proble! as to overco!e

bac2ardness/ Lenin sa state capitalis! as an ally of the or2ers< state/ an

unavoidable stage Dunder ussian conditionsE on the ay to socialis! .)". Lenin/ 7eport on the &!!ediate 4as2s of the Soviet overn!ent/7 April )9/ 191"/

in Collected WorksA Vol. )%/ pp. )9*#$F see also p. 339. 4he sa!e ideas ererepeated after the adoption of the 5PF see 74he 4a6 in Jind/7 Collected WorksA

Vol. 3)/ fro! p. 330 on/ and 7eport to the -ourth Congress of the Co!!unist&nternational/7 ove!ber 13/ 19))/ Vol. 33/ pp. *1"#))

underta2e could not yet be socialist planning based on the full scientificconsciousness of free/ associated producers. or/ on the other hand/ could theor2ers li!it the!selves to capitalist state planning ith the bourgeois goal ofe6panding value and surplus value. =hat had to be done as consciousintervention of the proletarian state into the econo!y to lessen the har!fulconseuences of capitalist relations for the or2ers/ on the one hand/ and tofind strategies for developing the econo!y/ on the other.

=ith the distinction beteen petty capitalis! and capitalist sociali?ation in!ind/ Lenin distinguished five categories of Soviet production> 1E 7natural7Dpre#capitalistE far!ingF )E s!all co!!odity De.g./ peasantE productionF 3E

private capitalis! on a larger scaleF *E state capitalis!F and $E socialis!. ,nderstate capitalis! he included> aE concessions to foreign or do!estic capitalistsfor the develop!ent of state#oned industry and ra !aterialsF bE cooperativesfor petty#bourgeois and peasant producers Dhich facilitated organi?ation andstate supervisionEF and cE hiring capitalists as agents for selling state#producedgoods.

Lenin<s ter! 7socialist7 production referred to the factories oned by thestate and directly !anaged by its agentsF he clearly used the ord in the sa!esense that he had ith the na!e 7,SS/7 !eaning industry that as furthestalong the path to the socialist goal. 8n the distinction beteen state capitalist

and socialist industry/ 4rots2y critici?ed Lenin<s use of 7the ter! <statecapitalis!< hich e e!ploy in referring to our state econo!y.7)9 Ge alsogenerali?ed the ter! 7socialist/7 applying it in Lenin<s directional sense to allSoviet industry>

74he industry of the or2ers< state is a socialist industry in its tendenciesof develop!ent/ but in order to develop/ it utili?es !ethods hich ereinvented by capitalist econo!y and hich e have far fro! outlived asyet. ... &n our country/ the groth of Soviet state industry signifies thegroth of socialis! itself/ a direct strengthening of the poer of the

proletariat.730

4he ter! 7socialist industry/7 hoever/ has been badly !isused/ above all

in Stalin<s self#serving clai! that capitalist las disappear hen all industryand agriculture is statified. &t ould have been clearer had the 'olshevi2scalled the entire econo!y of the or2ers< state under the 5P 7state capitalist/7in order to sho that the operational las of capitalis! had only barely beentouched in any sphere of the econo!y.

)9. =e can find no e6a!ple of Lenin using 7state capitalis!7 for the state econo!y asa hole. A later co!!ent by 4rots2y confir!s this> 74he Class ature of theSoviet State/7 Writin+s D19**-*4@A p. 110. M30. 4rots2y D19))E/ The 7irst 7ie

Hears o% the CominternA Vol. )/ pp. )**#$308

4he error as co!pounded in the theoretical or2 of Preobra?hens2y/ hichbeca!e the !odel for !uch confusion in hat as later called the 7political

!a2e every state enterprise pay its ay and sho a profit/ and in vie ofthe inevitable rise of narro depart!ental interests and e6cessive



beca!e the !odel for !uch confusion in hat as later called the politicalecono!y of socialis!.7 As e sa in Chapter )/ for Preobra?hens2y capitaliststate onership !eant/ 7al!ost co!pletely/7 the end of value production. Allthe !ore so for the Soviet state>

7&n Soviet econo!y the connection beteen trustified state industry andthe independent peasant holding is infinitely ea2er in respect ofe6change and of credit/ hile the or+ani3ational structure of industry ishistorically of a higher type than in any capitalist country. As a result e!ust inevitably have a far#reaching atrophy of the or2ing of the la ofvalue ithin the state econo!ic sector/ along ith a very greatdevelop!ent of the or2ing of the la of value beyond the li!its of the

state econo!y...7 31

Preobra?hens2y believed that in the state#oned industries value asessentially eli!inated because of the do!inance of planning and the ea2nessof trade ith the petty#bourgeois sector. Gis regarded the la of value chiefly asa regulator of prices based on supply and de!and in the !ar2et/ not as a guideto the ob@ective tendencies of the econo!y rooted in production by !eans oflabor poer. &ndeed/ he believed that state industry/ despite the bac2ardnessof the level of production/ as 7abolishing the co!!odity status of labor

poer7 to a great degree. 4he full i!plications of this error ere dran out only

later by others/ including Stalin/ and e ill ta2e the! up in Chapter $.&n contrast/ 4rots2y<s description of state industry !ade its adherence to

capitalist nor!s of labor as un!ista2able> 74he principles of co!!ercialcalculation have been reintroduced into the state#oned enterprises and theages again !ade dependent on s2ill and output of or2ers.7

Lenin ent even further. As the fa!ous trade union debate ithin the partyshoed/ he understood the i!plications of bourgeois drives ithin the 5P far

better than other leaders Dincluding 4rots2y/ ho as on the rong side on thisuestionE. &t as not enough to ad!it that labor ould be treatedcapitalisticallyF as ell/ or2ers ould have to be free to defend the!selvesfro! the inherent dangers of capitalist operation>

74he transfer of state enterprises to the so#called profit basis is inevitably

and inseparably connected ith the e 5cono!ic PolicyF... &n vie of theurgent need to increase the productivity of labor and

31. Preobra?hens2y/ The :e &conomicsA p. 1(1.3). The :e &conomicsA p. 191.33. 4rots2y D19))E/ The 7irst 7ie Hears o% the CominternA Vol. )/ p. )(%. ote that

4rots2y did not pretend that Soviet ages/ dependent as they ere on value con#siderations such as s2ill and intensity/ ere e6a!ples of socialist distribution

the inevitable rise of narro depart!ental interests and e6cessivedepart!ental ?eal/ this circu!stance is bound to create a certain conflictof interests in !atters concerning labor conditions beteen the !asses ofor2ers and the directors and !anagers of the state enterprise/ or thegovern!ent depart!ents in charge of the!. 4herefore/ as regards thesociali?ed enterprises/ it is undoubtedly the duty of the trade unions to

protect the interests of the or2ing people ...3*

:espite the capitalist nor!s of their internal operation/ Lenin hoped that the

state fir!s/ through participation in planned econo!y and production for theinterests of the proletariat/ ould help bring the Soviet state toards socialis!.4his failed> conditions ere too harsh/ and the advanced ele!ents of theor2ing class too fe/ to carry out the necessary organi?ation and planning.74here is hardly any evidence of the operation of an integrated state econo!ic

plan/7 Lenin rote in 19)1 to the head of the state planning co!!ission. Geadvocated favoring the !ost essential industries and shutting don inefficientfactories 7hich are being 2ept running by tradition/ routine and theunillingness of the or2ers to change their occupation and do!icile.7 And in19)) he arned the party congress/ 7:uring the past year e shoed uiteclearly that e cannot run the econo!y. 4hat is the funda!ental lesson. 5ithere prove the opposite in the co!ing year/ or Soviet poer ill not be able to

e6ist.73

4here ere 7left co!!unists7 at the ti!e ho regarded Lenin<s 5P as anunprincipled return to capitalis!/ in effect the overthro of the proletarianrevolution. 4his vie ignores not only that capitalist relations of production areunavoidable in the first period of any proletarian state/ but also that under the

prevailing conditions they could hardly have been done aay ith. Politicallythe anti#5P vie represents a !oralistic ultra#left refusal to retreat hennecessaryF it also reveals the sa!e idealistic understanding of the la of valuethat is so pervasive today. =ith the 5P the 'olshevi2s recogni?ed theundeniable reality of the ,SS<s petty#capitalist environ!ent and atte!pted toadapt to it econo!ically in order to overco!e it. 4hat they failed as partly a

product of devastating econo!ic conditions/ but !ost significantly the result ofthe party<s political acco!!odation to the necessity of retreat.&t !ust be said that the 'olshevi2s !ade i!portant !ista2es under the

enor!ous pressures they faced. -or e6a!ple/ the banning of factions ithin

3*. Lenin/ 74he ole and -unction of the 4rade ,nions ,nder the e 5cono!icPolicy/7 anuary 19))F Collected WorksA Vol. 33/ pp. 1"$#(.

3$. Lenin/ 7Letter to Co!rade Jr?hi?hanovs2y/7 Collected WorksA Vol. 3)/ pp. 3%1#*Fand Collected WorksA Vol. 33/ p. )%*

309

the Co!!unist Party and the prohibition of all other or2ing#class parties ere!easures ta2en under duress and initially regarded as te!porary D4he last

functions.730

4h fifth f t li t d b L i th l f th d t i



!easures ta2en under duress and initially regarded as te!porary. D4he lastsoviet party aside fro! the 'olshevi2s/ the Social evolutionaries/ had to besuppressed because of their adherence to the ar!ed counterrevolution duringthe civil ar of 191"#)1.E 'ut as during ar co!!unis!/ positions of retreatere too often defended as substantive conuests/ increasingly so as theor2ers< state degenerated. Severe !easures necessary to defend the or2ers<state/ li2e the suppression of the Jron#stadt !utiny in 19)1/ later beca!e the

@ustification for ar!ed repression of the or2ers< state<s defenders.

T>7 )R,,!S )& ;=R7A=CRAT,C D7CA#

4he ele!ent of or2ers< consciousness that characteri?es a or2ers< stateas seen first of all in the instru!ents of proletarian poer> or2ers< councilsDthe SovietsE/ !ilitias/ factory co!!ittees/ trade unions/ or2ing#class parties/etc. 4hese organs need to gro to include broader sections of the or2ing class.After the or2ing class as so terribly ea2ened in the civil ar/ only therevolutionary vanguard as ta2ing part in econo!ic and politicalad!inistration. 'ut gradually the entire class ould have to beco!e involveddirectly. 4o !a2e this possible reuired raising ages and shortening or2inghours so that or2ers had the ti!e/ energy and enthusias! to devote to politics.

Lenin enu!erated the virtues of the Soviets for the early Soviet state>

74he Soviets are a ne state apparatus hich/ in the first place/ providesan ar!ed force of or2ers and peasantsF and this force is not divorcedfor! the people/ as as the old standing ar!y/ but is very closely boundup ith the people... Secondly/ this apparatus provides a bond ith ... the!a@ority of the people so inti!ate/ so indissoluble/ so easily verifiableand reneable/ that nothing even re!otely li2e it e6isted in the previousstate apparatus. 4hirdly/ this apparatus/ by virtue of the fact that its

personnel is elected and sub@ect to recall at the people<s ill ithout any bureaucratic for!alities/ is far !ore de!ocratic than any previousapparatus. -ourthly/ it provides a close contact ith the !ost varied

professions/ thereby facilitating the adoption of the !ost varied and !ostradical refor!s ithout red tape. -ifthly/ it provides an organi?ational

for! for the vanguard/ i.e./ for the !ost class#conscious/ !ost energeticand !ost progressive sections of the oppressed classes/... by !eans ofhich the vanguard of the oppressed classes can elevate/ train/ educateand lead the entire vast !ass of these classes/ hich has up to no stoodco!pletely outside of political life and history. Si6thly/ it !a2es it

possible to co!bine the advantages of the parlia!entary syste! iththose of i!!ediate and direct de!ocracy/ i.e./ to vest in the people<srepresentatives both legislative and e6ecutive

4he fifth factor listed by Lenin # the role of the vanguard party # isespecially significant. =e have seen the role of the party in !a2ing the dual#

poer Soviets revolutionary during the events of 191%. &t is doubly necessaryafter the revolution. 4he political life of the or2ers< state features strugglesnot only against the bourgeoisie and its allies but also ithin the or2ing class/against the bac2ard sectors prone to adapt to bourgeois interests.

4ragically/ the Soviets as described by Lenin did not survive the civil ars.+any of the leading proletarians left to constitute the bac2bone of the

predo!inantly peasant ed Ar!y. 8thers had to leave the factories and beco!e attached to the apparatuses developing inside the party and state. 4heirties to the !asses loosened. 4he Soviets/ once tee!ing ith the heady politicallife of increasingly conscious !asses ta2ing their on destiny in hand/ turnedinto institutions of co!!and/ dispensing ith debate in the effort to organi?esurvival. As hunger narroed the or2ers< hori?ons/ bureaucracy supplantedinitiative. And the or2ers< state had no choice but to incorporate ele!ents ofthe old C?arist and bourgeois orderF ho else as educated and trained in the!ilitary arts and ad!inistrationH

&n 1919 Lenin observed that 7the Soviets/ hich by virtue of their progra!are organs of govern!ent (y the orkin+ peopleA are in fact organs ofgovern!ent %or the orkin+ people by the advanced section of the proletariat/

but not by the or2ing people as a hole.7 'y 19)1 the situation as farorse> the state as 7not uite a or2ers< state7 but one ith 7a bureaucratictist to it/7 or 7a or2ers< state ith bureaucratic distortions.7 4he 'olshevi2

party/ capable of !a2ing the revolution through the efforts of a s!all but politically conscious and dedicated proletarian cadre leading !asses of or2ersand peasants/ as overhel!ed by the proble!s of governing a vast countryfacing econo!ic disaster and a deci!ated proletariat. &t had to rely heavily onofficials and e6perts fro! the for!er state bureaucracy and the C?aristintelligentsia # for both their ad!inistrative e6perience as ell as speciali?ed2noledge. &n 19)) Lenin su!!ed up the situation>

7&f e ta2e +osco ith its *%00 Co!!unists in responsible positions/and if e ta2e that huge bureaucratic !achine/ that gigantic heap/ e

!ust as2> ho is directing ho!H73"

3(. Lenin/ 7Can the 'olshevi2s etain State PoerH/7 Collected WorksA Vol. )(/ pp.103#*.

3%. Lenin/ 7eport on the Party Progra!/7 Collected WorksA Vol. )9/ pp. 1"3F Vol. 3)/ pp. )*/ *".

3". Collected WorksA Vol. 33/ p. )"". Lenin cites a figure of )*3/000 public officials in+osco at that ti!e Dp. 39*E.

3-:

=ith the trade unions and Soviets bureaucrati?ed or atrophied/ the 'olshevi2party re!ained the only or2ers< institution lin2ing the or2ing class to the

ha!pered by its bac2ardness and isolation. Such a usage ould have to bedistinguished fro! the post#=orld =ar && 7defor!ed or2ers< state7 notions



party re!ained the only or2ers institution lin2ing the or2ing class to thestate. 'ut the party too as succu!bing to bureaucracy. oseph Stalin beca!ethe party<s general secretary Doriginally an ad!inistrative post/ not the top

political positionE and accrued !ore and !ore poer through appoint!ents tothe e6panding apparatus.

&n the absence of revolution abroad/ Lenin spent the last years of his lifestruggling over the degeneration of the party and the state ithout finding asolution. &n his final effort/ his 4esta!ent/ he de!anded Stalin<s re!oval asgeneral secretary and the e6pulsion of other 'olshevi2s hose bureaucratic!ethods had co!e to his attentionF he proposed a bloc ith 4rots2y to theseends. 'ut the struggle as delayed/ and bureaucratis! e6panded # beyonddegenerating officials using bad !ethods to a hole parasitic layer infecting theentire party and the state apparatus.

&n 19)3 hen Lenin as ill/ Stalin<s bureaucracy proved able to controlelections to the party congress and force opponents into public silence. AfterLenin<s death in 19)*/ for e6a!ple/ his 4esta!ent as 2ept fro! the party!e!bership. 4hen Stalin engineered the infa!ous 7Lenin levy/7 recruiting intothe party tens of thousands of !ore bac2ard !e!bersF this sa!ped the old'olshevi2 cadre and diluted the party<s revolutionary character. Advance!entithin the party and state as increasingly deter!ined by bureaucrats ho

oed their positions to Stalin and his inner apparatusF this faction gre li2e atapeor! in the party<s vital organs. 56#+enshevi2 careerists ere elco!edinto the party despite their record of opposition to the 191% revolution/ and soonere rearded ith leading positionsF they ca!e to the forefront later in thestruggle against the opposition against the Stalinist bureaucracy led by 4rots2y.

4he events of 191% had proved Lenin right on the centrality of therevolutionary partyF proletarian leadership as the decisive uestion of theepoch/ the essential ingredient of per!anent revolution. So too ith the fate ofthe Soviet state hen the 'olshevi2 party as under siege. 4rots2y latercharacteri?ed the 19)3#)* period as the 74her!idor7 of the ussian revolution/the turning point hen the anti#proletarian forces ho ould pave the ay tocounterrevolution got the upper hand.

Lenin had already labeled the Soviet ,nion a 7or2ers< state ith bureaucratic defor!ations/7 and it is clear that the history of even the earlySoviet ,nion hardly fits the +ar6ist !odel of a proletarian state. &t ould not

be incorrect to call it a 7defor!ed or2ers< state7 al!ost fro! the start/ aor2ers< state hose transition to socialis! as disastrously


39. 4rots2y/ 74he =or2ers< State/ 4her!idor and 'onapartis!/7 =ritings 193*#3$

distinguished fro! the post#=orld =ar && defor!ed or2ers state notionsthat contrasted the later Stalinist creations ith the 7healthy or2ers< state7 ofLenin and 4rots2y Dthe latter is a grotesue label if ever there as one/ giventhe realityE. 4he difference is that the early Soviet state as a or2ers< state/hoever defor!ed. 4he or2ers created it through their revolution/ defended itagainst the co!bined attac2 of the i!perialists and autocrats and sacrificed #and ere to continue to sacrifice i!!ensely # to allo it to survive anddevelop.

T>7 L7&T )PP)S,T,)!:uring the e 5cono!ic Policy period of the 19)0<s after Lenin<s death/

the political struggle ithin the Co!!unist Party appeared to be three#cornered. 4he or2ing class confronted bourgeois ele!ents built up under the

5P on the one handR and the bureaucracy on the other/ groing ever !oreseparate fro! the or2ers. Since other parties had been suppressed/ all thedivergent class forces in Soviet society ere reflected ithin the ruling CP.

=hile the 5P sti!ulated econo!ic recovery by reviving peasant and private capitalist production/ industrial groth as ell as conscious controlover the econo!y lagged behind. 4rots2y cited the 7scissors crisis/7 in hich

peasants hesitated to sell their goods at prices that ere relatively far belo the

costs of the industrial goods they needed. After Lenin died in 19)*/ the party!a@ority under Stalin and 'u2harin resisted industriali?ation in order to avoidconflict ith the peasantry/ hich held in its hands the bul2 of the country<ssurplus value. 'ut the state needed surplus value to develop the productiveforces and to advance the !asses< living standards. Go could this beacco!plished through proletarian !ethodsH

4rots2y led the ing of the party/ the Left 8pposition/ that advocated fasterindustriali?ation in order to strengthen and enlarge the proletariat. 4he Leftcalled for a progressive ta6 on the richer peasantry and an e6tension of thesector governed by the plan. 4he state had to not only ta2e over the dead laborheld by the old bourgeoisie but also to accu!ulate further. ot/ as undercapitalist rule/ for the purpose of replacing living labor in order to ea2en the

or2ers< poer in productionF but on the contrary/ to i!prove the conditions ofthe !asses and defend the! fro! co!petition of bourgeois forces ithin thecountry and outside. 4his de!anded restrictions on the la of value> state!onopoly of foreign trade to prevent i!perial do!ination of do!estic !ar2ets/controlling the ban2s and other financial institutions/ and strictly supervising!a@or industrial enterprises. Above all it !eant raising the political activity/consciousness and conditions of the !ass of or2ers.

3-4

4he Left 8pposition<s specific proposals called for defense of or2ingconditions age increases at least as great as productivity increases

4he Left 8pposition correctly sa the restoration of capitalis! 7on theinstall!ent plan7 as the chief danger facing the or2ers< state =ithin the



conditions/ age increases at least as great as productivity increases/ proportionate une!ploy!ent benefits/ i!prove!ents in or2ers< housing/genuine agree!ents ith trade unions/ !anagers< obedience to the Labor Code/euality for o!en or2ers/ etc. &n agriculture/ hen 'u2harin and Stalin!ade overtures toard denationali?ing land onership and giving propertytitles Das opposed to leasesE to the peasants/ the 8pposition forced the! toretreat. &t counterposed instead a syste!atic introduction of rural cooperativesand collectivi?ed far!ing/ a proposal having nothing in co!!on ith the

%orci(le enslaving of the peasants to 7collective7 far!s that Stalin i!posed atthe end of the decade.

4he Left<s agricultural proposals ere lin2ed to de!ands for planning andindustriali?ation/ since ithout stepped#up production of consu!er goods andindustrial goods needed on the far!/ the peasants<s resistance to grain collectioncould only increase. 'ut the 8ppositionists ere !oc2ed as socialist ro!anticsand 7super#industriali?ers7 by the sa!e people ho turned in desperation toStalin<s chaotic and brutal super#industriali?ation progra!s of the 1930<s.

evertheless/ under the 8pposition<s pressure the first plans ere dran up/ butin the hands of the ruling bureaucratic ing they ere restricted to the !ostti!id !easures. 4o accu!ulate capital in a balanced ay reuired as ell anactive international policy/ both in the econo!ic sphere through trade and

invest!ent and above all in politics. 4he ,SS had to ta2e advantage of theorld division of labor ithout being do!inated by it. 4he Left cha!pionedindustriali?ation and defense of the foreign trade !onopoly in order to e6pandtrade in !anufactured goods ith the capitalist orld. 4he 8ppositionunderstood that in the long run/ ithout socialist revolution in the advancedcountries/ econo!ic develop!ent could prolong the life of the or2ers< state

but not save it. 4he tragedy of Soviet history as that international necessitiesin the econo!ic and political spheres ere not carried out. 4he Left 8ppositionsu!!ed up the critical situation>

74he appropriation of surplus value by a or2ers< state is not/ of course/e6ploitation. 'ut in the first place/ e have a or2ers< state ith

bureaucratic distortions. 4he sollen and privileged ad!inistrative

apparatus devours a very considerable part of our surplus value. &n thesecond place/ the groing bourgeoisie/ by !eans of trade and ga!blingon the abnor!al disparity of prices/ appropriates a part of the surplusvalue created by our state industry.7


*0. 4rots2y/ Iinoviev/ et al./ Plat%orm o% the pposition D19)%EF in 4rots2y/ The Challen+e o% the

e%t pposition D1926-20@A p. 31). ote the e6plicit assu!ption that the state sector in aor2ers< state produces value and therefore co!!odities. Co!ing fro! the central progra!!atic docu!ent of the Left 8pposition/ this subverts the theories of various!odern 4rots2yists

install!ent plan as the chief danger facing the or2ers state. =ithin theruling party this threat as represented by the right ing led by 'u2harin/hich defended the interests of the 2ula2s Drich peasantsE/ the 5P!en and theunion aristocracyF it as developing into a bourgeois current ithin theor2ers< !ove!ent. 'ecause of the overall danger/ the 8pposition de!anded

party de!ocracy but opposed the call for de!ocracy in the country as a holeraised by social de!ocrats Das ell as liberals and !iddle#class leftists abroadE.iven the vast peasant !a@ority in ussia and their !istrust of theCo!!unists/ such 7de!ocracy7 could only have !eant the restoration ofcapitalist rule under C?arist or fascistic reaction.

+oreover/ ithout its on industry to produce !achinery for far!ing/ a bourgeois ussia<s inevitable entry into the orld !ar2et ould inevitablyhave subordinated it to i!perialis!. 4he peasantry itself cannot rule a !odernsociety. &n ussia in 191% it ulti!ately folloed the proletariat becausefolloing bourgeois leaders had not on the! the land. &n the 19)0<s a peasantvictory could only have !eant i!perialist do!ination/ since the old ussiancapitalist class had been shattered and as by then only a servant of foreigncapital.

4he centrist Stalinist ing of the party represented the bureaucracy/especially those sectors closest to the state apparatus. &n 4rots2y<s vie the

bureaucracy lac2ed a fir! class base and stood for no social alternative outsideof blind self#aggrandi?e!entF it as therefore destined to vacillate politically incentrist fashion beteen left and right. 'ut as a parasite on the surplus value

produced by the or2ers/ it as necessarily attuned to the right/ against theinterests of the proletariat.

<S)C,AL,SM ,! )!7 C)=!TR#<

4he Soviet ,nion<s econo!ic proble!s ere reinforced by the conservatis!of the bureaucracy even hile Lenin as alive. Afterards they ereco!pounded by the bureaucracy<s policy of building 7socialis! in onecountry/7 in Stalin<s phrase. 4his path as inspired by the defeat of revolutionsoutside ussia. Shoing less and less confidence in the or2ing class as their

on bureaucratic poer e6panded/ the Soviet authorities loo2ed abroad to bourgeois allies ho !ight align ith the! against their !ain antagonist/'ritish i!perialis!. 4heir foreign policy as dictated no longer by proletarianinternationalis! but by class#collaborationist !aneuvers to prod the orld

proletariat into support of 7anti#i!perialist7 bourgeois ele!ents. 4heir notionof defense of the or2ers< revolution as

3--

beco!ing defense of the 7national interest7 # their on poer.4he ne strategy openly too2 the for! of opposition to the theory of

talist relations/ feared endangering any for! of property by openingrevolutionary gates that the nely developing proletariat could !arch through



4he ne strategy openly too2 the for! of opposition to the theory of per!anent revolution/ even though the 'olshevi2 revolution had proved theaccuracy of this perspective. As the faction fight developed in the post#Leninyears/ per!anent revolution beca!e a !a@or issue for Stalin and 'u2harin/ butlargely a defensive one on the part of the Left. As e sa in Chapter )/ 4rots2yand other adherents regarded per!anent revolution as a progra! specific toussia. &t as not seen as a guide for co!!unist or2/ even i!!ediately afterits triu!ph in 191%/ and it re!ained undeveloped in the press of practicalactivity.

Stalin and his folloers clai!ed that the Soviet ,nion could achievesocialis! despite isolation by relying on its on political and !aterialresources. 'ut socialis! cannot be built on bac2ardnessF the only ay toavoid doubling the !asses< suffering under the la of value as to hold out andfight for the spread of the revolution to the advanced countries. 4he bureaucrats<go#slo policy and deepening cynicis! toard proletarian revolution led the!to !isadvise and help under!ine the er!an revolution of 19)3. &n 19)( theyrefuse to brea2 ith the labor#aristocratic bureaucrats ho led the 'ritishgeneral stri2e to defeat/ thereby giving betrayal the cover of the ussianevolution.

4he bureaucracy<s first great disaster too2 place in China. 4he Co!intern

decided that a revolutionary bourgeois stage as necessary under the leadershipof Chiang Jaishe2<s Juo!intang DJ+4E/ a bourgeois nationalist party hich/according to Stalin/ e!bodied the interests of the or2ers and peasants as ellas the 7anti#i!perialist7 bourgeoisie. Stalin invo2ed Lenin<s old theory of the7de!ocratic dictatorship of the proletariat and the peasantry7 to @ustify his line.4rots2y fought a losing battle in the Co!intern and the Soviet party against theChinese CP<s 7'loc of -our Classes7 ith the nationalist bourgeoisie/ a policyhich led to its per!anent entry into the Juo!intang and the elco!ing of theJ+4 into the Co!intern. 4rots2y as proved right hen/ during the civil arof 19)$#)%/ the 7de!ocratic7 J+4 capitulated to i!perialis!/ bro2e its alliance

ith the Co!!unists and slaughtered the or2ers of Shanghai.*1

4he Chinese events inspired 4rots2y to revive per!anent revolution and

apply it beyond the ussian case. 4he original theory argued that the proletariatould have to carry out the necessary bourgeois de!ocratic tas2s because ofthe counterrevolutionary role of the national bourgeoisie. As e sa/ this class/fettered though it as by feudal and other pre#capi#


*1. 4he disaster as the fruit of the Co!intern<s policy of the 7Anti#&!perialist ,nited-ront.7 4his policy as to !i!ic2ed later by the post#=orld =ar && 4rot#s2yist!ove!ent DChapter %E

revolutionary gates that the nely developing proletariat could !arch through.'ut after the e6perience of the orld ar and Lenin<s analysis of the i!perialistepoch/ it as clear that the !ain barrier to advancing the productive forces andachieving the de!ocratic tas2s as no longer precapitalist relations/ butcapitalis! itself in the shape of i!perialis!.

&ncreasingly even pre#capitalist for!s ere beco!ing capitalist in content.4he Chinese case as decisive. ,nder the Juo!intang/ the old social relationsof China ere increasingly subordinated to the needs of i!perialis! # despitethe Stalinists< assertion that the issue as bourgeois de!ocracy versus7feudalis!.7 ust as the ussian revolution had brought the centrality of theindependent revolutionary party into bold relief/ the Chinese revolutionhighlighted it negatively. 4rots2y concluded that the only ay China couldgain independence/ solve its agrarian proble! and achieve de!ocratic rightsas through a proletarian revolution/ supported by the peasants and lin2ed tothe international revolution.

:espite the e!barrass!ent of the Chinese defeat/ its conseuence as thatthe Stalinist bureaucrats gained !ore influence in the Soviet and otherco!!unist parties. 5ven though the Left<s arnings had proved correct/ thedefeat engendered a groing cynicis! toards the possibility of successfulor2ers< revolutions anyhere. 4his pessi!is!/ along ith the loss of China as

a potential bourgeois#nationalist ally/ heightened the bureaucracy<s sense ofnational isolation and fear. 4he idea that the ,SS !ust strengthen itself as a

nation in order to survive beca!e the do!inant conseuence of 7socialis! inone country.7

At ho!e/ the bureaucracy not only stepped up its attac2s on the Left8ppositionF as it turned aay fro! the or2ers< struggles internationally/ itincreasingly tightened the scres on the or2ers at ho!e. 4hroughout the later

5P period the Left endured political persecution/ Siberian e6ile/ vile slandersand e#baiting. &t fought heroically and at great hu!an cost against the

bureaucratic reaction that as corrupting every proletarian tradition ofsocialis! and 'olshevis!.

<S)C,AL,ST ACC=M=LAT,)!<4he struggle of the Left 8pposition in defense of proletarian interests too2

place on the theoretical level as ell as the practical. iven the vitali!portance of the debates in the orld<s only or2ers< state/ theoretical errorsof 8pposition leaders had far#reaching conseuences.

Preobra?hens2y as the outstanding case. Ge e6panded on the idea of astruggle beteen socialist consciousness and the capitalist inheritancee!bodied in the la of value. Ge regarded this struggle as one beteen tolas/ the la of value and the 7la of pri!itive socialist accu!ula#

3-8

tion.T*) 'y this he !eant the need of the or2ers< state to e6pand production inthe state#oned sector of the econo!y !ainly the largest enterprises in heavy

bac2ardness.*3 4he best interpretation that can be !ade is that Preobra#?hens2y<s la as an effort to give theoretical bac2ing to the Left 8pposition<s



the state#oned sector of the econo!y/ !ainly the largest enterprises in heavyindustry/ by siphoning off a portion of the surplus value produced by the

peasantry. &f the state sector ere left to e6pand solely on the basis of thesurplus value it produced itself/ it ould gro only 7at a snail<s pace7D'u2harin<s phraseE/ and the or2ing class ould re!ain a !inority of the

population for a long ti!e.State accu!ulation as certainly necessary/ but Preobra?hens2y<s theory

as rong. 4he dual character of production in a or2ers< state cannot berepresented as co!bat beteen to las/ a capitalist la of value and asocialist la of accu!ulation. -irst of all/ e have seen that accu!ulation is anunfulfilled capitalist tas2 left to the or2ers< state to carry out. 4he las ofaccu!ulation are derived fro! the las of value/ not counterposed. &n the shortrun/ accu!ulation runs counter to raising the cultural and living standards of the!assesF obviously it could be acco!plished far !ore speedily if the !assessacrificed their i!!ediate ell#being and all resources ere dedicated to !ore!eans of production. &n the long run/ if dead labor do!inates the living # that is/if accu!ulation is the supre!e goal # then all the evils of capitalis! in its epochof decay ill follo/ and accu!ulation itself ill be under!ined.

or is accu!ulation by the state at the e6pense of the petty#bourgeois peasantry specifically socialist. Achieved by transferring surplus value fro! the

ea2er and s!aller units of capital to the larger/ centrali?ed and !oreadvanced/ it is again a la of capitalist develop!ent. 5ven if the entireecono!y ere brought under state onership/ accu!ulation ould still be acapitalist survival. 4he socialist tas2s ould re!ain> advancing the cultural and!aterial level of the or2ers/ shortening the or2ing day/ bringing the !assesinto the running of the state/ increasing euality/ etc. 4he struggle against thela of value ould continue.

4he reason hy Preobra?hens2y<s theory is rong is that the proletarianconsciousness that co!bats the la of value is not a blind la independent ofthe ill of the or2ers. 4here is no la regulating conscious planning Dotherthan the la of value itself # hich holds it bac2/ restricts it and sub@ects it tothe econo!ic scarcities of the e6isting society.E Preobra?hens2y<s on atte!pts

to for!ulate his 7la7 present no ob@ective develop!ental process. 4hey !erelyac2noledge the level of Soviet econo!ic


*). Preobra?hens2y/ The :e &conomics$ 4his ter! had been critici?ed by Lenin as7e6tre!ely unfortunate7 and 7a childish ga!e in its i!itation of ter!s7 hen used

by 'u2harin. See 'u2harin/ &conomics o% the Trans%ormation Period D19)0F5nglish version 19%1/ pp. 110/ 191/ ))3E

?hens2y s la as an effort to give theoretical bac2ing to the Left 8pposition sstrategy for industriali?ation. 'ut it had the effect of draing a line beteen thestate sector and the private sector/ as if the la of value could penetrate thefor!er only fro! outside. Adopted ithout ac2noledg!ent by the Stalinists/it !isguided generations of oppositional co!!unists.

Li2e !any 'olshevi2s/ Preobra?hens2y had co!e to see accu!ulation asinherently progressive and did not recogni?e the need for conscious resistanceagainst the encroaching nor!s of capitalis!. 4his left the or2ers disar!ed inthe face of the Stalinist attac2. Stalin used the idea of the pri!acy ofaccu!ulation to 7enforce/7 in effect/ the la of value against the or2ing class# that is/ to i!ple!ent its conseuences> ineuality/ a labor aristocracy/i!perialis!/ etc.

Preobra?hens2y<s transfor!ation of proletarian consciousness co!battingvalue into an ob@ective la as itself a de!onstration of cynicis! toard therevolutionary capacity of the proletariat. &t as no accident that he as an earlyLeft capitulator to Stalin. Ge opposed 4rots2y<s fight ith Stalin over China/fatalistically accepting the defeat of the or2ers and seeing no point to fightingfor an alternative. &n capitulating to Stalin<s super#industriali?ation of the late19)0<s/ he clai!ed that this policy as hat the Left 8pposition had beenfighting for all along # hereas 4rots2y bitterly observed that Stalin<s

7planning7 loered the living standard of the or2ers instead of raising it.+any of the capitulators ere !otivated by careeris! and personal

unillingness to brave ostracis! in the party and Siberian e6ile. So!e hadgron cynical and agreed that Stalin<s brutal !ethods ere the only ay toachieve socialis! on the bac2s of a retarded proletariat. 'ut the !otivation ofstrategists li2e Preobra?hens2y can be located !ore sharply. 4he initialstruggles aged by the Left 8pposition against the snail<s pace course ofStalin#'u2harin enlisted not only those dedicated to the proletariat andinternationalis!F they also attracted Co!!unists !otivated chiefly by the needfor national develop!ent out of bac2ardness. 4he latter ere choicecandidates for Stalin hen he abandoned 'u2harin and e!bar2ed on hisnationalist accu!ulation policy.

;=?>AR,!6S C)!S7RVAT,SM

'u2harin/ the theoretician behind ho! the Stalinist ing operated in the!id#19)0<s/ reflected the de!orali?ation brought on by the internationaldefeats. Previously on the ultra#left ing of the party/ he adapted


*3. See The :e &conomicsA pp. "*/ 1)*/ 1*(.**. 4rots2y/ 7A =retched :ocu!ent/7 in Writin+s D1929@A pp. 19"#)1)

3-9

to the conservative pole. 8n the uestion of value/ here the 4rots2yist Leftheld that the goal of the or2ers< state as to restrict the operation of the la of

74he old rotten bourgeoisie/ hich lived on the charity of C?aris!/ illhave thus been replaced/ than2s to our ussian revolution/ by a ne



g pvalue/ 'u2harin argued that the state should utili?e it to control the econo!y.Ge rote>

7=hen e spea2 of our econo!ic groth on the basis of the !ar2et Dthisis the !eaning of the e 5cono!ic Policy fro! a certain viepointE/e thereby refute the vie that socialist accu!ulation is opposed to thela of value. -iguratively spea2ing/ e force the la of value to serveour purposes. 4he la of value <assists< us and/ strange as it !ay see!/

prepares thereby its on destruction.7 *$

-or 'u2harin/ the plan as an anticipation of hat spontaneous co!petitionould deter!ine/ ithout the uncertainties and crises of an unregulated !ar2et.4his !eant in effect re@ecting the struggle against the effects of the la ofvalue. Stalin<s policy reversal at the end of the 19)0<s DChapter *E put an end total2 of utili?ing the la/ but the concept returned in force during the Second=orld =ar.

&n 19)$ 'u2harin ent so far as to urge the ealthy peasants to 7enrichyourselves.7 +ore precisely/ he argued that 7the prosperous far!s have to be

developed in order that aid !ay be provided to the !iddle and poor peasants.7 *(

4his strategy as !eant to build up resources for socialis!/ but in reality itcould be acco!plished only at the e6pense of the urban or2ers and ea2

peasants. +oreover/ a strong capitalist peasantry as a deadly threat to theor2ers< state. 8b@ectively/ therefore/ 'u2harin and his allies ere setting thestage for counterrevolution.

'u2harin overloo2ed the danger of counterrevolution through privatecapitalis! because he feared a different threat> capitalist restoration arriving by!eans of the all#poerful state>

7=e ill arrive ... at a situation in hich all our declarations/ our banners/ the singing of the &nternationale/ the Soviet for! of govern!entill re!ain in place on the surface/ hile the inner content of all of thisill already have been transfor!ed> this content ill correspond to theatte!pt/ to the ishes and hopes of this ne bourgeois layer hichconstantly increases/ beco!es constantly stronger and by ay of slo

and organic changes ill succeed in transfor!ing all the characteristicsof the Soviet state and placing it bit by bit on the rails of a purelycapitalist policy. ...


*$. Quoted in the !a@or Soviet econo!ic te6tboo2 of the 5P period/ ritten by to'u2harinists> Lapidus and 8strovitianov/ <n utline o% Political &conomyA p. *%1.

*(. 7Concerning the e 5cono!ic Policy and 8ur 4as2s7 D19)$E/ in ichard '. :ay/ed./ :$.$ #ukharin Selected Writin+s on the State and the Transition to Socialism

D19")E/ p. 19"

p / / y bourgeoisie ... hich retreats before nothing/ hich !a2es its ay underthe sign of nationalis! but hides under the phraseology and the bannersof internationalis! in order to advance toards a ne capitalist and

bourgeois ussia/ strong and poerful.74he or2ing class can !echanically defeat its adversary/ it can

physically ta2e possession of hat e6ists but it can at the sa!e ti!e beabsorbed by adverse cultural forces. 4his danger inevitably threatensevery or2ing class hich conuers state poer. &f that happens/ e ill

transfor! ourselves into a ne bourgeoisie because e ill detachourselves ithout noticing it/ but co!pletely/ fro! the general

proletarian base and e ill thus transfor! ourselves into a ne social

for!ation.7*%

&n shoing that the ,SS<s capitalist heritage could be reasserted by thetransfor!ation of the state apparatus into a ne bourgeois class/ 'u2harin<sarning as perceptive # but it as nevertheless based on a cynical andfatalistic understanding of the proletariat. Ge attributed the danger to auto!atic

processes/ overloo2ing the need to raise rapidly the or2ers< !aterialstandards. o doubt the danger represented by the bac2ard culture of theor2ers as initially the deadliest obstacle/ but it soon yielded first place to the

fungus#li2e spread of the bureaucratic apparatus. Lenin had fought this nedanger in the last period of his life/ and 4rots2y ha!!ered aay at it/ stressingthe effect of scarcity>

7=hile the first atte!pt to create a state cleansed of bureaucratis! fellfoul/ in the first place/ of the unfa!iliarity of the !asses ith self#govern!ent/ the lac2 of ualified or2ers devoted to socialis!/ etc./ itvery soon after these i!!ediate difficulties encountered others !ore

profound. 4hat reduction of the state to functions of <accounting andcontrol/< ith a continual narroing of the function of co!pulsion/de!anded by the party progra!/ assu!ed at least a relative condition of

general content!ent. ust this necessary condition as lac2ing.7*"

&t as the concrete condition of econo!ic scarcity in ussia that produced

the ne strata of petty#bourgeois bureaucrats. 4rots2y pointed out that Lenin/in his concern about the cultural level of the or2ers/ had !is@udged theseriousness of bureaucrati?ation. Lenin<s 7obvious underesti!ation ofi!pending difficulties/7 4rots2y rote/ 7is e6plained by the


*%. 'u2harin/ 7Proletarian evolution and Culture/7 cited in 'ettelhei!/ es uttes de

Classes en 5SSA Vol. 1/ p. )(*.*". 4rots2y/ The eolution #etrayedA p. $9

35:

fact that the progra! as based holly on an international perspective.7&n placing the bla!e on the or2ers rather than the Stalinist apparatus/



p g pp /'u2harin blinded hi!self to the real threat. Applying his assu!ption to the

proletariat everyhere/ he adopted increasingly conservative vies on the prospects for revolution internationally/ the only hope for the ,SS. 4hesolution that floed fro! these pre!ises as a disaster> adaptation to the

peasant and petty#bourgeois forces of private capitalis!. 4he result as that'u2harin<s faction of the party contributed all the !ore to the bureaucraticcapitulation to the bourgeois forces during the 5P period. &n contrast ithStalin<s bureaucratic collectivi?ation of agriculture policy a fe years later/

'u2harin<s peasant policy ould have !a6i!i?ed the threat of i!perialist penetration of the ,SS. Soviet industry/ advancing sloly according to'u2harin<s for!ula/ ould be unable to !eet the de!and of the !ost

prosperous peasantsF in their search for household and capital goods/ theyould be dran inevitably to their subordination/ and conseuently ussia<s/ tothe orld !ar2et.

Loo2ing bac2 on the Soviet industriali?ation debates ith the advantage ofhindsight/ it is clear hy 'u2harin and Stalin ere able to agree on 7socialis!in one country7 despite their underlying differences. Stalin as heading for a

policy of brutally 7building socialis!7 by co!!and fro! the top don/ hile'u2harin preferred a !oderate but eually autar2ic Dself#reliantE !ode. 'oth

regarded the international revolution as dubious. 4he bureaucracy asunconsciously feeling its ayF its narroness and prag!atis! led it toard building up the national econo!y ith no internationalist e6pectations. &ts goalas a national 7socialis!7 to defend against the i!perial threat. 4he bureaucratsere by no !eans yet bourgeois in consciousness> they still hated i!perialis!and do!estic capitalis!. 'ut their cynicis! toard the proletariat as thestarting point for their degeneration and the counterrevolution.

4he popularity of 'u2harin<s vies a!ong leftists today reflects theirdiscouraged attitude toards the prospects of the or2ing#class !ove!ent/lin2ed to the fear that the progra! of the Left 8pposition ould have led to acentrali?ation eually obno6ious to !iddle#class sensibilities as Stalin<s. Stalin<sautar2ic sche!e has so obviously turned to disaster that even these fatalists are

forced to find an alternative in a pro#bourgeois course. 'ut 'u2harin<s progra!/no being echoed at the highest levels of the Soviet and allied ruling classes/had nothing to do ith genuine socialis!> the classless society by ay of

proletarian poer. &t as only 7capitalis! in one country7 by a different route.


*9. 4rots2y/ The eolution #etrayedA p. $"

Cha(ter -

The Stalinist Counterre+olution

3 T>7 P)L,T,CAL C)=!T7RR7V)L=T,)!

Loo2ing bac2 on the changes created in the ,SS during the 1930<s/ one isstruc2 by to re!ar2able and unforeseen develop!ents. 4he first is thetransfor!ation of a bac2ard country into an industrial poer capable ofdefeating Gitler<s ar!ies. 4he other is the e!ergence of a totalitarian state thatslaughtered !ore co!!unists than Gitler could drea! of. 4hecounterrevolution carried out by the Stalinist ruling party created the 7e6istingsocialis!7 that still e6ists. 4he route it too2 and the proble!s of analysis itengendered are the topics of this chapter.

=hereas the founders of +ar6is! had laid the basis for analy?ing the progress of a or2ers< state toard socialis!/ there had never before been anyconsideration of the de+eneration of or2ing#class rule. 4he Left 8ppo#sitionists ere co!pelled to co!e to grips theoretically ith the transfor!ation

of the Soviet syste!. ot surprisingly/ their positions shifted over ti!e # because of both a changing reality and their groing understanding.

&n this first section e ta2e up the develop!ent of Left and in particular4rots2y<s analyses of the Soviet state and the Stalinist party/ through threestages> on the eve of Stalin<s dra!atic brea2 ith the 'u2harinistsF @ust after the7revolution fro! above7F after the crisis of Stalinis! caused by econo!icdisaster in the ,SS and the triu!ph of fascis! in er!any. 4hen the central

part of the chapter presents our on analysis of the co!pletion of thecounterrevolution. -inally/ e critici?e 4rots2y<s last positions.

S)C,AL VS P)L,T,CAL C)=!T7RR7V)L=T,)!

&n the late 19)0<s the Left 8pposition included several theoretical

tendencies. 8ne held that the or2ers< state had already been s!ashedF another/that the bureaucracy/ despite everything/ as building socialis!. 4rots2y asa!ong the fe to hold to the position that the counterrevolution as ta2ing

place but as not yet triu!phant.8ppositionists ho believed that the or2ers< state no longer e6isted

reasoned that the Soviets/ the organs of the or2ers< class poer/ had

354

beco!e !oribund. 4rots2y did not challenge the factF he pointed instead to thecentrality of the Co!!unist Party/ the or2ing#class institution hich still held

the bourgeoisie could sei?e poer only by the road o% counterreolution-ary upheaal$ As for the proletariat/ it can regain full poer/ overhaul



y y/ gthe reins of poer.

74he socialist character of our state industry # considerably ato!i?ed as itis> ith the co!petition beteen the various trusts and factoriesF ith theonerous !aterial position of the or2ing !assesF ith the inadeuatecultural level of i!portant circles of the toilers # the socialist character ofindustry is deter!ined and secured in a decisive !easure by the role ofthe party/ the voluntary internal cohesion of the proletarian vanguard/ theconscious discipline of the ad!inistrators/ trade union functionaries/

!e!bers of the shop nuclei/ etc.7&f e allo that this eb is ea2ening/ disintegrating and ripping/ thenit beco!es absolutely self#evident that ithin a brief period nothing illre!ain of the socialist character of state industry/ transport/ etc. 4hetrusts and individual factories ill begin living an independent life. ot atrace ill be left of the planned beginnings/ so ea2 at the present ti!e.4he econo!ic struggle of the or2ers ill acuire a scope unrestrictedsave by the relation of forces. 4he state onership of the !eans of

production ill be first transfor!ed into a @uridical fiction/ and later on/

even the latter ill be sept aay.71

4he recognition that state onership could beco!e a legal fiction !as2ing

an alien poer over the or2ers as insightful. 'ut 4rots2y held that all asnot lost/ since the socialist character of the productive forces and therefore ofthe state Dsocialist in direction/ not yet in contentE depended on the proletariannature of the ruling party. 4he situation stood on the edge/ hoever> 4rots2ysa 7a strongly advanced process of dual poer7 beteen the or2ing classand the 5P bourgeoisie/ parallel to the !onths beteen -ebruary and 8ctober191% hen the Soviets co!peted for poer ith the bourgeois Provisionalovern!ent. &n 19)" unli2e in 191%/ a or2ers< revolution as not yet calledfor>

7&s the proletarian core of the party/ assisted by the or2ing class/capable of triu!phing over the autocracy of the party apparatus/ hich isfusing ith the state apparatusH =hoever replies in advance that it is

incapa(le thereby spea2s not only of the necessity of a ne party on ane foundation but also of the necessity of a second and ne proletarianrevolution. &t goes ithout saying that it can no ay be stated that such a

perspective is out of the uestion under all circu!stances. ...7A condition of dual poer is unstable/ by its very essence. Sooner orlater it !ust go one ay or the other. 'ut as the situation is no/


1. 4rots2y/ The Third .nternational <%ter enin D19)"E/ p. 300

y p p / g p /the bureaucracy/ and put it under its control by the road o% re%orm o% the

party and the Soiets$ 4hese are the funda!ental characteristics of the

situation.7)

4rots2y resisted surrendering any achieve!ent of the or2ing class thatas not yet irretrievably lost. Ge placed the burden of proof on those hoconsidered the or2ers< state defeatedF he de!anded evidence that the partyand Soviets could not be regained by the or2ers through refor!s. 4hroughoutthe decade he battled against cynics ho gave up on conuests of the or2ingclass in ussia and abroad.

&n fact/ it as undoubtedly true that the Left 8pposition could have gainedcontrol of the party by !eans of a or2ers< refor! !ove!ent/ even as late as19)" # but only on condition of a reassertion of proletarian revolution abroad.4hat ould have !ade it possible to force out Stalin/ ho had declared in 19)%that only a civil ar could oust the bureaucracy fro! poer.

'ut 4rots2y<s position as not yet developed theoretically. 4o see hy/ efirst cite his later distinction beteen political and social revolutions DandcounterrevolutionsE. &n a social re+olution the class character of the statechangesF the ne state serves a different class/ its econo!ic relations and for!sof property. =hereas in a (olitical re+olution the class character of the state

re!ains unchanged but a different section of the ruling class ta2es over thegovern!ent and the state apparatus.

4rots2y<s argu!ent that the bourgeoisie needed a violent overthro todestroy the or2ers< state !eant that a social counterrevolution had not ta2en

place/ despite the bureaucracy<s capitulations to capitalist interests. 'ut he aslater to understand that a counterrevolution (y the (ureaucracy as alreadyunder ay/ ithin the fra!eor2 of the or2ers< state # a politicalcounterrevolution. Ge did not fully understand the degree of degeneration ofthe party until the !id#1930<s/ hen e6ternal events proved that peacefulrefor! as i!possible Dsee beloE.

&f a political counterrevolution had occurred/ a ne political revolutionould be needed for the or2ing class to regain political poer. 4hus


). 4rots2y/ 78ur :ifferences ith the :e!ocratic Centralists/7 The Challen+e o% the e%t pposition D1928-29@A pp. )93#$.

3. See 4rots2y/ 74he Class ature of the Soviet State/7 Writin+s D19**-*4@A p. 11%.*. &t is idely believed that 4rots2y called for a political revolution to overthro the

bureaucracy fro! 1933 onF even 4rots2y recollected as !uch at the end of thedecade. &n fact he does not see! to have used the ter! until 193(. &n the interi! he

!ade clear that force ould be needed/ but he avoided the call for revolution

35-

building a ne revolutionary party/ in 19)" not on 4rots2y<s agenda/ ould beco!e a necessity. 4rots2y<s later shift in perspective also de!onstrated that

!e!bers of the ruling party/ this differentiation is at first functional/ butthen it beco!es social. & do not say class/ but social. & !ean that the



the refor!ability criterion of 19)" as insufficient as a basis for deter!ininghether the ,SS as a or2ers< state> the political counterrevolution couldoccur Dand !a2e party refor! i!possibleE ithout overturning the or2ers<state.4he failure to differentiate beteen the political counterrevolution alreadyta2ing place and the threatened social counterrevolution as understandable.4he 'olshevi2s had long been aare of the danger of a DsocialEcounterrevolution fro! outsideF that had been the fate of the Paris Co!!une

and the aborted or2ers< govern!ents in Gungary and 'avaria after =orld =ar&. &n ussia li2eise/ the danger seen by the 8ppositionists as the restorationof traditional capitalis! by ay of the entrepreneurs and 2ula2s/ leading to a

bourgeois state subordinate to i!perialis!.Although the Left as aare of both the degeneration and the strengthening ofthe bureaucracy/ the possibility of a counterrevolution fro! ithin as entirelyne. 4he 8pposition interpreted the bureaucracy<s triu!ph over the or2ers notas a political counterrevolution but as a ea2ening of the proletarian statehich/ together ith the creation of an internal 7fifth colu!n/7 ould !a2e iteasy prey for social overthro fro! outside. After all/ the bourgeoisie asalready a class ith the capacity to rule a stateF the bureaucracy/ poerful and

pervasive as it as/ had as yet no basis for establishing a ne class rule.'ut if the bureaucracy as capable of sei?ing the reins of poer for itself/ thenit did not have to depend for its strength on the s!all#scale capitalis! of the

5P> it could instead feed off the centrali?ed poer of the or2ers< state.&ndeed/ its continuing suppression of the or2ing class as setting the stage fora transfor!ation of its base of poer. 4rots2y !is@udged the balance of forces in19)" because he underesti!ated the degree of consolidation of the bureaucracyfor its independent interests.&t as natural Dand correctE that in the face of i!perialist pressure/ the Left8pposition ould see the !ar2et#oriented 'u2harinist ight Dresting on the

5P!en and 2ula2sE/ rather than the bureaucracy#based Stalinist Center/ as the!ain political source of counterrevolution. evertheless/ it as already possible

to conceive of the destruction of the or2ers< state fro! ithin/ ith the bureaucracy congealing fro! a privileged or2ing#class layer to a hardenedruling class. 4his ould reuire !a@or changes in the bureaucracy<s !ode ofoperation and its relations ith the or2ers. 'ut these had already begun>Christian a2ovs2y/ a pro!inent Left 8ppositionist/ called attention to the! in19)".7=hen a class sei?es poer/ a certain part ... is transfor!ed into agents of the

poer itself. &n this ay the bureaucracy arises. &n the proletarian state/ herecapitalistic accu!ulation is not per!itted for

social position of the Co!!unist ho has an auto!obile at his disposal/a good apart!ent/ regular leaves/ and earns the party !a6i!u!/ isdistinct fro! the position of that sa!e Co!!unist if he or2s in the coal

!ines ...7$

Less than to years later/ the differentiation that a2ovs2y arned against had progressed further. 4he ca!paign of slander and violence acceleratedF 4rots2yas e6pelled fro! the country. 4he suppression of the Left 8pposition as anenor!ous defeat for the or2ing class/ reducing the potential for reconstitutingor2ers< poer. 4he ruling bloc then underent a decisive change.

R7V)L=T,)! &R)M A;)V7

=e observed in Chapter ) that one aspect of the theory of per!anentrevolution as the @oining together of disparate property oners Dlandlords and

bourgeoisE against the threat fro! the rising proletariat. 4he Soviet situationas parallel> even though neither Center nor ight of the party ere propertyoners/ 'u2harin reflected s!all bourgeois property and Stalin stood for

bureaucratic control over state property. -ear of the proletariat united the!.8nce the or2ers< threat as stifled/ the Stalinists had the leeay to turnagainst their partners in order to establish unchallenged control over the

national capital. 4he bureaucratic !ethods that the ight had helped ieldagainst the Left ere no turned against the!.&n 19)"#)9 the ruling bureaucracy under Stalin<s leadership turned sharply

aay fro! its conservatis!. esponding to an intensification of the econo!iccrisis and a rise in or2ing#class !ilitancy/ as ell as to the e6acerbation ofinternational tensions/ it !oved to industriali?e the country at brea2nec2 speed.,nder the first -ive#ear Plan it forcibly collectivi?ed the peasantry/established !ass slave#labor ca!ps and ended the private 5P econo!y.Stalin called this turn the 7great brea2.7

eflecting the changes at ho!e/ the Co!intern also hardened its lineabroad. &n its adventurist 7third period7 it e6pelled the oppositionists/ Left andight/ and re@ected alliances ith the 7social#fascist7 Social :e!ocracy #

thereby under!ining the possibility of co!pelling the class#collaborationistrefor!ists to @oin in united or2ing#class struggles against real fascis! andother capitalist attac2s. 4he er!an Co!!unist Party/ folloing this line/

bears a great responsibility for the triu!ph of a?is!.


$. 7Letter on the Causes of the Party and overn!ental Apparatus/7 19)"F in .V.:aniels/ ed./ < ocumentary Fistory o% CommunismA Vol. )/ pp. 9#10. Also ina2ovs2y/ Selected Writin+s on pposition in the 5SS 192*-*"A p. 1)(

358

4he Stalinist 7revolution fro! above7 as a violent departure fro! previous practice. -orced collectivi?ation shattered the policy of persuasion and e6a!ple

orld<s second econo!ic poer by the end of =orld =ar && # in a period/!oreover/ hen !ost capitalist countries ere !ired in the reat :epression



for inning the peasantry to a socialist agricultural progra!. &t as/ !oreover/a collectivi?ation of bac2ardness> the state too2 over far!s or2ing under

pre#capitalist conditions. :riving !illions of peasants off the land and into thecities created a ne industrial labor force/ but hile industriali?ationaccelerated fro! its snail<s pace to an insane gallop overnight/ the or2ers erestripped of union and other rights so that they could not defend the!selvesagainst the !anagers and bureaucrats. 4he population of the infa!ous ulagconcentration ca!ps increased fro! 30/000 in 19)" to (00/000 in 1930 and

nearly to !illion in the !iddle of the decadeF( slave labor as used for !a@orconstruction pro@ects li2e the =hite Sea#'altic Sea canal/ here thousands died.

&n the ideological sphere the Stalinists declared the las of capitalis!abolished. 4he econo!ist Stru!ilin declared/ 7=e are bound by no econo!iclas. 4here are no fortresses hich 'olshevi2s cannot conuer by assault. 4heuestion of te!po is sub@ect to the ill of hu!an beings.7 Stalin hi!selfdenounced 7decreasing 4rots2yist curves7 of econo!ic groth as counterposedto 7increasing 'olshevi2 curves.7

4he ne 7revolution7 !obili?ed enthusiastic party cadres eager to brea2 outof the stagnation of the late 5P period and lead the country don the road tosocialis! by any !eans necessary. 'ut the -ive#ear Plan contained less

econo!ic planning than bureaucratic e6hortation. 4hat industry at every levelas characteristically co!!anded to 7overfulfill7 its targets shos that the7planning7 as anything but scientific. :espite the revolutionary fanfare andrhetoric re!iniscent of the ar co!!unis! period/ the 7great brea27 idenedineualities ithin the or2ing class and beteen or2ers and !anagers/ ratherthan narroing the!.

4he period also itnessed hat has been ter!ed the first socialist 7culturalrevolution/7 in hich young Co!!unists fro! proletarian or peasant

bac2grounds ere hastily given a !ini!al technical education and trained in7class#ar7 !ethods to build a ne orld for the 7ne Soviet !an.7 4his!isguided revolutionary energy as used/ hoever/ first to purge the party ofLeft and ight opponents of the bureaucratic Center and then to s!ash every

vestige of or2ing#class poer in the state.:espite its brutality and counterrevolutionary i!plications/ hoever/ the

industriali?ation drive of the 1930<s as an unprecedented achieve!ent. &t !ade possible the Soviet ,nion<s advance fro! a bac2ard country to the BBBBBBBBBBBBBBBBBBBB

(. :. :allin and '. icolaevs2i/ 7orced a(or in Soiet ussia D19*"E.%. Stru!ilin is cited in 'ettelhei!/ es uttes de Classes en 5SSA 192*-19*"A p. 3((F

Stalin/ Political eport to the 16th Party Con+ress D1930E

and could not e6pand at all. 4he 2ey as the centrali?ed state poer achieved by the soviet revolution. &t enabled the party to !obili?e the cadres< devotion tosocialis!/ focus resources on selected heavy industrial pro@ects and utili?e the!asses of labor thron into production during the decade. 'ut as undercapitalis!/ the or2ers< achieve!ents ere turned against the!. 4he parado6is that only a or2ers< state could have acco!plished this contradictory

achieve!ent."

4rots2y noted another irony. 74he conclusion is clear/7 he rote> 7evenapart fro! the socialist perspective it opens up/ the Soviet regi!e is for ussiain present orld conditions the only thin2able regi!e of national

independence$ 9 Ge did not thin2 that proletarian internationalis! andnationalis! ere identicalF si!ply that socialis! and national independencefro! i!perialis! too2 the sa!e road for a ti!e. 4hus a state !onopoly offoreign trade as necessary both for an or2ers< state and Stalinist nationalis!>strong !easures ere reuired to develop the econo!y and 2eep bac2ardussia out of the i!perialist grip.

Stalin understood this in a distorted fashionF hence his brea2 fro! 'u2harinand his atte!pt to build 7socialis! in one country7 by force. Against the Left<s

perspective of developing the Soviet state in connection ith the orld

division of labor/ Stalin sought to build a self#reliant bastion againstencircle!ent. ust as capitalis! had developed in =estern 5urope byconsolidating national states in order to control ho!e !ar2ets and protectnascent industries/ Stalin too sought to build the independent poer of the,SS to survive in a orld of i!perialist depredation.

'ut the cost as enor!ous. State poer as used to enforce starvation onthe rural poor and drive don or2ers< living standards to abys!al levels.Stalinist industriali?ation as based on a uniue co!bination of super#centrali?ation and intensification of capitalist relations/ an unstableco!bination that could not last. 4hat !asses of or2ers and peasants ereenslaved for the creation of dead labor shoed that the la of value had theor2ers< state by the throat.


". As 4rots2y co!!ented/ the bourgeois econo!ists 7ho confine the!selves tore!ar2s about an <e6tre!e e6ploitation of the peasantry< ... are !issing a onderfulopportunity to e6plain hy the brutal e6ploitation of the peasants in China/ forinstance/ or apan/ or &ndia/ never produced an industrial te!po re!otelyapproaching that of the Soviet ,nion.7 DThe eolution #etrayedA p. 1.E

9. 74oard Capitalis! or Socialis!H7/ Writin+s D19*"@A p. 19(. 7Soviet regi!e7!eans the or2ers< state in general/ not @ust Stalin<s regi!e

359

L7&T ,!T7RPR7TAT,)!S

+any leftists share ith the Stalinists the vie that the first -ive#ear Planinist states could acco!plish si!ilar feats of industriali?ation/ since they erenever or2ers< states. or could the postar Dand post#counterrevolutionE



as a decisive turning point in Soviet history/ as profound in its effects as 191%.4ony Cliff/ for e6a!ple/ ta2es the 7great brea27 to be the counterrevolution>

7A uic2 accu!ulation of capital on the basis of a lo level of pro#duction ... !ust put a burdenso!e pressure on the consu!ption of the!asses .... 4he bureaucracy/ transfor!ed into personification of capital/for ho! the accu!ulation of capital is the be#all and the end#all/ !ustget rid of all ele!ents of or2ers< control/ !ust substitute conviction inthe labor process by coercion/ !ust ato!i?e the or2ing class/ !ust force

all social#political life into a totalitarian !old.... M4hisN transfor!s the bureaucracy fro! a layer hich is under the direct and indirect pressure

and control of the proletariat into a ruling class /..7 10

Cliffs approach has inescapable difficulties. All or2ers< control and !uch7conviction in the labor process7 had long since passed aay under the 5P/even though labor discipline beca!e ualitatively !ore repressive hen itended. or as the bureaucracy under the 7control7 of the or2ing class before19)9/ even indirectlyF for that !atter/ 7indirect pressure7 applied even after the19)9 turn.

+ost i!portantly/ Stalin<s orsening of the !aterial conditions of theor2ers as not an i!perative result of capital accu!ulation. =e argued in

Chapter 3 that accu!ulation is a necessary/ bourgeois/ tas2 of the or2ers<state> carrying it out cannot in itself signify the restoration of capitalist rule. As+ar6 said in the Communist ani%estoA 74he proletariat ill use its politicalsupre!acy to rest/ by degrees/ all capital fro! the bourgeoisie/ to centrali?eall instru!ents of production in the hands of the state/ i.e./ of the proletariatorgani?ed as the ruling classF and to increase the total o% productie %orces as

rapidly as possi(le$ -i6ing on Stalinist accu!ulation as the cause of thecounterrevolution suggests that 'u2hara<s 7snail<s pace7 strategy ould have

been correct. 4he Left<s counter#posed proposal/ planned industriali?ation incoherence ith the orld !ar2et/ can be dis!issed as a ,topian i!possibilityonly if the continuation of a do!inant/ sollen bureaucracy is ta2en as given.

8n another level/ Cliffs dating of the counterrevolution at 19)"#)9 credits

the great Soviet industrial buildup to a capitalist state. 4o say that capitalis! bro2e through its on barriers against advancing the productive forces ande6panded as rapidly as did the ,SS !ar2s capitalis! as still progressive andchallenges the +ar6ist assess!ent of the epoch of decay. Against thisi!plication e note that none of the post#=orld =ar && Stal#


10. Cliff/ ussiaA a ar!ist <nalysisA p. 10%F State Capitalism in ussiaA p. 1($

Soviet ,nion surpass capitalist rates of econo!ic e6pansion.&n contrast to Cliff/ the for!er 4rots2yist &saac :eutscher sa Stalin

carrying out a perverted variant of per!anent revolution> a brutal and irrational but necessary and progressive one hich ould ulti!ately or2 to the benefitof !an2ind.

7Goever <illegiti!ate< fro! the classical +ar6ist viepoint/ Stalin<srevolution fro! above effected a lasting and as to scale unprecedented

change in property relations/ and ulti!ately in the nation<s ay of life.7 11

+any leaders of the Left 8pposition si!ilarly interpreted Stalin<s ne policy as an adoption/ hoever distorted/ of the 4rots2yists< progra!. D4he ideaof 7per!anent revolution fro! above7 also beca!e a staple of 7orthodo64rots2yis!7 after =orld =ar &&.E &f the only alternatives ere the 5P

bourgeoisie and the proletariat/ they reasoned/ and if the Stalinists ere agingan all#out fight against the bourgeoisie/ e !ust @oin the! # hatever cri!esthey !ay co!!it against the or2ers along the ay. 4hese capitulators !adetheir peace ith Stalin and agreed to serve the party in the loer echelons ofthe bureaucracy. 5ven so al!ost all of the! perished in the purges to co!e.

T>7 ;=R7A=CRAT,C DA!7R

4he bureaucracy<s dra!atic about#face has also been the focus of theories ofa ne for! of class society in the ,SS. =riting for Left 8ppositionists insidethe ,SS/ a2ovs2y posed the uestion this ay>

7Secretaries/ chair!en of e6ecutive co!!ittees/ procure!ent officials/heads of cooperatives/ heads of state far!s/ party and non#party directorsof enterprises/ specialists/ fore!en/ ho/ folloing the line of leastresistance/ install in our industry the seatshop syste! and factorydespotis! # here is the real poer in the period of proletarian dicta#torship hich e are no e6periencing. 4his stage can be characteri?edas do!ination by the corporative interests of the various categories ofthe bureaucracy/ and internecine struggle beteen the!.7rom the orkers' state ith (ureaucratic perersions B as Lenin

defined our for! of govern!ent # e have developed into a (ureau-cratic state ith proletarian-Communist surials$ 'efore our eyes agreat class o% rulers has been takin+ shape and is continuing to develop.&t has its on internal subdivisions/ and gros by ay of calculated co#optation/ through the direct or indirect appoint!ent syste! Dby ay of


11. :eutscher/ The Prophet utcastA p. 11)

38:

bureaucratic pro!otion or the syste! of fictitious electionsE. 4heunifying factor of this uniue class is that uniue for! of private prop#

:espite this foreboding of the de!ise of the or2ers< state/ 4rots2y sa the bureaucracy re!aining in li!bo beteen the decisive classes/ the proletariat



erty/ govern!ental poer. 74he bureaucracy has the state in its

possession/< rote +ar6/ <as rights of private property.< 71)

4he developing 7class of rulers7 in this docu!ent is analy?ed a!biguously.8n the one hand it is a 7uniue class7 of a bureaucratic state based ongovern!ental poer as a ne for! of private property. 8n the other hand/ the!ethods of do!ination described are those of capitalis!> the seatshop syste!and factory despotis! over hat is still a or2ing class. 4he 8ppositionists<docu!ent did not co!bine the to ele!ents of its analysis to suggest that the

ne ruling class ould be based on capitalist relations operating through thestate. &ndeed/ it continued to arn of the 7bourgeois counterrevolution/7 clearlystill or2ing fro! 4rots2y<s 19)" picture of bourgeois restoration. 4hisassess!ent !eshed ith 4rots2y<s political analysis> although 'u2harin had

been crushed/ the actual danger of counterrevolution still ca!e fro! traditional bourgeois ele!ents.

,nli2e his co!rades/ 4rots2y did not consider the bureaucracy to be a neclass in the !a2ing/ although he ac2noledged that it loo2ed that ay to theor2ers B for good reason>

7Another ele!ent of danger is in the apparatus of the dictatorship Mof the proletariatN. 4he bureaucracy has restored !any characteristics of a ruling

class and that is very !uch ho the or2ing !asses consider it. 4he bureaucracy<s struggle for its on preservation stifles the spiritual life ofthe !asses by constantly forcing on the! fresh illusions hich are nolonger in any ay revolutionary/ and thereby hinders the replace!ent oflost illusions by a realistic understanding of hat is happening.7-ro! the +ar6ist point of vie/ it is clear that the Soviet bureaucracycannot change itself into a ne ruling class. &ts isolation and the increasein its co!!anding social role lead unfailingly to a crisis in thedictatorship hich cannot be resolved e6cept by a rebirth of the revo#lution on deeper foundations/ or by a restoration of bourgeois society. &tis precisely the approach of this second alternative/ felt by everyone evenif fe understand it clearly/ that gives to the present regi!e this e6tre!e

tension.71* BBBBBBBBBBBBBBBBBBBB

1). 7Circular of the 'olshevi2#Leninist 8pposition to the Central Co!!ittee .../7 April1930F :aniels/ Vol. )/ pp. 1*#1$. 4he +ar6 uotation is fro! his 7Critiue ofGegel<s Philosophy of La7F +ar6/ of course/ as spea2ing of 19th century regi!esin 5urope.

13. See the version in a2ovs2y/ Selected Writin+s $$$A p. 1%*.1*. 4rots2y/ 74oard Capitalis! or Socialis!H7/ Writin+s D19*"@A p. )0%

and bourgeoisie. Gis insistence that the bureaucracy could not beco!e a rulingclass rested on its continued dependence on the gains of the or2ers B thecentrali?ed poer on by destroying the bourgeoisie. &ndeed/ e ill see thatthe bureaucracy and this centrali?ation ould both have to be transfor!ed forthe counterrevolution to be consolidated.

4he !ain change in 4rots2y<s position beteen 19)" and 1930 as thatno Stalin rather than 'u2harin represented the !ain danger to the revolution.

ot because Stalinis! could ta2e an independent course/ but because its

crushing grip on state poer could destroy any proletarian resurgence and pavethe ay for bourgeois restoration by others. 7Stalinis!/7 he rote in the sa!edocu!ent/ is 7a preparation for 'onapartis! inside the party.7

7'ureaucratic centrism begins its career as a current !aneuvering beteen to e6tre!e party currents/ one of hich reflects the petty# bourgeois line/ the other/ the proletarianF #onapartism is a stateapparatus that has openly bro2en fro! all traditional attach!ents/including party ones/ and fro! no on !aneuvers <freely< beteen theclasses as an i!perious <arbiter.< Stalinis! is preparing 'onapartis!/ allthe !ore dangerous since it is unaare that it is doing so.7 'onapartis!/ strong#!an rule that balances beteen the contending classes

in order to !aintain the social poer of the ruling class/ as a fa!iliar political pheno!enon in capitalist countries hen the bourgeoisie proves incapable ofruling in its on na!e. 'ut it had never before been considered for a or2ers<state. &n brea2ing ne ground/ 4rots2y as also e6tending the politicalanalogies to the great -rench evolution that ere co!!on coin a!ong the'olshevi2s. 4hus he had long called the bureaucracy 74her!idorian/7 arningof the danger of another turning point li2e 1%9* hen the radical acobins led

by obespierre ere overthron and the revolution sitched onto a !oreconservative trac2. &n predicting 'onapartis! 4rots2y foresa that theStalinists ould free the!selves fro! the last anchor of their proletarianheritage/ the ruling party.

&n retrospect/ 4rots2y<s assess!ent of the Stalinist ing/ correct on the

political level/ proved clearly erroneous on the social level. Ge never e6plainedho a rudderless apparatus ithout a fir! class base/ doo!ed to perpetualvacillation beteen classes/ could reach the point here it could sei?e the reinsof poer and shove aside the pro#bourgeois restora#tionist forces. Ge stille6pected an i!!inent bourgeois ta2eover/ hereas the bureaucracy had notrouble destroying the 5P bourgeoisie.

4rots2y still thought that the proletariat as gathering stea! for ani!!inent eruption that ould pulveri?e the bureaucracy beteen the to

384

classes and decide the fate of the ,SS. &n fact/ he tried to account for theStalinist centrists< sei?ure of sole poer through the pressure of the i!pending

2 < h l 4h hi 1930 l i i d

relative independence as possible. D&n contrast/ the non#proletarianrevolutions after =orld =ar && could never brea2 free of i!perialis! to

hi hi h d E



or2ers< upheaval. 4hus his 1930 analysis continued>7'oth in the present ob@ective conditions and in the suppressed feelingsof the or2ing class/ a deep resistance to the 4her!idorian trend is

brea2ing outF going over to this 4her!idorian course is still not possibleithout real counterrevolutionary upheavals. Although it stifles the party/the leadership cannot help pay attention to it/ because through its channel# hoever inco!plete and !uffled # there co!e arnings and appealsfro! the class forces. :iscussion of proble!s/ ideological struggle/

!eetings and congresses have given ay to an infor!ation agency insidethe party/ to spying on telephone co!!unications and to censorship ofcorrespondence. 'ut even by these devious ays the class pressure is felt.4hat !eans that the sources of MStalin<sN left turn and the reasons for its

abruptness are to be found outside the leadership.71$

=or2ers< hostility as plentiful as Stalin<s turn deepened and ai!ed bloafter blo against the!/ but contrary to 4rots2y<s hope it never ca!e close toeruption. or as the or2ing class responsible for the 7left turn7 in the first

place. 4he Stalinists/ rather than tailing pressure fro! the proletariat in !ovingleft/ had done so only after they had decapitated it by s!ashing the Left8pposition. D4his/ as e ill see hen e discuss the post#=orld =ar &&

Stalinist regi!es/ is again a reflection of per!anent revolution/ in an e6tendedfor!.E4rots2y<s error as not to overesti!ate the or2ing class but to

underesti!ate the inner drive of Stalinis!/ a historically unprecedented pheno!enon. 4hrough their se!iconscious shifts and ?ig?ags/ the Stalinists beca!e increasingly aare that they had a social !ission to create 7socialis!7as a syste! of do!ination over the or2ing class.

4rots2y forcefully analy?ed all the ne develop!ents but he did not gaugetheir full i!pact. Ge could not see that Stalin/ uite unconsciously/ as headingtoard a restoration of ussian capitalis! on an ultra#nationalist basis in orderto brea2 out of the i!perialist stranglehold. 4he theory of per!anent revolutionled 4rots2y to believe that any restored capitalis! ould capitulate al!ost

i!!ediately to i!perialis!. 4he fla in the reasoning as that Stalinis!/ stillresting on the foundations of the Soviet or2ers< state/ as able to build up thenation to the e6tent that


1$.4his passage shos another line of continuity ith 4rots2y<s 19)" position> the party/ the one organ of the or2ers< state that re!ained to give it its proletariancharacter/ as still fulfilling that role through !ethods even !ore bureaucratic than

before

anything approaching the sa!e degree.EContrary to the fatalis! inherent in Cliff and ra!pant in :eutscher/ it as

by no !eans guaranteed that there ould be a ne ruling class. A long strugglere!ained to decide hether the class ta2ing shape ould be able to s!ash the

proletarian state # not @ust dispossess the or2ers of political rule ithin it Band establish a ne class society.

STAL,!,SM ,! CR,S,S

After the first -ive#ear Plan/ Stalin declared that capitalist econo!icrelations had been destroyed De6cept for petty#bourgeois re!nantsE. CitingLenin<s five categories of Soviet econo!y DChapter 3E/ he asserted that 7thefifth social#econo!ic for!ation # the socialist for!ation # no holdsunchallenged say and is the sole co!!anding force in the hole national

econo!y.71(

&n reality/ hoever/ the Soviet econo!y as on the road to chaos.:isproportions ere ra!pant> factories lac2ed !aterials and or2ersF inflations2yroc2eted through 1933/ and in that year there as a precipitous andunplanned decline in invest!ents. 4he 7civil ar7 against the peasants DStalin<sdescriptionE led to !ass fa!ine/ as peasants resisting collectivi?ation

slaughtered their ani!als. As a result/ 71933 as the cul!ination of the !ost precipitous peaceti!e decline in living standards 2non in recorded history.71%

Stalinis! had entered its first econo!ic crisis.,nli2e the capitulators/ 4rots2y denounced the forced pace of indus#

triali?ation and collectivi?ation> the acco!panying barbaris!/ irrationality anddisorgani?ation had ea2ened the foundations of the Soviet state. 74he Sovietecono!y today is neither a !onetary nor a planned one. &t is an al!ost purely

bureaucratic econo!y.7 Accordingly/ he called for a retreat fro! adventuriste6pansion and a 7year of capital reconstruction.7 4his !eant replacing the-ive#ear Plan ith a return to the !ar2et B in the hope of later regaining the

possibility of centrali?ed scientific planning and econo!ic accounting. 4rots2yalso de!anded restoring or2ers< rights/ Soviets/ trade unions and internal

party de!ocracy.1"

,nli2e so !any of his !odern disciples/ 4rots2y understood that capitalistdrives and institutions still survived in the ,SS. 4hat is hy he identified thecounterrevolutionary danger as a capitalist one/ not that of


1(. Stalin/ 7eport to the 1%th Party Congress7 D193*E.1%.Alec ove/ <n &conomic Fistory o% the 5SS D19%)E/ p. )0%.

1". 74he :egeneration of 4heory and the 4heory of :efeneration/7 Writin+s D19*2-**@; 74he Soviet 5cono!y in :anger/7 Writin+s D19*2@

38-

so!e une6plained ne class. Gis ritings and those of the Left 8pposition referoften to surplus value/ co!!odities and capital accu!ulation in the Soviet, i G ll d f 2 t d t l t t b h

Stalinis! in the ,SS has learned nothing.7?u

4he attribution of a dual role to the bureaucracy is a reed that today<s



,nion. Ge called for a !ar2et and a !onetary regulator # not because head!ired capitalist !ethods but because the reality of bac2ardness had to berecogni?ed if the crisis as to be overco!eF accurate !easure!ent of labor ti!eand resources as crucial. 4he third#period Stalinist clai!s that 'olshevi2sere bound by no ob@ective la value ere fantasies/ triply so for a society asecono!ically retarded as ussia<s.

T>7 !AT=R7 )& T>7 C)MM=!,ST PART,7S

4he 7revolution fro! above7 did not in itself change 4rots2y<s funda!entalanalysis of the ruling party. 4he sing fro! the conservative bloc ith'u2harin to the fa2e leftis! of the third period as the 2ind of centrist ?ig?aghe had e6pectedF no a ne rightard vacillation ould be in the offing afterthe adventuris! proved futile. As a current ithin the party/ the bureaucraticcentrists ere incorrigible. 'ut until 1933 4rots2y still regarded the party as ahole to be refor!able/ although refor! ould reuire decapitation of theStalinists.

4he turning point as the s!ashing defeat of the or2ing class in er!any.4he Co!intern<s ultra#left policies had per!itted Gitler to co!e to poer ithno organi?ed proletarian resistance. 4rots2y then pronounced the CPs dead asrevolutionary organi?ations hen the er!an Co!!unist Party Dand then thehole Co!internE refused to reconsider their gross !isleadership. 74o spea2no of the <refor!< of the CPS, ould !ean to loo2 bac2ard and not forard/to soothe one<s !ind ith e!pty for!ulas.7 A ne Leninist party ould have to

be constructed.19

'ut this also !eant that 4rots2y had to alter his previous position that therule of the Co!!unist Party in hoever distorted a for! as the 2ey to thesurvival of the or2ers< state. =ith the party no centrist as a hole and notrefor!able/ the only re!aining characteristic that 2ept the Soviet state

proletarian as the 7property relations that have been created by the 8ctoberrevolution and that are funda!entally adeuate for the dictatorship of the

proletariat.7

=hat as the lin2 beteen Stalinis! and the Soviet stateH7=e call the Stalinist apparatus centrist precisely because it fulfills a dualroleF todayA hen there is no lon+er a +ar6ist leadership/ and noneforthco!ing as yetA it defends the proletarian dictatorship MstateN ith itson !ethodsF but these !ethods are such as to facilitate the victory ofthe ene!y tomorro$ =hoever fails to understand this dual role of


19. 4rots2y/ 7&t is &!possible to e!ain in the Sa!e &nternational .../7 Writin+s D19**-

*4@A p. )0

pseudo#4rots2yists lean on to account for Stalinis!<s supposedly revolutionaryaspect after =orld =ar &&. =hat is forgotten is/ first of all/ that 4rots2y<sanalysis of Stalinis! as centrist changed again as a result of later eventsF hischaracteri?ations ere concrete and dialectical/ not fro?en. -urther!ore/ healready sa the Stalinists< duality as only partial/ specifically not applicable tothe international scene>

7As regards the ,SS/ the role of the bureaucracy ... is a dual one> onthe one hand/ it protects the or2ers< state ith its on peculiar!ethodsF on the other hand/ it disorgani?es and chec2s the develop!entof econo!ic and cultural life by repressing the creative activity of the!asses. &t is otherise in the sphere of the international or2ing#class!ove!ent/ here not a trace re!ains of this dualis!F here the Stalinist

bureaucracy plays a disorgani?ing/ de!orali?ing and fatal role fro!

beginning to end.7)1

4he distinction beteen the bureaucracy<s reactionary international and!i6ed internal roles could at best be te!poraryF the funda!ental character ofany political apparatus is in the last analysis indivisible. 4he Stalinists<reactionary international policy reflected a si!ilar role internally. 4he !ethods

by hich the bureaucracy defends the proletarian dictatorship 7are such as to

facilitate the victory of the ene!y to!orro/7 and there is nothing progressiveabout !ethods of defense that set the stage for capitalist restoration.

4rots2y<s sense of the pace of the or2ers< state<s decay as distorted because nationali?ed property for!s re!ained/ even though the degenerative processes ere accelerating> restoring internal co!petition and strengtheningthe i!pact of the la of value. &n retrospect the only thread still tying the

bureaucracy to a proletarian base as that it as not yet consolidated behindthe counterrevolution. A violent struggle had yet to be aged to destroy itsre!aining lin2s ith the proletarian revolution.

S)V,7T ;)!APART,SM

Soon 4rots2y sa Stalin reali?ing the Soviet version of 'onapartis! that he

had predicted/ concentrating state poer at the top and resting on the !ilitaryand police !achinery>

7Stalin guards the conuests of the 8ctober evolution not only against thefeudal#bourgeois counterrevolution but also against the


)0. 74he Class ature of the Soviet State/7 Writin+s D19**-*4@A pp. 11*#1(.)1. 74he Stalinist 'ureaucracy and the Jirov Assassination/7 Writin+s D19*4-*,@A p.

1)*

388

clai!s of the toilers/ their i!patience and their dissatisfactionF he crushesthe left ing that e6presses the ordered historical and progressivet d i f th i il d 2i h t

tarian verbiage they !ight continue to spout. So Stalin<s regi!e as already a petty#bourgeois govern!ent ithin the or2er<s state. As 4rots2y sa/ it ash di t d th li id ti f th 2 < t t



tendencies of the unprivileged or2ing !assesF he creates a nearistocracy by !eans of an e6tre!e differentiation in ages/ privileges/ran2s/ etc. Leaning for support upon the top!ost layer of the ne socialhierarchy against the loest # so!eti!es vice versa # Stalin has attainedthe co!plete concentration of poer in his on hands. =hat else should

this regi!e be called if not Soviet 'onapartis!H7))

Ge added/ 7'onapartis! by its very essence cannot long !aintain itselfF asphere balanced on the point of a pyra!id !ust invariably roll don on oneside or the other.7 4he regi!e as dangerously unstable/ and in the absence of aregeneration of the soviet syste! by the proletariat/ 74he inevitable collapse ofStalinist 'onapartis! ould i!!ediately call into uestion the character of the,SS as a or2ers< state.7

Stalinist 'onapartis! defended or2ing#class property by propitiating theorld bourgeoisie. =ith its sharp right turn in foreign policy Dsee beloE/ it

balanced not only beteen class layers in the Soviet ,nion but beteen the bourgeoisie and proletariat abroad.

4rots2y began to or2 out the i!portant theory of the 7degenerated or2ers<state7 B a or2ers< state that as not only closer to capitalis! than to socialis!

but as also in retrograde motion bac2 to capitalis!>

7=hile the bourgeois state/ after the revolution/ confines itself to a policerole/ leaving the !ar2et to its on las/ the or2ers< state assu!es thedirect role of econo!ist and organi?er. 4he replace!ent of one politicalregi!e by another e6erts only an indirect and superficial influence upon!ar2et econo!y. 8n the contrary/ the replace!ent of a or2ers<govern!ent Min a or2ers< stateN by a bourgeois or petty#bourgeois

govern!ent ould inevitably lead to the liuidation of the planned beginnings and/ subseuently/ to the restoration of private property. .n

contradistinction to capitalismA socialism is (uilt not automatically

(ut consciously$ Progress toards socialis! is inseparable fro! that state

poer that is desirous of socialis! or that is constrained to desire it.7)3

&n the bureaucrati?ed Soviet case/ not only as the state e6ceptionally

poerful/ but the or2ers< initiative and institutions had been so crushed thatthe only active ele!ents of consciousness rested in the state. =as this state

poer 7desirous of socialis!7H Certainly Stalin anted to eli!inate privatecapitalis! and e6pand the state#oned econo!y. 'ut the Stalinists also sa itnecessary to crush the or2ers in the process/ hatever prole#


)). 74he =or2ers< State/ 4her!idor and 'onapartis!/7 Writin+s D19*4-*,@A p. 1"1.)3. 74he =or2ers< State/ 4her!idor and 'onapartis!/7 p. 1%9

heading toards the liuidation of the or2ers< state.4here ere li!its/ 4rots2y noted/ to the 'onapartis! analogy. After

apoleon fell/ 7in its essence the social pyra!id of -rance retained its bourgeois character.7 Capitalis! as a !ode of production in itselfF once the-rench revolution had iped out the feudal barriers to its advance/ even

apoleon<s corruptions/ even the restoration of the !onarchy/ could not eraseit. A or2ers< state/ hoever/ is a transitional regi!e/ and the socialist !ode of

production as far fro! established. Stalinist 'onapartis! as the last stage

on the bureaucracy<s road to independence fro! the or2ing classF that is hyits collapse 7ould i!!ediately call into uestion the character of the ,SS asa or2ers< state.7 4rots2y<s su!!ed up his analysis in this period as follos>7:espite its econo!ic successes ... deter!ined by the nationali?ation of the!eans of production/ Soiet society co!pletely preserves a contradictorytransitional character/ and/ !easured by the ineuality of living conditions andthe privileges of the bureaucracy/ it still stands !uch closer to the regi!e ofcapitalis! than to future co!!unis!.

7At the sa!e ti!e/ ... despite !onstrous bureaucratic degeneration/ theSoiet state still re!ains the historical instru!ent of the or2ing classinsofar as it assures the develop!ent of econo!y and culture on the

basis of nationali?ed !eans of production/ and/ by virtue of this/ prepares the conditions for a genuine e!ancipation of the toilers through

the liuidation of the bureaucracy and of social ineuality.7)*

&n contrast to 7orthodo67 interpretations of 4rots2y<s position/ note that herehe does not treat nationali?ed property as a for!al criterion for a or2ers< state.State property characteri?es a or2ers< state for a !aterial reason> it assures thedevelop!ent of econo!y and culture and thereby paves the ay for thetransition to socialis!. =hether Soviet property ould continue to acco!plishthis/ hoever/ as to be deter!ined by the response to the econo!ic crisis ofthe early -ive#ear Plans.

4rots2y distinguishes beteen Soviet society B the syste! of production/class structure/ etc. # and the state. 4his su!!ari?es his !ost precise definition

of a or2ers< state/ one that enable us to ta2e its degeneration into account anddeter!ine hen that state has ended. Soviet society as still in transition

beteen capitalis! and socialis!/ far closer to the for!er. 4he state re!aineda or2ers< institution so long as it as capable/ despite its degeneration/ ofleading the transitional society toards socialis!. &n its founding years theSoviet state had led/ or had tried to


)*. 74he =or2ers< State/ 4her!idor and 'onapartis!/7 pp. 1%0#1389

lead/ in that direction. 'ut Stalinis! had turned the rudder around.4rots2y no corrected his 4her!idor analogy. 4her!idor as not in the

future but in the past 4he 4her!idorian period had begun in 19)3 ith Lenin<s

period on/ the ,SS has alays played a conservative role on the orld stage/safeguarding its on interests both in collaboration and in conflict ith=estern i!perialis!



future but in the past. 4he 4her!idorian period had begun in 19)3 ith Lenin<sre!oval fro! political activity/ and as no endedF 'onapart#is! had replacedit/ signifying the co!pletion of the political counterrevolution. -ro! then onthe ,SS as a degenerated or2ers< state/ !oving bac2ards toardscapitalist restoration. 4he re!aining uestion as hether its direction could bereversed # if not/ the outco!e ould be social counterrevolution.

4he anser as not long in co!ing. Stalinist 'onapartis! as transfor!ed/ but not through its collapse and the restoration of private property tied to

i!perialis!/ as 4rots2y e6pected. &ts drive for independence as deeper.4hrough a ne ca!paign against the or2ers and its on proletarian vestiges/the bureaucracy established itself as a ne ruling class based on theinstitutionali?ation of the la of value ithin the confines of state property. 4heor2ers< state as destroyed in the na!e of socialis! and replaced by anunprecedented for! of capitalis! built on its carcass.

2. THE COUNTERREVOLUTION COMPLETED

-aced ith the to#sided crisis of the !id#1930<s # econo!ic disaster atho!e and the rise of fascis! in 5urope # the ruling bureaucracy e!bar2ed onanother turn. &n foreign policy Stalin reversed every Leninist principle as ell

as his on left adventuris!/ searching for bourgeois allies instead of proletarianinternationalis!. Less ell understood are the decisive events that too2 placeinside the ,SS.

=hereas the early 'olshevi2s had tried to steer a safe course a!ong thedivided =estern poers # see2ing transitory and practical political/ !ilitary andecono!ic agree!ents # Stalin no tried to consolidate long#ter! alliances.Support for the Juo!intang in the 19)0<s had been only a foretaste. Aser!any under the a?is began to challenge the division of the orld dictated

by the postar treaties/ the Stalinists concluded !ilitary blocs for the preservation of i!perialist states/ @oined the League of ations Dhitherto the7den of thieves7E/ and ordered the Co!intern parties to collaborate not only

ith the social de!ocrats De6#7social fascists7E but ith the bourgeois parties asell.Stalin tried to prove his true orth to i!perialis! by crushing the proletarian

forces in the Spanish epublicF he thereby halted the Spanish revolution at acapitalist stage and ensuring the fascist victory.)$ -ro! this


)$. See -eli6 +orro/ eolution and Counterreolution in Spain D193"E and -ernandoClaudin/ The Communist oement D19(9E

=estern i!perialis!.4he Soviet Stalinists< turn fro! isolationis! to popular#frontis! abroad

!ar2ed a deepening of their ussian nationalist course. 4he CPs abroadli2eise hardened their nationalis!. 4hey had been purged and toughened inthe 7third period7 # only to e!erge as agents of blatant class collaboration/ benton convincing their bourgeois rulers to ally ith +osco against 'erlin. =hileon the surface they reflected Soviet national interests/ underneath they eredigging their roots ever deeper in do!estic nationalis! as ell> the A!erican

CP<s change of slogans/ fro! 74oards a Soviet A!erica7 to 7Co!!unis! is)0th Century A!ericanis!/7 as sy!bolic. 4he popular#front strategy hasgone through !any changes over the yearsF for e6a!ple/ in -rance in the late1930<s the Stalinists< 7ational -ront7 e!braced ho!egron anti#er!anfascists. 'ut in contrast to Stalinis!<s previous ?ig?ags/ it has re!ained aconstant since that ti!e.

D)M7ST,C R,>T T=R!

4he international right turn in the !id#1930<s reflected the do!estic needsof Stalinis!/ and a si!ilar turn as !ade at ho!e. &t is a curious fact that feobservers B +ar6ist or bourgeois B recogni?e Stalinis!<s conservative shiftinside the ,SSF they are see!ingly blinded by the violence of the 7left turn7of 19)9#30 and the great purge of the Co!!unist Party at the end of thedecade.

4re!endous pressure for a right turn ca!e fro! the international situation>the rise of the !enacingly anti#Co!!unist a?i regi!e/ hose very e6istencecan be credited to Co!intern policies of the early 1930<s. Gitler<s threatsintensified the bureaucrats< very real fears. 4he Soviet ,nion as no in acutedanger fro! i!perialis!. 8ne result as the intensification of ussian Dasopposed to SovietE nationalis!F it reached its pea2 during =orld =ar && inStalin<s grotesue appeals to the !e!ories of C?arist generals and theiri!perial conuests.

Another conseuence as the tightening of political control. 4he party/

ar!y and industrial bureaucracies had to be sub@ected to an even !ore stringentdiscipline than before to eli!inate all ris2 of internal subversion. 4his need ledto the great purges/ hich had the effect of disrupting Soviet productioninstead of e6panding it. 'ut this is all ell 2non. =hat needs to be brought tolight is the consolidation of a panoply of capitalist !ethods fro! the !id#1930<s on/ revisions of Soviet theory and practice


)(. 4he Gitler#Stalin pact appears to belie this assess!ent/ but see Chapter (

31:

hich have survived to the present unchanged in their essentials.4o start ith/ the rulers clearly had to build up the Soviet ar!s industry.

Ar!s production advanced rapidly ith the general industrial groth of the first

peasantry<s traditional petty#bourgeois outloo2.7&n one i!portant respect ... collectivi?ation turned out to be a lessradical change in the !ode of agricultural production than appeared at



Ar!s production advanced rapidly ith the general industrial groth of the first-ive#ear Plan/ stagnated in the !iddle 1930<s hen the econo!y as in crisis/and then sped up again after 193( # at a ti!e hen Soviet industrial productionas otherise decelerating. &t is noteorthy that under the Gitler#Stalin pactussia as able to supply ar!s to er!any. 4he ar!s build#up both drainedcivilian industry of resources and co!pelled ide sections of it to produceinputs for ar!s factories.

&n the postar ,SS the !ilitary sector is the !ost technologically

advanced in industry. 4o achieve the uality necessary for reliabilityDnotoriously lac2ing in generalE/ Soviet fir!s supplying the !ilitary arereuired to co!pete for contracts. Quality and precision ere even greater

proble!s in the pre#ar econo!y/ hen industry as built up by throing!asses of uns2illed laborers into the factories under dictatorial discipline.,nder such conditions/ constructing a 7state of the art7 !ilitary sector also havereuired intensified co!petition as an e6ecutor of the la of value. 4hus thethreat of ar/ through its nationalist and !ilitarist effects/ as a !a@or sourcefor the institutionali?ation of capitalist relations.

'ut these ere by no !eans restricted to the !ilitary sphere. All 2inds oftraditional institutions ere restored/ bringing bac2 into Soviet respectabilityold ruling class professionals li2e clergy!en and layers. 4he depth of thetransfor!ation as obscured by the violence of the !ass arrests and purges thatacco!panied it/ but these/ as e ill see/ ere designed to eli!inate allopponents of the ne conception of socialis!. 4he Soviet and bourgeois !ythof a 7+ar6ist#Leninist continuity7 fro! 191% on is entirely at variance ithreality.

An notably counterrevolutionary change as Stalinis!<s revival of nationaloppression/ in contrast to the early Soviet support for the rights of !inoritynations Dincluding self#deter!inationE. =hole populations DJoreans/ the Volgaer!ans/ 4atars/ etc.E ere deported fro! their ho!elands. Several nationalrepublics ee dissolved and their peoples 7resettled.7 ussian settlers in the!inority republics ere granted favoritis!/ and non#ussian languages ere

ussified. 4he nationalist resent!ent thus encouraged has boiled over bloodilytoday.

C)MP7T,T,)! A!D ,!7=AL,T# ,! LA;)R

4he Stalinists adopted co!petitive techniues across the board. &nagriculture/ collectivi?ation as not a socialist but a !anagerial [email protected]!petition as used to brea2 don collective labor by encouraging the


)%. +ar2 Garrison/ Soiet Plannin+ in Peace and War 19*8-194, D19"$E/ p. "

radical change in the !ode of agricultural production than appeared atfirst glance. 4he peasant beca!e a collective producer/ but the landhich the 2ol2ho? Mcollective far!N collectively cultivated as !ainlydevoted to grain/ and grain ... as also the !ain ite! of state

procure!ent. &n other respects the 2ol2ho? peasant as able to re!ain a private producer/ cultivating his private plot ... and entitled to raise ali!ited nu!ber of ani!als outside the collective fra!eor2. Althoughthe private plots ere s!all/ they ere of great i!portance to the

peasants/ and indeed to the national econo!y as a hole. Produce fro!the private plots could be sold in 2ol2ho? !ar2ets in the tons/ and the

proceeds ent directly to the individual peasant/ not to the 2ol2ho?.-ro! $0 to %0 percent of total production of vegetables/ fruit/ !il2 and!eat ca!e fro! the private plots in 193%/ and a substantial proportion ofthis as sold on the 2ol2ho? !ar2et rather than to state procure!ent

agencies.7)"

&n labor the slogan of the day as 7socialist e!ulation7>7&ncentives ere !ade !uch !ore effective/ by the recasting of theage scales and idening !onetary differentials/ then by the gradualabolition of rationing and the greater availability of goods to buy. 4he

very high prices of basic necessities/ in and after 193*/ sti!ulated harderor2 on piece#rates/ so as to be able to !a2e ends !eet.7)9

A boost to such incentive policies as added ith the Sta2hanovistca!paign that started in 193$/ hereby 7star7 s2illed or2ers ere givenhu!an and !aterial aid to bust or2 nor!s and establish !ore de!andingrates for the or2ers as a hole. 4he intent as to brea2 the Soviet or2ersco!!it!ent to euality as ell as to create a ne labor aristocracy ith a deepsta2e in the bureaucrats< state poer. 4he ne syste! as an intensification ofcapitalist !ethods. 4rots2y uoted the president of the State PlanningCo!!ission> 74he ruble is beco!ing the sole real !eans for the reali?ation of

a socialist DOE principle of pay!ent for labor.730

,nder glasnost in the ,SS it as revealed that the !iraculous feats of

productivity achieved by the original hero/ Sta2hanov/ ere actually the or2of three !en/ not one. Sta2hanovis!/ !oreover/ contributed to an increase of!ining accidents and/ conseuently/ a ca!paign of persecutions against

7saboteurs.731 4here as also or2ing#class opposition/ often BBBBBBBBBBBBBBBBBBBB

)".Sheila -it?patric2/ The ussian eolution D19")E/ p. 1*(.)9.ove/ &conomic Fistory $$$ p. )31.30.The eolution #etrayedA p. "1. 4he 7O7 is 4rots2y<s.31. e ondeA 8ctober 1"/ 19""

314

violent/ to the state<s i!position of ineuality and speed#up.4he regi!e !ade sure that o!en ould bear the double burden of

houseor2 and child rearing as ell as age labor as under capitalis!

tivity of labor and guarantees socialist accu!ulation.7#<*

+ar6/ hoever/ had characteri?ed pieceor2 as 7the for! of ages !ostit bl f it li t d ti 7 f @ t th , d th 5P



houseor2 and child rearing as ell as age#labor/ as under capitalis!.Alar!ed by the groing labor shortage/ the state abolished the right of abortion/one of the leading conuests of or2ing#class o!en established by the 191%revolution. Conservative propaganda e6tolling the nuclear fa!ily and the7sacredness7 of !otherhood has been a constant in the Soviet press since then.&n the sa!e spirit/ ho!ose6uality as outlaed.

-ro! the point of vie of or2ers and peasants/ therefore/ the !id#1930<s brought bac2 traditional capitalist !ethods of co!petition ai!ed at sti!ulating

production. 'ut traditional !ethods ere not enough> to carry out a genuinecounterrevolution/ increasing repression of the or2ers as needed/ for!s thatled 4rots2y to na!e the regi!e 7totalitarian.7 Literature and art beca!e!onolithic and stifling. ot only as the party Stalini?ed and the SovietserodedF all or2ers< organi?ations fro! unions to sports clubs ere encrustedith a bureaucratic hierarchy.

Labor las ere drastically toughened. -irst the labor or2boo2 asreintroduced/ in effect creating an internal passport for the or2ing class. 4henthe penalties of auto!atic dis!issal and loss of housing for a single case ofabsenteeis! ere restored. Such !easures/ originally legislated in the earlythirties/ had lost force because individual !anagers did their best to ignorethe!F and even in the repressive cli!ate of 193" they fell into disuse. -inally/ in19*0 @ob#changing and absenteeis! Darriving tenty !inutes late for or2counted as a day<s absenceOE ere !ade cri!inal offenses to be punished by @ail

ter!s.3) As one observer su!!ed up/ 7&t too2 only a little over tenty years todevolve fro! the 8ctober evolution/ hich declared factories to be the

property of the or2ers/ to Stalin<s decree/ hich reduced or2ers to property

of the factories.733

4he Stalinist attac2 on the or2ers as acco!panied by a counterrevolutionin +ar6ist theory. So!e of Stalin<s theoretical contributions have already been!entioned. 4o illustrate further the ne policy of open opposition to eualityithin the or2ing class/ his aide Vo?nesens2y rote in 1931 a defense of

pieceor2 Dpay!ent not according to hours or2ed but for tas2s co!pletedE>

7&n the period of socialis! there ill still be pieceor2 ages/ since thiscorresponds best to the principle of re!uneration according to theuantity and uality of labor furnished/ and since it raises the produc#


3).See :onald -ilt?er/ Soiet Workers and Stalinist .ndustriali3ation D19"(E/ Chapters$ and (.

33. Victor Iaslavs2y/ The :eo-Stalinist State D19")E/ p. *%

suitable for capitalist production/7 for @ust these reasons. ,nder the 5P so!e pieceor2 nor!s had been introduced as a necessary but te!porary !easure.Stalin<s innovation as to @ustify the groing ineuality/ in part by citing+ar6. =hatever the @ustification/ the trend beca!e do!inant. 'y the ti!e ofStalin<s death three#fourths of Soviet industrial or2ers ere under the piece#rate syste!. 4rots2y co!!ented aptly>

7=hen the rhyth! of labor is deter!ined by the chase after the ruble/then people do not e6pend the!selves <according to ability< # that is/

according to the condition of their nerves and !uscles B but in violationof the!selves. 4his !ethod can only be @ustified conditionally and byreference to stern necessity. 4o declare it <the funda!ental principle ofsocialis!< !eans cynically to tra!ple the idea of a ne and higher

culture in the fa!iliar filth of capitalis!.73$

STAL,!,ST PLA!!,!

4he escalation of repressive labor policies shos that the bureaucracy asincreasingly conscious of its separate e6istence as the e6ploiter of the or2ingclass. et its on internal divisions/ above all the needs of individual !anagersto run their plants successfully and co!petitively/ !ade proble!atical the

enforce!ent of central decrees that li!ited bosses< ability to bargain ith theor2 force. 4hese separate !anage!ent interests ere obviously not the resultof individual onership of enterprises/ or of shares in separate corporations/ asunder traditional capitalis!. 4o understand their develop!ent/ e loo2 at the!ethods of decentrali?ation that Stalinis! introduced.

4he planning syste! is supposedly the heart of Stalinist centralis!.Ad!inistration of the econo!y as divided into several layers> the StatePlanning Co!!ission DosplanE on topF the various econo!ic !inistries Dthese!ultiplied fro! four in 193* to telve in 193(/ then tenty#four in 1939E/ and!ore sinceF production or territorial sub#!inistries Dglav2iEF and the enterprisesthe!selves. :espite the for!al hierarchy of planning/ here in theory allgoods produced ere transferred fro! one fir! to another not through a

rando! !ar2et but by ad!inistrative decision/ the reality as that co!petitionflourished at every level in the planning syste!. 4he !ore elaborate theStalinist econo!y beca!e/ the !ore co!petitive the different interests beca!e>if not over sales/ then over resources/ labor/ funds and assign!ents.


3*. Cited in 'ernard Chavance/ e Capital Socialiste D19"0E/ p. )3*.3$. The eolution #etrayedA p. ")

31-

7&n respect to Soviet econo!y/ there as ... a funda!ental revision oftheory and practice beginning in the !id#1930<s/ based upon a brea2donof the older theory and practice 4he -irst and Second -ive#ear Plans

econo!y as sub@ected to a plan that in effect accelerated its decentrali?ation.=e ill say !ore about Stalinist planning in the ne6t chapter.

4he decentralist tendencies in the econo!y e!erging in the !idst of



of the older theory and practice. 4he -irst and Second -ive#ear Planshad succeeded in industriali?ing ussia to a re!ar2able e6tentF by 193(/hoever/ it as apparent that production in itself is no solution to the

basic econo!ic proble!s. ... &n response to such proble!s and because ofthe apparent inadeuacy of earlier doctrine/ ... the e!phasis since the!id#1930<s has been on co!petition D<socialist e!ulation<E/ on reard forincentive/ on profits/ on prices that reflect !ore adeuately !ar2etconditions/ on <econo!ic accountability/< on <econo!ic las.< 4his as a

return to the econo!ic and legal institutions of the 5P/ but ithin thefra!eor2 of a planned econo!y.73(

Such policies are nor!ally associated ith the refor!ists of the present day,SS/ but it all began ith Stalin. 4he author of a !a@or study of Soviet

planning su!!ed up>7=ithin each !inistry/ enterprises co!peted fiercely for a privilegedstatus/ for reasonable uotas/ and for easy orders. 4he sa!e sort ofco!petition e6isted on a loer level ithin each enterprise and on ahigher level a!ong !inistries. 4he @ungle of liberal capitalis! of the pastloo2s li2e a fencing tourna!ent in co!parison ith this sordid infightingfor influence interspersed ith negotiations/ shady deals and

blac2!ail.73%

8bviously 7planning7 under the conditions of the struggle for survival in theStalinist @ungle is hardly the scientific !echanis! that the founders of theor2ers< state envisaged. &t is in reality ad!inistration by fiat. 4he very conceptof 7socialist co!petition7 as a !eans for subordinating all units of production tothe drive for !a6i!i?ing accu!ulation !a2es genuine planning i!possible> tocalculate and foresee the output of any enterprise/ shop or individual or2erreuire regular/ cooperative and predictable or2 practices. Stalinist !ethods ofincentives # Sta2hanovis!/ shoc2 or2/ etc. # rule this out.

Li2eise/ the !ar2et for co!!odities as replaced by a syste! of !andatesissued fro! above/ based not on scientific planning that !eshed resources ithneeds but on a syste! of priorities. Geavy industrial and !ilitary sectors ere

favored/ and agriculture and light industry subordinated to the!. As a result/7planned7 production in the disfavored spheres as often ell under theanticipated figures in the 1930<sF these sectors ere deprived of resources andleft to scra!ble for hat they could find. 4his !eant that/ aside fro! the !ost

privileged sectors/ the Soviet BBBBBBBBBBBBBBBBBBBB

3(. Garold 'er!an/ Eustice in the 5SS Drevised edition/ 19(3E/ p. $0.3%. 5. Iales2i/ Plannin+ %or &conomic =roth in the Soiet 5nion D19()E/ p. )9(

4he decentralist tendencies in the econo!y e!erging in the !idst of political centrali?ation and national planning have been overloo2ed by+ar6ists of every stripe. 4hey see only the e6ternal shape of institutionsithout penetrating to the contradictions beteen for! and content. 4he heartof the !atter as the intensification of the struggle over surplus value andaccu!ulation. 4hat is the essence of all the co!petitive for!s that assertedthe!selves as the ne ruling class prepared its ta2eover.

S)V,7T LAW4he structure of Soviet la as li2eise revised in the !id#1930<s. Stalin<s

ne Soviet Constitution of 193( Dapparently drafted by 'u2harinE re!oved thespecial electoral advantages granted to or2ers by the original constitutionadopted shortly after the revolution. &n their place/ it offered a !odel bourgeois

parlia!entary syste! based on the votes of isolated individuals. 8f course/ by193( the or2ers had lost their de!ocratic rights in the Soviets anyayF and

by the sa!e to2en the bourgeois#type elections that ere pro!ised ere never

carried out.3 evertheless/ the sy!bolic turn fro! a proletarian to a bourgeois!odel had great significance. &n 4rots2y<s ords/ it a!ounted to 7@uridically

liuidating the dictatorship of the proletariat.739 -or Stalin it as an indication

that the Soviet revolution had achieved its !ain political ob@ectives and that the period of upheaval as officially ended.4he Stalin Constitution for all practical purposes defined the developing

ruling class in the ,SS>74he !ost active and politically conscious citi?ens a!ong the or2ingclass/ or2ing peasants and or2ing intelligentsia voluntarily united inthe Co!!unist Party of the Soviet ,nion/ hich is the vanguard of theor2ing people in their struggle to build co!!unist society and is the

leadin+ core o% all or+ani3ations o% the orkin+ peopleA (oth social and

+oernmental$ 4"

4he Co!!unist Party included not @ust the top bureaucracy but a holerange of people at every level/ including lo#echelon or2ing#class !e!bers.

'ut the Constitution gave the CP hierarchy the right to appoint the entire bodyof leading officials in every sphere of life. D4hus as


3". ot until orbachev/ that is. See Chapter " belo.39. The eolution #etrayedA p. )(1.*0. Constitution D7undamental a@ o% the 5nion o% Soiet Socialist epu(licsA D193%E/

Article 1)(F e!phasis added. 4he translation is adapted to confor! ith 4rots2y<sco!!entary folloing

318

created the so#called no!en2latura.E 4rots2y observed> 74his astounding#lycandid for!ula ... reveals the hole fictitiousness of the political role of those

<social organi?ations< subordinate branches of the bureaucratic fir! 7*1 4he

credit facilities/ and/ finally/ ith the right to !a2e a profit. &n the distributionof this profit the establish!ent considers its on reuire!ents/ contributes adefinite su! to the or2ers< elfare and provides bonuses for good or2ers 7



social organi?ations # subordinate branches of the bureaucratic fir!. 4he bureaucracy<s assertion of its right to lead all social organi?ations signified itsgroing self#consciousness as a separate layer in the process of beco!ing aseparate class.

&n 193( Stalin also e6tended his dog!a that capitalist relations had beene6punged fro! the Soviet ,nion by declaring that 7the co!plete victory of thesocialist syste! in all spheres of the national econo!y is no a fact.7 =hile thee!erging ruling class could not present an open legal @ustification for its rule/ it

could deny the legiti!acy of or2ing#class rule. Stalin reasoned that the proletariat is a class e6ploited by the capitalists and there are no !orecapitalistsF therefore there can be no !ore proletariat/ and hence no dictatorshipof the proletariat. As a syllogistic argu!ent this is flaless. 'ut there re!aineda slight proble!. &f the proletariat no longer e6isted/ ho had replaced it at thehead of the stateH Stalin proposed/ so!ehat unconvincingly/ that Sovietsocialis! no e!bodied the 7dictatorship of the or2ing class/7 adding that7our or2ing class/ far fro! being bereft of the instru!ents and !eans of

production/ on the contrary/ possesses the! @ointly ith the hole people.7 So!uch for the +aoist clai! that the 7state of the hole people7 as a counter#revolutionary Jhrushchevite invention that overturned everything Stalin stood

for.Stalin<s lying and convoluted theory aside/ the changes in Soviet laacco!panying the ne Constitution ere real enough. 4he specifics are given

by Garold 'er!an/ a noted authority on the Soviet legal syste!F e cite so!eespecially re!ar2able sections. -irst 'er!an uotes fro! a boo2 by a Sovietfinancial e6pert of the thirties/ +.&. 'ogolepov/ e6plaining ho and hy Sovietfir!s ere !ade econo!ically independent in la>

7Logically/ Mcapital accu!ulationN could be entirely contributed to the56cheuer/ for the State is the oner of industry. &n actual fact/ hoever/the process is !uch !ore co!plicated. 4his is necessitated by thefolloing considerations> the State see2s to create a!ong the !anagersand or2ers of its establish!ents a direct interest in the results of their

efforts. State#oned establish!ents are run as @uridically independentecono!ic units. 5ach establish!ent/ having received fro! the State forits e6clusive use both euip!ent and capital/ proceeds to operate on itson/ ith its on financial accounting/ ban2 account/


*1. The eolution #etrayedA p. )(9.*). Stalin/ 78n the :raft Constitution of the ,SS/7 Pro(lems o% eninismA pp. 3")#3

and 39$

definite su! to the or2ers elfare/ and provides bonuses for good or2ers.'er!an then su!!ari?es ho this syste! developed in Soviet history>

7Although econo!ic accountability Dkho3raschet@ is a concept hichdates fro! the 5P period/ hen state enterprises ere co!peting ith

private business/ it lost its reality in the period of the -irst and Second-ive#ear Plans/ hen the drive as for production al!ost regardless ofcost. ... 4he critical change here/ as in so !any other aspects of Sovietinstitutional develop!ent/ as in 193(/ hen it as ordered that an end

be put to state subsidies of enterprises. Although there ere nu!erouse6ceptions to this rule/ the principle it established has prevailed> first/that each econo!ic enterprise should be profitable in the sense that the!onetary value of its operations should e6ceed that of its e6penditures/and second/ that each enterprise !ust be financially responsible for itsobligations.7*3

A conseuence of treating Soviet fir!s as @uridically independent as that theycould sign contracts ith one another/ sue if these ere not fulfilled/ and inda!ages in court. 5ach fir! operated li2e a govern!ental corporation Dor7authority7E in the ,.S.F although state#oned/ it had financial autono!y andlegal independence. 'er!an notes that 7the director of the enterprise is in onesense li2e a =estern civil servant/ but in another sense he is li2e a =estern

business e6ecutive. Ge !easures his success not by the elfare of the econo!y

as a hole/ but by the econo!ic achieve!ent of this enterprise.7 **

4his last point is crucial. +ar6<s principle that 7capital e6ists and can onlye6ist as !any capitals7 as un2noingly rediscovered and verified byStalinis!.

4he disorders of the first -ive#ear Plan !ade clear that the state<s agents ofcapital accu!ulation had to be co!pelled to produce 7rationally.7 4he statifiedecono!y alloed violations of the la of value even greater than undertraditional !onopoly capitalis!. 4o correct the e6cesses/ surrogates for !ar2etco!petition had to be created B but ithout re!oving the central poer ofallocation !ade possible by nationali?ation. 4hat as acco!plished by !a2ing

the various enterprises relatively autono!ous. 'y arranging that each capitalhad to confront others in the course of production for e6change/ the rulershoped to i!pose the discipline of value.


*3. 'er!an/ pp. 110#11.**. 'er!an/ p. 11*

319

+anagers hose econo!ic sta2e as in their on fir!s< success/ not that ofsociety/ beca!e agents of the econo!ic las of capital. 4hey sought todiscipline their or2ers and to accu!ulate centrali?e and !oderni?e capital #

4he purge decapitated and transfor!ed the party and shattered the stateapparatus and the ar!y/ the ar!ed poer of the or2ers< state. 4rots2ycategori?ed the events as a 7preventive civil ar7 by the bureaucracy against



discipline their or2ers and to accu!ulate/ centrali?e and !oderni?e capital not according to the needs of the nation and certainly not according to the needsand rights of the or2ers # but in order to !a6i!i?e the value and surplus valueat their disposal. 4he central bureaucracy/ representing the interests of the rulersas a hole/ had to balance its de!ands against the specific interests of its localagents. =e ill spell out the conseuences in the ne6t chapter.

T>7 R7AT P=R7

4he !ass purge of the late 1930<s destroyed all ties to 'olshevis! ithin the party and gave the ne ruling upper bureaucracy its organi?ed structure andfor!al recognition.

4he purge iped out hundreds of thousands of advanced or2ers and partyofficials. 4he party as totally transfor!ed in its top levels> by the ti!e of the1"th Party Congress in 1939/ %0 to 90 percent of those ho held office in 193*Dat the previous CongressE ere re!oved/ i!prisoned or 2illed. Al!ost theentire layer of 7red directors/7 the co!!unists ho had !anaged industry fro!the 19)0<s on/ as eradicated. 4hey ere replaced by the 7ne intelligentsia/7the 're?hnevKJosyginKAndropov generation of the party ho had been trainedunder Stalin/ elevated precipitously into responsible positions and co!!itted tothe rule of the party over the !asses. 4he purges ce!ented the decentrali?ed

structures and social relations established in the !id#thirties. 4hus as produced the bureaucratic capitalist class and the statified capitalist syste! thatdefines Stalinis! today.

4he e6tent of the purge at the pea2 levels is astounding. 'y the end/ 100 outof 139 Central Co!!ittee !e!bers ere e6ecutedF li2eise 90 percent ofCentral Co!!ittee leaders in the Soviet republicsF all of the central co!!itteeof the oung Co!!unistsF si6 of the seven presidents of the Soviet 56ecutiveCo!!itteeF 90 percent of People<s Co!!issars of the republicsF nearly all ofthe Control Co!!ission/ of the Council of =ar and of leaders of the secret

police and for!er Che2istsF (0 percent of Co!intern functionaries. &n theSoviet Ar!ed -orces/ "( percent of all superior officers and $0 percent of all

officers Dincluding nonco!!issionedE ere shot/ specifically> 1* of 1( generalsof the ar!y/ (( of 199 generals of divisions/ ))1 of 3%% brigade generals/ "

ad!irals of "/ 11 of 11 co!!issars.*$


*$. -igures ta2en fro! Jhrushchev<s reports in 19$(/ cited in :avid ousset/ a

Societe &clatee D19%3E/ p. 3$$

categori?ed the events as a preventive civil ar by the bureaucracy against

the unar!ed and de!orali?ed or2ers.*(

o ruling class can afford to e6ter!inate the class it e6ploits/ a fact that setsli!its to its viciousness in the class struggle. 'ut Stalinis!/ faced ith the needto ipe out every re!nant of proletarian poer and all independent class!ove!ent and consciousness/ did so!ething else> it eli!inated therevolutionary and potentially revolutionary leaders of the or2ers. ot onlyLeft 8ppositionists but also for!er ightists and even the Stalinist core of the

early 1930<s ere destroyed> every vestige of the heritage of 8ctober asregarded as a threat.

4he purges ere not confined to the party tops but e6tended deep into the proletariat. Any or2er ho stood out in defense of or2ers< rights or thetradition of Lenin as denounced as a 4rots2yist and deported to labor ca!ps.Accurate figures of the nu!bers of or2ers or party !e!bers slaughtered areun2nonF only esti!ates are possible. 7At the beginning of 191" the party hadnu!bered )(0/000 to )%0/000 !e!bers/ !ostly young people. 5ven ta2inginto account the high !ortality during the Civil =ar Mof 191"#)1N it can beassu!ed that hardly feer than )00/000 of these people ere alive at the

beginning of 1939. 'ut only 10 percent of the! had re!ained in the party.7*%

4he others ere liuidated or si!ply purgedF in either case the party as nolonger theirs.As 4rots2y su!!ari?ed/ 7&n order to establish the regi!e that is @ustly

called Stalinist/ hat as necessary as not a 'olshevi2 Party/ but the e6#ter!ination of the 'olshevi2 Party.7*"

T>7 !7W ;=R7A=CRAC#

4he purge created nu!erous ad!inistrative vacancies/ and the rising layerof bureaucrats as aiting in the ings to ta2e over> 74he Party as rapidlytransfor!ed into a !anagerial and technical elite under the !inisterial syste!.&n 19)%/ there had been only 9 thousand Party !e!bers ith higher educationand %$1 ith higher technical education. &n ten years/ 10$ thousand !e!bers

had higher education and *% thousand higher technical education. 4he influ6into the industrial econo!y of young technical specialists and their pro!otionto leading technical and ad!inistra#


*(. 4rots2y/ Writin+s D19*0-*8@A pp. *0/ $". 4he nu!ber of purge deaths is variouslyesti!ated to be in the hundreds of thousands or !illions. 5ither ay it shos that4rots2y<s ter! as no literary e6cess.

*%. Solo!on +. Schar?/ 7Geads of ussian -actories/7 Social esearchA 19*).*". 4rots2y/ StalinA volu!e )/ p. ))9

39:

tive posts as accelerated by the purge of ad!inistrative and econo!ic officialsin 193( and 193%. 4he 8ld 'olshevi2 +laki heads ere liuidated/ and theco!position of plant !anagerial personnel altered significantly ith the purge

couraged outside or2. <Gints ere dropped that e should select our

friends fro! a!ong the personnel appro6i!ately eual in ran2.<...7$

4he ne social relations transfor!ed not only the personnel of the ruling



co!position of plant !anagerial personnel altered significantly ith the purge

of the ed directors....7*9

4hat the ne upper bureaucracy as indeed a separate class above the proletariat is shon by the social relations that ere introduced in this period.=e provide several descriptions/ again because the conservati?ing effects of thecounterrevolutionary period are not co!!only understood.

74he creation of a hierarchical scaffolding of dedicated bosses/ heldtogether by discipline/ privilege/ and poer/ as a deliberate strategy of

social engineering to help stabili?e the flu6. &t as born/ therefore/ inconditions of stress/ !ass disorgani?ation/ and social arfare/ and the

bosses ere actually as2ed to see the!selves as co!!anders in a battle.4he Party anted the bosses to be efficient/ poerful/ harsh/ i!petuous/and capable of e6erting pressures crudely and ruthlessly and gettingresults <hatever the cost.< ... 4he for!ation of the despotic !anager asactually a process in hich not leaders but rulers ere !ade.7$0

4he nely for!ed ruling class organi?ed itself through the no!en2latura/the hierarchical list of official assign!ents and party !e!bers eligible for the!/co!bined ith the privileges attached to each post. 4he old co!!unist spiritthat had fired the party even during the 7revolution fro! above7 as driven out

by corruption. 4he classical 7party !a6i!u!7 that li!ited officials< salaries toor2ers< ages as no a @o2eF conspicuous consu!ption beca!e the rule/ andthe special shops dispensing lu6uries appropriate to ran2 ere established as anor! that still enrages or2ing people today. 4he ne rulers also had to behaveli2e a proper elite. 4his is described in an account that uotes several interviesith Soviet technical specialists after =orld =ar &&>

74he tightening of labor discipline during the 1930<s as acco!panied/after 193%/ by the introduction of for!al/ hierarchical relations. <4hereere no open declarations and nothing as said at !eetings or innespapers. 'ut privately e ere told to behave differently.< 8ralinstructions encouraged a !ore rigid set of relations> <fa!iliarity beteensuperiors and subordinates< as discouragedF subordinates ere not

alloed to sit don hen reporting to a superiorF reports ere to be shortand given only after an appoint!ent had been scheduledF hen thedirector or chief engineer passed through a shop/ the or2ers had to standup to sho their respect. Gierarchical relations ere also en#


*9. =illia! Conyngha!/ .ndustrial ana+ement in the Soiet 5nionA p. $1.$0. +oshe Lein/ 7Society/ State and &deology during the -irst -ive#ear Plan7/ in

Sheila -it?patric2/ ed./ Cultural eolution in ussiaA 1928-19*1A p. %*

4he ne social relations transfor!ed not only the personnel of the ruling party but also its class character. &ts original proletarian base had been erodedin the early 19)0<s/ but in the 1930<s recruit!ent fro! the intelligentsia beca!ea positive policy. Anti#Stalinist 7Leninists7 ho believe that 7socialis!7 !ust

be brought to the or2ers fro! outside the class Doverloo2ing Lenin<stheoretical change described in Chapter )E ought to ta2e a loo2 at theirreflection in the Stalinist CP.

4o consolidate their position/ the ne bureaucrats then !ade sure that the

rapid social !obility out of the or2ing class and peasantry that has startedthe! on their road to rule as no longer operative. 4he chas! beteen

bureaucracy and proletariat idenedF the bureaucracy beca!e a self# perpetuating ruling class.

74he influ6 of or2ers and or2ers< children into the institutions ofhigher education fell off !ar2edly after 1933. Also/ the pro!otion ofor2ers into ad!inistrative positions as al!ost stopped in the secondhalf of the 30<s. 4he outstanding or2ers ere no protected by higherages/ bonuses and the li2e/ and in their social and !aterial positionthey ere elevated high above the !a@ority of the or2ers/ al!ost to thelevel of the higher ran2s of plant e!ployees and engineers. 'ut they

ere no longer <pro!oted<F they re!ained !anual or2ers. +oreover/ bythis ti!e it as for only a fe of these favored or2ers that the ay asopen to a higher education/ ith the prospect of rising later to industrialleadership. 4he idea of putting the direction of industry into the hands of

people rising fro! the or2ing class and bound up ith labor/ as it had been for!ulated at the end of the )0<s/ as no lost/ and the order toassure a or2ers< nucleus in the colleges and technical schools had beentacitly forgotten. At the end of 19*0 obstacles ere even put in the ayof or2ers< children attaining a higher education.7$)

4hat is/ s2illed or2ers ere no recruited into the labor aristocracy but nolonger into the bureaucracy. 4he ne bureaucracy as trying to build up a!ass base of support/ yet at the sa!e ti!e it as closing the doors to class

!obility behind itself. &t as guaranteeing the rigorous delineation of classlines signified by the no!en2latura.

C)=!T7RR7V)L=T,)! TR,=MP>A!T

4he for!al cul!ination of the counterrevolution ca!e at the 1"th Party


$1. Jendall 'ailes/ Technolo+y and Society under enin and StalinA p. 3)).$). Schar?/ p. 3)(

394



tional labor aristocracy. 4his has acted to definitively fi6 the counter#revolutionary character of Stalinis! on the international arena.7 $(

4he bureaucracy no longer vacillated beteen its base in the or2ers< state

political poer in a country here the principal !eans of production arein the hands of the state creates a ne and hitherto un2non relation

beteen the bureaucracy and the riches of the nation. 4he !eans of



y gand orld capitalist pressures. &t had no beco!e an active counter#revolutionary agent of i!perialis!/ as Spain had decisively proved/ andtherefore even its defense of the Soviet state for its on ai!s as co!pro!ised.4he purges ere proof as ell. 74he +osco trials had already revealed thatthe totalitarian oligarchy had beco!e an absolute obstacle in the path of the

country<s develop!ent.7$" &n the 4ransitional Progra! of 193" he dre theconclusion>

74he political prognosis Mfor the ,SSN has an alternative character.5ither the bureaucracy/ beco!ing ever !ore the organ of the orld

bourgeoisie in the or2ers< state/ ill overthro the ne for!s of property and plunge the country bac2 to capitalis!F or the or2ing classill crush the bureaucracy and open the ay to socialis!.74he Stalinists< role in Spain represented the or2ing#out of tendencies set in

!otion after Gitler<s victory/ notably the class#collaborationist pact ith the-rench bourgeoisie of 193*. Spain as si!ply the first revolution that Stalinhad the opportunity to destroy fro! ithin. Li2eise/ the 7civil ar7 in theSoviet ,nion as the cul!ination of deep#seated tendencies that had previously

been established> the rise of the ne bureaucracy/ the suppression of or2ing#

class gains/ the subordination of the econo!y to value. 8nce the basis for thene ruling class had been laid/ all that re!ained as to re!ove the obstacles toits poer.

4rots2y understood this very ell. 4a2e his analysis of the bureaucracyDbefore he classified it as counterrevolutionaryE>

7&n its inter!ediary and regulating function/ its concern to !aintainsocial ran2s/ and its e6ploitation of the state apparatus for personal goals/the Soviet bureaucracy is si!ilar to every other bureaucracy/ especiallythe fascist. 'ut it is also in a vast ay different. &n no other regi!e has a

bureaucracy ever achieved such a degree of independence fro! thedo!inating class Mthe proletariatN. ... &n this sense e cannot deny that itis so!ething !ore than a bureaucracy. &t is in the full sense of the ord

the sole privileged and co!!anding stratu! in the Soviet society.7Another difference is no less i!portant. 4he Soviet bureaucracy hase6propriated the proletariat politically in order by !ethods of its on todefend the social conuests. 'ut the very fact of its appropriation of


$%.4rots2y/ 74he Lessons of Spain> 4he Last =arning7 D193%EF in The Spanish eolutionA p. 311.

$". 7+anifesto of the -ourth &nternational ...7/ Writin+s D19*9-4"@A p. )00

y production belong to the state. 'ut the state/ so to spea2/ <belongs< to the bureaucracy. &f these as yet holly ne relations should solidify/ beco!e the nor! and be legali?ed/ hether ith or ithout resistancefro! the or2ers/ they ould/ in the long run/ lead to a co!plete li#uidation of the social conuests of the proletarian revolution. 'ut tospea2 of that no is at least pre!ature.7$9

So con@unctural an assess!ent of 7ne and hitherto un2non7 relations

should have arned 4rots2y<s folloers that re#e6a!ining the role of the bureaucracy !ight be called for. -ifty years later the ne relations have notonly solidified but calcified. &n any case/ the legali?ation of the ne relationsas already ta2ing place> e have already cited 4rots2y<s vie that the 193(Constitution a!ounted to 7@uridically liuidating the dictatorship of the

proletariat/7 even though it did not enshrine the bureaucracy as ruling class.4rots2y understood that the bureaucracy/ as 7so!ething !ore than a

bureaucracy/7 as on the road to destroying the or2ers< state.Gis theory at this Stage as perched li2e the Stalinist state itself on the

point of a pyra!id> the to#pronged prognosis @ust cited as on the verge of being tested as the counterrevolution ca!e to a head. Any overallcharacteri?ation of Stalinis! had to be above all te!porary. 4hus he labeledthe bureaucracy a 7caste7 because he needed a ter! and 7the old sociologicalter!inology did not and could not prepare a na!e for a ne social event hichis in the process of evolution DdegenerationE and hich has not assu!ed stablefor!s.7(0 4he degenerated or2ers< state had precisely such an ephe!eralualityF it could only e6ist for a !o!ent in historical ti!e on the road tocounterrevolution.

4rots2y regarded the purge trials as a sign of the ea2ness and i!!inent brea2up of the Stalinist regi!e. 'ut in fact the transfor!ation of the party and bureaucracy shoed not ea2ness but the strength the Stalinists no had as astabili?ed class. Gaving erased the last vestiges of or2ers< poer in the stateapparatus/ party and ar!y/ the regi!e did not collapse in =orld =ar &&/ as

4rots2y e6pected/ but rather consolidated its poer.


$9. The eolution #etrayedA pp. )*"#9.(0. 4rots2y/ 74he ,SS in =ar7 D1939E/ .n e%ense o% ar!ismA p. (. 4rots2y noted

that the 'rah!in caste bore so!e rese!blance to the bureaucracy> 7its shut#incharacter/ its arbitrary rule and the haughtiness of the ruling stratu! ...7 'ut 7itould enter nobody<s !ind7 to identify the enduring Gindu caste ith the unstableStalinist one

398

evertheless/ 4rots2y<s position loo2s insightful today/ and it is in no ayunderstood by his epigones> the Stalinist syste!/ after a delay of severaldecades/ is proving to be as ea2 as 4rots2y foresa B for different but related

need to reassess the degenerated or2ers< state theory after it had beco!eobsolete. Gis on failure to produce a consistent assess!ent of Stalinis!<scapacity to advance the productive forces undoubtedly had !aterial causes. &n



/ p g yreasons.

4rots2y<s life as !urderously ended by Stalin @ust as the bureaucracysettled into the !old hich it ould inhabit for the ne6t half century. Gistheory/ hich should have continued to develop/ as e!bal!ed by hisfolloers. &t is as if Lenin had died on the eve of the -irst =orld =arF he thenould be re!e!bered for an increasingly erroneous theory. 8nly the concreteevents of the -ebruary 191% revolution proved that the 7de!ocratic dictatorship

of the proletariat and peasantry7 as obsolete.

T>7 STAL,!,ST 7C)!)M#

4here ere i!portant ele!ents in 4rots2y<s theory of the Soviet ,nion thatcould have alloed for the necessary changes as events ripened. 4he

bureaucracy<s counterrevolutionary character as proved once again by itssuppression of or2ing#class revolts after the Second =orld =ar. As ell/4rots2y<s insistence on the !aterial i!pact/ not @ust the for!/ of nationali?ed

property pointed to an altered conclusion. As the 4ransitional Progra! said/7the apparatus of the or2ers< state7 had been 7transfor!ed fro! a eapon ofthe or2ing class into a eapon of bureaucratic violence against the or2ingclass/ and !ore and !ore a eapon for the sabotage of the country<s econo!y.7

A or2ers< state incapable of advancing the productive forces is a or2ers< stateon the verge of e6tinction.

&n the sa!e vein 4rots2y observed that 74he progressive role of the Soviet bureaucracy coincides ith the period devoted to introducing into the Soviet,nion the !ost i!portant ele!ents of capitalist techniue.7 &t could borro andtransplant but not innovate # a farsighted assess!ent/ given today<s crises.+oreover/

7&t is possible to build gigantic factories according to a ready#!ade=estern pattern by bureaucratic co!!and # although/ to be sure/ at triplethe nor!al cost. 'ut the farther you go/ the !ore the econo!y runs intothe proble! of uality/ hich slips out of the hands of a bureaucracy li2e

a shado. 4he Soviet products are as though branded ith the grey labelof indifference. ,nder a nationali?ed econo!y/ /uality de!ands ade!ocracy of producers and consu!ers/ freedo! of criticis! andinitiative # conditions inco!patible ith a totalitarian regi!e of fear/ liesand flattery.7(1

4rots2y<s deep understanding that the survival of the Soviet ,nion dependedon surpassing the capitalists< productivity of labor pointed to the BBBBBBBBBBBBBBBBBBBB

(1. The eolution #etrayedA pp. )%$#(

p y p ythe first half of the 1930<s he produced regular analyses of the state of theSoviet econo!y/ but this output dindled to nothing in the second half of thedecade. 4he reasons no doubt included the closing off of his sources ithin the,SS as the purges intensified/ along ith the necessity to devote !a6i!u!effort to refuting the charges against hi! and his folloers in the +oscotrials.

evertheless/ there as a central theoretical ea2ness that prevented hi!

fro! co!ing to a satisfactory analysis of the counterrevolution. =e sa inChapter ) that Lenin/ as opposed to Jauts2y/ had understood that the epoch of!onopoly capitalis! intensified co!petition a!ong the !onopolies. 'ut as!onopolis! e6panded to e!brace statified production/ others # notably'u2harin # dre the conclusion that co!petition ould not intensify but ouldither aay ithin the fra!eor2 of the state !onopoly. o the theoreticalgap delivered its conseuences> the 'u2harinist thesis as being proved falsein the case of the Soviet state !onopoly/ but the Leninists failed to grasp thei!portance of the decentrali?ing trend.

An i!portant factor underlying 4rots2y<s errors shos through in his last!a@or or2 on Soviet society/ The eolution #etrayedA a se!inal dissection ofthe Stalinist pheno!enon. Ge arns against capitalist aspects in the Sovietecono!y in the sphere of distribution only>

74o opposite tendencies are groing up out of the depth of the Sovietregi!e. 4o the e6tent that/ in contrast to a decaying capitalis!/ it develops the

productive forces/ it is preparing the econo!ic basis of socialis!. 4o the e6tentthat/ for the benefit of an upper stratu!/ it carries to !ore and !ore e6tre!ee6pression bourgeois nor!s of distribution/ it is preparing a capitalistrestoration. 4his contrast beteen for!s of property and nor!s of distribution!ust in one for! or another spread to the !eans of production/ or the nor!s ofdistribution !ust be brought into correspondence ith the socialist property

syste!.7() +ar6 insisted that the !ode of distribution depended on productionDChapter 3E/ so fro! this standpoint 4rots2y as certainly @ustified to say that

the to could not long re!ain disparate. 'ut he as rong to i!ply that bourgeois nor!s ere e6pressed only in distribution. =e have already seenthat 4rots2y 2ne better/ for he too2 pains to counter the Stalinist !yth that

bourgeois production had been overco!e. Gere he is e6plicit>


(). The eolution (etrayedA p. )**. =e cited a si!ilar passage in Chapter 3

399

7 74he or2er in our country is not a age slave and is not the seller of aco!!odity called labor poer. Ge is a free or2!an.< DPrada$@ -or the

present period this unctuous for!ula is unper!issible bragging. 4he

ould have to introduce in the !atter of for!s of property and !ethodsof industry not a refor!/ but a social revolution.7(*

+ost of this is recogni?able today. Soviet enterprises have long had !any



transfer of the factories to the state changed the situation of the or2eronly @uridically. &n reality/ he is co!pelled to live in ant and or2 adefinite nu!ber of hours for a definite age. <(3

4hat is/ in contrast to Stalin/ Preobra?hens2y and his on !odern epigones/4rots2y 2ne that labor poer is a co!!odity/ and the or2ers< rights inselling it ere being increasingly abused. 'ourgeois nor!s ere operative andstrengthening in productionA and this !eant that the 7socialist property syste!7

as ever !ore beco!ing a @uridical fiction. 4he proletarian property for!s that4rots2y eighed so heavily ere already ielded by the Stalinists against theor2ers for counterrevolutionary purposesF they already had a bourgeoiscontent. =hen for! and content are te!porarily at odds/ the class content illulti!ately in out and produce for!s co!patible ith it. 4he capitalist classcontent that appears today in one Stalinist#ruled country after another asalready being established under Stalin. 'ut 4rots2y had only a partial

perception of the proble!.=e cannot close a discussion of 4rots2y<s assess!ent of the Stalinist ,SS

ithout citing his farsighted description of a hypothetical bourgeoiscounterrevolution Din contrast to a revived or2ers< revolutionE.

7&f # to adopt the second hypothesis # a bourgeois party ere to overthrothe ruling Soviet caste/ it ould find no s!all nu!ber of ready servantsa!ong the present bureaucrats/ ad!inistrators/ technicians/ directors/

party secretaries and privileged upper circles in general. A purgation ofthe state apparatus ould/ of course/ be necessary in this case too. 'ut a

bourgeois restoration ould probably have to clean out feer people thana revolutionary party. 4he chief tas2 of the ne poer ould be torestore private property in the !eans of production. -irst of all/ it ould

be necessary to create conditions for the develop!ent of strong far!ersfro! the ea2 collective far!s/ and for converting the strong collectivesinto producers< cooperatives of the bourgeois type B into agriculturalstoc2 co!panies. &n the sphere of industry/ denationali?ation ould begin

ith the light industries and those producing food. 4he planning principleould be converted for the transitional period into a series ofco!pro!ises beteen state poer and individual <corporations< #

potential proprietors/ that is/ a!ong the Soviet captains of industry/ thee!igre for!er proprietors and foreign capitalists. otithstanding thatthe Soviet bureaucracy has gone far toard preparing a bourgeoisrestoration/ the ne regi!e


(3. The eolution #etrayedA p. )*1

si!ilarities ith traditional capitalist public corporations/ and !ore differencesare being eli!inated through orbachev#type refor!s. 4hecounterrevolutionary purge of the state apparatus too2 place/ shortly after4rots2y rote. :enationali?ation is already ell under ay in the StaliniststatesF the planning principle has long contained the series of co!pro!ises4rots2y suggested. All that re!ains of the once#proletarian state is thenationali?ed property for!/ gutted of its content and therefore losing !ore of

its proletarian shape every day. 4hat this could happen is the one possibility4rots2y overloo2ed.($

A !7W CLASS S)C,7T#G

8ne of 4rots2y<s last !a@or articles/ ritten at the pea2 of Gitler and Stalin<s poer on the eve of =orld =ar &&/ contains an unnecessarily pessi!istictheoretical alternative about the e6tension of Stalinis! on a orld scale. =ecite it at length>

7&f this ar provo2es/ as e fir!ly believe/ a proletarian revolution/ it!ust inevitably lead to the overthro of the bureaucracy in the ,SSand regeneration of Soviet de!ocracy on a far higher econo!ic andcultural basis than in 191". &n that case the uestion as to hether theStalinist bureaucracy as a <class< or a groth on the or2ers< state ill

be auto!atically solved. 4o every single person it ill beco!e clear thatin the process of the orld revolution the Soviet bureaucracy as onlyan episodic relapse.7&f/ hoever/ it is conceded that the present ar ill provo2e not arevolution but a decline of the proletariat/ then there re!ains anotheralternative> the further decay of !onopoly capitalis!/ its further fusionith the state and the replace!ent of de!ocracy herever it still re#!ained by a totalitarian regi!e. 4he inability of the proletariat to ta2einto its hands the leadership of society could actually lead under theseconditions to the groth of a ne e6ploiting class fro! the 'onapartist

fascist bureaucracy. 4his ould be ... a regi!e of decline/ signalling theeclipse of civili?ation. BBBBBBBBBBBBBBBBBBBB

(*. The eolution #etrayedA p. )$3.($. 'ut not co!pletely. 4rots2y did see that capitalist restoration could occur ithout

ending state property> 7Should a bourgeois counterrevolution succeed in the ,SS/the ne govern!ent for a lengthy period ould have to base itself upon thenationali?ed econo!y.7 D7ot a =or2ers< and ot a 'ourgeois StateH7/ Writin+sD19*0-*8@A p. (3.E

32:

7An analogous result !ight occur in the event that the proletariat ofadvanced capitalist countries/ having conuered poer/ should proveincapable of holding it and surrender it/ as in the ,SS/ to a privileged

ery/ and capital still needed to e6ploit the !asses as orkers$ 4hey have risenup again and again against their e6ploitation by capital/ notably in the Stalinistcountries the!selves # ith de!ands that are socialist in their i!plicit content



bureaucracy. 4hen e ould be co!pelled to ac2noledge that the rea#son for the bureaucratic relapse is rooted not in the bac2ardness of thecountry and not in the i!perialist environ!ent but in the congenitalincapacity of the proletariat to beco!e a ruling class. 4hen it ould benecessary in retrospect to establish that in its funda!ental traits the ,SSas the precursor of a ne e6ploiting regi!e on an international scale. ...74he historic alternative/ carried to the end/ is as follos> either the Stalin

regi!e is an abhorrent relapse in the process of transfor!ing bourgeoissociety into a socialist society/ or the Stalin regi!e is the first stage of ane e6ploiting society. &f the second prognosis proves to be correct/ then/of course/ the bureaucracy ill beco!e a ne e6ploiting class. Goeveronerous the second perspective !ay be/ if the orld proletariat shouldactually prove incapable of fulfilling the !ission placed upon it by thecourse of develop!ent/ nothing else ould re!ain e6cept only torecogni?e that the socialist progra!/ based on the internal contradictionsof capitalist society/ ended as a ,topia. &t is self#evident that a ne<!ini!u!< progra! ould be reuired # for the defense of the interests ofthe slaves of the totalitarian bureaucratic society.7((

4rots2y<s selection of alternatives as rong in theory and proved rong in

actuality. 4he Stalin regi!e turned out to be !ore than episodic> it e6pandedafter the ar and still e6ists/ half a century later. 8n the other hand/ capitalisti!perialis! survived ithout transfor!ing itself into a ne totalitarian classsociety Dalthough in so!e countries it certainly is totalitarianE. Stalinis! as arelapse/ but a relapse bac2 to capitalis!. &t survived the ar along ithi!perialis! as a necessary prop for the orld syste! and a uniuely defor!ed

part of it.4he reason i!perialis! survived as neither the orld proletariat<s

7decline7 Dinability to rise up in revolution against capitalis!E/ nor its surrenderof conuered state poer to Stalinist#type bureaucracies. =or2ers in advancedcapitalist countries did revolt but ere de%eated DChapter (E. 4hat as not

because of any congenital incapacity/ but because Stalinis! had usurped theirfore!ost conuest and turned it against the!. =hat 4rots2y !ostfunda!entally overloo2ed as the alternative of a !assive defeat of the

proletariat (y capitalismA including its Stalinist co!ponent. 4he or2ers erenot historically set bac2 to a for! of slav#


((. 74he ,SS in =ar7 D1939E/ .n e%ense o% ar!ismA pp. "#9

if not alays in e6plicit for!.4heir !ove!ent confir!s again +ar6<s conclusion that the las of !otion

of capitalis! drive the or2ers to struggle for co!!unis!. =hat they havelac2ed is not proletarian !o!entu! but revolutionary leadership Das 4rots2y!ore than anyone else too2 pains to e!phasi?eE # and that too is a result ofStalinis!<s years of unprecedented opportunis!/ ideological stultification andoutright !urder. Stalinis!<s present#day decay is further reason for reneed

revolutionary opti!is!> it is one ene!y the or2ing class ill not have toconfront again at full strength.

4rots2y<s failure to esti!ate the outco!e of =orld =ar && as lin2ed to hisrong assess!ent of the nature of the ,SS. 'oth resulted fro! an inco!pleteunderstanding of the capitalist aspect of the or2ers< state/ despite his freuentinsights into @ust this. Gis error fed into the !iddle#class#based pessi!is! ofhis epigones/ both those ho too2 the ,SS to be a ne for! of society/ andothers ho i!agine a degenerated or2ers< state fro?en !iday beteencapitalis! and socialis! for half a century.

-or +ar6/ capitalis! as destined to be the last class society on earth because of its capacity to develop the productive forces to the point here classoppression as no longer progressiveF the revolutionary or2ers< state and

socialis! ould then be able to achieve genuine abundance. &f 4rots2y<salternative of a ne slave society ere to occur/ that ould !ean that the

productive forces had not only stagnated but had been ualitatively destroyed/on a scale of centuries. iven capitalis!<s enor!ous advance!ent of the forcesof destruction/ this possibility cannot be absolutely ruled out/ but there isnothing inevitable about it.

4he reason 4rots2y posed the alternative so pessi!istically as hiscertainty about Stalinis!<s ea2ness. &t as not a ne class but a 'onapartist

balancing act. Ge did not thin2 it strong enough to s!ash the or2ersFtherefore Stalinis!<s survival could only reflect the proletariat<s incapacity for

poer. Continuing that outloo2 in the face of Stalinis!<s postar triu!phs

could lead only to cynicis! toards the proletariat.4rots2y did not thin2 this perspective li2elyF revolutionary opti!is! andconfidence in the or2ers< gains fro! 191% ere in his nature. 'ut he feltobliged to consider all theoretical alternatives/ and his theory as flaed. Gis!ost pessi!istic pronounce!ent of the past/ also based on the supposition ofor2ing#class passivity/ as !ore accurate than his 1939 outloo2/ since it didnot assu!e the end of the proletariat>

7&f e grant # and let us grant it for the !o!ent # that the or2ing classfails to rise in revolutionary struggle/ but allos the bourgeoisie

324

the opportunity to rule the orld<s destiny for a long nu!ber of years/ sayto or three decades/ then assuredly so!e sort of ne euilibriu! ill beestablished. +illions of 5uropean or2ers ill die fro! une!ploy!ent



and !alnutrition. 4he ,nited States ill be co!pelled to reorient itselfon the orld !ar2et/ reconvert its industry/ and suffer curtail!ent for aconsiderable period. Afterards/ after a ne orld division of labor isthus established in agony for 1$ or )0 or )$ years/ a ne epoch ofcapitalist upsing !ight perhaps ensue.7(%

+ost of this in fact happened/ and a period of upsing did follo =orld=ar &&. 'ut it as not a ne 7epoch7> the productive forces ere not set bac2 to

the point here capitalis! beca!e again a progressive society/ despite thedecades of prosperity in the i!perialist countries. 4he result as instead theunnecessary prolongation of the i!perialist epoch that e live in today.

:espite the inco!pleteness of his theory/ no one can reach a +ar6istunderstanding of the Stalinist counterrevolution and society today ithoutstarting ith 4rots2y<s or2/ notably The eolution #etrayed$ &ts conclusionthat the ,SS re!ained a degenerated or2ers< state on the edge ofcounterrevolution as correct at the ti!e it as ritten. &t also laid the basis fora groing understanding as the historic events of =orld =ar && unfolded.+oreover/ 4rots2y is not responsible for the gross absurdities of his epigonesFthe 7defor!ed or2ers< states7 created to crush the or2ers/ for e6a!ple/ andthe idea of a 7or2ers< state7 fro?en !otionless for fifty years/ have no

foundation in 4rots2y. et as he and Lenin both pointed out/ theoretical errorscan leave open the door to political capitulations hen conditions are ripe forthe!. 4hat as the fate of the 4rots2yist !ove!ent not long after his death.

<Dialectical thin$ing analy.es all things and (henomena in their

continuous change* "hile determining in the material conditions of

those changes that critical limit beyond "hich 6A6 ceases to be A*6 a

"or$ers6 state ceases to be a "or$ers6 state The fundamental fla" of

+ulgar thought lies in the fact that it "ishes to content itself "ith

motionless im(rints of a reality "hich consists of eternal motion<82

____________________

(%. 4rots2y/ 7eport on the =orld 5cono!ic Crisis7 at the 4hird =orld Congress ofthe Co!!unist &nternational D19)1EF in The 7irst 7ie Hears o% the CominternA Vol.)/ p. )11.

(". =e ill see this in Chapter (. =e have already cited Din Chapter 3E 4rots2y<s !oredeveloped vie based on the actual course of events in the 19)0<s that does not

presu!e a ne/ post#decay epoch at all.(9. 4rots2y/74he A'C of +aterialist :ialectics/7 .n e%ense o% ar!ismA p. $0

Cha(ter 5

Stalinist Ca(italism

3 PS7=D)'S)C,AL,ST CAP,TAL,SM

&n this chapter e analy?e the Stalinist syste! as it arose in the ,SS andthen spread to other states. 5ven though the Soviet !odel never !atched thedesigns of Stalinist theorists/ a general interpretation of that !odel is necessary

both to distinguish it fro! other for!s of capitalis! and to account for thedeviations it inevitably ent through.

4hree decades ago Jhrushchev bri!!ed over ith confidence in the futureof his socialis!. 7=e ill bury you/7 he told the ,nited States/ boasting thatthe Soviet econo!y ould soon outproduce the A!erican. 7ourgrandchildren ill live under co!!unis!.7 Although Jhrushchev as ousted

by his fello bureaucrats for 7harebrained sche!es/7 the official opti!is!continued under 're?hnev. 4oday orbachev tells a different story. Sinceco!ing to poer in 19"$/ the ne eneral Secretary Dno PresidentE has

repeatedly proclai!ed that the Soviet econo!y is in critical shape and !ustundergo a 7revolutionary7 restructuring.

4he Soviet crisis has been previeed by events in China and 5ast 5urope.=hereas ussia as able to beco!e a superpoer by usurping the gains of theSoviet or2ers/ the neer Stalinist regi!es had no ay to overco!e theirinherited bac2ardness. 4hey escaped only te!porarily fro! the clutches ofi!perialis!. After brief spurts of groth their econo!ies no are in ghastlyshape/ no better off Din !ost cases far orseE than the traditional capitalistcountries of si!ilar develop!ent/ and all again depend on the =est for capitaland technology. 4heir crises ere apparent since the first or2ers< revolts ofthe 19$0<s/ and the no#obvious devolutionary tendency toards orthodo6

bourgeois !ethods of e6ploitation as theoretically predictable.,ntil recently a +ar6ist analysis of the ,SS ould have had to prove


1. =e rote in 19%(> 7&nternal co!petition has to be reintroduced for the sa2e ofefficiency ... . Capitalist decay !eans that state capitalis! decays in the direction ofanarchic state !onopoly capitalis!.7 DSocialist )oice o. 1.E

32-

at length that Soviet#style 7socialis!7 had not acco!plished hat Stalinist!ythology clai!ed Dand !illions of or2ing people still hoped and believedE ithad. 4oday the leading authorities ad!it the fact readily/ ith startling if self#

i d h i h 2 f h i l l ifi i h

oned capital ithin the national boundaries. 4his is a !odification ande6tension of the overall capitalist !otive> !aintaining and e6panding the valueof the e6isting capital.

h li i l i fl d i h d di i 2



serving candor. 'ut there re!ains the tas2 of theoretical clarification. &n theords of for!er Soviet leader uri Andropov>

7-ran2ly spea2ing/ e have not yet studied properly the society in hiche live and or2/ and e have not yet fully discovered the lasgoverning its develop!ent/ especially econo!ic las. 4herefore e areat ti!es forced to act/ so to spea2/ e!pirically/ in a uite irrational

!anner of trial and error.7)

8f course/ the fact that the bureaucracy acts blindly/ e!pirically andirrationally is itself a function of the las of develop!ent that operate. 4he

bureaucracy is as incapable of laying bare the las of its on rule as is the bourgeoisie in the =est. &t is a tas2 only for +ar6ists.

T>7 S)C,AL )AL )& PR)D=CT,)!

According to +ar6/ capitalis! is continually co!pelled by its internaldyna!ic to 7preserve the value of the e6isting capital and pro!ote its self#e6pansion to the highest li!it.7 4his co!pulsion has different conseuences indifferent stages of capitalis!.

&n pre#!onopoly capitalis!/ !a6i!i?ation of value cannot be achieved byall capitals at once> so!e e6pand and others are destroyed. +a6i!i?ingindividual capitals detracts fro! !a6i!i?ing the total capital because of this

periodic destruction/ but the syste! as a hole benefits fro! the iping out ofits ea2est !e!bers. -or an individual capital/ !a6i!i?ing its value does notconflict ith !a6i!i?ing its rate of profit.

&n the i!perialist stage/ a !onopoly<s goal of !a6i!i?ing its total value !ay prevent it fro! !a6i!i?ing the profit rates of its branches or even of the holefir!. -or e6a!ple/ introducing !odern techniues in one branch !ay !eandeadly co!petition for other branches and therefore devaluation of the overallcapital. &n such cases !oderni?ation ill be avoided. &!perialists ill evenallo their national econo!y to run don for the sa2e of foreign invest!entsand overall profitsF 'ritain today shos the result of this policy/ and the ,nited

States is !oving in the sa!e direction. 4hus capital accu!ulation in the presentepoch does not follo the sa!e rules as in the progressive epoch of capitalis!>centrali?ed onership often appears to contradict the !otive of !a6i!i?ing

profit.4he Stalinist !odel follos this pattern but ith its on peculiarities. ,nder

Stalinis! the pri!ary social ai! of production is to presere and ma!imi3e thealue o% the national capital as a hole - that is/ the state#


). Andropov/ in :us2o :oder/ Shados and Whispers D19"(E/ p. 1))

4he Stalinist goal is reflected in the syste!<s dedication to autar2y>7socialis! in one country.7 &t is a natural choice for nationalist rulers infor!erly coloni?ed or econo!ically bac2ard countries since it helps the!2eep surplus value at ho!eF it perpetuates the nation here traditionalcapitalis! can no longer do so. &n the case of the ,SS/ the nationalist goal!eans that the society !otivated for over half a century by Stalin<s slogan has

been really operating under a progra! of 7capitalis! in one country.7

As e sa in Chapter )/ centrali?ation and !onopoli?ation of capital do noteli!inate co!petition/ contrary to the theories of 'u2harin and Jauts2yF noteven statification does so. &t therefore is no surprise that under Stalinis! the

pri!ary goal of national capital accu!ulation has to operate in con@unction #and often at variance B ith the narroer goals of local and sectoral

bureaucrats> !a6i!i?ing the value of the fir! or sector they are responsiblefor. At both national and local levels the !eans of production are state

property/ so the goals are e6pressed as the !a6i!i?ation of the value of thestate property controlled at each level. A significant feature of the Stalinistecono!y is its subdivision into separate !inistries acting in !any ays li2ethe giant corporations of the =est> they co!pete a!ong each other for sharesof the syste!<s overall resources/ but cannot co!pletely suppress internal

co!petitive tendencies.&t is no accident that Stalinis! styles itself socialist. 4hat is a necessary

appearance/ not a conspiratorial plot. Stalinist 7socialis!7 !irrors the or2ers<state they overthre but hose vestiges it could not entirely erase. -ro! adifferent angle/ it reflects the sociali?ing for!s that decaying capitalis! adoptsto stave off the advance of the proletariat. =hile capital in its progressiveepoch disguised its e6ploitative essence under the cloa2 of euality/ in thisepoch its garb is lafully 7socialis!.7 4herefore the Stalinist syste! is !ostaccurately na!ed (seudo'socialist ca(italism. 7Pseudo#socialist7 indicates

both the syste!<s pretensions and the fact that its peculiarities derive largelyfro! its proletarian heritage.

4he ter! statified ca(italism is also accurate. 4he !ore co!!on 7statecapitalis!7 is not rong but can be !isleading. -or one thing/ it often refers tothe state#oned sector in traditional capitalist econo!ies. Lenin also used it forone sector of the or2ers< state econo!y in the 5P period/ not the econo!yas a hole DChapter 3E. Cliff and others use 7state capitalis!7 for a single#factory !odel of capitalis! in hich the la of value does not operateinternally. -inally/ the Cliffites and a!esK:unayev#s2aya use 7statecapitalis!7 as a label for !odern capitalis! of both 5ast

328

and =est/ the end result of capital<s las of !otion. 4hat too is rong. 4ounderstand this syste! reuires analysis of the las of !otion of capitalis! intheir Stalinist !ode. =e ill first describe several features of the Stalinist

h i h h fi h l f i = 2 f

valuable inventions by <outside< researchers fro! gaining entry to <their<

branches for years.73 Second/ Pri!e +inister i2olai y?h2ov conde!ns theanarchic results of the Soviet planning process>



econo!y/ shoing ho they fit the las of !otion. =e ta2e !ost of ourillustrations fro! the Soviet ,nion in the pre#orbachev period. 'ut ourgeneral interpretation applies to the other Stalinist states and to today<s ,SS asell/ even here countries have abandoned so!e 2ey Stalinist features. &ndeed/these changes often illu!inate the true nature of the classical Stalinist patterns/for only through change can e understand a !ystified orld. As ell/ to

paraphrase +ar6/ the changes sho the !ore conservative Stalinists the !irror

of their on future.

PS7=D)'PLA!!,!

4he Soviet bureaucracy e!ploys a panoply of plans to direct its econo!y>the -ive#ear Plans hich su!!ari?e overall goals/ and the !ore or lessoperational yearly and uarterly plans. 4he ord 7plan7 is deceptive. &tindicates the underlying sociali?ing trend of capitalis! that 5ngels and Leninspo2e of/ not the conscious organi?ation of production by the associated

producers characteristic of socialis!. &t is bureaucratic !anage!ent fro! thetop/ a !echanis! of e6ploitation.

4he 7plan7 refers above all to hat and ho !uch a fir! ill produce/ andin so!e cases hich enterprises it ill buy fro! and sell to. 4he plans are

bargained over by fir!s and !inistries before adoption and constantly !odifiedafterard/ according to the poer relations a!ong the! and hat or2s outduring production. As a result/ the -ive#ear Plans alays postdate the periodof their applicability Dso!eti!es the short#ter! plans do tooEF they are hardlydeter!ined in advance of production by scientific !ethods. An e6tre!e case isChina during the Cultural evolution/ hen the statistical bureaus needed forany pretense of central planning or ad!inistration ere reduced to less than ahandful of people. ot only has no Stalinist plan ever genuinely planned or

predicted the econo!y/ but the failures have diverged fro! the plans inforeseeable directions.

4hese days horror stories about Stalinist planning are co!!onplace. =eta2e to descriptions that reveal the underlying reality. -irst a leading Soviet

theorist of orbachev<s 7restructuring7 policy Dperestroi2aE/ 4atyanaIaslavs2aya/ !a2es a direct co!parison beteen =estern !onopolies andSoviet fir!s>

78ne of the !ost i!portant conseuences Mof the rising organic co!positionof capitalN is the e!ergence and gradual intensification of <!onopoly effects< in

production and research and develop!ent. Lac2ing co!petitors/ industrialgiants dictate to custo!ers their on ter!s of delivery/ going so far as to foiston the latter the output they find easiest to produce. esearch institutes in agiven !inistry can 2eep

7-irst and fore!ost/ e !ust cla!p don on the frag!entation offinancial resources. +ore than 300/000 large and s!all construction

pro@ects are currently under ay. &t is an i!per!issible nu!ber/ eventa2ing the enor!ous si?e of our country into account. Pro@ects areusually put into operation later than scheduled as a conseuence offrag!entation.7*

&n one case the proble! is !onopolyF in the other/ econo!ic anarchy. 'ut

as Lenin pointed out/ these see!ingly opposite conditions are characteristic ofcapitalis! in its i!perialist epoch. 'oth are illustrative of Stalinist pseudo#

planning.Another telling e6a!ple is co!petitive hoarding by enterprises hich

cannot otherise guarantee that they ill obtain the !aterials for !eeting theirofficial targets. -or their part/ the central planners assign targets beyond eachfir!<s 2non capacities/ hoping to force it to use its secret illegal reserves. 4hisga!e ensures that supplies continue to be dispersed and asted. aps have to

be filled outside of the plan/ either through a blac2 !ar2et or private production. -ir!s typically e!ploy se!i#official 7e6pediters7 to obtain needed/even planned#for/ !aterials hen they cannot be obtained through officialchannels. 8r even orse/ factories have to adapt the!selves to producing their

on supplies.$ 4his is a centrali?ation pheno!enon/ but not one that adds tothe efficiency of accu!ulation. Soviet enterprises often acuire advancedtechnology fro! foreign sources. 'ut even though such purchases have beenhandled Duntil recentlyE by the central state organs of foreign trade/ thei!ported techniues nor!ally do not spread ithin the ,SS fro! one fir! toanother. Co!petitive secrecy prevents such dispersion/ and technologicalconservatis! freuently prevents spin#offs fro! the ne technology. 4hissituation is the opposite of an advancing capitalist poer li2e apan/ hereforeign tech#


3. Iaslavs2aya/ 74he Gu!an -actor in 5cono!ic :evelop!ent and Social ustice/7Current i+est o% the Soiet PressA Vol. 3"/ o. *1 D19"(E.

*. y?h2ov/ speech at the )%th Congress of the Soviet Co!!unist Party D+arch19"(E/ Soiet i%eA +ay 19"(.

$. 8ne survey shoed that %1U of !achinery plants in the ,SS produce their oncast iron/ )%U their steel/ $%U their non#ferrous casting/ "*U their forgings/ %(Utheir sta!pings/ 99U their pinions/ (1U their industrial cla!ps # all outside the

plan. Dertrude Schroeder/ 74he Soviet 5cono!y on a 4read!ill of efor!s/<7oint 5cono!ic Co!!ittee of the ,.S. Congress/ Soiet &conomy in a Time o%

Chan+eA 19%9/ p. 33(.E322

niues ere traditionally first i!ported/ then i!proved on and finallye6ported bac2 to the original innovators.

Another ay in hich planning habitually fails is through unplanned pricei 5 t i f bidd t i i th i d t ill 2

of consu!er goods/ the result of suppressed inflation. 'ut this shortage is alsoa conseuence of the bureaucracy<s notorious inability to produce enoughconsu!er goods to !eet de!and # not to spea2 of need.

& t di t t th S i t ffi i l h t ti d



increases. 5nterprises forbidden to raise prices on their products ill !a2eslight alterations and distribute their output as ne products ith higher prices.Since Soviet !anagers operate in a 7sellers< !ar2et/7 and since they arerearded by increasing their sales/ there is an absolute incentive to inflate

prices. As 4rots2y pointed out/ 7+oney regulated by ad!inistrative prices fi6edfor goods loses the ability to regulate such prices and conseuently the ability toregulate plans.7 &t is in this conte6t that he concluded that 74he Soviet econo!y

is neither a !onetary nor a planned one.7 8f course/ raising prices producesinflation/ another capitalist disease. 4he total brea2don of planning is !ostevident in the s2yroc2eting inflation that rac2ed ugoslavia and Poland in thelate 19"0<s. 4he fact that the syste! does not or2 according to plan is tacitlyrecogni?ed by 5rnest +andel>

7=ithin the Soviet econo!y/ given the bureaucracy<s !aterial interests ingetting the !a6i!u! possible resources for the !ini!u! possible goalsfor the plan/ not only is open infor!ation beteen the enterprises and thehigher bodies not assured/ it is practically e6cluded. &t is even li!itedithin one enterprise. 4he bureaucratic !anage!ent syste! or2slargely on the basis of rong infor!ation/ as is recogni?ed by all thoseconcerned.7%

&f genuine planning is e6cluded by the !aterial interests of society<s rulersthen so!e cause other than 7the planning principle7 !ust e6plain ho theecono!y or2s. 4he entire blac2 and grey !ar2et pheno!enon throughout theStalinist countries/ including factory e6pediters/ self#supplying/ and all/confir!s +ar6<s arning that the la of value is an ob@ective la that 7forciblyasserts itself li2e an overriding la of nature. 4he la of gravity thus assertsitself hen a house falls about our ears.7 "

C)!S=M7R ))DS

&n late 19"" the Soviet authorities ad!itted for the first ti!e that budgetdeficits had beco!e a habitual and serious proble!. 4hat is/ the state spends!ore revenue than it ta2es in/ resulting in a circulation of rubles in e6cess of thesupply of co!!odities available for consu!ers. 4his inevitably leads either toinflation/ as above/ or the ell#2non shortages


(. 4rots2y/ 74he :egeneration of 4heory .../7 Writin+s D19*2-**@A p. ))*.%. +andel/ 74he Significance of orbachev/7 .nternational ar!ist eieA =inter

19"%/ p. 1).". +ar6/ CapitalA Vol. &/ Chapter 1/ Section * Dp. %$E

&n response to !ass discontent the Soviet officials have at ti!es announcedtheir intention to increase the production of consu!er goods. 'ut even henthese announce!ents are included in the plans/ they end up not being carriedout. A typical account>

74he preceding five#year plan Dfor 19"1#"$E had e6plicitly targeted anincrease in the share of the consu!ption fund/ at the e6pense of invest!ent.'ut hen anticipated revitali?ation and increased effectiveness in the

invest!ent sphere did not !ateriali?e/ it proved necessary to increaseinvest!ents and !a2e cutbac2s in consu!ption.79

4his tendency too is accounted for by our national capital approach. 4hereason for syste!atic violation of 7planning priorities7 is that the role of

production goods is to increase the value of the state#oned capital/ hile theuse of consu!ption goods does not do soF if or2ers get to eat too !uch ofhat they produce/ accu!ulation suffers. So hen a choice has to be !ade

beteen priorities/ production goods inevitably in out. 4hat<s hy invest!entincreases 7prove necessary.7

Li2eise/ private consu!er goods production Dthe so#called secondecono!yE/ even though often far !ore efficient econo!ically/ does not add tothe state's capital. So these !ar2ets ere officially only tolerated DuntilrecentlyE/ although they are a syste!ic necessity that fills gaps in state

production. +ar6<s la that production gros faster in :epart!ent 1 Dpro#duction goodsE than in :epart!ent ) Dconsu!ption goodsE holds in stati#fiedcapitalis! @ust as in the traditional case. &t is a la of capital operating behindthe planners< bac2s.

An e6ception that proves the rule is vod2a/ a consu!er good producedunder state !onopoly that has brought in great profits. 4hat is hy it as oneof the fe consu!er products encouraged by the Soviet rulers/ despite itshar!ful effects/ and had alays been plentifully available. =hen orbachevtoo2 over as leader/ alcohol consu!ption as drastically discouraged. Sovietecono!ists had calculated that the cost to the state fro! industrial and traffic

accidents/ or2er absenteeis!/ disease/ etc. as about *0 billion rublesannually/ !ore than the revenue fro! vod2a. A capitalistic cost#benefitcalculation/ not concern for or2ers< health and safety/ caused the policy

shift.10

4he priority of production over consu!ption led to the Stalinist prac# BBBBBBBBBBBBBBBBBBBB

9. 'oris u!er/ 7ealities of orbachev<s 5cono!ic Progra!/7 Pro(lems o%CommunismA +ay#une 19"(.

10. etente o. (/ Spring 19"(F a(our 7ocus on &astern &uropeA +ay 19"(/ p. 9.4::



typically Dand unscientificallyE instruct each enterprise to produce a certain percentage above its previous target.

'ut fro! the local !anager<s point of vie the planned targets can best be!et ithout shutting don his plant for retooling 4here is no econo!ic

'ut this is a !isunderstanding. As e shoed in Chapter 1/ the -P does notoperate across the board by loering the profit rates of all capitals unifor!ly. &tloers the aera+e profit rate by bringing don the profits of the (ackard

fir!s 8n the orld scale since Soviet techniues nor!ally lag ell behind



!et ithout shutting don his plant for retooling. 4here is no econo!icco!pulsion for the !anagers to !oderni?e since they have no fear of beingforced out of business and no need to lay off e6cess or2ers. &n fact/ they needto 2eep e6cess or2ers on hand because of the periodic last#!inute drives to!eet production goals D7stor!ing7E/ !ade necessary by the absence of plannedsupplies. As a result/ accu!ulation in e6isting plants is al!ost alaysacco!plished by e6panding production under old techniues> hence the

proliferation of obsolescence. &f the central authorities ant !oderni?ation theyhave to build ne plants.

4his e6plains the fact that Soviet econo!ic groth has been largelye!tensieA in the sense that e6isting techniues are e6tended through the labor ofnely industriali?ed or2ers # as opposed to intensieA hich reuires theadvance of productivity through the displace!ent of living labor by capital. Arecent econo!ic survey of the 19)"#19"$ period noted>

7:uring the entire period/ but !ore so ith ti!e/ Soviet groth is generated by high rises in inputs and declining groth of overall input productivity. ...4he relative contribution of inputs to groth gre to "0 percent in the postar

period and beca!e its sole co!ponent fro! 19%0 on/ hen productivityco!pletely stagnated or even retreated.713

4hat is/ declining overall groth has been acco!panied by increases in the proportion of resources give to industrial invest!ent. 4he predo!inance ofe6tensive accu!ulation not only hurts the Stalinist syste! in its rivalry ith the=est. &t also has its on li!its to e6pansion/ the availability of ra !aterialsand labor # and the Soviet authorities are running out of both. 'ut thefunda!ental reason for declining groth lies deeper.

T>7 &RP A!D &,CT,T,)=S CAP,TAL

:eclining econo!ic groth rates are characteristic of the long#ter!develop!ent of capitalist society in general> they reflect the falling rate of profittendency D-PE. As in the =est/ the -P is !ost visibly e6pressed as a fallingrate of capital accu!ulation> since invest!ent funds for increased groth co!eout of surplus value DprofitE/ hen the rate of profit falls the rate ofaccu!ulation necessarily falls ith it.

&t !ight be argued that the -P cannot apply under Stalinis! because itderives fro! the capitalist drive for accu!ulation through increased

productivity/ a tendency hich is so severely distorted in the Soviet syste!. BBBBBBBBBBBBBBBBBBBB

13. ur 8fer/ 7Soviet 5cono!ic roth> 19)"#19"$/7 Eournal o% &conomic iteratureA

:ece!ber 19"%/ p. 1%")

fir!s. 8n the orld scale/ since Soviet techniues nor!ally lag ell behindinternational standards/ the Soviet econo!y is a pri!e e6hibit of the -P inoperation.

4he !ain countertendency to the -P/ the devaluation of fi6ed capital/ isinhibited because Soviet fir!s have rarely been forced to liuidate. 4his shosagain ho the -P do!inates in this epoch even !ore forcefully than underclassical capitalis!. Statification inhibits the trans!ission of capitalis!<s las

but it does not abolish the!. Since protected obsolete fir!s are overvalued/ thefalling rate of profit tendency is carried out through the !ediu! of fictitiouscapital. 4he Soviet e6a!ple reinforces our interpretation in Chapter ) thatfictitious capital is central to the operation of the -P in the epoch of capitalistdecay. &t stri2ingly illustrates +ar6<s co!!ent that if accu!ulation ere left togiant capitals/ 7the vital fla!e of production ould die out.7

Abel Aganbegyan/ the Soviet econo!ist ho as a leading adviser toorbachev/ in effect observed the -P in action during the 7stagnation7 periodDthe label given by orbachev<s folloers to the 're?hnev yearsE> 74he rate ofgroth of all indicators of efficiency in social production sloed don> ineffect the productivity of labor did not increase and return on capitalinestment %ell 14

Another Soviet econo!ist illustrates fictitious capital this ay> 74he present financial syste! is based/ in !any respects/ on inflation !ethodsof financing. State inco!es and e6penditure are !ere fiction/ thin air/

presenting an illusion of !oney ith no !aterial security behind it. 4he!ost obvious !anifestation of such a situation is the levying of ta6esfro! enterprises to the budget/ ell (e%ore their output is sold andirrespective of hether it ill be sold. A si!ilar role is played by thecrediting of industrial and agricultural enterprises/ hich has !ore orless turned into pure irrevocable financing Dthe pu!ping of e!pty!oney into the econo!yE. 4he debts of agricultural enterprises alonea!ount to around 1*0/000 rubles. 8ne of the gravest conseuences of

such <inflated< financing is the nu!ber of launched construction pro@ectsin the country/ hich is nearly three ti!es the a!ount e can afford.7 1$

aturally/ if so !uch capital is invested in pro@ects hich cannot pro#


1*.Aganbegyan/ The &conomic Challen+e o% Perestroika D19""E/ p. 3 De!phasisaddedE.

1$.i2olai Sh!elev/ osco :esA o. (/ 19"".

4:-

duce useful output/ then the overall rate of profit is bound to be forceddonard. =hile the boo2s can be coo2ed so that a fictitious profit is reported/the declining rate of accu!ulation has a !aterial reality that cannot besuppressed forever -ictitious capital in the 5ast as in the =est is a device for

struction pro@ects half#finished. 8verproduction is !ost visible on theinternational scale in the Co!econ econo!ic bloc/ hich !a2es fe pre#tensions to coordinated planning. 5ach country 7needs7 its on steel !ill/ fore6a!ple !a2ing overproduction of euip!ent and the conseuent shortage of



suppressed forever. -ictitious capital/ in the 5ast as in the =est/ is a device forupgrading the profitability of certain sectors of capital at the e6pense of othersor of capital as a hole. &t indicates that the failure to shut don obsoleteenterprises is not a progressive but a reactionary aspect of the syste!.

-ictitious capital flourishes in the Soviet syste!. &f the Soviet ruble eresuddenly !ade convertible ith the currencies of the =est/ !ost Soviet goodsould plunge in valueF the econo!y ould be in chaos. 4he state !onopoly of

foreign trade/ introduced after the revolution to defend the bac2ard Sovietor2ers< state fro! i!perialis!/ is still necessary in the present#day Sovietsyste! but for a different reason> to defend the nationalist and sectoralistinterests of the bureaucracy. As a result/ over#protected Soviet enterprisescannot co!pete internationally.

=hy are Stalinist enterprises alloed to operate unprofitablyH 4his too is!ade clear by our 7capitalis! in one country7 approach. Closing don afactory that still functions/ even if inefficiently/ ould reduce the state capital<stotal value Dand ould also displace the local !anagersE. So it is preferable forsuch a fir! to stay in production and be subsidi?ed ith state funds # that is/through surplus value supplied by other fir!s. Accu!ulation of ne dead laboris sacrificed to preserve the value of the old. And raising the overall rate of

profit is sacrificed in the atte!pt to preserve the value of the national capital asa hole.

)V7RPR)D=CT,)! A!D CR,S7S

:espite the enor!ous apparatus devoted to bureaucratic planning and theeli!ination of !ost direct co!petition for !ar2ets/ there is still intenseco!petition a!ong !inistries and enterprises for !aterials and labor. 4heresults are surprisingly often parallel.

-or e6a!ple/ under traditional capitalis! the unplanned nature of the syste!Dindependent capitals producing for an i!precisely 2non !ar2et underuncertain conditions of supply and de!andE leads to periodic overproduction.,nder Stalinis!/ there is uncoordinated planning by co!peting fir!s and!inistries producing for an i!precisely 2non !ar2et and anarchic conditionsof supply. 'oth pheno!ena derive ulti!ately fro! the capitalist drive to e6pand

production beyond all bounds.8ne result of Stalinist 7planning7 is the continuous overproduction of capital

goods/ since every !inistry see2s a groing share of the state budget to e6pandits on do!ain. Such a situation as e6posed to vie during the 19"0#"1 crisisin Poland/ hen the regi!e as forced to cut bac2 on borroing fro! the =estand had to leave its overa!bitious con#

e6a!ple/ !a2ing overproduction of euip!ent and the conseuent shortage ofsupplies inevitable. Co!econ is living proof of the co!petitive national capitalcharacter of Stalinis!. As !uch as traditional capitalis!/ the Stalinistecono!ies are driven/ as +ar6 observed/ by the !otto/ 7Accu!ulate/accu!ulateO 4hat is +oses and the prophetsO7

Stalinist overproduction is hidden by the fact that there are tangibleshortages of consu!er goods/ for reasons already discussed. +any consu!er

goods/ hoever/ are overproduced in unanted for!s or of poor uality andtherefore languish on the shelves or never reach the!. eports of arehousesfull of unusable goods are plentiful. 4hat !ar2et forces do not prevent this doesnot !ean that overproduction is not at or2.

4here is a reason for the difference beteen the to variants of capitalis!.&n traditional capitalis!/ overproduction is periodicF it is brought to a halt bythe syste!ic crises that eventually ipe out the e6cess capitali?ation ofunprofitable fir!s. ,nder Stalinis! here unprofitable fir!s are not thronout of business/ the overvaluation continues and the crisis is not resolved. 4hatobsolescent enterprises survive shos that the Stalinist syste! suffers fro! acontinual pressure toard crisis. 'ut if the la of value is not alloed to forcethe syste! to restructure/ that tas2 is thereby left to inescapable !aterial factors

li2e the availability of ra !aterials. 4hese finally force the bureaucrats to cut bac2 invest!ent and call a halt to e6cessive construction and production

[email protected](

4hen the cycle begins again/ but ithout having acco!plished the cathartic benefits for the bosses that it ought to provide # disciplining inefficient fir!sand generating une!ploy!ent to induce or2ers to capitulate. +ar6 rote that7per!anent crises do not e6ist7 because crises nor!ally lead to the destructionand devaluation of a part of the e6isting capital. Crises are the solution/ ate!porary bloodletting/ not the proble!. 'ut under Stalinis! the crises arenever fully resolved/ so they continue ith the effect of per!anence.

Since crisis is an essential co!ponent of a +ar6ist analysis of capitalis!/

those ho say the Soviet syste! is not capitalist have over and over againargued that crises are not a proble! there. A typical ob@ection co!es fro! anacade!ic +ar6ist ho clai!s that/ hereas 7capitalis! has a tendency tochronic under#invest!ent7 because of its !illions of une!#


1(.4he 7ra !aterials barrier7 as first analy?ed in 19($ by Juron and +od?eles2iin their 78pen Letter to the Party.7

1%.+ar6/ Theories o% Surplus )alueA Vol. )/ p. *9%.

4:8

ployed/ 7socialis!7 generates 7chronic over#invest!ent.7 Goever/ capitalistunderinvest!ent in ti!es of crisis is a result of overproduction Dand thereforealso of overinvest!entE during its cyclical boo!s. 4he author also recogni?esthe 7very broad !argins of unutili?ed capital euip!ent in !any industries7 in

une!ploy!ent doubled fro! early 19"0 to late 19"1F in addition/ 7the threat ofdis!issal no hangs over the heads of 100 !illion age earners in China.7))

So !uch for @ob security and guaranteed !ini!u! ages.=henever he ad!its the e6istence of the Stalinist crises +andel denies



the very broad !argins of unutili?ed capital euip!ent in !any industries inthe 5ast # a situation parallel to =estern capitalis! in crisis periods and anindication of the underinvest!ent that results fro! overproduction.

+andel has been !a2ing si!ilar argu!ents for decades. &n 19(" he rotethat the Soviet econo!y 7escapes co!pletely7 fro! the las of capitalis! and7is e6e!pt fro! the fluctuations in the con@uncture of orld econo!y.7 19 Gerepeated in 19"0>

74he countries ith planned and sociali?ed econo!ies hae not been hit by the sa!e pheno!ena that have/ ithout e6ception/ !ar2ed all theindustriali?ed capitalist countries> a recurring absolute decline inindustrial production during the phases of recessionF !assive une!ploy#!entF the shutdon of nu!erous enterprises and the collapse of hole

branches of industryF the accu!ulation of huge uantities of unsalableco!!odities.7)0

4o years later/ as the reality of crisis in the Stalinist states beca!eapparent/ +andel ad!itted 7the e6ception of Poland7 but uic2ly added that it7has been hit by a crisis of underproduction and not overproduction7 # in orderto distinguish the Soviet syste! fro! capitalis! .)1 5ven if this interpretationere true/ it ould hardly reflect a progressive !ode of production>

underproduction is a plague of pre#capitalist/ pre#industrial societies/ notindustriali?ed 7post#capitalist7 countries li2e Poland.

+andel !a2es even !ore contradictory argu!ents about China. Ge insiststhat China is still progressive because of the fact 7that labor poer is no longera co!!odity/ that there is no longer a labor !ar2et in China/ that or2ers have

@ob security and a guaranteed !ini!u! age.7 'ut he also rites of 7theenor!ous e6tent of rural une!ploy!ent and urban une!ploy!ent/7 7the rise ofyouth une!ploy!ent/7 the ten percent of Chinese peasants 7ho do not eatenough to still their hunger7 and inflation rates of 1$ to )0 percent. &n a

postscript he adds/ 7As a result of retrench!ent/ thousands of factories have been idled or shut don7 so that urban BBBBBBBBBBBBBBBBBBBB

1". :.+. uti/ 74he Contradictions of Socialist 5cono!ies> A +ar6ian &nterpretation/7Socialist e+isterA 19%9F p. )*9.

19. +andel/ ar!ist &conomic TheoryA Vol. )/ pp. $(1#).)0.+andel/ 74he &!pact of the =orld Capitalist ecession on 5astern 5urope/7

.ntercontinental PressA uly 1*/ 19"0.)1. +andel/ 74he Second Postar =orld ecession/7 .ntercontinental PressA une )"/

19")

=henever he ad!its the e6istence of the Stalinist crises/ +andel deniestheir lafulnessF he bla!es the! on the orld capitalist crisis or !is!an#age!ent by the ruling bureaucracies rather than on internal las of the syste!.&t is true that the econo!y of a s!all country li2e Poland or one longvicti!i?ed by i!perialis! li2e China ill be inevitably buffeted by its !ore

poerful neighbors. And there is no doubt that the bureaucrats !is!anage. evertheless/ +andel<s clai! that 7post#capitalist7 societies are not sub@ect to

capitalist conseuences collapses in the face of reality.

=!7MPL)#M7!T

4he preservation of obsolete capital is officially called a socialist principle because it !aintains full e!ploy!ent. 4he policy of @obs for all/ althoughdistorted by the vast aste of labor/ is indeed one of the fe gains hich ca!eas a conseuence of the or2ers< revolution that the Soviet or2ers did not losein the counterrevolution. 'ut it is no accident that this surviving revolutionaryachieve!ent turns out to be the one that fits the bureaucracy<s nationalist andlocalist goals # or did fit the! before its toll on the statified capitalist econo!y

beca!e clear.&n this respect the Soviet syste! functions in e6actly the opposite ay fro!

a genuine or2ers< state/ hich ould ai! to close out!oded plants as uic2lyas possible. e techniues ould be introduced and generali?edF fulle!ploy!ent ould be !aintained by the progressive di!inution of or2inghours as labor productivity i!proves B not by 2eeping productivity bac2ard.A or2ers< state has as its goal the self#eli!ination of the or2ing class/ not its

preservation for e6ploitation.Soviet planners and !anagers openly co!plain about their dissatisfaction

ith full e!ploy!ent> they cannot use !ass layoffs to discipline the or2force. 4heir co!!ents are re!iniscent of a Sedish business!an<s co!plaintsabout West 5uropean e!ploy!ent policies>

7&n the ,.S. you can still fire people if you don<t need the!. &n 5uropeyou can<t reduce your or2 force through dis!issals unless a business ishopeless ... . Goever/ ell#!anaged 5uropean fir!s have learned !oreabout or2ing ith their e!ployees because you can<t dispose ofthe!.7)3

Seden is untypical ith its s!all/ speciali?ed econo!yF !oreover/ orthern 5uropean fir!s do !anage to fire 7guest or2ers7 fro! south# BBBBBBBBBBBBBBBBBBBB

)). +andel/ 7China> the 5cono!ic Crisis/7 Socialist e+isterA 19").)3. Pehr yllenha!!ar of Volvo/ :e Hork TimesA -ebruary 3/ 19"%.

4:9

ern 5urope and the third orld hen they need to. evertheless/ there isconsiderable si!ilarity over @ob security beteen the !ar2et#oriented 5ast andthe social#de!ocratic countries of the =est. 4he Soviet !anagers/ hoseecono!y is not as prosperous as Seden<s or Austria<s ould !uch prefer

e!ploy!ent e6isted and still e6ists> concealed/ structural/ seasonal/te!porary. &t is only no that e have learned about the !assiveune!ploy!ent in Central Asia.7)$

4he sa!e paper reports that as a result of ne layoffs under perestroi#2a in



econo!y is not as prosperous as Seden s or Austria s/ ould !uch preferune!ploy!ent policies li2e those of the !ore socially bac2ard countries ofthe South and the =est Dincluding the ,.S.E to hat they have no/ and they areta2ing steps to get it.

&t is indeed a ea2ness of Stalinist capitalis! not to be able to deploy thereserve ar!y of une!ployed or2ers as a bra2e on proletarian co!bat#ivityF theconseuences ere seen in Poland in 19"0#"1. 4he Stalinists/ of course/ rely

heavily on police !easures to restrain the or2ers B as did a?i er!any/hich also achieved full e!ploy!ent. 'ut a police state is an inefficientecono!ic toolF a stic2 ithout a carrot/ it offers or2ers no incentive to or2harder. +aintaining full e!ploy!ent is a policy that goes hand in hand ithenterprises that are typically over!anned and labor productivity that isnotoriously lo. Labor intensification/ including slave labor/ as usable as asubstitute for capital only at a pri!itive stage of industrial develop!ent.

ot every 7socialist7 state !aintains a full e!ploy!ent policy. ugoslaviasuffers one of the highest une!ploy!ent rates in all 5urope/ 5ast or =est.China too/ in the after!ath of +ao<s death/ as revealed to have a per!anentreserve ar!y of une!ployed/ despite the volu!inous testi!ony by =esternsycophants about !asses of ever#so#contented people. &n both countries the

Stalinist !odel of national accu!ulation is strongly !odified by provincialindependence and ineuality. =hen or2ers fro! one province find @obs in aricher one or outside the country/ the rulers still gain fro! ages sent bac2ho!e or straightforard labor contracts signed ith foreign fir!s.

5ven the ,SS has revealed so!e startling figures under the cli!ate oforbachev<s glasnost DopennessE policy. ,ne!ploy!ent is no ad!itted toe6ist/ at least in so!e regions and a!ong so!e categories of or2ers.According to Soviet sources in 19"%/ there ere )00/000 une!ployed in4ad?hi2istan/ over a !illion in ,?be2istan Dfor an une!ploy!ent rate of over10 percentE/ and )$0/000 in A?erbai@an Dagain at a 10 percent rateE. &n 'a2u/ theoil#producing capital of A?erbai@an/ the adult une!ploy!ent rate is 1)

percent.)*

Confir!ation co!es fro! &gor Iaslavs2y/ head of the e!ploy!ent sector atthe esearch &nstitute of Labor in +osco. 7=e<ve been brought up on Stalin<s<full e!ploy!ent</7 he said>

7'ut e plugged our ears and turned a blind eye to reality. ,n# BBBBBBBBBBBBBBBBBBBB

)*. Cited by Ale6ander A!erisov/ .n These TimesA Septe!ber 9/ 19"%

4he sa!e paper reports that/ as a result of ne layoffs under perestroi#2a/ inthe republic of +oldavia the nu!ber of une!ployed or2ers is esti!ated at1$0/000/ appro6i!ately seven percent of the or2 force. 'ut the figure cannot

be chec2ed/ because according to the govern!ent nespaper .3estiaA

78fficially/ there is no une!ploy!ent in this country. 4he status of theune!ployed has not been defined and there are no figures.7

&n addition to the !isery bred by une!ploy!ent itself/ the fact that it is still

officially concealed !eans that labor force planning is all the !ore fictional. &fthe e!ploy!ent statisticians don<t have reliable infor!ation/ plans based onlabor allocation have no scientific basis.

W)M7! W)R?7RS

4he co!parative situation of !en and o!en or2ers is one of the !ost pivotal indicators of social relations. &n the ,SS/ !ore o!en or2 outsidethe ho!e than in the =estF nevertheless o!en earn on the average (0 to %0

percent of hat !en earn/ a si!ilar ratio to that in the ,nited States and

'ritain.)( =o!en tend to or2 in distinct industries and @ob categories/especially those reuiring less training # despite the fact that their average level

of education is higher.)% 4hat results fro! outright discri!ination in hiring asell as fro! the often e6plicit assu!ption that o!en !ust carry out the great

bul2 Dif not allE of do!estic labor and child rearing. &t is another lafultendency of traditional capitalist society reflected in the Stalinist syste!.

So!e of the !ost oppressive !easures against o!en<s gains ta2en duringthe counterrevolutionary period ere reversed after Stalin<s death/ includingthose restricting divorce and abortion. 'ut discri!inatory conditions re!ain.orbachev cites +ar6<s observation that the degree of o!en<s e!ancipationreflects a society<s social and political level and boasts of Soviet achieve!entsin granting o!en euality and security. Ge goes on to sho hat Stalinis!<srefor!ers have in !ind/ hich has nothing in co!!on ith +ar6>

7'ut over the years of our difficult and heroic history/ e failed to pay

attention to o!en<s specific rights and needs arising fro! their role as!other and ho!e#!a2er ... =o!en no longer have enough ti!e to

perfor! their everyday duties at ho!e # houseor2/ the upbringing


)$. Iaslavs2y/ intervieed in osco :esA Septe!ber 10/ 19"9.)(. Alastair +cAuley/ Women's Work and Wa+es in the Soiet 5nion D19"1E/ p. )1.)%. :avid Lane/ Soiet &conomy and Society D19"$E/ pp. 1%3#%.

43:

of children and the creation of a good fa!ily at!osphere. =e have dis#covered that !any of our proble!s # in children<s and young people<s

behavior/ in our !orals/ culture and in production # are partially causedby the ea2ening of fa!ily ties and slac2 attitude to fa!ily

i?ed property conceals the operation and even the e6istence of value.8f course/ the la of value is i!peded under both Stalinis! and a genuine

or2ers< state. 'ut that doesn<t !a2e the to euivalent. A or2ers< stateattenuates the operation of value in the interest of the or2ers in the direction



by the ea2ening of fa!ily ties and slac2 attitude to fa!ilyresponsibilities. 4his is a parado6ical result of our sincere and politically

@ustified desire to !a2e o!en eual ith !en in everything. o/ inthe course of perestroi2a/ e have begun to overco!e this shortco!ing.4hat is hy e are no holding heated debates in the press/ in publicorgani?ations/ at or2 and at ho!e/ about the uestion of hat e shoulddo to !a2e it possible for o!en to return to their purely o!anly

!ission.7)" 5uality is a fine thing in !oderation/ apparently/ but it has gone too farO

8utrageously/ orbachev say that o!en<s hard#on gains are responsible fordeclines in Soviet !orals/ culture and production. So they had better get bac2 totheir 7o!anly !ission7 and do!estic duties. 4here are si!ilar ca!paigns inthe =est to restore traditional fa!ily values and thereby re#enslave o!en.orbachev<s ad!irers abroad ought to recogni?e that their hero has vies ono!en<s liberation as advanced as those of erry -alell and esse Gel!s.

-or so!eone ho clai!s the heritage of +ar6/ it is significant thatorbachev does not !ention the traditional +ar6ist solution for o!en<sdouble burden Ddo!estic plus age laborE> the deeper sociali?ation of do!esticlabor. D4he ,SS has better !aternity provisions and a !ore e6tensive netor2of child care facilities than/ for e6a!ple/ the ,.S./ but they are still inadeuate.Eorbachev<s re!ar2s point in the opposite direction. Ge is setting the stage forthreatening or2ing o!en ith une!ploy!ent/ supplying a conservativeideological rationale for driving up the intensity of labor # one of the !a@ortas2s of perestroi2a DChapter "E. As in the =est/ a ruling#class retreat on thecondition of o!en acco!panies a pro@ected assault on the gains of theor2ing class.

4 T>7 LAW )& VAL=7 =!D7R STAL,!,SM

Gaving seen the conseuences of the la of value under Stalinis!/ e turn

to the la itself. As e shoed in Chapters 3 and */ the la of value asinherited by the Soviet or2ers< state and could not be uic2ly overco!e/ giventhe revolution<s isolation and bac2ardness. 4he counterrevolution enforced thee6ploitation of the or2ing class/ thereby bringing the la and its conseuencesinto full play. 'ut the continuation of national#


)". orbachev/ Perestroika D19"%E/ pp. 10)#3

attenuates the operation of value in the interest of the or2ers/ in the directionof co!!unis!. Stalinis! distorts value to help e6ploitation survive. =hereas aor2ers< state opposes the la of value consciously/ Stalinis! interferes ith it

blindly but lafully. Statified capitalis! only intensifies the syste!<s las ofdecay.

=e focus on the various for!s of denial of value by +ar6ists. Several arevariations on one the!e> the la of value is not an ob@ective la that governs

production 7behind the bac2s7 of the producers and planners/ but a techniuethat planners can use to decide hat and ho to produce. So!eti!es they useit ell/ often badly/ but it is theirs to use or not. 4he rulers and their theorists

believe that they plan according to use#value needs # and only e!ploy value/ orallo it to operate/ to organi?e use#value production. 4his the!e is the

practical application of the notion that the la of value is the rational ay torun an econo!y.

CAP,TAL &L)WS

4he la of the euali?ing tendency of the rate of profit under capitalis! isoften invo2ed to prove that Stalinis! is not governed by the la of value.Stalin/ to begin ith/ too2 profit euali?ation as the defining la of capitalist

econo!y and argued that it represented a significant difference beteencapitalis! and the ,SS>

74otally incorrect... is the assertion that under our present econo!icsyste!/ in the first phase of develop!ent of co!!unist society/ the laof value regulates the <proportions< of labor distributed a!ong thevarious branches of production. &f this ere true/ it ould be inco!#

prehensible hy our light industries/ hich are the !ost profitable/ arenot being developed to the ut!ost/ and hy preference is given to ourheavy industries/ hich are often less profitable/ and so!eti!es alto#

gether unprofitable.7)9

4otally idiotic/ hoever/ is any assertion about +ar6is! that doesn<t

recogni?e that capitalis!<s la of value did not prevent it fro! developingheavy industry 7to the ut!ost.7 As e have seen/ the Soviet econo!y today isdo!inated by heavy industry and continues to favor it hatever the plansdecreeF that is the capitalist nor!. &n asserting that Soviet planning controls theflo of invest!ent capital and concentrates it in heavy industry/ Stalin/contrary to his intention/ is illustrating the +ar6ist la of the accu!ulation andconcentration of capital reflected in the


)9. Stalin/ &conomic Pro(lems o% Socialism in the 5SS D19$)E/ Chapter 3.434

do!ination of :epart!ent 1 over :epart!ent ).As ell/ in clai!ing that light industries are 7!ost profitable/7 Stalin is

recalling +ar6<s point that industries of lo organic co!position produceproportionately !ore surplus value. 'ut he forgets the la of profit

the state/ the las of capital concentration and centrali?ation have beencancelled. 4he Soviet econo!y/ far fro! 7escaping co!pletely7 fro! capi#talis!<s las/ instead fulfills the! in a for! suitable to the epoch.

&t is re!ar2able that the !asters of state property/ even though they are told



proportionately !ore surplus value. 'ut he forgets the la of profiteuali?ation> the surplus value produced by a given enterprise is not the sa!e asthe profit it obtains on the !ar2et. -or +ar6 there as nothinginco!prehensible about surplus value floing to heavy industry> capitalis!cannot accu!ulate otherise.

Stalin<s intervention into theoretical disputes has been echoed by analystsho ought to 2no better. -or e6a!ple/ +a6 Shacht!an cited the above

passage fro! Stalin and gave his opinion> 74his is very ell put/ and no +ar6istcould reasonably uarrel ith it. 4he acade!ic e6pert Alec ove agrees>7Stalin in his last or2 !ade the point clearly enough> in a situation in hichresources could be !uch !ore profitably devoted to light industry than to heavyindustry/ resources none the less go to the latter.731 ove notes that Sovietfactory prices are set by the planners to yield higher profits for productiongoods than for consu!er goods and bla!es 7politically deter!ined plan#

priorities7 # but he cannot see that there is lafulness to such politicaldeter!ination. 4hen there is 5rnest +andel>

7Capitalist econo!y/ sub@ect to the tyranny of profit/ develops inaccordance ith uite precise las # tendency of the rate of profit to fallFflo of capital into sectors ith rates of profit higher than averageF

concentration and centrali?ation of capital leading to the see2ing of!onopoly super#profit/ etc. # fro! hich result the particular features ofits present#day phase. Soviet econo!y escapes co!pletely fro! theselas and particular features. ... :espite the huge accu!ulation of <capital<in heavy industry/ invest!ents continue to go pri!arily into this sector/instead of spilling over !ore and !ore into the !arginal sectors/ ashappens in capitalist econo!y in its declining phase.7 3)

+andel echoes the fallacy that high profit rates and therefore capital in acapitalist econo!y are attracted to industries ith lo organic co!positions ofcapital. Ge adds an argu!ent about the pro!inence of !arginal B i.e./ astefuland unproductive # sectors/ in the declining phase of capitalis!. 'ut it isludicrous to i!ply that Soviet invest!ent avoids aste #or that in this epoch/ith invest!ent do!inated by giant enterprises and


30. Shacht!an/ 7Stalin on Socialis!/7 The :e .nternational D19$)E/ pp. )91#).31. ove/ The Soiet &conomic System D19%%E/ p. 1"(.3). +andel/ ar!ist &conomic TheoryA Volu!e )/ Chapter 1$/ pp. $(1#). +andel<s

argu!ents that the ,SS cannot be i!perialist are o!itted fro! this passageF theuestion is covered in the ne6t chapter

&t is re!ar2able that the !asters of state property/ even though they are told by theorists that they have the poer to escape capitalis!<s las/ neverthelesssee! conde!ned by so!e !ysterious force to obey the!. ust as 7capitalistco!!unis!/7 the euali?ation of profit rates in the pre#!onopoly epoch/appears to violate the la of value but only does so on the basis of the la ofvalue itself/ the sa!e is true of the Stalinist syste!. And @ust as the

proportionate sharing of surplus value by the capitalists creates the illusion that

capital itself # not labor poer B is productive/ so does the statification ofcapital produce the illusion that state property is independent of econo!icrestraint. 4he illusion is strongest in the !inds of !iddle#class +ar6ists hosee the state as the agency for the benevolent allocation of society<s resources.

T>7 TW)'S7CT)R T>7)R#

Another favorite argu!ent is that in the Soviet syste! the !eans of production are not co!!odities B unli2e consu!er goods hich are stille6changed for !oney. 4hat is/ the la of value is said to apply only in theconsu!er goods sector. 4his distinction beteen the las of state and private

production as originated by Preobra?hens2y and/ after the turns and tists ofthe 1930<s ere over/ as adopted by Stalin hi!self> 7As a !atter of fact/

consu!er goods/ hich are needed to co!pensate the labor poer e6pended inthe process of production/ are produced and reali?ed in our country asco!!odities co!ing under the operation of the la of value. &t is precisely

here that the la of value e6ercises its influence on production.733 -or Stalinthe la of value governs only consu!er goods because they are produced for a!ar2et. +andel also holds that an econo!y can be disconnected into publicand private sectors. &n a revealing discussion/ he develops the difference

beteen state and private distribution to an absurd conclusion>7&n distinction to the distribution of capital goods a!ong the stateenterprises/ distribution of consu!er goods a!ong individuals is notregulated by the plan. 4hus/ or2 perfor!ed in the enterprises producing

consu!er goods is not auto!atically social labor recogni?ed as such. A portion of these products !ay prove unsalable. 4heir use#value cannot be reali?ed if their e6change#value is not reali?ed. 74he Soviet or2erscannot use a suit if it is too e6pensive ... And/


33. Stalin/ &conomic Pro(lems o% Socialism in the 5SS D19$)E.

43-

if the gar!ent re!ains unsold/ the labor e6tended for its production is pure loss. &n contrast/ nothing prevents the state fro! !a2ing use of!achinery even if its pri!e cost as e6tre!ely e6cessive. &n the firstcase the use#value is asted. &n the second case it is reali?ed. 4hat is a

4he value e6pended can be altered/ di!inished or as in +andel<s e6a!ple/destroyed. 4his is precisely the after#the#fact valuation characteristic ofco!!odity production. &t has nothing to do ith socialis! or social labor.:espite +andel/ the to depart!ents of production are inti!ately connected/



case the use value is asted. &n the second case it is reali?ed. 4hat is adifference hich no !ountain of !ore or less scholastic argu!ents candispose of either in theory or in practice.73*

+andel is absolutely right about the Soviet suit/ a typical e6a!ple ofoverproduction in any capitalist econo!y. &f it is too e6pensive for anyone to

buy/ its use value is asted and its e6change value is lost. Goever/ to test+andel<s opposite conclusion about Soviet !achinery/ consider the euip!ent

that as used in the production of that suit. Suppose/ ith +andel/ that such!achinery ere e6cessively costly. 4hese e6cess costs ould inevitably lead tooverly e6pensive suits/ for the value of constant capital is transferred to theco!!odities that it is used to produce. 4hus e6pensive production goods

produce e6pensive consu!ption goods.+andel insists that nothing prevents the state fro! !a2ing use of its

e6cessively e6pensive !achinery. 4his is true only in a for!al sense/ not inreality> the !achinery ould be used to produce piles of unused/ unsold goods.'ut i% the alue that a machine produces is astedA so is the alue o% the

machine itsel%$ 4he lu6urious !achine<s value !ay have been 7reali?ed7 by theenterprise that produced it hen it as sold/ but then the purchasing fir! andthe state as a hole have been sindled> they have not reali?ed the value paid

for the !achine. 4o blithely call the labor asted on the !achine 7social laborrecogni?ed as such7 clashes ith reality.

Soviet econo!ists 2no better. 8ne report says> 74he population hadenough !oney to buy/ they @ust refused to buy goods of bad uality. At thesa!e ti!e producers< goods also re!ained un!ar2eted/ or 2ept accu!ulating inso!e parts of the econo!y hen they ere badly needed in so!e other.73$ Andso does the Soviet bureaucracy. &n a speech to auto or2ers in 4ogliatti/ the7Soviet :etroit/7 orbachev arned that 7Vast labor and !aterial inputs !ayturn out to have been asted if the articles and goods !ade do not !eet !odernreuire!ents.3(

-urther/ consider +andel<s argu!ent that the distribution of capital goods/li2e the !achinery !a2ing unsuitable suits/ is 7regulated by the plan.7 4hatdoesn<t !a2e the goods any less co!!odities. 4hey are produced by one fir! to

be sold Dfor !oney/ even if the sale is assigned in advanceE to another/ hichuses the! to produce consu!er goods for a third/ and so on. :espite the plan/the result is not consciously controlled.


3*. +andel/ 74he Soviet 5cono!y 4oday/7 .nternational Socialist eieA une 19%).3$. Cited in +oshe Lein/ Political 5ndercurrents in Soiet &conomic e(atesA p. 1*3.3(. orbachev/ Soiet i%eA uly 19"(

:espite +andel/ the to depart!ents of production are inti!ately connected/integral parts of the sa!e econo!ic structure. ou cannot have value

production of consu!er goods ithout having it for producer goodsF onesphere cannot be socialist if the other is capitalist. +andel<s 7socialis! in halfan econo!y7 is even !ore unreali?able than Stalin<s slogan.

PR)D=CT,)! &)R =S7

4here is another co!!on argu!ent si!ilar to +andel<s> Soviet enterprisesare said to produce use values but not values because they are plannedaccording to physical criteria D7!aterial balances7EF the !onetary for!s thate6ist are si!ply leftovers fro! capitalist days/ or possibly the 5P period.Soviet !aterial balances and indicators are intended to govern the narrorelations beteen fir!s/ !inistries and enterprises/ etc. 'ut they have nothingto do ith use values. 4hey are devices used by the planners to !a2e the

producing fir!s confor! to the planners< intentions. 4hey specify one or a feaspects of production # gross output/ net output/ eight/ etc. # hich have to be!a6i!i?ed.

4here is a popular Soviet @o2e about a hardare factory hich/ hendirected to !a6i!i?e the eight of its output/ produced one gigantic nail. 4his

e6aggeration reflects une6aggerated reality.7Let us ta2e an e6a!ple. &t is ell 2non that the co!pilation of opti!alsche!es of freight ship!ent can yield a uite substantial saving. 4his isnot a co!plicated tas2. +any articles and boo2s have been ritten andnot a fe dissertations defended on the sub@ect. Still/ hardly any freightis shipped according to opti!al sche!es. =hy notH Si!ply because thetransport organi?ations/ contrary to the dictates of co!!on sense/ aregiven plans based on ton#2ilo!eters/ hile opti!al sche!es !ini!i?eton#2ilo!eters. 8ne can establish co!puter centers/ and conceive superbalgorith!s/ but nothing ill co!e of it as lone as transport organi?ationsrec2on plan fulfill!ent in ton#2ilo!eters. 3%

-or e6a!ple/ if truc2ers are told to !a6i!i?e the tonnage carried and thedistances traveled Dand are co!pensated accordinglyE/ they can do this ithout!a6i!i?ing socially useful labor # they can/ for e6a!ple/ ta2e long detours/carry e6cess eight bac2 and forth/ etc. Such a syste!/ far fro! being based onthe production of use values/ is precisely the opposite. &t is production ofvalues hich need not (e use alues at all. +andel<s suits


3%. Cited fro! a 19(* article in .3estia by to Soviet econo!ists/ in :avid :y2er/The Soiet &conomy D19%(E/ p. 3*.

438

and the related suit#!a2ing !achinery are additional illustrations.4his also happens/ of course/ under the la of value in traditional capitalis!

hen goods are overproducedF eventually a crisis ensues. &n the Soviet syste!/here one enterprise can often pass on its futile e6penses to another ithout

,nion as gross output/ !easured in rubles. 4his naturally encouraged the production of capital#intensive goods and discouraged attention to labor productivity or econo!ies in !aterial and euip!ent. ,nder 're?hnev it asshifted to 7nor!ative net output/7 !eaning nely produced value as opposed to



p p psuffering any conseuences/ it ta2es longer for the true value Dor lac2 of itE of aco!!odity to be learned. Gence the production of non#use values in value for!is even !ore prevalent than in traditional capitalis!. A vivid description of hothe Stalinist econo!y can produce for aste as given by a local Solidarityspo2es!an in Poland in 19"1>

74he govern!ent gives the or2ers directives/ <ou !ust produce this

!uchF you !ust or2 this long. 4his factory !ust produce this type ofshoes/ this style/ this a!ount.< 4here is no concern about use value. 4heor2ers produce. 4he stores !ust stoc2 the ite!s. 4he people/ hoever/refuse to buy. 4hen e end up asting everything> !oney/ !aterial/hu!an energy. -or hatH &t doesn<t serve any purpose.73"

&t serves no useful purpose to produce useless goods/ of course. 'ut it canserve the purposes of sectors of capital to gain value # if necessary/ fictitiousvalue. Stoc2 !ar2et sindles and other for!s of speculation are a grothindustry in the ,nited States/ 7asting everything7 and producing nothing.4hey survive because of the econo!y turns not on use value but on value/ acategory easily and often distorted # lafully. &t is necessary to recall that for+ar6 the la of value beco!es a restraint on productionF it is not the rational

distributor of resources it is ta2en for.4he necessity of 7stor!ing7 at the end of each planning period in order to

fulfill assigned uotas on ti!e also destroys the usefulness of use values. A'ritish reporter cited this e6a!ple>

7 <=e never use a scredriver in the last ee2/< one production lineor2er at a Lithuanian television factory told !e. <=e ha!!er thescres in. =e sla! solder on the connections/ cannibali?e parts fro!other 4Vs if e have run out of the right ones/ use glue or ha!!ers to fi6sitches that ere never !eant for that !odel. And all the ti!e!anage!ent is pressing us to or2 faster/ to !a2e the target so that eall get our bonuses.< 739

=or2ers in factories of the indisputably capitalist =est 2no ell thatuality and safety are often sacrificed in the interest of profitability. 4hat thesa!e occurs in the 5ast/ and as a result of the drive of the !anagerial

bureaucracy to !a6i!i?e its earnings/ is further proof of the anti#social Dandtherefore non#socialistE nature of Stalinist production.:espite all the additional indicators/ the pri!ary one in the Soviet


3". .ntercontinental PressA +ay )$/ 19"1.39. +artin =al2er/ The Wakin+ =iant D19"(E/ p. *)

p / g y p pptotal value. 4his shifted the bias to asting labor instead of capital # but it stillalloed value deter!inations/ hoever biased/ to overco!e use#value needs ofsociety.

=S7'VAL=7 T>7)R,7S

8ur for!ula that the Stalinist econo!y ai!s to preserve and !a6i!i?e the

value of the state#oned capital as a hole is superficially si!ilar to otheranalyses. A pro!inent neo#+ar6ist theorist/ yorgy +ar2us/ says that the goalof production under Stalinis! is 7the !a6i!i?ation of the !aterial !eans Das<use#values<E under the global disposition of the apparatus of poer as a unified

hole.7*0 Goever/ the bureaucrats do not care pri!arily hether the outputof their enterprises is actually usefulF they are rearded by uantitativeindicators/ not use value. +ar2us and others ho reason li2e hi! are deceived

by the deviation of the Soviet indicators fro! genuine value/ but distortion ofvalue is not the sa!e thing as use value.

+oreover/ on the theoretical level/ the unbounded increase of use values/unli2e the !a6i!i?ation of value/ is not an internally contradictory goalF if thesyste! ere accu!ulating use values by leaps and bounds Deven those of the

bosses and not the or2ersE it ould be a success. 4hus such a theory cannotaccount for the chronic failure of the syste! to actually produce the goods itsrulers need. *1 4he i!plication of use#value theories is that no revolution isneeded under Stalinis!> it is only necessary to incorporate refor!s andde!ocracy into the syste! so that use#value production can e6pand ithoutcontradiction.

Juron and +od?eles2i argued that the 7class goal of production7 inStalinis! is production for the sa2e of production/ 7to obtain the !a6i!u!surplus product.7*) 'ut they stressed that they !eant 7the surplus product in its

physical for!/7 not value. Although their theory analy?ed the Stalinist la of!otion in sufficient depth for the! to predict the contin#


*0.+ar2us/ 7Planning the Crisis> e!ar2s on the 5cono!ic Syste! of Soviet#4ype

Societies/7 Pra!is .nternationalA Vol. 1/ o. 3F also in ictatorship er :eedsA

ith -. -eher and A Geller.*1.Aside fro! this/the ma!imi3ation of use values is a !ista2en conception. As +ar6

pointed out/ hereas value is a uantitative property of co!!odities/ use value isualitativeF ithout value/ use values are not uantitatively co!parable. GCapitalA

Vol. &/ Chapter 1/ Section )/ p. *$E.*). Juron and +od?eles2i/ 7An 8pen Letter to the Party7 D+erit Publishers edition/

p. 3)E.439

ued decline of accu!ulation rates/ this !isconception prevented the! fro!foreseeing the tendency toard devolution of the Stalinist econo!ies toardstraditional capitalis!/ a tendency driven by the need to enforce value !oreaccurately in order to discipline bosses and or2ers Dsee beloE. 'ecause they

ti!e of ussian society as a factory oner vis#a#vis the labor of hise!ployees. &n other ords/ the division of labor is planned. 'ut hat isit that deter!ines the actual division of the total labor ti!e of ussiansocietyH &f ussia had not to co!pete ith other countries/ this division



y p D E ye6cluded value fro! their theory they overloo2ed its very real deter!ination of

production in the syste!.4his error as bolstered by their argu!ent that the !anagers for! a separate

class/ the 7technocracy/7 distinct fro! the 7central political bureaucracy/7 theruling class proper. D4he technocrats ere even said to be the ruling class inugoslavia.E Since it is the technocrats hose specific class ai! is to e6pand

value/ and since they are only the bureaucracy<s hired overseers/ Juron and+od?eles2i argued that the ruling bureaucratic class is under no co!pulsionto use value as a criterion of planning.

4he 2ernel of truth in the use#value theory is that in this epoch of stateecono!ic intervention/ the central authorities of every state/ 5ast and =est/strive to introduce use#value goals instead of !ere value accu!ulation. 'ut theatte!pt to bypass value inevitably falls victi! to the reality that capitalis! is

based on e6ploitationF value/ and the class struggle that acco!panies it/ distortsevery effort at conscious planning. And so even the Stalinist rulers/ as e illsee/ no 2no they have to strengthen value accounting in order to boost the

production of the goods they ant/ even if they do not 2no hy.

VALUE WITHOUT WAGE LABOR =hereas +andel/ +ar2us and JuronK+od?eles2i hold that value is in#

applicable to the Soviet syste!/ Cliff argues that the la of value is broughtinto the syste! fro! outside. Labor poer there/ he says/ is not a co!!odity

because the state is the only legal e!ployer. Ge identifies the division of laborunder Stalin ith that under the slave society of the ancient 5gyptian Pharaohs #it is 7different in degree but not in essence.7 4hat is because the Soviet or2eris not free in +ar6<s double sense. =or2ers are 7free7 of the !eans of

production # they do not on the tools they or2 ith. 'ut they are not free tochange e!ployers for better ages or or2ing conditions/ since every factory isoned by the sa!e boss/ the state. Cliff rites in his boo2 on the ,SS>

7Gence if one e6a!ines the relations ithin the ussian econo!y/ one is bound to conclude that the source of the la of value/ as the !otor andregulator of production/ is not to be found in it. &n essence/ the la

prevailing in the relations beteen the enterprises and beteen thelaborers and the e!ployer#state ould be no different if ussia ere one

big factory !anaged directly fro! one center/ and if all the laborersreceived the goods they consu!ed directly/ in 2ind. 74he Stalinist state isin the sa!e position vis#a#vis the total labor

y p /ould be absolutely arbitrary. 'ut as it is Stalinist decisions are basedon factors outside its control/ na!ely the orld econo!y/ orldco!petition. -ro! this point of vie the ussian state is in a si!ilar

position to the oner of a single capitalist enterprise co!peting ithother enterprises.7*3

As for Cliffs !onolith theory of a hole country as one big factory/ e

have already seen the independence and rivalry that e6ists ithin the Stalinist bureaucracy. 4his notion ignores the !aterial reality of decentrali?ation/co!petition and the labor !ar2et # and it also accepts the Stalinist planners<notions that the only restrictions on hat they can do are i!posed fro! outside.:ialectical !aterialis! dictates that every pheno!enon !ust funda!entally

be understood through its internal dyna!ic/ hich conditions the result ofe6ternal influences as ell. =e ill say !ore on the !onolith theory indiscussing See?y belo.

'ut Cliff has a orse proble!. &f his interpretation ere right then Sovietor2ers ould not be proletarians. &f they do not live by e6changing their laborfor ages/ then labor poer is not a co!!odity B so genuine ages/ andor2ers/ cannot e6ist. Cliff doesn<t dra this conclusion> it is too obviously

false. &n fact he spea2s of the Soviet or2ers as proletariansF he cites theirages/ rate of e6ploitation/ etc. 'ut he never e6plains ho this can be.

5lsehere/ in an article against Shacht!an<s bureaucratic collectivis!/ hecritici?es this theory for suggesting that the Soviet or2ers are not proletarian.7&f Shacht!an is right and there is no proletariat in the Stalinist regi!e/+ar6is! as a !ethod/ as a guide for the proletariat as the sub@ect of historicalchange/ beco!es/ superfluous/ !eaningless.7** 4his precise refutation ofShacht!an also refutes hi!self.

,nder any for! of capitalis! the second 7freedo!7 of the or2ers isillusory. 74he period of ti!e for hich he is free to sell his labor poer is the

period of ti!e for hich he is forced to sell it/7 +ar6 said aptly.*$ ,ndercapitalis! a or2er is free if he or she chooses # to starve. Soviet


*3. Cliff/ ussiaA a ar!ist <nalysisA pp. 1$%#9F State Capitalism in ussiaA pp. ))0#)1.

**. Cliff/ .nternational SocialismA o. 3). 8ddly/ this article as added to the 19""edition of Cliffs boo2. =e no can read on one page that Soviet or2ers aretanta!ount to slaves/ and on another that Shacht!an<s idea that slave labor isfunda!ental to Stalinis! is 7absolutely rong.7

*$. CapitalA Vol. &/ Chapter 10/ Section %.44:

or2ers have about as !uch freedo! to sell their on labor poer as anyothers> they can sitch e!ployers ithin the ,SS/ and they are often

persuaded by co!petitive ages and benefits to do so. Cliff hi!self provideddocu!entation for the i!!ediate post#Stalin period>

tively by another &S leader/ :uncan Gallas Dhere the 7e6ceptionalist case7!eans third#syste! theories of Stalinis!E>

7=hat is at issue here is nothing less than hether there is a proletariatDin +ar6<s senseE in the ,SS or hether there is not. 4o concede that



p p75ven prior to the decree of )$ April 19$(/ hich alloed or2ers tochange their @obs after giving a fortnight<s notice/ labor turnover too2

place on a large scale. 4hus/ according to 'ulganin/ )." !illion or2ersDout of so!e 1) !illionE left their @obs in ... industrial enterprises ... in19$*/ and 1.*$ !illion left building sitesF 90 percent of building or2ershave been in the trade continuously for less than $ years/ and (0 percent

for less than ) years.7*( +ore recently/ according to one =estern su!!ary/ )0 percent of industrial

or2ers and )" percent of construction or2ers leave their @obs each year onaverage/ and the figures are !uch higher # $0 to ($ percent # for those in the )0

to )$#year age brac2et.*% Another> 74here are ... a!ple statistics shoing that!illions of people change their @obs annually of their on volition/ as they havethe for!al right to do/ and !igrate fro! area to area in total disregard of the

planners< intentions.74rue/ and individual enterprises # also in disregard of the best#laid plans B

often bid for labor/ in effect recogni?ing that the lure of value is the onlyeffective ay to distribute labor according to need. -or e6a!ple/ the state pays!uch higher ages to lure labor to Siberia. =or2ers accept such offers not

because they are flighty and irresponsible/ as the bureaucrats and their acade!ic!outhpieces charge/ but because they are selling the one co!!odity they havefor the best deal they can get. Any or2er recogni?es this universal proletariancondition.

4he right of Soviet or2ers to change their @obs at ill as restrictedseverely during the fascis!#li2e ape6 of Stalin<s rule @ust after the triu!ph ofthe counterrevolution. &n Victor Iaslavs2y<s ords/ 7&t too2 only a little overtenty years to devolve fro! the 8ctober evolution/ hich declared factoriesto be the property of the or2ers/ to Stalin<s decree/ hich reduced or2ers to

property of the factories.7 4he restoration of the or2ers< right to change @obsafter the anti#Stalin revolts in the early 19$0<s as a !a@or victory. 'ut it also

serves the interests of the central bureaucracy in that it intensifies co!petitionfor labor and thereby co!pels enterprise !anagers to deal ith labor productivity.

4he Shacht!an position so!eti!es shared by Cliff as dissected effec# BBBBBBBBBBBBBBBBBBBB

*(. Cliff/ ussia < ar!ist <nalysisA p. 30%F he cites Soviet sources.*%. acues Sapir/ Traail et Traailleurs en 5SS D19"*E/ p. (0.*". ove/ The Soiet &conomic SystemA )nd edition D19"0E/ p. )0$.*9. Iaslavs2y/ The :eo-Stalinist State D19")E/ p. *%

D Ethere is not is to accept the substance of the <e6ceptionalist< case and tounder!ine the funda!ental basis of the bureaucratic state capitalistanalysis. &f labor poer is not a co!!odity in the ,SS/ then there is no

proletariat. +oreover/ if labor poer is not a co!!odity then there can be no age laborKcapital relationship and therefore no capital either.4herefore there can be no capitalis! in any shape or for!.7$0

56actly. 'ut Gallas could not ad!it that the proble! per!eates the entire &Stheory. Gis point as elaborated in a subseuent article by Ale6 Callinicos/ho correctly concluded 1E that age labor is necessary in capitalis!/ and )Ethat age labor genuinely e6ists in the Soviet ,nion #that is/ the pay!ent ofages for labor poer is not @ust an accidental for! !as2ing a really non#

proletarian content.$1 'ut Callinicos stopped short/ too. Ge did not dra theconclusion that if the producers are proletarians then they e6change their labor

poer for ages and in turn transfer value and add surplus value to the goodsthey produce for the capitalists. or did he notice that these goods are in factco!!odities/ since they contain the value the or2ers have given the! and are

produced for e6change a!ong the different enterprises and !inistries that!a2e up the Soviet national econo!y DCallinicos does observe that these

institutions co!pete for labor poerE. 4o do so ould under!ine Cliffs clai!that the la of value is not generated internally in ussia.

&n their halfay critiue/ Gallas and Callinicos are hardly original. rantingthe e6istence of age labor but not generali?ed co!!odity production is an oldidea/ as e have seen/ originating ith Stalin and given theoretical eight by+andel. 4he bourgeois e!pirical perspective si!ply notes that the e6istence ofages is a 7fact.7 'ut for +ar6ists age labor is !ore than @ust pay!ent forlaborF it is the sale of labor poer as a special co!!odity hose specificfunction Duse valueE is to transfer and add value to other co!!odities. 4hat ishy +ar6 insists that 7capital presupposes age#labor.7 D&n e6ceptional casesli2e the ,.S. South before the Civil =ar of the !id#19th century/ capital couldeven e6ploit slave labor # as long as the relation re!ained funda!entallycapitalistF that is/ as long as the tas2 of the slave as to add value toco!!odities.E


$0. Gallas/ .nternational Socialism o. 9 D19"0E.$1. Callinicos/ 7=age Labour and State Capitalis!/7 .nternational Socialism o. 1)

D19"1E.

444

Callinicos<s atte!pt to repair Cliffs theory by inserting age labor as the !odeof e6ploitation hile changing nothing else is only cos!etic. 4o get to the rootsof the proble! it is necessary to refute Cliffs theory that the la of value doesnot arise fro! internal forces in the Stalinist syste!. Callinicos instead notes

fro! the various enterprises and <Soviet< trusts/7 See?y replies>7&t is indisputable that under capitalis! the separate capitals struggle <forthe appropriating and accu!ulation of the largest possible fraction ofsurplus value.< &n an econo!ic sense this is a life#and#death struggle> the



politely that Cliffs 7fra!eor27 is still the basis for analy?ing state capitalis!.&n fact/ Callinicos<s ad@ust!ent !a2es Cliffs fra!eor2 collapse.

A telling anser to the denial of age labor is the account by the Gungarian poet and factory or2er/ +i2los Garas?ti/ originally titled Pieceork$ Gedescribes the effects on or2ers of the 7nor!s7 set by the bosses< ti!e2eepers>

7Ge ho sells his ti!e/ his strength/ his abilities for ages/ hether bit

by bit or for piece#rates or in a !ore transparent total for!/ 2nos that hedoes not or2 for hi!self. Ge 2nos that he has sold everything/including his right to deter!ine ho !uch he ill produce. 4he nor! isnothing other than the uintessence of those connections beteen !enthat the social scientists call the relations of production in age labor.,nder favorable circu!stances the age can be adeuate/ evengenerous> the nor!/ never. 4he nor! is the thinly veiled constraintithin the apparently voluntary fra!eor2 of age labor. &ncessantly itre!inds those ho drea! of a fair age of the true nature of age labor/so that as a result of the constant threat to our conditions of life/ e<freely< pave the ay to ever#groing output.7$)

=hat +ar6 and 5ngels did for factory or2 of the 19th century/ Garas?ti

does for the )0th> he describes not only the surface attributes of labor but alsothe !eaning underneath. And that is the sa!e for )0th#century 7socialis!7 asfor 19th#century capitalis!. =age labor e6ists to yield surplus value.

+andel<s for!ula that the Stalinist syste! co!bines 7post#capitalist relationsof production7 ith 7basically bourgeois7 relations of distribution DChapter 3E isal!ost precisely bac2ards. 4he relations of production are !ost clearlycapitalist/ based on the e6ploitation of age labor. 4he distribution relationsdiverge fro! bourgeois nor!s/ but they too stay ithin the 7infinite variationsand gradations7 that capitalist relations allo.

!)!'CAP,TAL,ST C)MP7T,T,)!

Another critiue of a capitalist analysis of the Stalinist syste! co!es fro!See?y. &n reply to 'ettelhei!<s assertion that a co!petitive struggle foraccu!ulation of value occurs 7through the de!ands for invest!ent credits andallocations of !eans of production hich continuously e!anate


$). Garas?ti/ < Worker in a Worker's State D19%%E/ p. 131

victorious capital thrives and absorbs s!aller and less successful onesFthe vanuished capital suffers ban2ruptcy and disappears. 'ettel#hei!euates this process ith the efforts of Soviet enterprises to get largercredits and allocations of !eans of production fro! the state ban2 and

planning co!!ission. ... &f this co!parison ere indeed a valid one/'ettelhei!<s argu!ent ould !a2e a very strong case for the real Das

distinct fro! the for!alE si!ilarity of the co!petitive processes inclassical capitalist and Soviet societies.7'ut in fact the co!parison is totally inappropriate. +anage!ents ofSoviet enterprises are not independent entities struggling to survive andget ahead in the @ungle of the capitalist !ar2etplaceF they are appointeesin a political bureaucratic structure/ hich is so!ething entirelydifferent. &f one ants a valid co!parison ith capitalis!/ it ould be

beteen the Soviet !anagers and the !anagers of subordinate units oflarge capitalist corporations li2e 566on or eneral +otors. 'oth groupsof course do co!pete a!ong the!selves/ and individuals can inadvance!ent or be fired. 'ut this has nothing hatever to do ith thesurvival andKor groth of the larger units on hich they are dependent.

'y clai!ing that these larger units are governed by the sa!e <las< in thecapitalist and Soviet syste!s/ 'ettelhei! is actually foreclosinginvestigation of hat are precisely the !ost funda!ental differences

beteen the to syste!s.7$3

See?y insists there is nothing co!parable about Soviet and =esternsocieties # and yet hi!self chooses to co!pare Soviet !anage!ents ith=estern corporate e6ecutives. Gis clai!s that the internal bureaucratic rivalrieson both sides are parallel but that there is no co!petition beteen capitals inthe 5ast. 'ut See?y<s analogy shos the opposite of hat he intends. 4hechief @ob of =estern !anagers is not to co!pete but to e6ploit proletarianlabor/ and in that role they are entirely co!parable ith their 5asterncounterparts.

As ell/ the la of value does operate ithin giant =estern fir!s.+onopolies sti!ulate co!petition beteen plants they on in order to pressure!anagers and or2ers to boost profitsF in ,.S. auto fir!s it is calledhipsaing. 8f course/ the conscious pushing of co!petition does


$3. See?y/ 7After Capitalis! # =hatH/7 onthly eieA uly#August 19"$. ote thatSee?y snea2s surplus alue bac2 into his description of capitalis! # as 7ind#isputable/7 to boot. &n onopoly Capital he had 7preferred7 a different 7concept.7

44-

not !ean introducing the la of valueF it si!ply reflects the de!ands of a laalready there.

ecall that for +ar6 co!petition is not the driving force of capitalis! butthe !echanis! for carrying out the underlying las of e6ploitation and

of Soviet econo!ists yielded to evidence and accepted that/ in all itssectors/ the Soviet econo!y as and is a co!!odity producer. 4his !eant thaton the hole the products ere e6changed and not @ust directly appropriatedand distributed. Producers could not appropriate products ithout selling their



accu!ulation. &n Stalinis! the !echanis! of direct co!petition has beenreplaced by pseudo#planning/ but the drive for accu!ulation still do!inates theecono!y. 4hat econo!ic units do not live and die according to theirco!petitive success is an intervention into the 7pure7 operation of the la ofvalue/ but it is on the basis of that la itselfF it e6tends the 7violations7 of valuethat apply in capitalis!<s !onopoly epoch.

See?y<s co!parison of Stalinist bosses ith =estern sub#!anagersillustrates this point> corporate units do get lopped off or shut don for reasonsof profit/ even if they are so!eti!es propped up by the parent fir! hen theiri!!ediate profits are poor. 4he propping up is characteristic of the Sovietsyste!/ and the shutting don has also begun to occur under the ne refor!s.

ot only is there a defor!ed co!petition beteen capitals in the 5ast but thereis a si!ilar pheno!enon beteen subordinate units of capitals in the =est. 'othoccur because even the largest capital can only age the class strugglesuccessfully through co!petitive !ethods. 4hey can hide the la of value/ butthey can<t hide fro! it for long.

T>7 ;=R7A=CRATS6 LAW )& VAL=7

&n contrast to +andel/ Cliff and See?y/ Soviet theoreticians after Stalin<sdeath deter!ined that value operates throughout the econo!y. =e ill discussshortly hat they !ean/ but first it is necessary # given the idespreadi!pression that Stalinist econo!y is independent of the la of value B to

prove that Soviet econo!ists indeed invo2e it. =e cite three =esternauthorities.

7&n the period 19$(#" there began a series of discussions on econo!ictheory and practice hich cul!inated in recognition of the fact that pricesould have to be based on the la of value as outlined by +ar6.7$*

74he econo!ics profession debated the scope and relevance of the <la ofvalue< in the Soviet econo!ic syste!. A large !a@ority ca!e to assert thatit operates throughout the econo!y/ including transactions ithin the

state sector/ and that Stalin<s contrary ideas ere rong.7$$

75ventually/ enough proof accu!ulated to sho that value categories stille6isted. Against the still very vigorous <anti!ar2eteers/< the !a@ority


$*. +arie Lavigne/ The Socialist &conomiesA pp. ))$#(.$$. ove/ The Soiet &conomic SystemA )nd edition/ p. 3*0

on in e6change. Pricing and !oney ere indispensable econo!ic categories/and the e6istence of the !ar2et/ albeit a <socialist !ar2et/< could no longer bedenied. ather/ all the necessary conseuences of this co!pelling realityshould be dran/ and practices based on negating such realities of Sovietecono!ic should stop.7$(

A pioneer theorist of such 7use7 of value as 8s2ar Lange/ a top

Stalinist econo!ic official in postar Poland. Ge rote>7+ar6 considered the <la of value< as a guiding principle hich illregulate the allocation of resources in the socialist econo!y. 4here is/ ofcourse/ a difference in the !ode of operation of the <la of value< undercapitalis! and under socialis!. ,nder capitalis! it asserts itself throughthe i!personal auto!atis! of the !ar2etF in a socialist society it servesas a nor!ative principle for the allocation of resources by the planningauthorities.7$%

+ar6 considered the la of value to be nothing of the sort/ as e sa inChapter 3. Lange<s rationalist approach is ideally designed for planning

bureaucrats ho prefer to ignore the conseuences of e6ploitation and classstruggle # until they find that/ la of value or no/ they too cannot avoid the

crises and decay of capitalis!.Go is the la of value 7used7H So#called 7value balances/7 openlye6pressed in !onetary ter!s/ are adopted to align the broad sectors of theSoviet econo!y.7Value balances ... deter!ine the ratios of the !ain ele!ents of theecono!y in !oney ter!s. Value balances of the national econo!y areused as a basis for establishing the !ost general socioecono!ic pro#

portions/ for e6a!ple/ the ratio beteen consu!ption and accu!ulationin the national inco!e/ beteen the output of !eans of production andconsu!er goods/ beteen the real inco!es of the population and their

provision ith goods.7$"

4he Soviet econo!y<s !onetary record#2eeping is so essential that it isinscribed in the ne 19%% Constitution. =e read in Article 1(> BBBBBBBBBBBBBBBBBBBB

$(. Lein/ Political 5ndercurrents in Soiet &conomic e(atesA p. 1%1.$%. Lange/ 7+ar6ian 5cono!ics in the Soviet ,nion/7 <merican &conomic eie

D19*$E.$". osplan Dthe Soviet state planning co!!issionE/ Soiet Plannin+ Principles and

Techni/ues D19%)E/ pp. "$#(.

448

74he econo!y is !anaged on the basis of state plans for econo!ic andsocial develop!ent ... and by co!bining centrali?ed direction ith the!anagerial independence and initiative of individual and a!alga!atedenterprises and other organi?ations/ for hich active use is !ade of

of each co!!odity/ assu!ing DfalselyE that this !easures the underlying laborti!e ith so!e appro6i!ation of reality. 'ut they apparently also ignore the

proble! of socially necessary labor and ta2e into account only hat aco!!odity has actually cost/ necessary or not. D4hat is another result of



!anage!ent accounting/ profit/ cost and other econo!ic levers andincentives.7 ot even the arch#capitalist ,nited States so blatantlye!braces the profit !otive in its ConstitutionF this bourgeois docu!enthides it under the nostru! of the 7pursuit of happiness.7Anti#value theorists are alays eager to point out that 7profit7 in Stalinist

countries is not the sa!e as in the =est> it is a planner<s category/ they say/ not

the result of true co!petition. 4rue/ Stalinist profit is a device used as asubstitute for co!petition to carry out the inner las of capitalis!. 'ut it too isdriven by the la of value and li!ited by the total a!ount of surplus valuee6tracted fro! or2ers. ust as capitalists thin2 that their profits arise not fro!e6ploitation but rather fro! co!petitive success/ so too the !iddle#class+ar6ists believe that the planners< profit is independent of value/ that is/ ofe6ploitation.

4he planners hope by 7ta2ing !ar2et realities into account7 to run theirecono!y better ith !ore accurate !easure!ent of the values of co!!odities.4hey cannot !easure labor ti!e scientifically/ given the co!peting separateinterests that bring about hoarding/ suppressing infor!ation fro! the center/etc. or do they have an even appro6i!ately adeuate !ethod to deter!ine

value after production/ as under traditional capitalis!. &n one sphere they havean easy solution> trade beteen 7socialist7 countries is conducted according toorld DcapitalistE !ar2et prices/ so each country can be sure that it is not gettingcheated. 4his !ethod cannot be so easily adopted internally/ lest the bureaucratsgive up all se!blance of control over their econo!y. 'ut all they can do henthey try to use the la of value for setting prices is to shift their proble! # fro!arbitrary pricing to inaccurate pricing.

+ar6<s theory/ after all/ as not designed to deter!ine precise prices but tosho the course of develop!ent of capitalism # above all its classcontradictions and i!per!anence. &t as not designed to be 7used7 # least of all

by those ho ould !ore rationally e6ploit the proletariat. Gence there asnothing in the +ar6ist boo2s about hat to do. 4he Stalinist theorists have hadto restle over uestions +ar6 ould never have thought to as2. :o e applythe original value of co!!odities or prices of productionH :o e ta2e intoaccount interestH entH Supply and de!andH All these proble!s arefunda!entally unanserable> they !ight @ust as ell debate ho to 7use7 thela of gravity in learning to fly by @u!ping off buildings and flapping theirar!s.

=hat the price#setting bureaucrats can do is loo2 at the !onetary cost

insisting that value is a rational/ not an ob@ective/ category.E 4hus they arrive at

the for!ula 7the higher the e6penditures/ the greater the price7$9 # a procedureguaranteed to !a2e prices increase across the board. 4his often forces the! tooffset price increases ith !assive subsidies/ hich beco!es less and less

possible as the crisis deepens.4he !easure!ent of value according to cost led a perceptive scholar to

co!e to a highly realistic overall conclusion>7'ecause of the uniue character of !any invest!ent pro@ects it is in

practice very difficult to value design and construction or2 e6cept in ter!s ofthe actual costs involved. 4hus crude output !a6i!i?ation can easily turn intocrude cost !a6i!i?ation. ... 4hus the area of the Soviet econo!y hich !ost

badly needs to get altogether aay fro! the cult of the gross is the one still!ost at its !ercy. =hile one can place the crudity of early Soviet industrial

planning into historical perspective/ and see a certain hesitant logic in thecourse of planning refor! since 19($/ e !ust no really raise the uestion ofhether Soiet inestment isA or eer has (eenA planned in any ayhatsoeer$7 (0

4he inability to plan according to value has led so!e Soviet Das ell as

=esternE econo!ists to re@ect the labor theory of value as having no relevanceto !odern society.(1 &nterestingly/ hen Soviet planners turn aay fro! thela of value because it doesn<t serve their purposes/ they then loo2 to the

bourgeois theory of !arginal utility. 'ut this too is an atte!pt to describe a laof capitalist society. Goever they flounder/ they see! unable to use any toolse6cept those derived fro! theories of capitalis! to run their econo!y.Appropriately/ it is the true las of capitalis! that rebound against the! anddestroy all their tools.

+ar6ist theorists ho deny the e6istence of value in the Stalinist syste!have a !a@or proble!. &f the la of value does not regulate the econo!y/ thenthe 7planning principle7 or so!e other !anifestation of hu!an consciousness

!ust do so. &f so/ hose consciousnessH 8bviously not the or2ers</ ho havelittle to say about ho the syste! runs. &t can only be the consciousness of the bureaucrats> the planners/ econo!ists/ etc. 'ut BBBBBBBBBBBBBBBBBBBB

$9. -ro! a 19"$ editorial in PradaA cited by u!er/ 74he Syste! # at =hat PriceH7/ Pro(lems o% CommunismA +ay#une 19"(.

(0. :avid :y2er/ The 7uture o% the Soiet &conomic Plannin+ System D19"$E/ p. 11(.(1. See u!er/ Pro(lems o% CommunismA +ay#une 19"(/ p. 30/ for both 5astern and

=estern viepoints.449

their understanding is that they operate under the la of value. 4hus denying thela of value leads right bac2 to it.8f course/ hen the planners< ideas prove inadeuate and the econo!y does notdevelop according to 7plan/7 it is because it follos capitalis!<s las behindh i b 2 h i l l h b i h h

8n the contrary/ +ar6 and 5ngels stated repeatedly that value as ini!icalto socialis! Dhile it ould only gradually be eli!inated under the transitionalor2ers< stateE. &n addition to our discussion in Chapter 3/ e can cite 5ngels<

pithiest state!ent>7 2 b li h h i li f f d i b bli hi <



their bac2s. 4here is no escape> value rules the bureaucratic econo!y/ hetherthe bureaucrats deny it or try fruitlessly to use it to strengthen their syste!.

7VAD,! T>7 LAW )& VAL=7

4he la of value as belatedly recogni?ed by Stalinist theorists/ ell after theyhad learned to ield it in practice against the or2ing class. 4hus ended an olddebate. 'u2harin had advocated that the la could be utili3ed by the plan/ since

value and plan ere non#antagonistic. Preobra?hens2y had countered that theto ere antagonistic but that the la Din the spheres e he ad!itted itsoperationE could be limited by the plan. Goever/ the governing conceptionduring the period of brea2nec2 industriali?ation as that the la of value had

been eliminated by planning. o change in this dog!a as per!itted for so!eti!e.Vo?nesens2y rote in 19*0 that 74he la of value has been abolished in the,SS/ although the uantity and uality of labor are the !easure of production/consu!ption and e6change.7 &n its place/ 7&n the Soviet econo!ic syste! the

plan as a directive of econo!ic policy has obtained the force of la.7() 4his asan echo of the Stalinist 7teleological7 theory of the late 19)0<s/ according to

hich nothing prevented 'olshevi2s fro! carrying out hat they ished.'ut in the early 19*0<s the uestion as in effect reopened. Preobra?hens2y<sconception as a subtler cover Dand therefore is reflected in current pseudo#+ar6ist theoriesE/ but 'u2harin<s better described the reality of Stalinistcapitalis!. So a ne official line revised the dog!a that the la of value could

be ignored>74here too2 root in our teaching practice and te6tboo2 literature the false ideathat in socialist econo!ics there is no place for the la o% alue$ 4his idea is in

plain contradiction to nu!erous state!ents in the classics of +ar6is! and to thehole e6perience of socialist construction. ... 4he idea that under socialis! thela of value plays no part of any 2ind is in its essence contradictory to the holespirit of +ar6ist#Leninist political econo!y. ... 8n the contrary/ it functions

under socialis! but it functions in a transfor!ed !anner.7(3


().Vo?nesens2y/ cited by +ar2 Garrison/ Soiet Plannin+ in Peace and War 19*8-

194, D19"$E/ p. ))*.(3. 74eaching of 5cono!ics in the Soviet ,nion/7 <merican &conomic eieD19**E.

Vo?nesens2y e6pressed si!ilar vies> The Soiet &conomy durin+ the Second

World War D19*9E/ pp. 119#)3

74o see2 to abolish the capitalist for! of production by establishing <truevalue< is therefore euivalent to atte!pting to abolish Catholicis! byestablishing the <true< Pope/ or to set up a society in hich at last the producerscontrol their products by the logical application of an econo!ic category hichis the !ost co!prehensive e6pression of the sub@ection of the producers bytheir on product.7(*

4he idea of suppressing the la of value contradicted the hole e6perienceof Stalinist constructionF the point of the transfor!ation of the !id#1930<s asto enforce it. eadopting the la in theory as a tacit recognition that capitalistdiscipline as reuired/ for the or2 force first of all/ but also for the

bureaucrats. &t !eant that production as in the hands of separate/ autono!ousunits hich had no alternative but to relate to one another through thee6change of value#e!bodying products/ i.e./ co!!odities. 4he shift in Stalinisttheory as an ac2noledg!ent that the syste! operates under an alternativefor! of co!petition/ hich in any for! e6ecutes the inner las of capital to!aintain and deepen the e6ploitation of the proletariat.

4he ti!ing of the theoretical sitch as no accident. =hen a capitalist stategears up against a foreign ene!y it has to loc2 together all classes in support of

the rulers # all the !ore so hen the e6istence of the nation as at sta2e/ asith the ,SS in =orld =ar &&. +a6i!i?ation of the national capital is thegoal/ so value as approved. 'ut circu!stances changed. 4he liberated la ofvalue as too !uch of a restriction hen the Soviet ,nion had to be built upagain after arti!e devastation and the onset of the Cold =ar. 4hat is henStalin codified the to#sector theory. Ge told the planners that in heavyindustry/ the sphere central to the needs of the ruling class/ no arbitrary 7las7should dictate to the bureaucracy hat it can or cannot produce. =hereas forconsu!er goods granted to the !asses/ the planners needed the la of value to7e6ercise its influence7 B i.e./ 2eep consu!er production as lo as ages/ butallo the consu!ers 7free choice7 ithin that constraint.

+iddle#class +ar6ists hose ob@ection to Stalinis! is its bad planning havein all essentials the sa!e goals. 4hey too ish to 7use7 the la of valuerationally # of course/ for good ends/ not evil. Putting aside its theo#


(*.5ngels/ <nti-uhrin+A p. 3*%

40:

retical absurdities/ this !eans if ta2en seriously that Stalinis! is a refor!ablesyste!/ one in hich good planners can substitute for bad ithin the structureas it is. 4he proper progra! therefore is de!ocracy. =e ill see theconseuences of such reasoning in Chapter ".

called the!/ the <sovbours<.7(%

Such ter!s !ay not be chosen for analytical purposes/ but they are deeplyfelt conclusions on the essence of the !atter and therefore are far !ore realisticthan the evasions of the rulers< apologists. ,nderstanding forged in struggle isl h b f h i l f l



0 T>7 STAL,!,ST R=L,! CLASS

5ven though the underlying las that govern Stalinis! are the sa!e as thoseof traditional capitalis!/ !any of their !anifestations differ. As e have seen/the chief divergences lie in the contradictions induced by the re!nants of the

revolutionary or2ers< state # the 7socialist7 trappings of Stalinist society. 4heseare 2ey to hy statified capitalis! is proving so unstable and indicate thedirection in hich the Stalinist countries are !oving. Another i!portantdifference lies in the na ture of the Stalinist ruling class/ hose origins e tracedin the previous chapter.

&t is so!eti!es argued that a capitalist theory of Stalinis! is preposterous because the bureaucrats have no aareness that they are capitalist. -or e6a!ple/5rnest +andel !oc2s 7those ho McontendN that capitalis! still rules in ussia/China/ 5astern 5urope/ Cuba and Vietna!. Suffice it to say that they can hardlyfind any capitalist/ hether ussian/ Chinese/ 5ast 5uropean/ or Vietna!ese/ toshare their bi?arre conviction.7

4rue/ the bourgeoisie does not see the orld ith +ar6ist insight. 'ut

=estern econo!ists report that so!e Soviet professional colleagues privatelyrefer to the Soviet econo!y as state capitalist. And no less an authority than-idel Castro reassured +e6ican investors that 7=e are capitalists/ but state

capitalists. =e are not private capitalists.7((

8f course/ neither the Stalinist rulers nor their =estern counterparts ad!it to being a ruling class. 'ut those they rule over 2no better. =or2ers in theStalinist countries habitually distinguish beteen 7us7 and 7the!.7 &n Poland in19"0/ or2ers !obili?ed in one of the !ost class#conscious !ove!ents to arisesince =orld =ar && labeled their bosses the 7red bourgeoisie.7 &n 19""ugoslav or2ers de!onstrated against high#living Co!!unist officials ith

posters reading/ 7:on ith the socialist bourgeoisieO7 &n the sa!e year a

group of Soviet or2ers fro! the ,rals rote to a leader of the suppressed ovocher2ass2 stri2e in 19()> 7=e ould li2e to 2no your advice on the!ethods of struggle against the ene!ies of the or2ing class # the bureaucratic

bourgeoisie/ or/ as Lenin


($. +andel/ on+ Waes o% Capitalist eelopment D19"0E/ p. (*.((. 4ranslated fro! Proceso D:ece!ber */19""E by Sa! -arber. -or further e6cerpts

fro! this intervie/ see Proletarian eolution o. 3*

alays the best test of theoretical for!ulas.

;=R7A=CRAC# AS R=L,! CLASS

4he Stalinist ruling class is properly called capitalist since it e!bodies thecapitalist relation in opposition to the proletariat> it is the e6ploiter of labor

poer/ 7personified capital7 in +ar6<s phrase. Since it did not evolve

historically li2e the classical bourgeoisie that gre up under feudalis! anddoes not operate in the sa!e ay/ e do not call it a bourgeoisie. Li2e 4rots2ye label it a bureaucracy. 7=e cannot deny that it is so!ething !ore than a

bureaucracy. &t is in the full sense of the ord the sole privileged andco!!anding stratu! in Soviet society.7

&t is argued that the Stalinist bureaucracy cannot be a ruling class because bureaucracies in general are not classes # only servants of ruling classes/ as inthe despotis!s described by +ar6. =e reply first that bureaucracy is not anabstract suprahistorical pheno!enon. 4he Stalinist rulers do!inate a societyvastly different fro! pre#capitalist ones of any for!. 4heirs is a syste! driven

by accu!ulation and its contradictions/ hereas the bureaucracies of old livedfor the privileges of consu!ption. 4he despotic bureaucracies suashed all

atte!pts at pri!itive accu!ulation Dby !erchants and incipient bourgeoisele!entsEF Stalinists depend on such accu!ulation by the state. Chattel slaveryas vastly different fro! ancient slavery. So too !odern bureaucracy ishistorically specific to capitalis!.

,nder capitalis!/ bureaucracy is a !ethod of social organi?ation thatualitatively e6panded at the dan of the i!perialist epoch hen entrepre#neurial onership gave ay to sociali?ed for!s. &t is capitalis!<s anser toconscious planning/ substituting hierarchical organi?ation and 7netor2s7 forthe interplay of a conscious or2ing class carrying out the productive process.Capitalist bureaucracy atte!pts to overco!e the divisions i!posed by the laof valueF it regards itself as the soul of prag!atic rationalis!. 4op bureaucratsand !anagers understand that their @ob is profit !a6i!i?ationF hoever/ given

their social penchant to believe that they stand above narro class interests/they so!eti!es @ustify this goal as a !eans for achieving hu!an elfare. 8fcourse/ the loer layers interpenetrated


(%. Cited by :avid +andel in The Socialist e+ister 1989A p. 1)(F e ill see !ore ofthis letter in Chapter ". 4rots2y had also recalled that Soviet or2ers called

privileged dignitaries by the na!e sovbour DThe eolution #etrayedA p. 100E.(". 4rots2y/ The eolution #etrayedA p. )*9.

404

ith the ne professional and hite#collar layers often see the!selves asdevoted only to the national Dor even socialE good. 4hey regard their role as analternative to the greed of the bourgeoisie and proletariat.'ureaucracy is one of capitalis!<s ob@ectively generated for!s that cover and

t it l l ti &t t f th l ti f d ti i

!e!bers largely fro! the !iddle classF it also guarantees that its children beco!e part of the !iddle class if not the ruling class itself. ot since thecounterrevolution has it recruited significant nu!bers fro! the proletariat. 4herecent upheavals in 5ast 5urope sho that !iddle#class ele!ents/ as in the= t h ld t t ffi ith t b i t f th li l



carry out its real poer relations. &t gros out of the relations of production/ inenterprises and the state. 4he degeneration of the ,SS also produced such a

bureaucratic layer. =hen it beca!e conscious of its distinct status and its needto e6ploit the or2ers/ it violently bro2e its ideological and hu!an lin2s iththe proletariat and transfor!ed itself into a ruling class. As a result of itscounterrevolutionary civil ar/ it no longer balanced beteen layers of society

but stood clearly and consciously for its on distinct interests. D&t identifiedthose interests ith those of 7the hole people/7 but any capitalist class doesthat.E =hen it achieved do!inance as a class in the or2ers< state/ it beca!e thee!bodi!ent of capitalist relations/ not @ust officiousness and corruption.As 4rots2y i!plied/ a sociological ter! li2e 7bureaucracy7 is inadeuate. 4heStalinist ruling class is not @ust an organi?ational for!/ not even as specific afor! as the no!en2latura Dthe list of a half !illion or so official posts and

people ualified to fill the! by Party appoint!entE. &n +ar6is! classes aredefined by relationships reflecting the social organi?ation of productionF acapitalist ruling class is deter!ined by its direct or indirect appropriation ofsurplus value through the e6ploitation of the proletariat. 8f course/sociologically the Stalinist ruling class is headed by the no!en2laturists/ but

there are !illions of loer echelon ad!inistrators in the bureaucratic class. Andespecially in recent years/ the e6ploiters of surplus value have included a

peripheral layer of private capitalists separate fro! but increasinglyinterpenetrated ith the bureaucracy.4o define the Stalinist rulers as an identifiable layer of individuals is !a2e thesa!e error as the Stalinists and sociologists ho characteri?e =estern rulingclasses as 7ruling circles/7 7poer elites7 or the 7!ilitary#industrial co!ple6.7Aside fro! the inaccuracy of such ter!s/ they suggest that the ruling class can

be transfor!ed by ousting the specific people or layer. Li2eise/ replacing the bureaucratic no!en2latura ith a de!ocratically selected cadre of officialsould not alter the e6ploitative production relations as such. 4he !iddle#classDincluding !iddle#class +ar6istE vie of classes as su!s of individuals leads

easily to refor!ist conclusions.Since =orld =ar && and especially since 19(0 there has also e!erged/ as in the=est/ a vast layer of intelligentsia or 7specialists7 situated beteen theno!en2latura and the or2ing class. Since these !illions of people !ostly holdstate posts Das is inevitable in a statified econo!yE/ they !ight be thought of as

part of the bureaucracy. 'ut it is necessary to distinguish beteen the ruling bureaucracy and the inter!ediate layers/ or !iddle class. Li2e the =estern bourgeoisies/ the ruling class recruits ne

=est/ can hold state office ithout being part of the ruling class.&n 4rots2y<s day it sufficed to describe the class structure of the ,SS as

co!posed of a politically do!inant bureaucratic caste ith a s!all professionalintelligentsia on top of the or2ers and peasants. 4oday<s structure is !oreco!ple6/ even though 4rots2y<s self#described folloers use the sa!e ter!s.

ot only has the !iddle class gron under Stalinis! because the rulers

need its technical functions and its political support as a buffer beteen bureaucracy and proletariat. 4he ruling bureaucracy itself has beco!e !uch!ore articulated. -or co!parison/ in the =est the ruling class is highlyvariegated/ ith idely different spheres Dfinance/ industry/ !erchandisingE!aintaining a se!i#independence despite their interconnections. =hile the big

bourgeoisie has alays been the heart of the ruling class/ there have alays been local oners of !ediu!#si?ed capitals ho are not corporate giants butare also not in the petty bourgeoisie or inter!ediate !iddle class. 4his categorystill e6ists but has di!inished. &ts social/ political and econo!ic functions have

been superceded by the !iddle#level !anager#oners ho serve in theinter!ediate rungs of the !onopoly corporations.

&n the 5ast there is a different but co!parable layering ithin the

bureaucracy. Local and !inisterial officials do not share the sa!e interests asthe central state and party bureaucrats ho !a2e up the heart of the rulingclass. 4hey too are not the sa!e as the !iddle class professionals belo the!Fthey are part of the ruling class and articulate its interests as they see the!. 4heconstant disputes over perestroi2a beteen orbachev and the 7conservatives7reflects this division. And as in the =est/ the !iddle#class professionals can becounted on to act for the ruling class and even hold poer for it/ hen the

beleaguered syste! needs the aid of populists and refor!ists.4he variegated ruling#class structure no longer confor!s to the notion of a

7caste.7 4he co!ple6ity of the rulers< inner relations/ their longevity at the pea2of state poer # as ell as their control over surplus value B all de!onstratethat they constitute a full#fledged class/ not a si!ple privileged stratu! risen

above the aristocracy of the or2ing class.

;)=R7),S,7 A!D ;=R7A=CRAC#

4he bureaucracy that rules in the na!e of socialis! is a peculiar capitalistclass. &ts !e!bers have no legal title to the property they dispose of/ hich

belongs to the 7state of the hole people.7 +e!bers of the

40-

no!en2latura can be transferred fro! one post to anotherF they are thereforesee!ingly independent of any single seg!ent of the national capital/ althoughthey do develop onership#li2e attach!ents.

As a ruling class/ the bureaucracy reflects the split beteen onership ofit l d it i l f ti A i Ch t ) + l d

rearded by ho ell they do this according to the prevailing standards. -orthis purpose the econo!y is divided into separate capitals. 'osses< interests arealays sectoral> they are tied to a specific capital in the =est/ or to a localenterprise/ !inistry or region in the 5ast. 'oth syste!s have a central state

t hi h ll d l it ti l i t t t



capital and its !anagerial function. As e sa in Chapter )/ +ar6 alreadyobserved that 7the capitalist e6ists in a dual for! # @uridically andecono!ically7 hen the receiver of interest or dividends beco!es functionallyseparate fro! the !anager/ ho !ay get only a salary for his labor. 4he=estern !anager or bureaucrat is re!oved fro! onership but re!ains part ofthe capitalist class. Li2eise the 5astern bureaucrat/ e6cept that it is the

bureaucracy as a hole that ons the state property.5ven hen separate/ the to functional spheres are alays interlin2ed/socially and practically. 4he =estern !anager !ay ell on shares hi!self/lin2ing hi! to specific capitals. Still/ capitalists are relatively independent ofthe specific location or use#values they have invested inF they can pac2 up and!ove their industries fro! ti!e to ti!e/ or invest their capital elsehere. 4helatter 7freedo!7 is sy!boli?ed by the stoc2 !ar2et/ through hich capitaliststa2e out shares of each others< capitals. &t also illustrates +ar6<s observation thatthe bourgeoisie as a hole e6ploits the proletariat as a hole.

&n the 5ast the capital belonging to the various enterprises is tied to specific plants and !achinery Dalthough there are no s!all beginnings of bond andstoc2 !ar2etsE. -i6ed capital appears to be fi6ed not only in the technical sense

that it doesn<t circulate/ but also in the sense that one bureaucrat cannot transfer7his share7 to another. 'ut although a Stalinist official cannot !ove his assets toanother sphere/ he can hi!self be transferred/ nor!ally in the course of !ovingupard in the hierarchy. D&n +ao<s China transfers ere !ade deliberately to

prevent special interests fro! ta2ing root.E 4his characteristic of the bureaucracy also reflects the capitalist e6ploitation of the or2ers as a relation beteen classes/ not @ust beteen individuals.

&n the =est/ each capital see2s the greatest possible !obility beteendifferent !eans of production/ in order to !a6i!i?e its value independently andat the e6pense of all others. Gence the per!anent anarchy/ periodic crises/i!perialis! and une!ploy!ent that characteri?e traditional capitalist life. &n the5ast the capitals are tied don physically/ but they also see2 to !a6i!i?e their

on value and are content to let the others go to the devil. Gence the sense thatno one is in charge> the unconcern for uality/ the disdain for consu!er needsand the apparent per!anent crisis. 4he ulti!ate absurdity is the internationalco!petition and even ars that have bro2en out beteen rival statified capitals.

=hat the 5astern and =estern variants have in co!!on is that they e6tractsurplus value by e6ploiting proletarian labor/ and bosses are

apparatus hich nor!ally develops its on particular interestsF a currentconfir!ation of this in the 5ast is the resistance of poerful ings of the

bureaucracy against the orbachev refor!s that threaten to reduce theirstrength. Although the state in the 5ast plays a ider and !ore varied role thanin the =est/ the picture of a super#organi?ed econo!y in hich all econo!icevents are dictated fro! +osco and carried out accordingly is/ as e have

seen repeatedly/ a !yth.4here are parallels in the @uridical sphere as ell. +onopoly capital in the,nited States has acuired full legal rights> the ,.S. Constitution asinterpreted in the 19th century to say that corporations are 7persons7 under thela. Although the predo!inant for! of capitalis! has changed drastically/

bourgeois legal theory understands that underlying class relations re!ain thesa!eF the legal fiction that spea2s of !onopolies as individuals incorporatesthe ne reality and !as2s the change in for!. Li2eise in the ,SS/ the legalfor! of one national capital Dthrough the Constitutional specification of profit/etc.E reflects both the country<s past history as a proletarian state as ell as thenationalist needs of the rulers. &t too both !as2s and reflects reality.

4he ai! of the syste! created by Stalin in the 1930<s as to build up the

national capital by tying each bureaucrat to so!e specific capital/ either locallyor further up the hierarchy. &t as a necessary step in separating the

bureaucracy fro! its original base in the or2ing class/ and therefore inulti!ately resting state poer fro! the proletariat. 4here have alays beenconflicts beteen locally and nationally oriented bureaucrats. 4he orbachevrefor! ca!paign can be interpreted as the assertion of national interests overlocal and parochial ones # despite superficial evidence that the refor!s !eandecentrali?ation of poer.

&R)M &ASC,SM T) S7!,L,T#

4here are stri2ing parallels beteen the Stalinist econo!y and that of a bourgeois state during or @ust before a ar. =e cite a description of a typical

fir! in a 7centrally ad!inistered econo!ic order7>78ur leather factory produces on the orders of the Leather Control8ffice/... MhichN allocates ra hides and au6iliary !aterials. &t gives thefir! its instructions to produce/ and disposes of the leather it produces.-or 2noledge as to ho the plans are for!ed by hich the econo!y isguided in a centrally ad!inistered syste!/ e !ust go to these controloffices. ... -irst/ there as the collection of statistical !aterial. ...

408

4hey for!ed the foundation for the planning itself hich as the secondstage of the process. 4his consisted of draing up the progra!s forreuire!ents and supplies/ and for the !eans by hich the to ere to

be balanced. &t is an essential point that the figures planned forreuire!ents had their source only partially in the de!ands of the higher

over privately oned fir!s. &ndeed/ !ost of the argu!ents that the Sovietsyste! is non#capitalist ould apply eually ell to the 7private7 econo!y ofGitler<s er!any.%0

4he parallelis! ith fascis! can be loo2ed at fro! a different angle. =hen4rots2y described Stalin<s rule in the 1930<s as 7sy!!etrical7 to fascis! he



reuire!ents had their source only partially in the de!ands of the higherauthorities ... . Another part originated ith other users/ that is/ !ostlyother control offices. ... After the centrally ad!inistered econo!yhad been or2ing so!e ti!e/ the planning offices often used the figuresfor earlier planning periods. ... 4he third stage as the issuing of

production orders to individual fir!s. 4he production of the fir!s as

fi6ed in ter!s of uantities for particular periods of ti!e/ and ith regardto varieties and ualities.74his picture could be of Stalinist ussia/ but it as ritten about a?i

er!any.(9 4he riter notes that such an econo!y inefficiently !easures thevalue of goods produced/ but is very capable of handling the !obili?ation oflabor and !aterials that is necessary for !a@or pro@ects in arti!e. 7=here anecono!y is under the direction of a central ad!inistration/ it is usual for ane6ceptionally large a!ount of invest!ent to be underta2en.7 +oreover/ thetraditional role of the ban2ing syste! is bypassed.

74he a!orti?ation period and the rate of interest ere not ta2en intoaccount. either acted as a bra2e. So huge invest!ent pro@ects ereunderta2en/ stretching ahead for very long periods into the future. ... 8f

necessity/ the ban2s ill have an insignificant place in a centrallyad!inistered econo!y.7-urther/ the progra!s dran up by the sectional control offices ere highly

co!petitive. 75ach control as out to produce as !uch as possible/ for eachheld its on line of production to be specially i!portant. ... 4he resultingstruggle beteen the controls for the factors of production/ and particularly forlabor supplies/ had ... to be decided by orders fro! the center.7 As a result ofthis co!petition and central decision#!a2ing/ the econo!y too2 an unbalancedappearance in co!parison ith traditional profit#based capitalist fir!s.

7Side by side ith invest!ent in so!e fields ent a disinvest!ent orcapital consu!ption in others. 4his capital consu!ption as an essentialaid to invest!ent in other branches. ... 8n the one side there ere fir!s

ith stoc2s falling and !achinery deteriorating/ and on the other neconstruction and the e6pansion of euip!ent.7&n the a?i case this central ad!inistration as handled !ainly ithout

nationali?ing property but rather by i!posing govern!ental controls BBBBBBBBBBBBBBBBBBBB

(9. =alter 5uc2en/ 78n the 4heory of the Centrally Ad!inistered 5cono!y> AnAnalysis of the er!an 56peri!ent/7 &conomicaA 19*"

4rots2y described Stalin<s rule in the 1930<s as 7sy!!etrical7 to fascis!/ he!eant that the !ethods of rule ere si!ilar/ even though the state poer restedon a different class. -olloing up the i!plications of his position/ 4rots2yconcluded that if the process of counterrevolution ere to continue/ it ould!ean that 7the state regi!e ill in that case inevitably beco!e fascist.7%1 Andso it happened.

&n his analysis of er!an fascis!/ hoever/ 4rots2y had pointed out thatfascis! cannot !aintain forever the iron#fisted !ove!ent that brings it to poer/ the counterrevolutionary !obili?ation that s!ashes the proletariat andforges a !onolithic unity out of the ruling class. 'efore long the class struggle!ust re#e!erge/ and different sectors of capital ill reassert their co!petingclai!s. Ge applied parallel reasoning to Stalinis!>

7A totalitarian regi!e/ hether of Stalinist or fascist type/ by its veryessence can be only a te!porary transitional regi!e. a2ed dictatorshipin history has generally been the product and the sy!pto! of an espe#cially severe social crisis/ and not at all of a stable regi!e. Severe crisiscannot be a per!anent condition of society. A totalitarian state iscapable of suppressing social contradictions during a certain period/ but

it is incapable of perpetuating itself.7%)

5ven under Stalin<s dictatorial regi!e/ the Soviet econo!y shoed signs ofanarchy. uthless attac2s on the or2ers ere acco!panied by selectiveconcessions/ and Stalin could never erase co!pletely the gains or2ers had!ade in the 'olshevi2 revolution. evertheless/ during the first period of therestored capitalist state/ especially fro! the end of the ar until Stalin<s death/control as tightening. ust as ar prolongs the life of ordinary fascis! byalloing it to loc2 together the disparate forces it straddles/ so too did are6tend Stalinis!<s fascist period.

4he fascist#li2e regi!e ca!e to an end after Stalin died. Soviet rulersen@oyed a period of i!perial stabilityF they crushed revolts but generallyadhered to a policy of granting concessions as needed. iven the history


%0. -or e6a!ple/ Gillel 4ic2tin<s re!ar2 that 74he fact that no genuine union can e6istin those societies and no for! of collective action of any 2ind/ ithout i!!ediaterepression/ raises the uestion of the !eaning of class in that conte6t.7 DCriti/ue

o. )0#)1/ 19"%.E%1. 4rots2y/ 7:oes the Soviet overn!ent Still -ollo the Principles Adopted 4enty

ears AgoH7/ Writin+s 19*0-*8A p. 1)".%). 4rots2y/ 74he ,SS in =ar/7 .n e%ense o% ar!ismA p. 13.

409

of 'olshevis!/ they understood ho dangerous it can be to push the or2erstoo hard. 4hus consu!er goods production increased/ although never as !uchas pro!ised or even planned. Li2eise/ after the Gungarian revolution of 19$(/a refor! regi!e under anos Jadar as established/ not a fascist garrison state.4he fact that Gungary as one of the first Soviet !odel countries to introduce

planning. As Lenin pointed out in his ritings on the ne epoch/ capitalis! borros this tool of the proletarian revolution to prolong its on class ruleF inthe hands of alien class rulers it beco!es a eapon ielded a+ainst theor2ers. Stalinis! is the e6tre!e version.

5ven so nationali?ed property is a to edged sord :esigned to free the



4he fact that Gungary as one of the first Soviet#!odel countries to introduceconsu!er#oriented refor!s as an unac2noledged gain of the or2ers< ar!edstruggle.

Jhrushchev<s 7revelations7 of Stalin<s cri!es D4rots2y had e6posed the!decades beforehandE assured the ruling class that it could no rela6 and en@oythe spoils of poer # no !ore early#!orning 2noc2s at the door fro! the secret

police. 4he ,SS as no longer totalitarian but rather/ under 're?hnevespecially/ a senile se!i#totalitarian regi!e. or is it 'onapartist> certainly notin 4rots2y<s sense of a regi!e carrying out the counterrevolution in a or2ers<state/ nor in the traditional sense of a popular leader governing in place of theoners by balancing beteen classes. 4he orbachev refor!s e6pose a badlydivided ruling class debating/ a!ong other things/ hether a ne for! of'onapartis! should be atte!pted in order to enforce the needs of perestroi2a ona or2ing class unilling to sacrifice its living standards further.

!AT,)!AL,E7D PR)P7RT# A!D ,TS D7V)L=T,)!

4he triu!phant period of the Stalinist counterrevolution lasted for less than adecade after =orld =ar &&. :edicated to 7socialis! in one country/7 the ruling

party atte!pted to constitute itself as the ideal accu!ulator of capital operatingthrough the state. 'ut as +ar6 had foreseen/ hen capital 7see2s refuge infor!s hich/ by restricting free co!petition/ see! to !a2e the rule of capital!ore perfect/7 it only succeeds in adopting for!s hich are 7the heralds of itsdissolution and of the dissolution of the !ode of production resting on it.7&ndeed/ not only could it not create an isolated socialis! # even 7capitalis! inone country7 proved chi!erical.

4he nationali?ed property that defines the Stalinist regi!es enabled the! to!obili?e resources in ti!es of acute stress Dar/ postar recoveryE. 'ut it hasnot proved an un!i6ed blessing. 8n the one hand/ state property is the endresult of capitalis!<s inherent tendencies of centrali?ation and concentration.4oday in =estern econo!ies/ nationali?ed industries serve to shore up the

national econo!y as a hole/ its !onopoly profit#!a2ing sectors in particularFthey help absorb the brunt of crises and are to this end alloed to deteriorateunder govern!ent control. 8f course/ they are still sub@ect to the li!itations andlas of capital.

8n the other hand/ nationali?ed property is a proletarian for! of propertyF itas cited by 5ngels as part of the 7invading socialistic society.7 &t is proletariansince it is a necessary co!ponent of or2ing#class rule> it per!its the or2ersto centrali?e econo!ic control and establish conscious

5ven so/ nationali?ed property is a to#edged sord. :esigned to free the productive forces fro! their capitalist fetters/ it typically fails this purpose because it !irrors the underlying decay of the syste!. 4he great advance of the productive forces in the ,SS too2 place in the 1930<s hen it as still aor2ers< state and could !obili?e cadres and or2ers dedicated to buildingsocialis! even at great sacrifice.

'ut no that the ruling class ith its established and parochial interests haslong been in poer/ the barriers of capitalist relations that +ar6 spo2e of allco!e into play. :efense of large concentrations of capital conflicts ith thegroth of the syste! as a hole. 4hus the e6pansion of the 1930<s contrastssharply ith the Stalinist decay of today. 4he concessions to the or2ing classe!bodied in Stalinist state property B guaranteed e!ploy!ent/ over!anningin the factories/ leeay to slac2 off at or2 #reflect both the strength of the

proletariat even after its defeat and the inherent ea2ness of a ruling class thathides behind socialist pretensions and cannot on property in its on na!e.

A statified capitalist econo!y is inherently fragile. 4he or2ing class facesone boss/ a thin layer of state bureaucrats/ fro! ho! all econo!ic decisionse!erge. 4he bureaucracy naturally gets the bla!e for all the or2ers< !iseryF

the state cannot pretend to be neutral beteen bosses and or2ers/ as in the=est. 4o hold onto poer in a situation of na2ed e6ploitation/ the rulers need ahuge apparatus of repression as ell as a vast layer of !iddle and petty

bureaucrats to shield the! fro! the or2ers. 'oth are evident drains on production and hindrances to the accu!ulation of capital/ the basis of theirrule.

4he bureaucracy can be thought of as a regent class for the traditional bourgeoisie. 4his applies in to senses> 1E 4he ea2ness of statified capitalis!!a2es its rulers dependent on orld i!perialis! for capital and technologyand therefore opens the syste! to foreign e6ploitation. )E As its ea2ness

beco!es obvious/ the syste! tends to devolve bac2 in the direction oftraditional capitalis! by adopting openly bourgeois econo!ic !easures.

:evolution !eans that the bureaucracy is laying the groundor2 for deeper bourgeois characteristics to develop ithin itself/ and even for a future bourgeoisie fro! both inside and outside its on ran2s to replace it. Goever/the regency analogy should not suggest that the bureaucracy as it is is not thee!bodi!ent of the national capital.

4he theory of per!anent revolution teaches that capitalis! in its epoch ofdecay is unable to co!plete the funda!ental tas2s of the bourgeois

4-:

revolution. =ere it not for the or2ing#class revolution usurped by the bureaucracy/ no statified capitalis! ould ever have been possible. 4heachieve!ent of a 7single capital7 on the verge of its annul!ent as capital is only

possible by a genuine or2ers< state.As if to prove this as the Stalinist econo!ies grind to a halt today !any of Cha(ter 8



As if to prove this/ as the Stalinist econo!ies grind to a halt today/ !any oftheir uniue characteristics are being called into uestion by their on creators.Stalinist rulers are co!!itted to the defense of state property only to the e6tentthat it supports continued e6ploitation. As 5ast 5uropean states threaten todestroy nationali?ed property through privati?ation/ it is the proletariat thatdefends it.

&f the Stalinists retain state poer/ the devolution toards traditionalcapitalis! does not !ean that the econo!y ill tend to beco!e less centrali?ed.&t too is sub@ect to the la of increasing concentration and centrali?ation. Asgreater econo!ic authority devolves fro! the center/ the strongest enterprisesand co!binations ill tend to gro disproportionately/ hile the s!aller/ lessecono!ically efficient and less politically influential ill be shut don orsalloed up.

4he 7orthodo6 4rots2yist7 vie that China/ 5ast 5urope/ etc. beca!edefor!ed or2ers< states after =orld =ar && DChapter %E is lin2ed ith the!echanistic belief that the proletarian for! of nationali?ed property necessarilyi!plies a do!inant proletarian content. D&f this ere true/ +ar6 and Lenin<sdescription of @oint#stoc2 co!panies and !onopolies as sociali?ed for!s of

property ould !ean that they ere socialist.E A sy!!etric counterposition isthe denial of any proletarian content in the nationali?ed property for!F this isthe vie of Shacht!an and Cliff. Against both/ +ar6ists !ust recogni?e thatfor! reflects content but does not deter!ine it. -or! and content continuallyco!e into contradiction B hich is te!porarily resolved at a ne level as thecontent/ itself changing/ e6ercises its do!inance. &n the Stalinist states/ thesociali?ed for!s are re!nants of the proletarian past/ ith the capitalist contentno clearly do!inant.%3

4he full develop!ent of capitalist rights to property has not yet ta2en place/ but every day brings ne reports of refor!s that open the door ider. 4he fallof each pillar of Stalinist orthodo6y/ the eagerness of ide sectors of the

bureaucracy to slide over into being truly bourgeois/ proves that the state for!

readily conceals capitalist relations. 4hus the +ar6ist understanding of for!and content is increasingly confir!ed.


%3. Leftists ho defend the Stalinist state as progressive ris2 defending it hen itdis!antles the property for! that e!bodies its alleged progressiveness. &n parallel/those ho see no proletarian character in state property ris2 denying support toor2ers defending past gains

Cha(ter 8

Stalinism and the Post"ar World

3 T>7 D7&7AT )& T>7 W)R?,! CLASS

4he destruction of the Soviet or2ers< state led to the defeat of the proletariat<s revolutionary challenge to orld capitalis! at the end of =orld=ar &&. Postar or2ers< !ove!ents ere crushed or diverted into classcollaboration/ and third#orld revolutions ere led don the path of bourgeoisnationalis!. As a result i!perialis! gained a ne lease on life. 4rots2y<sarning Dcited in Chapter )E proved correct> euilibriu! as erected over the

prostrate for! of the defeated or2ing class/ leading to an unprecedented period of prosperity. 4he epoch of capitalist decay as significantly prolonged.

8n the surface it !ay not loo2 li2e e still live in the epoch of decay. 4hefirst half of the century # to devastating orld ars/ the reat :epression ofthe 1930<s/ the si!ultaneous triu!ph of fascis! and Stalinis! # a!plyconfir!ed the epochal picture dran by +ar6ists. 'ut history after =orld =ar&&/ ith its e6pansive boo! in the i!perial countries and four decades ithoutinter#i!perialist ar/ loo2s different. 5ven though the postar boo! has co!eto an end and the possibility of severe crisis is no openly discussed ithin the=estern bourgeoisie/ the predo!inant vie # a!ong the conservati?edintelligentsia and proletariat as ell as the bourgeoisie # is that capitalis! issuccessful. 4he collapse of the 5astern 7socialist7 regi!es providesconfir!ation.

&n this chapter e analy?e the post#=orld =ar && orld/ ith specialattention to the i!pact of Stalinis! on it. =e ill see that Stalinis! played the2ey role in 2eeping i!perialis! strong. =e ta2e up in turn the origins of the

postar orld/ an assess!ent of !odern i!perialis! as a hole/ and finally

the rise and decline of the Stalinist for! of i!perialis!.

,MP7R,AL,SM ;7TW77! T>7 WARS

=e begin ith a brief loo2 at i!perialis! after =orld =ar &. &n addition tothe isolation of the ,SS and the defeat of or2ers< revolutions elsehere/ theresult of that ar as the suppression of the losing i!perialists and theirconfine!ent ithin national boundaries. 4he ,nited States

4-4

as the chief victor in that it beca!e/ for the first ti!e/ a net creditor on theorld financial !ar2et and an e6porter of industrial goodsF that is/ it @oined thefirst ran2 of the i!perialist poers. et this result as not enough to alleviatethe epochal crisis that had brought about the orld ar. one of the greatpoers as strong enough to do!inate the orld aloneF none had been

control of the ruling classesF but their ishes are nevertheless a factor/ and inthe light of the revolutionary events that folloed =orld =ar &/ they feared toris2 another conflict that could provo2e the or2ers to do aay ith capitalis!once and for all. 'y 1939 the rulers sa they had less to fear fro! theproletariat> the er!an or2ers had been crushed Dith the help of the



poers as strong enough to do!inate the orld aloneF none had beeneli!inated as an i!perialist contender De6cept Soviet ussiaE. 4he syste!flourished for a short ti!e on the spoils of ar and the reconstruction fro! it/

but then disaster struc2 again.Largely because of the reat :epression/ the decade of the 1930<s as

characteri?ed throughout the i!perialist orld by increasing fusion beteen

capital and its state. &n addition to its custo!ary and groing functions ofcoercing the or2ing class and supervising capitalist co!petition/ the state too2on the role of central organ for the organi?ation of the econo!y as a hole.4his as !ost e6tre!e for the late#starting i!perialists and those ea2ened by=orld =ar &/ ho had the least opportunity for i!perial e6pansion. 4he trend

pro!inent in a?i er!any/ !ilitaristic apan and fascist &taly as alsoe6pressed in the e :eal in the ,nited States.

4he reat :epression could not be resolved by a ne i!perialist e6pansion/since the globe as already i!perialist property and could only be redivided.4he resulting tensions led to intensified rivalries/ division of the orld intocurrency blocs and a precipitous collapse of trade/ factors hich led inevitablyto the ne orld ar. 4he national li!its of capital concentration had been

reached and no had to be breached.=ar as the only bourgeois solution to !ass une!ploy!ent and poverty. &n

the depths of the :epression in the ,nited States/ for e6a!ple/ at least a uarterof the or2 force as une!ployed and the rate of profit fell belo ?ero. 4hereere ups and dons ithin the decade/ but the nor!al processes of capitalistrecovery never too2 holdF not even the govern!ent#sponsored pu!p#pri!ing ofoosevelt<s e :eal cured the crisis. :epression/ usually capitalis!<s cure forits periodic crises at the proletariat<s e6pense/ as no longer an effectivesolution.

&n er!any the crisis of the early 1930<s as even greater and the bourgeoisie<s !ethods correspondingly !ore drastic. a?is! as ieldedagainst the or2ers to s!ash their poerful independent organi?ations/ drive

don their standard of living/ discipline the! through a police state B all toobtain a !a6i!u! e6traction of surplus value. 4he crisis also led ine6orably torear!a!ent and a policy of !ilitary conuest of ne territories to e6ploit.

STAL,!,SM A!D W)RLD WAR ,,

'ut hatever the a?is< e6pansionist a!bitions/ the Second =orld =arcould not have occurred ithout Stalinis!<s victory in the ,SS. =ar can

brea2 out under the pressure of econo!ic and political las beyond the

proletariat> the er!an or2ers had been crushed Dith the help of theStalinistsE/ the Co!intern had proved its loyalty by restraining the Spanishrevolution and guaranteeing its defeat # and then the counterrevolution asco!pleted in the ,SS itself.

4he Gitler#Stalin pact under hich the ar began shoc2ed Soviet supporterseveryhere even though it as predictable> the Soviet rulers had abandoned all

!ethods of defense other than the !ilitary and diplo!atic. 4he pact as not aualitative brea2F it signified only the !o!entary failure of the alliances iththe 7de!ocratic7 i!perialists that had been tried and ould be turned to again.&t did not end class collaborationF it si!ply sitched partners. &n the =est theCPs changed fro! petty#bourgeois chauvinists to petty#bourgeois pacifistsF iner!any/ they unsuccessfully approached the a?is for a or2ing relationship.

4he pact as signed because the ,.S./ -rance and 'ritain still distrusted theland of the 'olshevi2 revolution # even though they accepted the benefits ofStalinist policy in 2eeping their on or2ers in line. 4hey had reason> radicalor2ers everyhere still loo2ed to the ,SS as the e!bodi!ent of proletarianrevolution. And although =estern diplo!ats loudly ob@ected to Stalin<s blocith Gitler/ it proved so!ething to the!> that +osco as no capable of any

iniuity # @ust li2e a nor!al nationalist poer. &n this ironic sense the pact laidthe basis for the later victorious alliance in =orld =ar &&.

4he a?i#Soviet alliance as highly unstable. 8n the diplo!atic level/ itssecret codicils bore itness to Soviet i!perialist ai!s in 5astern 5urope and=estern Asia/ but they also shoed that ussian territorial interests ere

predo!inantly regional. +oreover/ Soviet industrial groth reuired i!porting=estern technology and reducing the burden of ar!a!ents productionF thusStalinis! as conservative/ loo2ing to establish international stability.

Gitler/ on the other hand/ ruled a cooped#up i!perialist poerhouse that hadto pry open the stranglehold on the orld !ar2et held by the colonial poersD'ritain/ -rance/ etc.E and the ,nited States. a?i er!any as therefore adestabili?ing and radical player on the orld stage. And even though er!any

divided Poland ith the ,SS at the start of the ar/ its drive to e6ploit 5ast5urope and/ inevitably/ ussia precluded any long#ter! toleration of the dealith Stalin.

+oreover/ in countries here both Stalinist and fascist parties e6isted theycould not seriously collaborate over do!estic policy. a?is!<s appeal

4--

to capital as based on its ability to crush independent organi?ations of theor2ing class/ hile the Stalinists outside of ussia ere still tied to layers andinstitutions of that class. -or these reasons the alliance as necessarily short#lived.

4he alternate alliance of the 7de!ocrats7 ith Stalin as therefore

Such drea!s in the spread of socialis! under Stalinist guidance could only be held by people ith no conception of hat transfor!ations had beenrea2ed on the 7land of socialis!.7 -ascis! as s!ashed by the Sovietar!ies/ but the result as not even the victory of Stalinis! in 5uropeFi!perialist deals led to the division of 5urope and Asia ith the ,nited States



4he alternate alliance of the de!ocrats ith Stalin as thereforenecessary/ and during the ar it as established on the basis of Sovietnationalis! as ell as overall i!perialist interests. Stalin e6pressed his i!perialdesires to his =estern allies as he had done to Gitler/ and the ,SS asguaranteed its on sphere of interest alongside those of the =estern poers.4he Soviet arti!e resistance against the er!an offensive as conducted

under the banner not of socialis! but of the +otherland/ and the Co!intern asofficially disbanded in order to cal! re!aining bourgeois fears of revolution.5ven the 7&nternationale7 as readily dispensed ith and replaced by anationalist anthe!.

4he Co!!unist Parties internationally defended the Soviet state and

deepened their on do!estic nationalist orientation/ especially in the a?i#occupied countries after the invasion of ussia. 4he CPs played leading roles inresistance !ove!ents/ pressing the or2ers to subordinate their independentand revolutionary interests to national bourgeois restoration. &n the =est they

beca!e the !ost disciplined advocates of ar production/ using their influenceto uell even non#ar#related stri2es. 4he !agnitude of the Stalinists<counterrevolutionary role is illu!inated by co!paring it to the e6pectations of a

ell 2non fello#traveler at the ti!e> 74here is strong evidence that thee6istence of the Soviet ,nion/ and its consistently anti#i!perialist policy/e6ercised a strong disintegrating effect on the cohesiveness of the total structureof i!perialis! ... it appears not unli2ely that the disintegrating effects oni!perialis! of a further groth of socialis! ill outeigh the consolidatingeffects Mof the arti!e allianceN. ...

7=e start ith the assu!ption of a !ilitary defeat of er!an fascis!. 4hishappy event/ it !ay be postulated/ ould be folloed by the collapse ofcapitalist rule and the victory of socialis! over substantially the entire5uropean continent/ not !erely in er!any and the occupied countries but alsoin -rance/ &taly/ and Spain. Anglo#A!erican atte!pts at intervention are note6cluded/ but it see!s hardly li2ely that they ould !eet ith success ... .

Socialis! ould no have an i!pregnable base e6tending fro! the Atlantic tothe Pacific ... . A fir! alliance ith the colonial and se!i#colonial countries ofAsia ould follo ... . 4he evolution of the entire -ar 5ast/ including &ndia/China and apan/ in a socialist direction ould no be assured ... .7 1


1. Paul See?y/ The Theory o% Capitalist eelopment D19*)E/ pp. 3$"#9

i!perialist deals led to the division of 5urope and Asia/ ith the ,nited Statesgetting the predo!inant share. Stalinis! proved to be the 2ey ingredient ini!perialis!<s survival/ not its de!ise.

4he degree of corruption of the Stalinist parties in the or2ing classes can be seen fro! the case of the ,.S. Co!!unist Party. :uring the course of=orld =ar &&/ this party supported the govern!ent<s i!prison!ent of

thousands of apanese#A!ericans solely on the grounds of raceF it enthu#siastically endorsed the prosecution of 4rots2yist leaders under the anti#co!!unist S!ith Act Da la predictably turned against the CP itself after thearEF it opposed the anti#racist protests of the A!erican blac2 !ove!ent as adisruption of arti!e unityF it fought against or2ers< stri2es as sabotagingar productionF and it approved the !ass !urder of civilians through theato!ic bo!bing of apanese cities.

STAL,!,SM A&T7R T>7 WAR

Stalinis! e!erged strongly fro! the ar. 4he basis for its resilience asthe counterrevolution in the ,SS/ hich gave the bureaucracy class poerand its on national capital/ enabling it to serve as a shareholder and bular2

of i!perialis! as a hole. 4he Co!!unists had also gained a do!inating position ithin the orld proletariat through the authority of the 'olshevi2revolution together ith the Soviet victory over fascis!. &n 5astern 5urope theCPs and the Soviet Ar!y suppressed or2ers< uprisings to consolidate Stalinistcontrol. &n -rance and &taly the CPs used their poer and prestige to brea2 the

bac2 of potential revolutions. &n Vietna!/ orth Africa and other colonies they paved the ay for i!perialis! to regain its hold.

&t is rarely re!e!bered that the end of the ar sa or2ing#class upsurgesthroughout 5urope. ,nder conditions of !isery and starvation in the ar#ravaged territories/ capitalis! as everyhere discredited. =or2ers rose up tooust the bourgeois officials fro! factories and local ad!inistrations/ and too2steps to re#establish functioning econo!iesF they had no need for bosses and

stood openly for socialis!. 4o illustrate both the !ood of the !ass proletarian!ove!ent and the CPs< role/ e cite a vivid historical account of events iner!an#occupied &taly in 19**#*$ at the ti!e of the Anglo#A!erican invasion>

74o the Allied soldiers reaching the o!e region the e6perience asstrange indeed. Ar!ed &talians/ often in red shirts/ aving revolutionary

banners/ greeted the!/ freuently after they had set up their on local

4-8

ad!inistrations. 4he Allied ar!ies pushed so!e Partisans aside/ and eventhreatened the! ith the tiring suadF they arrested !any and thre the!into prisons. ...7:espite the Anglo#A!erican policies and er!an repression/ by thebeginning of the spring of 19*$ the esistance nu!bered perhaps

in the hirlind of a revolutionary upsurge. 4he or2ers occupied thefactories/ established or2ers< control over production/ set up factoryco!!ittees/ etc. At that !o!ent/ it could be said> the proletarianrevolution in Poland had begun. 'ut the political intervention of theSoviet bureaucracy as pri!arily counter-reolutionary$ 4he Soviet



beginning of the spring of 19*$ the esistance nu!bered perhaps1$0/000 !en/ supplying the!selves ith groing stoc2s of deserted orcaptured fascist and er!an eapons. Success as i!!inent/ and !en

@oined.74he or2ers of +ilan/ so!e (0/000 of the!/ revolted ... ith slight

bloodshed/ assigning control of the factories to or2ers< councils and

!eting out @ustice to the fascists. 4hen in 4urin/ against heavy er!anopposition/ they siftly too2 the city. 4hroughout northern &taly theesistance as in control everyhere/ and uic2ly shot appro6i!ately)0/000 fascists or alleged collaborators. 4he esistance as triu!phantand in poer. =as &taly on the verge of revolutionH74he Allied !ilitary asted no ti!e in finding out. 4hey 2ne it asnecessary to disar! the Partisans and ta2e over local govern!ents.:isar!a!ent/ as the files of the !ilitary govern!ent reveal/ the Anglo#A!ericans e6ecuted Vith astonishing success.< ...7=ith red banners and poer in hand 1$0/000 !en disappeared in a!o!ent/ and the al!ost !orbid fears of the 5nglish and A!ericans

proved entirely chi!erical. =hyH

7... there is no uestion that the Co!!unists saved the 8ld 8rder in &taly.As if by reluctant necessity the A!ericans gradually ac2noledged theconservative role of the CP hen it as useful to do so/ and ignored ithen it violated !ore convenient preconceptions. =hen disar!ing theesistance the Anglo#A!ericans !ade the decision <to secure theconfidence of the Partisan co!!anders and conduct disar!a!entthrough the!....<... &n both cases the leaders ere illing to cooperate/

pri!arily because the !a@ority ere Co!!unists.7)

&n countries here the old bourgeoisie collapsed after the ar/ the CPs!oved cautiously to ta2e poer the!selves. 4he ne regi!es as a rule ere

based on a Stalinist alliance ith bourgeois collaborators/ based on the or2ers<defeat. &n the light of the belief in the revolutionary possibilities of Stalinis!

held by so !any present#day 4rots2yists/ e present the e6a!ple of Poland/since events in that country ere ell su!!ari?ed by 5rnest +andel at theti!e>

7=hen the ed Ar!y approached Poland/ this country as caught up BBBBBBBBBBBBBBBBBBBB

). abriel Jol2o/ The Politics o% War D19("E/ pp. (1/ *3(#". 4his boo2 and its seuelDoyce and abriel Jol2o/ The imits o% PoerA 19%)E contain a ealth of valuableinfor!ation

Soviet bureaucracy as pri!arily counter reolutionary$ 4he SovietAr!y as used to <restore order/< <re#establish the authority of e!ployers<and rapidly rebuild a (our+eois Polish state apparatus.73

&n other countries of 5ast 5urope circu!stances differed but the overallresults ere si!ilar. =or2ers ere still not prepared to go bac2 to living undercapitalis!. So the Stalinists declared that 7de!ocratic/7 not socialist/

revolutions ere on the agenda and/ after the or2ers< upsurges ere crushed/used their control of ar!ed forces to set up popular front govern!ents ith theold bourgeois parties. 8nly several years later did the CPs oust their bourgeois

partners/ co!plete the nationali?ation of industry and establish the Stalini?edregi!es that lasted until today.

An essential ele!ent of the Stalinist counterrevolution as the eli!inationof the revolutionary proletarian leadership. +ainly 4rots2yist/ they ereconsciously !urdered before the ar in Spain and ussia and afterardsherever the Stalinists held poer. 4he slaughter of the Soviet 4rot#s2yists in

particular !eant eli!inating the !ost advanced and e6perienced layer ofrevolutionary leaders in the orld. 5lsehere 4rots2yists ere influential inonly a fe countries/ here they sought to lead the colonial or2ers and

peasants against both i!perialist ar blocs. &n Vietna!/ the Stalinists/ ithguns supplied by Chiang Jaishe2<s China and the =est/ iped the! out at theend of the ar and handed the country bac2 to -rench i!perialis!.

:espite political !ista2es !ade by the 4rots2yists during the ar/ they played an often heroic role. 4hey fought both for socialis! and against nationalchauvinis!F they ere practically alone in co!batting anti#er!an racis! inthe =est Dabove all in sections of the anti#fascist resistance !ove!entsinfluenced by the CPsEF at enor!ous ris2 they published a er!an#language

paper distributed to soldiers of the a?i ar!y in occupied -rance. 4he beheading of the or2ing class on top of all other counterrevolutionary eventsnot only prevented revolution after the ar but derailed the or2ers< !ove!entfor a long ti!e to co!e.

&R)M ALL,A!C7 T) C)LD WAR

4he Stalinists< eagerness to act as full !e!bers of the i!perial club assu!!ed up in one of history<s classic i!perialist deals. Gere is =instonChurchill<s on description of negotiations for the alta treaty


3. +andel/ 7ourth .nternationalA ove!ber 19*(.

4-9

that shaped the postar orld>74he !o!ent as apt for business/ so & said/ <Let us settle about ouraffairs in the 'al2ans. our ar!ies are in o!ania and 'ulgaria. =ehave interests/ !issions and agents there. :on<t let us get at cross#pur#poses in s!all ays. So far as 'ritain and ussia are concerned/ ho

'ut that as not all. &n -rance/ for e6a!ple/ the CP @oined :eaulle<s postar govern!ent/ in hich it voted to send troops to reconuer Vietna!and helped crush uprisings in orth Africa and +adagascar.

4he shared do!ination suggested by Churchill<s !e!oir as not held to forvery long by either side/ given the !oves !ade by the =est in the latter part of



poses in s!all ays. So far as 'ritain and ussia are concerned/ hoould it do for you to have 90 percent predo!inance in o!ania/ for usto have 90 percent of the say in reece/ and go $0#$0 about ugoslaviaH<=hile this as being translated & rote out on a half#sheet of paper>

o!aniaussia ................................................. 90U

4he others ........................................... 10Ureecereat 'ritain........................................... 90U

Din accord ith the ,.S.A.Eussia ................................................. 10U

ugoslavia.................................................. $0#$0UGungary...................................................... $0#$0U'ulgaria

ussia ................................................. %$U4he others ........................................... )$U

7& pushed this across to Stalin/ ho had by then heard the translation.4here as a slight pause. 4hen he too2 his blue pencil and !ade a large

tic2 upon it/ and passed it bac2 to us. &t as all settled in no !ore ti!ethan it ta2es to set don. ...7After this there as a long silence. 4he penciled paper lay in the centerof the table. At length & said/ <+ight it not be thought rather cynical if itsee!ed e had disposed of these issues/ so fateful to !illions of people/in such an offhand !annerH Let us burn the paper.< <o/ you 2eep it/< saidStalin.7*

And dispose they did. 4he outstanding e6a!ple of 5ast#=est collaborationalong the lines Churchill indicated occurred in reece/ hich had beenconsigned to the =estern sphere of influence. Stalin as holding bac2 theree2 guerrillas and had already cut off aid to the! by closing the borders ofhis 'al2an satellites. D4he dissident Stalinist 4ito did his bit for i!perialis! by

sealing the ugoslav border to the rebels in 19*9.E &n the course of the 'ritish#A!erican 7pacification7 of reece/ thousands of victi!s ere e6ecuted and1*/000 ere deported ithout trial to island concentration ca!ps to overco!e7Co!!unist indoctrination.7


*. Churchill/ Triumph and Tra+edy D19$3EF cited in 7'ehind alta> 4he 4ruth About the=ar/7 in Gal :raper/ ed./ .ndependent Socialism and War D19((E/ p. **

very long by either side/ given the !oves !ade by the =est in the latter part ofthe ar to he! the Soviets in. Stalin<s fears of 7de!ocratic7 i!perialist

presence on his doorstep !ade hi! !ore ary but did not affect his atte!pt at building a grand alliance.

A!erican !ilitary aid to the anti#co!!unist forces Dincluding fascistcollaboratorsE as sent under the 4ru!an :octrine that brought the arti!e

alliance to an end. 4hen ,.S. ,ndersecretary of State/ :ean Ache#son/described ho he convinced Congress of the need for such a !easure>7&n the past eighteen !onths/ & said/ Soviet pressure on the Straits/ on&ran/ and on northern reece had brought the 'al2ans to the point herea highly possible Soviet brea2through !ight open three continents toSoviet penetration. Li2e apples in a barrel infected by one rotten one/ thecorruption of reece ould infect &ran and all to the east. &t ould alsocarry infection to Africa through Asia +inor and 5gypt/ and to 5uropethrough &taly and -rance/ already threatened by the strongest do!estic

Co!!unist parties in =estern 5urope.7$

Acheson refrained fro! pointing out that the =estern CPs ere openlydedicated to the reconstruction of capitalis!/ not socialist revolution. 4he

2ernel of truth in the notion of Co!!unist bogey!en as the desire of !asseson every continent for freedo! fro! foreign do!ination and for a better life/su!!ed up as socialis!. That is the infection that had to be uarantined in theinterests of i!perialis! and ,.S. do!ination/ not any desire on the part eitherof Stalin or the allegedly indoctrinated !asses for the spread of Sovietterritorial poer beyond the ,SS<s 5ast 5uropean satellites and Asian

peri!eter.'y the late 19*0<s/ the Stalinists had done the @ob of crushing the

revolutionary potential of the or2ers< !ove!ents effectively enough so thatthe =est no longer needed the!. 'ut to retain its grip Stalinis! had to displaya level of !ilitancy/ so it still appeared dangerous in a volatile orld. 4he+aoist victory in China/ hich Stalin had not anted/ could not be recogni?edas part of a orldide anti#colonial !ove!ent and so had to be painted as aconspiracy directed fro! +osco.

,nder these conditions the ,.S. as able to depict the 7Co!!unist threat7as an alien force in order to ce!ent the ne alliance. 4here as stillidespread radical !ilitancy in the or2ing classes/ so trade unions


$. Acheson/ Present at the Creation D19(9E/ cited in oa! Cho!s2y/ Toards a :e

Cold War D19")E.45:

ere purged of radicals and rival labor bodies ere created. 4he CPs ereostraci?ed and driven fro! govern!ents in =estern 5urope/ +cCarthyis! inthe ,.S. served to roll bac2 the liberal and leftist trends pro!inent since the:epression/ and the Soviets ere e6cluded fro! the i!perial alliance by !eansof the Cold =ar.

Co!intern feed fro! the sa!e sources as the Social :e!ocracy/ that is/the superprofits of i!perialis!. 4he groth of the Co!!unist parties inrecent years/ their infiltration into the ran2s of the petty bourgeoisie/their installation in the state !achinery/ the trade unions/ parlia!ents/!unicipalities/ etc./ have strengthened in the e6tre!e their dependence



A ne balance of poer as struc2 beteen hat appeared to be todistinct and hostile orlds. 5ven though e6cluded fro! partnership/ the Sovietscontinued to prop up the overall i!perialist syste!. =hile 5urope and apanheld their rivalries ith the ,.S. and each other in chec2/ the ,SS used itsstill#potent influence to 2eep third#orld revolutions ithin bounds. 4he ne

nations of the third orld hich had on independence after the ar beca!efor!ally neutralist and often 7socialist.7 4he initial nationalist victories/ &ndia<sabove all/ see!ed to point to a ay out of the i!perial grip and inspired anti#i!perialist !ove!ents everyhere. 'ut hile re!aining politically friendly tothe Soviets/ the e6#colonies ere effectively reintegrated into the =estern#runi!perialist orld !ar2et. 4he hole balance/ including ussia<s alleged role ase6ternal threat/ as ai!ed at preserving stability # above all preventingupheavals by the groing or2ing classes.

4hroughout the postar period/ the Soviet ,nion has tried to play aninfluential political role that ould enhance its econo!ic opportunities. 4hisdoes not !ean necessarily intensifying its rivalry ith =estern i!perialis! butrather doing hatever is reuired to increase overall stability. &t is i!possible to

understand the Soviets< policies by assu!ing either that they funda!entallydefend progressive interests/ or that they are the !ost dangerous evil on the

planet # the !ost co!!on 7+ar6ist#Leninist7 positions. 4he only realisticanalysis is that they are defenders of the national capital everyhere/conditioned by the particular !ode of operation developed in Soviet ussia.

T>7 STAL,!,ST PART,7S

o one ho had folloed 4rots2y<s analyses of the Co!intern<s degen#eration could be surprised at the Stalinists< ill to carry out such betrayals.=hat as une6pected as their capacity to do so. 4rots2y sa the Stalinist

parties traveling the sa!e road as the chauvinist social de!ocratsF only

transitory bureaucratic rivalries inhibited their incorporation into traditionalrefor!is!. Gere is his assess!ent of these 7e67#Co!!unists/ once he haddeter!ined that Stalinis! as a counterrevolutionary force>

7As regards the e6#Co!intern/ its social basis/ properly spea2ing/ is of atofold nature. 8n the one hand/ it lives on the subsidies of the Jre!lin/sub!its to the latter<s co!!ands/ and/ in this respect/ every e6#Co!!unist bureaucrat is the younger brother and subordinate of theSoviet bureaucrat. 8n the other hand/ the various !achines of the e6#

p / / g pon national i!perialis! at the e6pense of their traditional dependence onthe Jre!lin.7(

4his analysis as true but inco!plete. :uring the ar the CPs did notdisintegrate or dissolve into the social de!ocracy/ despite the dissolution of theCo!intern. 4hey ere indeed refor!ist> unli2e centrists/ they didn<t vacillate in

the least in support of capitalis!. 'ut theirs as a refor!is! of a ualitativelydifferent 2ind fro! that of the pluralist social de!ocrats. 4he CPs< essentialnature as to be cha!pions of the national capital and advocates of thestatification of capital to the highest possible degree. 4heir goal as7socialis!7 as they understood it> a society based on the Soviet !odel/ ithindustry controlled by the state and the or2ing class out of poer. 'ut theycha!pioned the 7national interest7 everyhere.

&n countries here the old bourgeoisie as too ea2 to rule/ the CPs too2over and carried out bureaucratic nationali?ations/ 'ut they sought at first tolead a coalition of shado bourgeois parties in office to legiti!i?e their on

participation in the defense of the national capital. D=e ill discuss theStalinist ta2eovers through our analysis of 4rots2yis! in Chapter %.E

=here the bourgeoisie re!ained strong/ as in the i!perialist =estern poers/ the CPs consistently stood for an increased role for the statenevertheless. 4hey pursued refor!ist policies since the !id#1930<s through

bourgeois popular#front alliances/ because every !easure ta2en to strengthenthe econo!ic role of even a bourgeois state is regarded as a step toards7socialis!.7 As 4rots2y observed/ in the bourgeois de!ocracies the CPsflourished on posts funded by the state and rested on sections of the laboraristocracy and the !iddle class. After the ar the state e6panded everyhere/

because of the las of capital accu!ulation in general and the need to bothincorporate and suppress the or2ing class in particular. 4he CPs e6panded asthe vanguard of the overall trends toard statification and nationalis!.

4he inspiration and direct role of Stalinis! as particularly i!portant in

third#orld countries. 4he ussian revolution had originally aroused not onlyor2ers and intellectuals dedicated to the co!!unist cause but also !e!bersof the intelligentsia attracted by the drea! of an independent nation#state thatcould stand up to i!perialis! and overco!e centuries of


(. 4rots2y/ 7A -resh Lesson/7 Writin+s 19*8-*9A pp. %0#%1.

454

hu!iliation. 4he Stalinists found a social base a!ong govern!ent e!ployees/ asector that e6panded greatly both in the i!perial past and the nationalist

present. +ore generally/ since arti!e i!perialis! depended on inning !asssupport/ it had to encourage nationalist senti!ents not only at ho!e but also inthe coloniesF here !obili?ing the !asses under the slogan of 7de!ocracy7

&n this light/ the theory of per!anent revolution has to be e6tended. Acentral point of 4rots2y<s theory as that the bourgeoisie feared to challengeany for! of property/ given the potential threat of the proletariat. 4hereforethroughout this century it has been unable to carry out the de!ocratic andnational tas2s of the bourgeois revolutionF the internationalist or2ers<



F g g yreuired using the rhetoric of national self#deter!ination in to counter pro#A6is

propaganda. 4his enhanced the appeal of the CPs and other petty#bourgeoisnationalist currents.

P7RMA!7!T R7V)L=T,)! 7@T7!D7D

4he bourgeois nationalists of the oppressed countries loo2ed to the Soviet,nion for support against i!perialis! and as a !odel for their on countries. Ane nation state in this epoch e!erges into a orld of i!!ense repressive forceand econo!ic interdependence. 4o fend off the i!perialists it !ust be capableof highly concentrated control of both capital and political poer. 4he nationneeds to !obili?e and retain the bul2 of its on internally produced surplusvalue/ so that the fruits of e6ploitation can be put to use at ho!e rather thanabroad. &t also has to repress internal capitalists ith interests tied toi!perialis! !ore directly # as ell as to 2eep don the producing classes/hose aspirations for a better life are hetted by the anti#i!perialist struggle.4hese conditions reuire a centrali?ed state apparatus/ and the Soviet !odel

provided it.

Political independence for the ne states and at least a te!porary !easure ofecono!ic leverage as the price i!perialis! had to pay to reestablishinternational stability under ,.S. hege!ony. -acing a tide of !ass rebellions/the iser i!perialists chose to acco!!odate to it/ thereby !aintainingecono!ic influence of not political control. &n !ost of the for!er colonialcountries/ separation fro! i!perialis! as on by non#Stalinist petty#

bourgeois forces ho neither could decapitate their proletariats as effectively asthe Stalinists nor ished to centrali?e property to the sa!e e6tent. 'ut they tootoo2 poer only because of the defeat of the orld proletariat. 4he victory ofStalinis! is the 2ey that loc2ed the revolution of the oppressed colonial !assesinto the nationalist prison and 2ept the! under i!perial do!ination.

=hether Stalinist or not/ the ne nationalist rulers sa their goal asdefending and e6panding the nation#state and the national capital. 4o this endso!e chose to elco!e i!perialist invest!entF others preferred to build uplocal industries ith state aid to produce needed goods at ho!e rather thani!port the!. Al!ost all used so!e for! of socialist or populist rhetoric to

@ustify strengthening the state and capital. As noted in Chapter )/ i!perialis!creates a reciprocal nationalis! in the i!periali?ed countries. And thisnationalis!/ li2e the i!perialis! that engenders it/ is heavily reliant on thenational state.

g Frevolution is ob@ectively necessary. 'ut under specific conditions B here the

proletariat has been defeated or decapitated and its threat to property therebyte!porarily re!oved/ and here the traditional bourgeoisie is too feeble to

pose even a te!porary brea2 fro! i!perialis! B ele!ents fro! the bureaucratic !iddle classes can sei?e the reins of poer. Such nationalists can

even resort to the dangerous step of statifying property/ if the or2ers have been effectively e6cluded fro! independent activity.4his corollary to per!anent revolution is critical for understanding postar

international politics. 4he or2ers< defeat accounts for the creation of so !anyStalinist states in the ar<s after!ath/ as ell as for the particular seuence ofevents in hich the proletariat as shoved aside (e%ore property could benationali?ed. 4he theory also illu!inates the initial success and later collapseof third#orld nationalis!/ the subseuent dependence of these countries onassistance fro! the =estern capitalist poers. All for!s of private propertyere beco!ing interpenetrated in ussia hen 4rots2y first developed thetheory/ and it is all the !ore true today B hen there is not onlyinterpenetrated onership but an inescapably international econo!y.

4rots2y rote a brilliantly perceptive critiue of Stalin<s policy of 7nationalsocialis!7 hich applies ith eual force to the postar third#orld countries>

7+ar6is! proceeds fro! orld econo!y/ not as a su! of national parts but as a !ighty/ independent reality/ hich is created by theinternational division of labor and the orld !ar2et/ and/ in the presentepoch/ predo!inates over the national !ar2ets. 4he productive forces ofcapitalist society have long ago gron beyond the national frontier. 4hei!perialist ar as an e6pression of this fact. &n the productive#technical respect/ socialist society !ust represent a higher stageco!pared to capitalis!. 4o ai! at the construction of a nationally

isolated socialist society !eans/ in spite of all te!porary successes/ to pull the productive forces bac2ard even as co!pared to capitalis!. 4o

atte!pt/ regardless of the geographic/ cultural and historical conditionsof the country<s develop!ent/ hich constitutes a part of the orldhole/ to reali?e a fenced#in proportionality of all the branches of

45-

econo!y ithin national li!its/ !eans to pursue a reactionary ,topia.7%

&ndeed/ national econo!ic independence for the e6#colonial countries couldonly be te!porary during the period of relative prosperity after the ar basedon the or2ing#class defeat. 4his as the ti!e hen the bureaucratic !iddlestrata gre rapidly in all countries/ econo!ically advanced and se!i#colonial.

T>7 =!7@P7CT7D ;))M

4he Cold =ar balance of poer ould not have been possible ithout the postar boo! that brought considerable prosperity to the i!perialist countriesand opportunities for develop!ent even to so!e of the for!er coloni?ed andse!i#coloni?ed nations.



g p y y4he illusions of viable third syste!s and in third#orld nationalis! reflectedthe self#inflation of these layers. 4heir statist national capital solutions/reflecting the Stalinist !odel/ ere posed as an alternative to the real choices insociety> the bourgeoisie and capitalis! on the one hand/ and the proletariat andsocialis! on the other. 4he ne nationalist rulers eventually had to brea2 fro!

the fantasy that they ere not tied to international capitalis!.

"

4he re!oval of the or2ing class fro! the political stage/ hoever/ could beonly te!porary. 4he proletarian struggle cannot be eli!inated by capital/hoever repressive its stateF the defeated or2ers eventually recover/ and thelas of !otion of the syste! continually drive the! to oppose their bosses.4hat is the reality that has deceived all observers of the 7end of the or2ingclass7 school/ even those on the left. &t !eans in addition Das e ill sho laterEthat per!anent revolution applies in the Stalinist bloc as ell as in the countriesof traditional capitalis!.

4 P)STWAR ,MP7R,AL,SM

:espite the great proletarian defeats and the unprecedented econo!ic boo!in the do!inant countries of =estern capitalis!/ the end of =orld =ar && asnot the start of a ne or higher epoch of capitalis!. 4he proof that the epoch ofdecay persists is the orld econo!y of the 19%0<s and 19"0<s/ hen the partiallysuppressed crisis cycle reappeared and bourgeois theorists again panic2ed aloudover the threat of a ne great depression. 4he i!!ense international debtsoed by third#orld/ 5ast 5uropean and even so!e leading i!perialistcountries confir! the fictitious nature of !uch of the postar profitability.Lenin<s theory of i!perialis! as the final epoch of capitalis! re!ains centralfor understanding the syste!<s operation in our on day.


%. 4rots2y/ 7Preface7 to the A!erican edition of Permanent eolution D1930E.". 4he ideas of this section ere first or2ed out and are !ore fully elaborated in

7=hat Are the Co!!unist PartiesH7/ Socialist )oice o. 3 D19%%E/ and 7Per!anentevolution after =orld =ar &&/7 in the LP pa!phlet Permanent eolution and Postar Stalinism D19"%E

4he boo! as based in the ,nited States and on its victory in the ar. &ncontrast to all the econo!ic efforts of the ,.S. govern!ent in the 1930<s thatfailed to get the econo!y bac2 on its feet/ the ar itself as the only 7publicor2s7 pro@ect that the bourgeoisie ould endorse and as also large enoughto end !ass une!ploy!ent and restore profits. 4he astrono!ical state budget

as financed through debt/ as ere those of its ene!ies and allies. At first/ith about one#fifth of the labor force une!ployed and one#uarter ofindustrial capacity unused/ ar production created a boo! ithout cutting bac2civilian production. &n the ords of the fa!ous pro#e :eal econo!ist ohnJenneth albraith/ 74he reat :epression of the thirties never ca!e to an end.&t !erely disappeared in the great !obili?ation of the forties.79

4he A!erican victory in the ar as also an econo!ic victory. &t !adegood the ,.S. debt/ but the other poers/ even those on the inning side/ ereea2ened econo!ically and ended up greatly indebted to A!erica. apan ander!any ere sub@ected to ,.S. do!ination for years/ and 'ritain and -rancesa their e!pires dissolved and their e6#colonies pried open to A!erican

penetration # !ost significantly/ the oil producers of the +iddle 5ast. escued

fro! econo!ic collapse Dand its political conseuencesE by ,.S. loans/ 5uropeand apan ere li2eise subordinated to the A!erican#do!inated internationalorder.

4he +arshall Plan/ hich as instru!ental in spreading the boo! to the5uropean capitalist poers/ as not the rescue plan for dontrodden5uropeans as it as advertised. 4he 7rescue7 ca!e three years after arti!edevastation had left people under !iserably oppressive conditions. &ndeed/ itas only after the proletarian !ove!ents had been decisively set bac2 undertheir Stalinist and social#de!ocratic leaders that the ,.S. then stepped in to

bolster the 5uropean econo!ies.4he boo! had been anticipated by neither +ar6ists nor bourgeois analysts.

oseph Schu!peter rote> 75verybody is afraid of a postar slu!p/

threatening fro! a drastic reduction of !ilitary e6penditure financed byinflationary !ethods as ell as fro! !ere reorientation of production. 4he all

but general opinion see!s to be that capitalist !ethods ill be uneual to thetas2 of reconstruction.710 4rots2yist


9. ohn J. albraith/ <merican Capitalism D19$)E/ p. %".10.Schu!peter/ 7Capitalis! in the Postar =orld/7in S. Garris/ ed./ Postar

&conomic Pro(lems D19*3E/ p. 1)0458

theorists reasoned si!ilarly/ as e ill see in the ne6t chapter.=hat all overloo2ed as the opportunity to e6tract surplus value fro!

advanced or2ing classes hich had been sub@ected to !a@or defeats. As aleading business !aga?ine rote of the -rench or2er after the ar> 7Gisstandard of living today is !arginal in the statistics and all but insupportable in

i!perialist countries advanced ith une6pected regularityF but capitalsucceeded in preventing a return of the proletarian consciousness that had beencrushed in the 1930<s.

4he availability of surplus value in the =est contributed to a buildup of thehite#collar !iddle classes/ a vast layer of unproductive labor and a !odern#



the reality.711

Also i!portant as the international industrial do!inance by ,.S. industry/hich produced to#thirds of orld output. 4his as the ingredient !issingfro! the econo!ic scene after the -irst =orld =ar. o A!erican !ilitaryand econo!ic hege!ony per!itted a greater concentration of resources thanever before in capitalis!<s historyF control over surplus value as centrali?ed onan international scale. 4he co!bination of high rates of e6ploitation and anunparalleled level of international centrali?ation of capital gave birth to the

boo!.4he techniues of govern!ent intervention learned in the 1930<s ere

continued after the ar in all the advanced countries. 4hey included subsidies toindustry through the ar!s budget and other state spending/ together ithune!ploy!ent insurance and other !echanis!s to prevent or2ing#classinco!es fro! sin2ing as lo as before the ar. 4hese Jeynesian !ethodssucceeded in da!pening the sings of the business cycle and sustain the

prosperity bubble once it got startedF they could not create the !asses of surplusvalue that poered the boo!. 4hat as the achieve!ent of i!perialist

hege!ony and the proletariat<s defeat.A factor already !entioned as also i!portant> the isolation of radicalis!

ithin the or2ers< !ove!ents through the Cold =ar. 8ne conseuence asthat industrial speedup and increased productivity ere on by the capitalists

B in return for age increases that ould ulti!ately be eaten aay throughinflation Danother deliberate Jeynesian policyE.1)

4hese age gains had nevertheless to be fought for through !ilitant strug#gles/ hich the acco!!odationist union bureaucracy successfully 2ept divorcedfro! political ai!s threatening to capital. :epolitici?ed or narroly focusedstruggles replaced the !ore radical battles or2ers ere bursting to engage in

by the end of the ar. A reactionary labor aristocracy as strengthened in theadvanced industrial countries. 4hus for to decades after the orld ar/ ages

of the !a@ority of or2ers in the


11. 7ortuneA :ece!ber 19*".1).Jeynes hi!self @ustified inflation ith delicacy> 7=hilst or2ers ill usually resist

a reduction of !oney#ages/ it is not their practice to ithdra their laborhenever there is a rise in the price of age#goods.7 DThe =eneral Theory o%

&mploymentA .nterest and oneyA 193$F p. 9.E

day ad@unct of the labor aristocracy. As already noted/ =orld =ar && and theneed to contain the proletariat led to a big e6pansion of the state apparatus inthe i!perialist heartlandsF in particular/ !ilitary and corporate bureaucraciesgre inordinately/ along ith the concentration of poer at the level of thestate characteristic of the epoch.

Parado6ically/ the boo! based so heavily on the or2ers< defeat ended upcreating the illusion of per!anent or2ing#class prosperity and rising livingstandards. &n the ,nited States especially/ the early 19(0<s ere heady days.4he future appeared lu!inous for al!ost everyone entering adulthoodF at one

point in the decade college attendance e6ceeded $0 percent of all high schoolgraduates/ indicating that !asses of or2ing#class youth thought they had agood chance to rise in society. 4he blac2 revolts of the period/ initiated bycollege students/ reflected the bitter reali?ation that ith so !uch prosperity athand blac2 people ere still sub@ect to intolerable conditions.

4he opti!is! characteristic of the postar boo! period as felt in Sovietussia too. Jhrushchev predicted the surpassing of A!erican productionlevelsF he also boasted at the ))nd Party Congress in 19(1 that 7socialis! had

triu!phed fully and finally in our country and e have entered the period ofthe full#scale building of co!!unis!.7 +oreover/ 7everyone ill be assured of!aterial sufficiencyF by the end of the second decade M19"0N there ill beassured an abundance of !aterial and cultural benefits for the entire

population.7 Contrast this ith orbachev<s sober assess!ents today.

&,CT,T,)=S CAP,TAL

4he boo! engendered the buildup of a !assive balloon of fictitious capital.4he standard source of fictitious capital/ the overvaluation of invest!entsDChapter 1E/ as inflated by e6panding aste production and speculation. &nthe classical business cycles such balloons ere periodically burst by the

periodic crisesF in contrast/ the postar balloon has been continually inflated.

4he danger of a cataclys!ic collapse as a result of each upco!ing cyclicalcrisis co!pels govern!ents to try to postpone such crises by puffing up thedebt balloon # thereby !a2ing the potential conseuences of an e6plosion evengreater. &n this sense the fictitious capital boo! is a reflection of the latent

poer of the or2ing class and its per!anent threat to capital.

459

State spending on ar!s/ social benefits on by or2ers and subsidies ofinefficient capitals created large public debts fro! =orld =ar && on/ and theconseuent ta6 drain on profits !eant that a groing portion of businessinvest!ent had to co!e fro! borroed funds as ell. 'eyond a certain pointdebts are not si!ply one fir!<s e6pense balancing another<s inco!eF they are

see use values replacing value as the goal of capitalist production DChapter 1E/the opposite is in fact ta2ing place> as balloons of fictitious value build up/ useis !ore and !ore separated fro! value. &n the decadent epoch of capitalis!/fictitious capital beco!es a bra2e on the syste! that can be overco!e/revolution aside/ only by volcanic purges in the for! of great depressions and



clai!s on surplus value that reuire repeated postpone!ent to the future. 4heaccelerating debt buildup reached the point here by 19"1/ !ore capitalistinco!e in the ,.S. ca!e fro! interest than fro! corporate profits # the firstti!e this had happened since the years of sub?ero profits in the 1930<s. 13

Capitalis!<s creation of fictitious value threatening to cho2e the syste! is anillu!inating reflection of the inherent contradiction beteen the drive toaccu!ulate and the need to preserve the value of e6isting capital. 4he absolutededication of capital to the !a6i!i?ation of value leads it to generate valuefor!s ithout the bac2ing of !aterial goodsF then the dedication of !uchsurplus value to the proliferation of paper value disrupts the groth of real

production. An econo!ic @ournalist reported the vies of a pro!inent bourgeois theorist>

7Peter -. :ruc2er ... contends that there has been a basic change in the orldecono!y. 4he <real< econo!y of goods and services and the <sy!bolic< econo!yof !oney/ credit and capital are no longer bound tightly to each other/ he says/and <are !oving further and further apart.< Stri2ing evidence to support thisthesis is provided by the idening disparity beteen the sluggish groth of the

real econo!ies of the ,nited States and other industrial countries and thee6uberance of their financial !ar2ets. esterday the :o ones industrialaverage Mfor the e or2 stoc2 !ar2etN closed above )000 for the first ti!e/ again of 31 percent in the past year. 'ut this nation<s econo!y gre only ).(

percent last year ... . Li2eise/ ... the +organ Stanley Capital &nternationalPerspective =orld &nde6/ a !easure of global stoc2 !ar2et perfor!ance/ rose39 percent/ ad@usted for the dollar<s decline. 'ut the real orld econo!y as inthe doldru!s.71*

'ourgeois analysts fear/ of course/ that the balloon can be punctured and billions of dollars of fictitious capital/ together ith its oners/ iped out. Afterall/ hen crises destroy values/ the fictitious values are the first to go. Aforetaste of hat is in store as provided by the 8ctober 19"% stoc2 !ar2et

crash/ hich deflated the balloon but by no !eans enough to prevent a latere6plosion.1$ Contrary to Cliff and other theorists ho


13. &conomic eport o% the PresidentA ,.S. overn!ent/ 19").1*.Leonard Sil2/ :e Hork TimesA anuary 9/ 19"%.1$.See 7After the Crash/7 Proletarian eolution o. 31

orld ars.4he situation is analogous to the condition of 7per!anent crisis7 in the

Soviet variant of capitalis!. ust as the Stalinist rulers cannot allo enterprisesto go out of business ithout endangering their syste!/ so too =esterncapitalis! cannot afford to allo !a@or corporations or ban2s to collapse.'ecause all the giant fir!s are interpenetrated/ the collapse of one ould bringdon !any others. -or this reason the Chrysler Corporation as bailed out bythe ,.S. Congress in the late 19%0<s. 5ven under the 7free#!ar2et7 eaganAd!inistration/ the govern!ent has intervened to prop up failing fir!s and

ban2s if they are big enough. =hen the Continental &llinois ban2/ one of thecountry<s largest/ collapsed/ it as ta2en over and for practical purposesnationali?ed. Si!ilar solutions have been used in =estern 5urope and Canada.

4he build#up of fictitious capital !eans that a large uantity of paper capitalis chasing after a co!paratively s!all pool of surplus value. 4his !eans afalling rate of profit/ a reflection of the la +ar6 analy?ed and hich appliesespecially in the epoch of decay. 5!pirical evidence on the -P for the

postar period shos that/ for .,.S. capital/ the overall rate of profit held even

at an average of 10 percent Dith rises and falls of about ) percentE in the 19*%#(% period/ but then fell sharply to an average belo ( percent fro! thenthrough 19"$.1(

4he e6cess clai!s on surplus value that arise fro! the fictitious capital boo! contribute to another =estern analogue to Stalinis!> shoddy !ain#tenance of the 7infrastructure7 of industry/ transport and the naturalenviron!ent. =hen !assive debts have to be paid/ fir!s and govern!entshave to thro all available cash into the pot # not only their profits but alsotheir constant capital reneal and repair funds. DA portion of constant capitalcan easily be credited as surplus value/ thereby e6aggerating the real rate of

profit.E 4he orld has faced industrial disasters not only at Chernobyl but alsoat 4hree +ile &sland/ =indscale and 'hopalF not only is La2e 'ai2al polluted

and the Aral Sea evaporating/ but La2e 5rie is dying and the hine iver ache!ical seer. 'oth for!s of capitalis! find that !a6i!i?ing the nationalcapital !eans preserving obsolescence and per!itting environ!ental decayregardless of hu!an costF neither for! has


1(. Anar Shai2h/ 74he -alling ate of Profit and the 5cono!ic Crisis in the ,.S./7 in,P5/ The .mperiled &conomy D19"%E.

48:

resources sufficient to solve the crises brought about by the syste!<s !addisregard for the future.

As under Stalinis!/ postponing a decisive crisis Dand the restructuring ofcapital that ould acco!pany itE has !eant that the underlying basis for profitsis ea2ened and that the collapse/ hen it does arrive/ ill be all the orse. 4he

the resu!ption of depression conditions for !any. &n the ,nited States/ still theloco!otive of the orld econo!y/ the or2ing#class standard of living has notincreased since the late 19(0<s. 8ne revealing co!parison is that averageinco!e for or2ing#class !en aged *0 in 19%3 declined over the ne6t decade

by about 1.$ percent per yearF in the 19$0<s and 19(0<s it had gron by about



postar period has e6hibited so far no all#out collapse but rather a series of!ini#crises that succeed in destroying only s!aller capitals and strengtheningthe hand of the do!inant !onopolies. 'ut the untouchability of the giants is nota per!anent condition.

T>7 7!D )& T>7 ;))M

4he conditions that created the boo! eventually turned. 4he Cold =ar andthe international instability it engendered had led to a tre!endous ar!s buildup.4he vast !ilitary budgets of both i!perialist and non#i!perialist countriesfor!ed the !a@or part of state spending globally/ a considerable drain on

productive invest!ent and therefore on econo!ic reneal and e6pansion. 4hisand other Jeynesian techniues for da!pening the business cycle left crisesunresolved> old capital as not sufficiently devalued and bac2ard industriescontinued to operate. ecessions beca!e less profound but !ore freuentF the

postar cycles averaged less than five years rather than the nearly ten ofclassical ti!es.

4o decades ithout a !a@or donturn led to overproduction on a orld

scale/ especially hen apan and =est 5urope recovered fro! arti!edestruction and reached first ran2 in !anufacturing. 4he co!bination ofoverproduction and fictitious capital left feer outlets for productiveinvest!entF fro! this folloed the plague of speculative corporate ta2eoversand a ne e6pansion of fictitious clai!s to value. 'y the early 19%0<s a seriouscrisis cycle had re#e!erged/ and une!ploy!ent levels !oved out of the real!of 7prosperity.7 4he ,.S. and 'ritain beca!e conspicuous e6a!ples of grosse6tre!es of ealth and poverty e6isting side by side.

:eclining i!perial fortunes ere accelerated by the tre!endous costs of theVietna! ar/ the =est<s pri!ary atte!pt to stifle nationalist struggles againsti!perialis!. 4he ,.S. defeat as a blo to i!perialist prestige and a signal thatits unchallenged hege!ony as at an end. &t is no accident that the end of the

postar boo! led to rising or2ing#class struggles 5ast and =est. &n the 19(0<sor2ers in the ,.S. de!anded their share of the di!inishing prosperity throughidespread ildcat stri2es and the blac2 ghetto uprisingsF or2ers in -ranceD19("E and &taly D19(9E bro2e their chains through !assive stri2e struggles. Sodid or2ers in C?echoslova2ia and Poland/ countries hose econo!ic fortuneshad risen and fallen in parallel ith the =est.

4he upshot is that orld capitalis! is no e6periencing an intensifyingcrisis> not @ust periodic donturns but/ underneath the ruling#class glitter/

).$ percent yearly. 4he decline is greatest a!ong industrial or2ers hosehigh pay has been replaced by the !iserable ages available in uns2illed blue#collar service @obs/ and especially a!ong blac2 and Latino or2ers.1%

4he fact that the e6pansion of the postar years had ended as hidden byrising paper profits and stoc2#!ar2et values. 'ut other o!ens of a long#ter!depression are strong. &n 19"% in the ,nited States/ ith over % !illion or2ersune!ployed by govern!ent figures/ another ( !illion 7discouraged7 and notofficially in the category of those see2ing @obs/ plus an i!!ense 1" !illionor2ing less than half ti!e for an annual inco!e of under 10/000/ theeffective une!ploy!ent rate as ell above )$ percent # a level co!parable tothe 1930<s. 4his situation has not yet penetrated the consciousness of !ostA!erican or2ers. 8ne co!!entator su!!ed up the proble! for the rulingclass>

7Sooner or later/ a falling living standard ill be political dyna!ite/ too.=hen it dans on enough A!ericans that they can no longer e6pect to do

better econo!ically than their parents/ or even as ell/ their reaction is li2elyto be outraged/ even dangerous.7 1"

4hat is correct. 4he bourgeoisie understands that the or2ing class is !ore poerful than it appears under its refor!ist leadership. 4he unpopular Vietna!ar/ for e6a!ple/ as fought under the 7guns and butter7 recipe # ages ere2ept relatively high to prevent a social e6plosion. A decade and a half later/hen declining profits led to a united capitalist attac2 on or2ers< ages/President eagan too2 the lead by crushing the air traffic controllers< unionDPA4C8E. 'ut the bourgeoisie did not dare follo up ith an all#out ar onthe unions. And in the face of today<s desperate need for higher productivityand profits/ hen bosses are turning to incorporative devices li2e 7uality#of#life circles7 to grind or2ers don/ austerity is real but its pace re!ains slo.4he bourgeoisie recoils fro! a head#on conflict.

&nternationally/ ,.S. econo!ic hege!ony could not last forever. &ndustry in

apan and continental =est 5urope e6panded and !oderni?ed !ore rapidly/unencu!bered by the ar!s burden. 4he resulting co!petition Din#


1%.-ran2 Levy/ 7Changes in the :istribution of A!erican -a!ily &nco!es/ 19*% to19"*/7 ScienceA +ay ))/ 19"%.

1".4o! =ic2er/ :e Hork TimesA August 1%/ 19"%.

484

cluding that fro! industries/ !any i!perialist#oned/ in the 7developing7countriesE has led to A!erican obsolescence in specific industries li2e steel/te6tiles and shipbuilding. 'ut hen the ,.S. econo!y ea2ens/ its centralityand si?e !eans that orld capitalis! as a hole suffers. Another factor is theenor!ous third#orld debt> its conseuences have inflicted !isery on !illionsFd f l ld h i f @ S b 2

'ut this as not the !ain line of attac2. 4he A!erican social de!ocrat+ichael Garrington argued that central features of i!perialis! ere no longerdecisive for orld politics>

7Lenin<s theory of the essential and inevitable role of i!perialis! in Asia/Africa and Latin A!erica no longer holds. 4he 4hird =orld is less i!portant

h d d i li h i i h i hi d h i



default ould threaten ruin for !a@or ,.S. ban2s.4he econo!ic situation that capital has faced since the early 19%0<s is

tenuous. Profits are insufficient for the thoroughgoing restructuring of capitalnecessary for a ne boo!. 4he ,.S. even hesitates to co!!it itself to the neopportunities Din 1990E for !a@or invest!ent in 5ast 5urope. 4here is also fearof a deep depression that could ipe out the !ost bac2ard and obsolete fir!sand devastate the or2ing classes once again.

4he 7eagan revolution7 in econo!ic policy increased ,.S. govern!entdebt by years of borroing in lieu of ta6ation and a!assed a record foreign debtthrough enor!ous trade deficits. 4he gain as a spurt of prosperity for the!iddle classes at the cost of !assive decay of the country<s productiveindustrial plant/ not to !ention the infrastructure of transport and theenviron!ent already cited. eagan<s 7voodoo econo!ics7 Deorge 'ush<s @ibein the 19"0 presidential ca!paignE see!s/ oddly enough/ to have !i!ic2ed theiere2 strategy of postponing Poland<s crisis in the 19%0<s. &n any case/ theresult ill be !uch the sa!e> the crisis ill co!e to a head through a financialcollapse and the or2ing class ill be told to shoulder the burden for e6cesses it

never shared. 4he ,.S. has the potential for the greatest or2ing#class eruptionin its history. 4he 5astern 5uropean crisis DChapter "E reflects the future notonly for the Soviet rulers but for A!erica as ell.

L7!,!6S T>7)R# R7V,S,T7D

4he end of the postar boo! plus the revival of or2ing#class struggle laidthe basis for a reneal of left#ing !ove!ents and +ar6is!. 4here as also areturn to Lenin<s analysis of i!perialis! # and a corresponding attac2 by liberaland social#de!ocratic theorists against the relevance of Leninist theory.

So!e obvious updating has to be done to Lenin<s 7five point7 definition ofi!perialist econo!ics DChapter )E. +onopoly/ the !erger of ban2 and industrialcapitals/ and international carteli?ation are still pro!inent B !ore so/ ith the

rise of 7!ultinational7 corporations/ the increased statification of capital Dup toan including the Stalinist for!E/ and even state cartels along the lines of7co!!on !ar2ets.7 8n the other hand/ the outright colonialis! of the early)0th century is co!paratively li!ited today. A handful of poers still e6ploitthe orld/ not pri!arily through direct political rule but rather throughecono!ic poer # bac2ed up/ as alays/ by overhel!ing !ilitary force.

to the advanced capitalist poers than at any ti!e in their historyF and their prosperity is !uch !ore dependent on the !aintenance of high !assconsu!ption ithin their on borders B and ithin other ealthy countries #than upon the e6ploitation of the orld<s hungry.719

Garrington concluded that i!perialist ar as no a !atter of policy/ notco!pulsion> the syste!/ he said/ 7is no longer fated to do evil.7 4his could onlyhave been ritten during the boo!/ hen illusions in the eternal prosperity ofthe =est e6tended to the conclusion that i!perialis! ould be happy to live in

peace ith its victi!s. 4heories li2e Garrington<s ere devised less to probethe reality of the !odern orld than to defend the refor!ist thesis thatcontinuing i!perialist outrages Dnotably the ,.S. ar on Vietna!E ereunfortunate choices to be corrected by electing greater nu!bers of liberal

bourgeois politicians.Since Garrington rote his rationali?ation/ the e6perience of 4hatcher#is!

in 'ritain and eaganis! in the ,.S. has again falsified the undercon#su!ptionist vie that capital beco!es unprofitable if !ass living standardsdecline. Profit/ after all/ not consu!ption/ is hat 2eeps the syste! going. As

for the econo!ic significance of the third orld/ 7deindustriali?ation7 hasshifted !any @obs there in search of loer ages. 4he capitalists are constantly

proving that they depend on e6ploiting the or2ers/ both abroad and at ho!e/far !ore than on satisfying consu!ption needs.

Garrington as also rong to suggest that Lenin<s theory of i!perialis!applied e6clusively to e6ploitation of third#orld peoples> Lenin specifiedcapital e6port in general/ to advanced countries as ell. 'ut !uch of this islin2ed to e6ploitation of the third orldF ,.S. oil co!panies< invest!ent in the5urope in the postar period/ for e6a!ple/ enabled the! to increase their

profits fro! the +iddle 5ast and Algeria. +oreover/ even if Garrington ereright to i!ply that direct invest!ent in third#orld industry is relativelydeclining/ there re!ains the indirect !ethod of loans to third#orld capitalists

and govern!ents # hich have increased enor!ously in the past fifteen years.-inally/ the fact that the capitalist poers are vitally interested in preservingtheir do!ination of the third orld is proved by their constant ars to guardthe syste!<s outposts and halt !ilitant nationalist !ove!ents. 4hey arei!perialist as ever.


19. Garrington/ Socialism D19%0E/ p. 3"9.

48-

4he social#de!ocratic theories depend in part on the fact that several7developing countries7 Da euphe!is! for the victi!s of i!perialis!E have infact developed. &n the 19%0<s bourgeois apologists ere hailing 'ra?il/ +e6ico/4aian/ South Jorea/ and other countries hose econo!ies e6panded rapidly.4hey gre not only because of the invest!ents of i!perialist capital/ but alsoh h h i f l l b i i f h bi i f l

!eant that/ at least te!porarily/ political poer/ as ell as econo!icelfare/ have beco!e less eually distributed. &t has thus beco!e clearthat the econo!ic develop!ent processes of the fifties and si6ties havenot led to the intended result # !assive i!prove!ents in the elfare ofthe poor # but have/ if anything/ increased ineuity.7))

4h i i l d b i i h h l ll d i i h i



through the prospering of local bourgeoisies fro! the co!bination of slaveages Dtypically enforced by !ilitary repressionE and the groth of orld!ar2ets during the boo!.

4his is no refutation of Lenin. A 2ey ele!ent in Lenin<s theory is co!!onlyoverloo2ed> since capitalist decay ould !ean parasitis! of the richestcountries through the siphoning of profits fro! the poor ones/ Lenin foresaecono!ic e6pansion in the colonies acco!panied by decline in the i!perialistcenter. :uring the postar boo!/ Lenin<s prediction see!ed rong> thei!perialist poers e6panded and did 7raise the standard of living of the !assesMat ho!eN/ ho are everyhere half#starved and poverty#stric2en/ in spite of thea!a?ing technical progress7)1 # so!ething Lenin thought i!possible e6cept forthe narro labor aristocracy.

4he develop!ent of the 7nely industriali?ed countries/7 hoever/especially hen co!pared ith recession in the =est in the after!ath of the

postar boo!/ appears to fulfil Lenin<s prognosis> as boo! turns to bust/ !oreand !ore industrial @obs are !oving to lo#age labor in the poor countries.5ven so/ the econo!ic groth in these countries has been li!ited Das Lenin

e6pectedE. one of the! has been able to approach the econo!ic level of theadvanced/ and their i!pressive statistics of increasing ross ational Product

per capita in reality !as2 grossly uneven inco!es and grinding !ass poverty.As one bourgeois e6pert su!!ed up Dith a degree of euphe!is! that fe

besides practiced acade!ics can !usterE> 7ot only have !ost developingcountries e6perienced a decrease in the share of inco!e accruing to the poorest(0 percent/ but in !any/ the relative decrease has been sufficiently pronouncedto result in declines in the absolute levels of the poor. At the sa!e ti!e/ in the

political arena/ the process of interaction beteen the social forces of !od#erni?ation and the e6isting poer structure has led to varying degrees ofinstability and internal violence/ as ell as to a general tendency toards less

participatory for!s of political structureF the latter has


)0.Lenin/ .mperialismA the Fi+hest Sta+e o% CapitalismA Chapter ". &n e6pectingcapitalist progress in the colonies Lenin echoed +ar6/ ho rote of 'ritaindragging &ndia forard but 7through blood and dirt/ through !isery and degra#dation7 at the e6pense of the !asses. D74he -uture esults of 'ritish ule in &ndia/71"$3F in ?arl ar! on Colonialism and oderni3ationA S. Avineri/ ed.E

)1. .mperialism $$$A Chapter *

4he international debt crisis has sharply called into uestion the econo!icstability of the third#orld countries. 'ecause of the obligations to the ban2s #hich third#orld rulers consider sacred and only postpone paying hen theyliterally don<t have the cash # starvation and disease are beco!ing even !orera!pant. 4he crisis also e6posed the third orld<s dependence on thei!perialist poers. Statistically/ an e6pert noted that the industriali?edcountries 7have absorbed the resources of the rest of the orld/ and principallythose of the developing countries.7 Li2eise/ the head of the =orld 'an2/hardly an opponent of i!perialist e6ploitation/ observed that 74he developingcountries are transferring to the industriali?ed orld !ore !oney than theyreceive in ne financing.7)3

-igures co!piled since the outbrea2 of the debt crisis e6plode the theorythat i!perialist e6ploitation is not profitable. Gere is hat the co!bination ofdebt repay!ents plus capital flight fro! the i!periali?ed countries has !eant>

7Since 19%9 the !ost i!portant debtors have devoted fro! %0 to "0 percent of the total of their ne borroings to the pay!ent of interest ontheir previous debts. 4his gigantic transfer of resources fro! the

periphery to the principle !etropolitan capitalist countries has had aspectacular effect> in 19"1/ for the first ti!e in postar history/ the third#orld countries have beco!e net e6porters of capital. -ro! 19"1 to19"$/ this flo has !ultiplied on the average by a factor of 10/ passingfro! % billion to %* billion dollars.7)*

Goever developed the third#orld countries !ay be/ their surplus value isstill appropriated in large !easure by the i!perialist poers. 4his results fro!the siphoning aay of profits as ell as fro! uneual trade DChapter )E. 4hereis also the o!inous trend of i!perialists de!anding


)). &. Adel!an/ Eournal o% eelopment StudiesA 19%*. 7Less participatory for!s of political structure7 indeedO Liberals see! incapable of believing ill of ruling

classes. &sn<t it apparent by no that the 7intended result7 of i!perialist invest!entand 7aid7 is precisely hat Adel!an describes rather than hat is piously

preachedH)3. ,.. 5cono!ic Co!!ission for 5urope/ &conomic Surey o% &urope in 1980-

1988; 'arber Conable/ World #ank :esA April )*/ 19"". 'oth cited by -.Clair!onte/ e onde iplomati/ueA uly 19"".

)*. -. Clair!onte and . Cavanagh/ e onde iplomati/ueA Septe!ber 19"(.

488

and getting property rights hen cash repay!ents are not forthco!ing. Lenin<soverall outloo2 has proved correct> the rich countries get richer Dith their!asses benefiting in partE/ hile the poor re!ain poor and dependent.

8ne reason for the error in Lenin<s specific e6pectation that the !asses atho!e ould re!ain 7half#starved and poverty#stric2en7 is that the !ost !odern

d ti t h i i l d d l d i d i l

e6cessive surplus/ hich the syste! cannot absorb but hich neverthelessserves to eli!inate periodic crises at the cost of stagnation and various socialdiseases. Gence the per!anent corruption of the or2ers and the conclusionthat 7the anser of traditional +ar6ist orthodo6y # that the industrial proletariat!ust eventually rise in revolution against its capitalist oppressors # no longer

i i ti 7



production techniues reuire an already developed econo!ic and socialenviron!ent and therefore have to locate in the advanced countries. Another isthe success of the revolution Lenin led> hen the Soviet or2ers sei?ed poerand e6propriated capital/ !uch of it foreign oned/ the i!perialists learnedabout the ris2 of investing in potentially volatile areas. 8nly in the profits crisisafter the postar boo! has i!perialis! turned broadly toard industriale6pansion in the third orld.

T>,RD W)RLD,SM

=hile social de!ocrats hold that capitalis! is no longer i!perialist/ the7third#orldist7 school believes that i!perialis! has totally transfor!edcapitalis! and its las of !otion. &n the 19(0<s this current as heavilyinfluenced by the Chinese Co!!unist Party<s conception of an revolutionarystruggle by the orld<s 7countryside/7 the se!i#colonial countries/ against the7city/7 the advanced i!perial poers. 4his as a !ore revolutionary line thanthe pro#+osco Stalinists</ ho tried to li!it every struggle to refor!s. 'ut itignored the class struggle not only ithin the capitalist centers but also ithin

the se!i#colonies. 4he theory<s roots lay in bourgeois nationalis!/ not+ar6is!.&n the =est third#orldis! beca!e the predo!inant vie a!ong a hole

generation of leftists in the 19(0<s. 4heir !entor/ Paul See?y/ denounced theCo!!unist Parties and the 5uropean proletariat for having succu!bed toi!perialist bribery>

7:uring the long period of capitalist e6pansion after the Second =orld =ar/those Co!!unist parties hich had been relatively !ost successful B the so#called 5uroco!!unist parties # gre gradually !ore refor!ist. 4oday/ ahundred years after +ar6<s death/ it is i!possible to !a2e out a reasonable casefor the vie hich had been for so long at they very heart of +ar6is!/ i.e./ thatthe proletariat in the advanced capitalist countries is destined to be the agent of

revolutionary change.7)$

See?y ignores history and logic> the CPs beca!e refor!ist during the not#so#prosperous 1930<s. 'ut he is consistent ith underconsu!ption theory> heand 'aran credit the transfor!ation of !odern capitalis! to


)$. See?y/ 7+ar6is! and evolution 100 ears After +ar6/7 onthly eieA 19"3

carries conviction.7=hat really lac2s conviction/ hoever/ is a theory that displaces the

proletariat ithout discussing the class struggle B and still styles itself+ar6ist. 'aran and See?y illingly ac2noledge their 7al!ost total neglectof a sub@ect hich occupies a central place in +ar6<s study of capitalis!> thelabor process.7 4heir e6cuse is that they uphold the 7international classstruggle7 and believe that the revolutionary initiative has passed to the7i!poverished !asses in the underdeveloped countries.7)( 4his !eans/hoever/ not the or2ers< struggle in these countries but rather the efforts ofnationalist leaders to in breathing roo! fro! i!perialis!.

4he international class struggle is indeed critical. 'ut in the third#orldcountries/ as elsehere/ the proletariat is central to the socialist cause> only its

!aterial interests are funda!entally anti#capitalist. Li2eise/ it is i!possiblefor +ar6ists to dis!iss the struggle in the advanced countries/ here theor2ers have greater econo!ic poer. As the per!anent revolution analysisshos/ revolution in the i!perialist countries is necessary/ not only to disar!i!perial !ilitary poer but also because ithout international socialis! the

e6#colonial countries ill never reach the econo!ic level of !oderncapitalis!/ !uch less go beyond it.

&t is an evasion of +ar6is!/ not an updating/ to overloo2 the effect that thecapitalist crisis has on the or2ing class/ forcing it into deeper levels ofstruggle. -ro! the end of the postar boo!/ hen the -rench and &talianor2ers e6ploded in nationide class battles/ to the 19"0<s/ hich sa !assstri2es across 5urope fro! 'ritain to Poland and the ,SS Dnot to spea2 of&ran/ South Africa/ South Jorea/ the Philippines/ 'ur!a and ChinaE/ the

proletariat has signaled that it is dissatisfied ith conditions under capitalis!.4he tas2 of +ar6ists is to @oin the struggles of their class in order to sho theay forard/ not to treat the! ith 7al!ost total neglect.7

+oreover/ hole sections of the or2ing class in the advanced orld/ li2e

A!erican blac2 or2ers/ are vitally interested in and influenced by thestruggles of the oppressed and e6ploited abroadF)% the latter have also closelyfolloed the ,.S. blac2 struggle ever since the early 19(0<s. 'aran and See?ycite only !onopoly capital<s effect on the blac2 7!asses7 in


)(. 'aran and See?y/ onopoly Capital D19((E/ pp. "#9.)%. See 74he 'lac2 Struggle/7 Socialist )oice o. %/ -all 19%" 666

489

the ,.S. ithout specifying the significance of the blac2 proletariat.:espite the argu!ents of both social de!ocrats and third orldists/ the

essentials of the +ar6ist theory of the epoch of decay have been a!plyconfir!ed. 4he -irst =orld =ar opened up a period of social revolutions

beginning in ussia and spreading to Central 5urope. 4he syste! survived byl i th f f f i b t it t l b f th ld

described by Lenin/ it is a product of the sa!e capitalist tendencies at a laterstage in their develop!ent. =e ill also sho that Stalinist i!perialis! haschanged significantly/ even in the less than half century of its e6istence.Although its isolation and ea2ness have dictated an overall strategy of

peaceful coe6istence ith the do!inant =est/ Stalinis!<s tactics have beco!e2 dl l i b f th t f it i d li



relying on the forces of refor!is!/ but it as not long before the orldecono!y collapsed in the reat :epression. And that as acco!panied by thehorrifying counterrevolutions in er!any and ussia # folloed by the reneeddevastation and defeats of =orld =ar &&. 4he continued e6istence of capitalis!/once the !ost progressive for! of society in hu!an history/ as !ade possibleonly by the !ost barbaric period the orld has ever seen # the 7!idnight of thecentury7 of the 1930<s and 19*0<s.

4oday/ narroing ealth in the do!inant countries coe6ists ith !ass!isery in the greater part of the globe. 4he build#up of fictitious capitalthreatens the i!perialists< econo!ic stability as ell as the living conditions ofthe !asses. 4he i!perialists are virtually deserting hole areas of the thirdorldF despite the super#cheap labor there is too little infrastructure for

profitable e6ploitation. 5ven during the Pa6 A!ericana/ ars and repressionvicti!i?ed the already poverty#stric2en countries. And if nuclear arfare has

been suspended Dnot prevented> it as used by the ,.S. against apanE/ its!onstrous capacity for destruction still e6ists/ threatening and constricting allinternational politics. othing in the nature of the i!perialist ruling classes ill

stop the! fro! using nuclear eapons hen political and econo!ic conditionsleave the! desperate. 4he progra! of +ar6 and Lenin re!ains> only proletarianrevolution offers a ay out.

0 STAL,!,ST ,MP7R,AL,SM

&f Stalinis! is a for! of capitalis! in the epoch of decay/ then the do!inantStalinist country/ the ,SS/ !ust be i!perialist as ell as capitalist. 4his raisesa uestion for our theory> if the Soviet syste! is driven only to e6pand itsnational capital/ in contrast to poers hich e6port capital/ ho then can it bei!perialist in the Leninist senseH

As e ill see/ the standard state capitalist theories fail to deal ith the

nature of Stalinist i!perialis!. 8n the other hand/ opponents of state capitalisttheories li2e +andel and See?y have difficulty accounting for the Sovietrulers< years of do!ination over/ and e6ploitation of/ nations ithin the ussian7prisonhouse7 as ell as their 5ast 5uropean allies.

=e ill sho that/ @ust as internal econo!ic relations ithin the Stalinistsyste! can be understood through the drive to !a6i!i?e the national capital/ sotoo can its e6ternal relations. 4he relation beteen the ,SS and its satellites is

i!perialist. Although not a si!ple copy of the type

!ar2edly less aggressive because of the nature of its econo!ic decline.

T>7 ,MP7R,AL,SM )& ;AC?WARD!7SS

At the height of Stalinis! during the postar years/ the Soviet rulers hadlittle co!pulsion to e6port capital. Statified capitalis! ai!s to e6pand thecapital ithin its national boundariesF it is therefore interested in foreigninvest!ents only insofar as they help toards this goal. egional/ local andindustrial bureaucrats are rearded according to ho they !anage their plantor bailiic2F they have had no incentive/ and nor!ally no opportunity/ toinvest abroad. +oreover/ they had little need to search for cheap labor abroad>they paid lo enough ages at ho!e. 4heir proble! as serious laborshortages due to lo productivity/ and their nationalist needs led the! toimport even loer#paid or2ers fro! satellite countries ith e6cess labor/ li2eVietna!.

'ut there is nevertheless an econo!ic !otivation for Stalinist e6pan#sionis!. 4he bureaucrats are forced to loo2 abroad for use-alues J netechnology/ !inerals/ food/ etc. # to fill the inevitable gaps in their do!estic

econo!y. 4his is because the Stalinist goal of national autar2y is ani!possibility/ especially for a country ith the ,SS<s notorious econo!icinefficiency. 4he Soviet econo!y/ devoted to the retention of every particle ofvalue/ nevertheless astes and destroys use values. 4he need to i!port usevalues inheres in the ,SS<s relations of productionF it is not @ust a policy set

by the rulers at particular [email protected] ,SS searches for use values abroad/ in contrast to the values it see2s

to build up at ho!e/ as it does in the 7second econo!y7 of privately producedconsu!er goods hich it depends on internally. All use values have value/ butthis is not the criterion for choosing the!. -inancial losses can be tolerated inthe effort to obtain the !issing use values/ as long as the overall result is to!aintain the national capital and !a6i!i?e its value. 4o this end/ of course/ the

acuisition of surplus value abroad ill be underta2en if it does not conflictith the pri!ary goal.

Let us loo2 at the history of Soviet i!perialis! in this light. &n the early postar period the ussian rulers had an additional !otive> the restoration ofthe Soviet econo!y/ even if at the e6pense of other peoples. 4hey utili?ed three

basic !ethods of e6ploiting their satellites Das ell as

41:

China/ before and after the revolution of 19*9E>)"

1. 8n the prete6t of obtaining ar reparations/ they stripped 5astern5urope/ dis!antling factories and !achines and shipping the! ho!e to the,SS. 5ven +anchuria/ a province of China/ a arti!e ally and victi! oftraditional i!perialis!/ as looted in this ay. Although the Stalinist econo!ycheed up i!ported use values as it did do!estic D!achinery as destroyed in

Co!econ encouraged !ultinational autar2y and dependence on the Sovietecono!y. Applying its use#value interests/ the ,SS asserted the right tochoose ho produce hat/ to ta2e first pic2 of uality goods/ etc.

At ti!es the ussians have subsidi?ed so!e allies B 5ast 5urope ingeneral for a period/ Poland after its !ilitary regi!e suppressed Solidarity in19"1 and the Polish econo!y re!ained in crisis and Cuba ever since it as



cheed up i!ported use values as it did do!estic D!achinery as destroyed intransit/ factories lay rusting by the aysideE/ and this !eant a huge loss for theDStalinistOE rulers of the looted countries/ it ca!e at no cost to the Soviet rulers/and so continued.

). 4he Soviets too2 over large enterprises previously sei?ed by the er!anoccupiers and declared the! @oint#stoc2 co!panies/ ith property rights shared

beteen the ,SS and the local ally. Profits ere also shared/ and a !a@or portion ent to the ,SS for its efforts of absentee onership # in reality itsrights of conuest.

3. Li2e any other occupying i!perialist poer/ the ussians enforceduneual trade relations ith their satellitesF charging high prices for Sovietgoods and de!anding cheap goods in return B the use values it needed. Suche6ploitation as specifically cited by both ugoslavia and China hen they

bro2e ith the ,SS in 19*" and the 19(0<s/ respectively.4he co!bination of all these !ethods obviously gained surplus value as ell

as use values for the ,SS. 4o of the !ethods/ reparations and @oint#stoc2co!panies/ ere abandoned in the 19$0<s/ in response to the conflict ith

ugoslavia and the or2ers< uprisings in 5ast 5urope after Stalin<s death. As foruneual trade/ hether it has continued has been !uch disputed. 4he proble! isthat the Soviet#type econo!ies don<t have even an appro6i!ate !ethod of!easuring the true values of co!!oditiesF they end up using co!parable=estern prices/ hich !ay not reflect actual production costs. 4he upshotappears to be that for !any years Dafter the initial lootingE the ,SS did accepttrade losses ith its satellitesF in the !ounting econo!ic crisis of the 19%0<s/hoever/ it !ade sure that trade relations ere tilted in its favor so that itslosses ere loered or even reversed. A special e6a!ple is that the Sovietscharged their allies far !ore than the production cost for the vital co!!odity/oil/ @ustifying their usury by the fact that the orld !ar2et price as evenhigher.

&n relations ith its satellites subseuently/ the ,SS has insisted on bilateral connections rather than !ultilateralis! # despite the founding ofCo!econ Dthe Council for +utual 5cono!ic AssistanceE. Atte!pts to establishdirect lin2s beteen sister 7socialist7 countries # Poland#C?echoslova2ia andugoslavia#'ulgaria # ere bloc2ed by Stalin/ hile


)". See . luc2stein D4ony CliffE/ Stalin's Satellites in &urope D19$)E and ao's

China D19$%E

19"1 and the Polish econo!y re!ained in crisis/ and Cuba ever since it asaccepted into the Soviet bloc. A clear indication of the ,SS<s i!perialistea2ness is its inability to adopt other third#orld dependencies/ notably

icaragua/ and its pressing need to reduce the aid hich is a !a@or prop of theCuban econo!y.

4he ,SS has also gains advantages over the !ore bac2ard of its allies/as ell as other 7third orld7 countries it trades ith/ by standard capitalist!ethods. As +ar6 pointed out/ trade beteen an advanced producer sellingcapital#intensive goods and a bac2ard one selling labor#intensive goodsinvariably favors the for!er/ because feer hours of high#productivity laborill e6change for !ore hours of lo#productivity labor. 5ual !onetarye6change !as2s uneual e6change of values/ @ust one of the ays that 7euale6change7 under capitalis! turns into its opposite under the operation of itslas of !otion.)9

&n the case of the ,SS<s !ore industriali?ed satellites li2e 5ast er!anyand C?echoslova2ia/ hoever/ the uneual trade relationship is reversed. &norder to i!port necessary production goods e!bodying advanced technology/

ussia has to give up a greater value by e6porting !inerals and other ra!aterials. 5ven though the ,SS is !ilitarily and politically do!inant in theregion/ its econo!ic control is hindered by its on li!ited develop!ent. So ituses non#!ar2et !ethods/ li2e reuiring pay!ent fro! its satellites in 7hard7D=esternE currency. Gungary since 19"$ has had to pay in dollars for its oili!ports fro! the ,SS. 4his is a sore point/ since not only the Soviets but allthe Stalinist partners desperately need convertible currency for i!ports.

&n recent years Soviet econo!ic do!ination has been aided by 7@ointinvest!ent pro@ects7 underta2en ith satellite countries to develop resourcesithin the ,SS. ,nli2e the alternative of foreign invest!ent/ these pro@ectsare on territory controlled directly by the Soviet rulers. 4hey allo the ,SSto i!port industrial use values of a uality superior to hat is produced at

ho!e. And they e6tend/ by econo!ic rather than purely !ilitary !eans/ the,SS<s control over its allies.

oint invest!ent pro@ects began in the 19(0<s and e6panded greatly in the19%0<s. According to the Gungarian econo!ist 4ibor Jiss/ 7the less developedcountries of the bloc bear ith difficulty a 10 to 1$U reduction


)9. +ar6/ Capital Vol. &ll/ Chapter 1*.

414



5urope and therefore the orld. 4hey both pointed out that ussia<s atypicalfeatures # its autocracy and !ilitary foundation # enabled it to play a role in

propping up i!perialis! that even unde!ocratic capitalist poers had toforego. Soviet ussia also functions to !aintain orld i!perialist hege!ony.4he ,SS today is not the sa!e as the ussia of 1913/ but li2e C?arist ussia ithas been an e6ceptional case ithin the real! of i!perialis! precisely

i!pulsion as every other country in the orld.73$

ussia/ said Shacht!an/ needs conuests for the e6ploitation of theconuered regions< ealth and its on !ilitary defenseF it had an unli!itedappetite for territory/ li!ited only by the counterforce ielded by rival poersor the !obili?ation of the !asses. 'ut any orld poer has the sa!e drive/especially those !otivated by the need for surplus value 4hus Shacht!an<s



has been an e6ceptional case ithin the real! of i!perialis! B precisely because of its special characteristics. Lenin did not deny the C?ar his i!perialistcron because his bac2ard econo!y fell short of !atching the fa!ous 7five

points.74he clai! that the ,SS cannot be i!perialist because it lac2s one of the

five points is a sterile argu!ent fro! pure for!. After all/ the traditionali!perialist poers today Dthe ,.S./ 'ritain/ -rance/ etc.E no longer territoriallydivide the orld # thereby violating one of Lenin<s points. 4he for!er colonial

poers lost !ost of their overseas territories after =orld =ar &&. 4he ,.S. is theorld<s do!inant i!perialist # but hardly because of the fe countries li2ePuerto ico that it rules directly.

4o su! up/ the ,SS is i!perialist despite the lac2 of capital e6port as adecisive feature> it functions as a vital section of orld i!perialis!/ and it is anautono!ous center of capital accu!ulation ith an internal drive to do!inateother countries for econo!ic purposes. &t is different fro! the traditionali!perialist poers because of the peculiar nature of that drive/ resulting fro! itsspecific history as a destroyed or2ers< state. &ts i!perialis! is essentially

defensive/ ai!ed at !aintaining its position as a great poer ith the ability to bargain for econo!ic concessions fro! the =est rather than aggressivelysee2ing to contend for =estern holdings. Soviet i!perialis! plays a 2ey role inaccounting for the continuity of i!perialis! as a hole to the present day/ alongevity Lenin never e6pected.

ALT7R!AT,V7 T>7)R,7S

+ost atte!pts to devise +ar6ist theories of Soviet i!perialis! have beenunsuccessful. 4he first or2ed#out 7third#syste!7 analysis of ussia as that ofShacht!an/ ho for all his insistence on the uniueness of the Stalinist syste!/sa an essential si!ilarity beteen Stalinis!<s i!perialist drive andcapitalis!<s>

74he present orld tends !ore and !ore to be divided into a fe of theadvanced and poerful econo!ic countries ho en@oy independence/ andthe others that stagnate or retrogress econo!ically and inevitably fall intoecono!ic and then political dependency upon the fe. -or a country Dandthe ruling class in itE to survive as an independent entity/ in our ti!eespecially/ reuires an e6tension of its econo!ic Dand therefore its

politicalE poer. ... &n other ords/ for all the social ... differences that!ar2 her off fro! the capitalist orld/ ussia is nevertheless confrontedith the sa!e proble! and driven by the sa!e

especially those !otivated by the need for surplus value. 4hus Shacht!an stheory of bureaucratic collectivis! offers the sa!e e6planation for Soviete6pansion as for capitalist e6pansionF it duplicates Cliffs notion that hatdrives both capitalis! and Stalinis! in the !odern epoch is the need for usevalues/ not value.

'ut Shacht!an really did thin2 Soviet ussia as different. &t as bac2ard and starved of capital/ and therefore had to conuer territories thatere industrially !ore advanced Dhich is hy ugoslavia and China ereinco!patible and alloed to escape the nooseE. 4his vie helped !a2e theclai! that Stalinis! as a dyna!ic syste! ith an unli!ited capacity fore6ploitation and looting # in contrast to capitalis!/ hose proble! as notho to e6pand production but rather ho to dispose of its e6cess products.3(

Gere the underconsu!ptionist theory of capitalist develop!ent is e6tended toits full anti#+ar6ist logic> capitalis! is less reactionary than Stalinis! becauseits drive for brutal e6ploitation is at least bounded. 4his reasoning helped pavethe ay for Shacht!an<s adaptation to =estern i!perialis! as the only viablealternative to the un!itigated rapacity of Stalinis!.

Cliffs boo2 on ussia as originally ritten in the 19$0<s and thereforecould only discuss the !ethods of Soviet i!perialis! in the i!!ediate postar period. Ge held that the bac2ardness of the ,SS drove it to conuersatellites in order to obtain cheap labor and to loot ra !aterials and!achinery.3% Since Soviet relations in this period ere based on undeniablelooting/ this see!ed correct. 'ut hen circu!stances changed/ Cliffs theorystood still. Later versions of the boo2 Dincluding the 19"" edition ith anupdating 7Postscript7E rehash the sa!e li!ited discussion/ cutting the storyshort at about 19$$. 4he proble! of ho the ,SS could re!ain i!perialistsince 19)9 ithout a drive to e6port capital as never addressed. +ore recentor2s by Cliffs folloers have added nothing substantial. 4he Cliffites<indifference to a theory of Stalinist i!perialis!


3$.Shacht!an/ 74he Progra! of Stalinist &!perialis!/7 The #ureaucratic eolution

D19()E/ p. 1)3F reprinted fro! :e .nternational D19*3E.3(.Gal :raper/ 7Stalinist &!perialis! and the Cold =ar Crisis/7 in :raper/ ed./

.ntroduction to .ndependent Socialism D19(3E/ pp. 10*#10(F reprinted fro! a(or

<ction D19$*E.3%. Cliff/ ussia < ar!ist <nalysisA Chapter 9F State Capitalism in ussiaA Chapter ".

418



sounds good only in nationalist language. estated in class ter!s the logic is a bit less convincing> since er!any<s rulers had slaughtered !ore Soviet peoplethan had the Stalinists/ it as only fair for the Stalinists to ta2e revenge oner!an # and 5ast 5uropean # or2ing people too. -or precisely this reason the'olshevi2s e6coriated the social#de!ocrats< acceptance of reparations de!andsby the conuerors after =orld =ar & &t is an i!perialist not a socialist de!and

beteen duplicitous Soviet diplo!acy and the intransigent or2ers/ and couldnot steer an independent course. As a result Soviet forces ere sent in to crushthe revolution/ and efforts to achieve 7peaceful7 acco!!odation beteen the=est and the ,SS ere set bac2 for years.

4he 19$( events thre into disarray the far left theories of Stalinis!. &n thecase of the Shacht!an group for all its fiery rhetoric about destroying



by the conuerors after =orld =ar &. &t is an i!perialist/ not a socialist de!and.&n su!/ to defend the Soviet ,nion is to defend/ hether in detente or Cold

=ar/ a funda!ental prop for the i!perialist syste! as a hole.

STAL,!,ST !AT,)!AL,SM

Led by ussia and China/ the Stalinist bloc at its height enco!passed a

uarter of the globe and ruled a third of the orld<s people. 'ut al!ost as soonas it reached its pea2 it shoed visible signs of distress # not only fro! theecono!ic crisis that beset the entire capitalist orld after the postar boo! butalso fro! internal tensions rending the bloc apart. 4his had a !a@or effect oninter#i!perialist relations as ell.

4he 5ast er!an or2ing#class riots of 19$3/ the Polish upheaval of 19$(and the Gungarian revolution in the sa!e year unnerved not only the Stalinistrulers. ohn -oster :ulles/ the reactionary Secretary of State in the 5isenhoerad!inistration/ stopped calling for the 7rollbac2 of co!!unis!7 in the face ofthe or2ers< !ove!ents. 4he Gungarians confronting Soviet tan2s and creatingor2ers< councils ere too dangerous a force. So the ,.S. abruptly began to

advocate the !ore realistic 7Polish road.74his alternative/ sy!boli?ed by the for!er Polish CP head =ladislao!ul2a/ began ith a refor!ist policy of li!ited concessions to the protesting!asses. 'ut it also included a careful appeal to Polish nationalis!. o!ul2aunderstood that Stalinis! could survive in Poland only by inning so!e

popular support/ and that reuired an end to overt ussian do!ination.o!ul2a had no intention of driving the Soviets out of the countryF on thecontrary/ he as si!ply a national Stalinist ho had on !ass sy!pathy

because of his victi!i?ation by +osco. 8nly through such a figure could theruling party thart the proletarian threat.

4he road to this alternative had been paved by the ugoslav brea2 ith the,SS in 19*". 4he =est learned then that nationalist Stalinists could oppose

Soviet do!ination and open up their countries to capitalist penetration. D4itoent so far as to endorse the ,.S. i!perialist side in the Jorean ar.E 4heeruptions after Stalin<s death !ade such solutions !uch !ore urgent. After19$( the Jhrushchev regi!e !ended relations ith 4ito/ thereby establishingso!ething li2e the 7$0#$07 split of influence over ugoslavia envisaged in theChurchill#Stalin deal at alta.

&n Gungary the Polish alternative failed. ationalist Stalinists led by Pri!e+inister &!re agy and !ilitary hero Pal +aleter ere caught

case of the Shacht!an group/ for all its fiery rhetoric about destroyingStalinis!/ its response to Gungary as to concentrate on de!ocratic de!andsrather than the socialist overthro of the state. 8n a deeper level/ theconception that the producing class under Stalinis! as not a true proletariatfaced a cala!itous proble!. =hy/ if they ere not a proletariat/ did therevolutionary or2ers construct classical proletarian dual poer institutionsH=hy did their de!ands stri2e against the e6ploitation through valueHShacht!anis! could not anser. 4hus the or2ers< revolts/ along ith the

brea2#up of the Stalinist !onolith they co!pelled/ under!ined the theory thatthe Stalinist syste! as a dyna!ic successor to decadent capitalis!.

4he rival 7orthodo6 4rots2yist7 current as also sha2en by the or2ers<revoltsF it too tended to adapt to the left Stalinists calls for de!ocracy. =e ta2eup their theory in detail in Chapter %.

4he nationalist aspect of the uprisings against Soviet do!ination raises afunda!ental uestion> hy did nationalis! beco!e so pro!inent if Stalinis!has done aay ith capitalis!H After all/ for +ar6ists the nation#state is not asupra#historical pheno!enon> it arose in the capitalist epoch of history as a

product of the bourgeoisie<s needs to brea2 don precapitalist obstacles toaccu!ulation/ unify a territory large enough for capitalist co!!erce anddevelop a co!!on language. Li2eise/ national !ove!ents ca!e intoe6istence ith the creation of nation states.

ationalis! in 5ast 5urope is not @ust an echo of a capitalist past but anessential co!ponent of the anti#Stalinist struggles B because of thecharacteristics of Stalinist society. &ndeed/ the specific ea2ness of Sovieti!perialis! # the fact that ithout significant capital e6port it cannot provideeven the se!blance of benefits to its satellites B often !ade its rule !orena2edly oppressive than =estern i!perialis!. 4he nationalis! of the sub@ectstates infected even the bureaucracies that had been carefully selected forloyalty to +osco. 5ach state atte!pted to build its on national econo!y

beyond the point of 7rationality7F this reflected not only the ,SS<s interest in2eeping the! apart but also the national bureaucrats< interest in building theiron poer base even at the e6pense of their 7co!rades7 across the border.

Stalin instigated purges in each of the 5ast 5uropean dependencies toeli!inate poerful bureaucrats dee!ed to be 74itoists7 and disloyalF eishofficials ere particularly targeted in the hope of sti!ulating pro#

49:

ussian national chauvinis!. 'ut even a reign of terror could not suppressnationalis!. &t spread further> to China/ Vietna! and Ca!bodia in the 19(0<sFto o!ania and C?echoslova2ia/ here it got out of hand in 19("F to all theStalinist states/ including the Soviet republics/ today. &n the =est/75uroco!!unis!7 flourished ithin the CPs/ a deepening of the centrifugalforces 4rots2y had pointed to long before. :espite the right#ing 7evil e!pire7

hich have loer labor costs.4he internal decline of Stalinis! as a proble! for the =est. Genry

Jissinger/ ho directed ,.S. foreign policy in the early 19%0<s/ hoped to builda Goly Alliance to repress the ave of revolution threatening to engulf theorld. 4he hub of his policy as to !aintain A!erican superiority by bindingtogether the i!perialist states of =est 5urope/ orth A!erica and apan. 4his



forces 4rots2y had pointed to long before. :espite the right ing evil e!pireand left#ing 7post#capitalis!7 theories/ the Stalinist bloc has suffered as !any

political confrontations and sualid ars as any other 'al2ani?ed group ofstates generally accepted as capitalist. And today ra!pant nationalis! is rippingthe ,SS apart.

ationalis!/ hoever/ does not anser the needs of its !ass folloing. &t isno coincidence that it has been consciously used as a diversion fro! the classstruggle. ust as +osco has little choice but to try to ride the ave of anti#ussian !ove!ents/ the =estern authorities too prefer it as a ise alternative to

proletarian revolution. 'ut nationalis! is a to#edged sord. 4he =est hasopenly stepped in to support orbachev in trying to chec2 the dis!e!ber!entof the ,SS/ in the interest of orld stability.

7MP,R7 ,! R7TR7AT

=hen orld crisis conditions resurfaced at the end of the 19(0<s/ theStalinists needed help to contain their potentially restive populations. 4hey ereco!pelled to brea2 out of their bloc<s relative isolation and beco!e an integral

part of the orld econo!ic structure. All the countries of statified capital/including even ultra#isolationist orth Jorea/ increased trade and e!bar2ed on @oint production deals ith =estern fir!s. 4heir plan as to e6pand intensively by i!porting =estern technology and to pay for it by e6porting ra !aterialsalong ith goods produced ith the i!ported techniues.

'ecause the econo!ies of their on bloc ere also orsening/ =esternfinanciers ere eager to grant loans to the 5ast. 4hey e6pected that Stalinistdiscipline over the or2ers/ especially prohibitions on stri2es/ ould allosufficiently high e6ploitation to guarantee profitable repay!ent.

eality/ including Stalinis!<s inherently retarded productivity and thedeepening econo!ic crisis/ decreed otherise. 4he 5astern bloc increased notits !anufacturing e6ports but its state debt to the =est/ hich !ounted tenfold

in the decade fro! 19%1#"1. As a result/ the 5ast/ li2e the third#orld South/still i!ports !anufactured goods fro! the =est and e6ports !ainly ra!aterials. &t also e6ports !anufactures of loer uality to the South ine6change for ra !aterials and convertible currency/ hich is in turn used tohelp pay for its trade deficit ith the =est. Although !ilitarily co!parable iththe =est/ the Soviet bloc Dno !inus ChinaE cannot co!pete effectively on theorld !ar2et either ith the =estern poers/ hich have higher productivity/or ith third#orld countries/

together the i!perialist states of =est 5urope/ orth A!erica and apan. 4his!eant trying to overco!e their rivalries Din hich the ,.S. as losing groundEin order to hold their grip over the se!i#colonial countries. 4his core alliancerested on regional @unior partners li2e &ran/ South Africa/ 'ra?il and &srael to

police the third orld.4he end of the Vietna! ar in 19%$ enabled =ashington to cut its losses

and hold the rest of the i!perial structure intact. &t also per!itted friendlyrelations ith China and 7detente7 ith ussia. 4he Soviet rulers/ hoever/ didnot accept Jissinger<s absolute attach!ent to the status uo. 4o !a2e sure thattheir on interests ere not bypassed/ they de!anded a senior partnership instabili?ing 2ey regions li2e the +iddle 5ast. 4hey also bac2ed troubleso!eleaders # Assad in Syria/ Qaddafi in Libya and Arafat in Palestine # as

bargaining chips for entry into the orld partnership. 4he Soviets neverachieved their hopes/ but they still held to the bargain and defended thei!perialist syste! as a hole. =herever they aided anti#i!perialist struggles/as in Angola or icaragua/ they did so to protect their on interests and to

prevent bourgeois#de!ocratic revolutions fro! beco!ing proletarian socialist

ones.4he Stalinists< ea2ness beca!e a proble! for the =est as ell because theSoviet threat could not so readily be used to eld the =estern bloc together.-ear of the ussian devil no longer !ade !ilitant or2ers cringe fro!confrontations ith their bosses. or could the collaborative =esternCo!!unist Parties be painted as conspirators behind every do!estic ill. Asell/ revolutionary nationalist struggles no e6ploded ithout the restraininghand of +osco holding the! ithin safe bounds. And by the !id#19%0<sor2ing#class unrest in 5ast 5urope as idespread once !ore. As Jissinger<s

lieutenant/ Gel!ut Sonnenfeldt/ put it/ 74he ussians are lousy i!perialists. 3

=estern foreign policy had to deal ith a ide array of proble!s. 4heecono!ic crisis under!ined A!erican hege!ony/ leading to er!an lead#

ership in =estern 5urope and a revived apanese sphere of econo!icdo!ination in Asia. 4he 7trilateralis!7 of i!!y Carter and Ibignie'r?e?ins2i as designed to !aintain the ,.S. as =estern leader and police!an/under conditions here er!any and apan had to consciously ta2e a bac2seat. 4his as a te!porary strategy/ i!possible for the long ter!.


*3. See 7Per!anent evolution in Southern Africa/7 Socialist )oice o. 1 D19%(E.494

Carter revived the old A!erican strategy of 7de!ocracy.7 Ge sought to containthe rising orldide class struggle by forcing the !ost oppressive regi!es ofthe =estern bloc # South Africa/ Chile/ So!o?a<s icaragua/ &ran B to accept a!ore benevolent facade. 4he adoption of pluralist syste!s as ai!ed at shoringup bourgeois rule by incorporating !iddle#class dissidents Dincluding blac2s inSouth AfricaE and thereby buying off the leadership of the !ass base of revolt.

he had a deal hereby the A!ericans ould ta2e care of &ran and the ussiansould handle Afghanistan. 'ut the strategy bac2fired.

4he second Cold =ar as initiated under Carter but it brought onaldeagan to poer/ since the ,.S. bourgeoisie de!anded a tougher line. At ho!eit as !ore guns and less butter/ to sho the or2ing class ho as boss.5cono!ic e!bargoes over Afghanistan and Poland put increased pressure on



Sou caE a d e eby buy g o e eade s p o e ass base o evo .

4oards the ,SS/ here Jissinger had si!ply tried to prop up the old order/Carter and 'r?e?ins2i tried to force refor!s on the stubborn Stalinists throughtheir 7hu!an rights7 ca!paign. 4hey recogni?ed that Stalinis! had lost itsideological attraction and as running the ris2 of a destabili?ing revolt. &n the

Gelsin2i accords the ,.S. officially recogni?ed 5ast 5urope as +osco<s fief ine6change for pro!ises of loosening up its econo!ic and social structure. 4husCarter sent aid speedily to the refor!ist iere2 regi!e in Poland in the face ofor2ers< revolts in 19%(. Gis ,.. spo2es!an Andre oung su!!ed up thestrategy toards Stalinis!>

7+y feeling is that as the ussians begin to evolve/ they<re going to have!ore proble!s rather than less. 4he fact that e are helping the! deal iththese fe dissenters right no ill prepare the! don the road to deal itha !assive generation of dissent hich is probably not ten years off in the

Soviet ,nion.7**

oung as insightful about the Stalinist future but far less so about the ability

of the rulers/ 5ast and =est/ to contain discontent. 4he stra that bro2e the bac2 of the 7hu!an rights7 ca!paign as the overthro in 19%9 of the Shah of&ran/ the strong#!an of pro#A!ericanis! in the third orld. Gere Stalinis!could not detour the !assesF its ideological collapse had discredited 7+ar6is!/7i.e./ national pseudo#socialist capitalis!. As a result the revolt as channeled toa rival anser to the horrors of oppression> 7anti#i!perialist7 religiousfunda!entalis! developing into national#chauvinist clerical fascis!. AnotherCarter effort also collapsed/ the atte!pt to integrate the icaraguan rebels into arefor!ed So!o?a regi!e. A ne turn as obviously needed.

,MP7R,AL,ST R7AL,!M7!T

=hen bourgeois refor!s fail/ the alternative is ar#!ongering. 4he Soviets provided the opportunity by invading Afghanistan. 4hey e6pected fe proble!s because their ai!s coincided ith those of i!perialis! overall> the stability ofthe +iddle 5ast and the ulf. 're?hnev assu!ed


**. -or details of the Carter strategy/ see 7i!!y Carter<s :e e South> the =orld/7Socialist )oice o. * D19%%E

co o c e ba goes ove g a s a a d o a d pu c eased p essu e othe beleaguered Stalinist econo!ies. 4he ,.S. ar!ed and aidedcounterrevolutionary !ove!ents against left#leaning regi!es across the globe>

icaragua/ Angola/ the Vietna!#i!posed govern!ent of Ca!bodia/ as ell asAfghanistan. And to a degree it or2ed. eagan< tea! understood hat theliberals and left did not> that !ilitaryKecono!ic co!petition ould furtherea2en the ,SS<s already crisis#ridden econo!y. eagan<s econo!ic arfurther under!ined the ,.S. econo!y/ continuing its transition to 7first a!ongeuals7 fro! hege!onic poer. apan and 5urope had to invest in a declining,.S. to 2eep the =est intact.

5ven during the revived Cold =ar/ =estern capital continued to orry overthe instability of the Soviet bloc. +argaret 4hatcher aside/ the =est 5uropeanleaders ere alays less than devoted to the +osco#as#devil line/ preferring

profitable relations ith 5ast 5urope. 4he ,.S. deepened its relations ithChina in the interest of finding cheap labor and of 2eeping up pressure on theussians. 'ut ith the Soviet threat declining and traditional i!perialistrivalries groing/ it needed openings ith 5ast 5urope too. After eneral

aru?els2i<s !ilitary suppression of the or2ers< !ove!ent in Poland DseeChapter "E/ an i!portant organ of ,.S. i!perialis! evaluated the alternativesaccording to the dictates of e6ploitation>

74he i!position of !ilitary control in Poland could in the long run bereassuring to =estern creditors/ if it provides greater econo!ic stability/an end to labor unrest and increased or2er productivity B even at the

point of a bayonet. 'ut in the short run there isn<t any guarantee this illhappen/ and the uncertainties could !a2e all =estern lenders !orenervous about continuing to bail out the Poles.7*$

Soviet econo!ic ea2ness soon led to a crisis in Cold =ar ideology> youcan<t have a devil ithout horns. Since the 7evil e!pire7 asn<t playing its part/eagan could not continue bla!ing the Soviets for 7all the unrest that is going

on/7 as he had done in his 19"0 ca!paign. 4he Cold =ar floundered/ and ane ene!y had to be invented. Gence the ca!paign against 7internationalterroris!7 in hich thousands of third#orld victi!s have already beenslaughtered. 'ut even such ene!ies as Qaddafi/ Jho!eini and Castro areunbelievable as o!nipotent sources of evil ithout Soviet poer behind the!.4he 7ar on drugs7 dragged up to

*$. Wall Street EournalA :ece!ber 1(/ 19"1.

49-

fill the gap is also a poor substitute/ although it does allo ,.S. i!perialis! todeploy its forces against unrest in third#orld countries.

=hen orbachev too2 poer/ his 2een perception of the Soviet e!ergencyled to an all#out effort toards acco!!odation. 5ven !ore than before/ the,SS needed credits and technology fro! the =estF its eagerness for peaceas palpable. Soviet policy shifted toard a deal ith the =est/ hoping for

ithout one nuclear arhead. =e are beco!ing a second#rate econo!ic poer and the Soviets a third#rate econo!ic poer/ and the tocountries that are first rate/ apan and =est er!any/ are ithout anyreal !ilitary strength. 4hat is absurd.7*%

So it is/ and therefore the direction of bourgeois policy on all sides ill beto correct the i!balance. apan ill !ilitari?e !ore than it already has/ the



p p p y / p gsettle!ents in Afghanistan and elsehere and a co!!on effort to prevent the&ra#&ran ar fro! getting out of hand. orbachev<s diplo!acy successfullyused the differences beteen 5urope and the ,nited States and played on the=estern public<s peace senti!ents. Gis efforts !ade eagan<s dile!!a all the!ore apparent and led to the !ore or less official end of Cold =ar && in

:ece!ber 19"%/ hen the to superpoers staged a ee2#long lovefest at the=ashington su!!it conference.

Part of the deal as the Soviet pullout fro! Afghanistan/ the settle!ents inAngola and Ca!bodia and the Arias peace plan for Central A!erica. 'ut asLenin said of si!ilar diplo!atic deals in his day/ the i!perialists< alternative toar is i!perialist peace # hich leads to i!perialist ar. 4he Soviet ,nion has

been the natural ene!y since =orld =ar &&. 'ut the orld situation is rapidlychanging. &t is beco!ing increasingly clear that the ,.S.<s !a@or rivals today areits econo!ic co!petitors/ apan and er!any. :espite every ad!inistration<satte!pts to preserve the ,.S.<s traditional international alliances/ the

bourgeoisie is increasingly co!pelled to underta2e @ingoist/ protectionist

policies against its real targets.All this points toard a rearrange!ent of i!perial blocs/ as happened at thestart of =orld =ar &&. &f orld ar is staved off for a ti!e/ the ,.S.<s !ainene!y ill not be the ,SS but er!any or apan/ or both. e i!perialistrivalries ould undoubtedly !anifest the!selves through uarrels over the+iddle 5ast and other pri!e regions for e6ploitation/ such as China or the !oreindustrial Soviet#5ast 5uropean region. &n this case the ,SS ould serve as a

@unior econo!ic partner of one side or the other Das in the last orld arEF itsnuclear and conventional ar!ed forces ould serve as its !ost valuable

bargaining counter.*(

4he 19"% stoc2 !ar2et crash pro!pted a leading =all Street and :e!#ocratic Party poer bro2er to overstate graphically the changing orld balance

of poer>7Gere e and the Soviets are spending so !uch !oney on defense and

nuclear eapons hile the apanese are inning =orld =ar &&& BBBBBBBBBBBBBBBBBBBB

*(. Such a shift is obvious no in the era of orbachev/ but e pointed to it ell before/ at the height of Cold =ar &&. See 7+ar6ist esponse to eaganis!/7Socialist )oice o. 13 D19"1E and 7LP Convention/7 o. 1" D19"3E

p y /,.S. ill see2 to overco!e its econo!ic flabbiness through a serious austerity

policy/ and er!any ill try to e6tend its 8stpoliti2 of econo!ic and politicalties ith the 5ast 5uropean Stalinists. 4here is tal2 in high places of a ne7+arshall Plan7 for 5astern 5urope/ alloing invest!ent in those ane!icecono!ies in order to both e6tract profits and forestall revolt. Starting in 19""/

a parade of =esterners !arched to +osco to offer loans and invest!ents.4he ,.S. too began !oving in on Poland and Gungary. After the revolts of19"9/ the parade beca!e an avalanche. 'ut the post#boo! econo!ic conditionsof orld capitalis! do not per!it thesa!e level of aid for recovery that as

possible in the 19*0<s.

-or several decades/ Stalinis! and its ideology of nationali?ation servedcapitalis! ell. &t as the bular2 against revolution in 5uropeF it channeledthe upheaval in China into a nationalist dead#endF it persuaded the or2ers and

peasants in innu!erable third#orld revolutions that the national bourgeoisiesshared their interestsF it as a refor!ist prop for capital in the i!perial

countries. 'ut all that has changed. 4he ,SS cannot even support thedisintegrating econo!ies of its traditional satellites/ !uch less ne ones. &t hasalays refused to do for the pro#Stalinist rulers of beleaguered icaragua hatit does for Cuba/*" and in the late 19"0<s it started bac2ing aay fro! 5ast5urope too.

4he rulers of 5ast and =est face an overhel!ing dile!!a> they need afull#scale cathartic crisis to ipe out obsolete capitals and centrali?e theirecono!ies to re#establish profitability. 'ut the si?e of the enterprises thatould have to undergo the cure is so great that collapse cannot yet be ris2ed>not only are its econo!ic effects unpredictable/ but so is the response by theor2ing classes. And the collapse of the 5ast 5uropean


*%.-eli6 ohatyn/ uoted in :e Hork :esdayA ove!ber 1)/ 19"%.*".As our corollary to per!anent revolution e6plains/ Stalinist parties cannot carry out

their statification goals ithout first crushing or at least decapitating the or2ingclass. =e pointed out at the dan of the revolutionary regi!e that icaragua couldnot follo the Cuban road/ because of the Soviets< reluctance to intervene in the,.S.<s 7bac2yard/7 their on di!inishing resources and the decay of local Stalinis!as a force capable of attracting and thereby disciplining revolutionary or2ers. SeeSocialist <ction DLPE/ Septe!ber 19%9.

498



before =orld =ar &&/ is hat led the! to recogni?e the supposed revolutionarycapacity of the petty#bourgeois Stalinist parties in the 5ast. 4his notion as inreality a reflection of their adaptation to the Co!!unist and Socialist Parties atho!e.

4he pessi!is! a!ong !any radical currents originated in the 1930<s iththe crushing of the or2ing#class !ove!ent throughout 5urope under .F the

content euivalent to a de!ocratic revolution.7 &n other ords/ the revo#lutionary goal could no longer be socialis!> it could only be to restorede!ocracy and national independence Dfor countries that ere already i!#

perialistOE. 4his strategy/ !oreover/ as proposed hen the ar as endingand !ass proletarian !obili?ations ere developing in =estern 5urope.

4he theory as 2non as 7historical retrogression.7 ) oing beyond an



g g g pheel of fascis!. 4he Stalinists< cynical betrayals of every revolutionary idealand achieve!ent # see!ingly ithout proletarian resistance B deepened theradicals< fatalistic attitude toard the !asses. Against these poerful forces/ the

predo!inantly !iddle#class left loo2ed to the bourgeois state and nationalis!for salvation. 4hus it built ties to i!perialis!/ nor!ally via the inter!ediary of

social de!ocracy. 4he Gitler#Stalin pact strengthened the argu!ent that bourgeois de!ocracy as the K sole defense against totalitarianis! in all for!s.

eorge 8rell/ never a 4rots2yist but nevertheless a partisan of anti#Stalinist co!!unis! after his e6periences in the Spanish civil ar/ roterevealingly in 19*0>

7-or several years the co!ing ar as a night!are to !e/ and at ti!es &even !ade speeches and rote pa!phlets against it. 'ut the night beforethe usso#er!an pact as announced & drea!ed that the ar hadstarted.... & ca!e donstairs to find the nespaper announcingibbentrop<s flight to +osco. ... =hat & 2ne in !y drea! that nightas that the long drilling in patriotis! hich the !iddle classes go

through had done its or2/ and that once 5ngland as in a serious @a! itould be i!possible for !e to sabotage.1

4he social de!ocrats and Stalinists Dafter er!any<s invasion of ussiaEadopted si!ilar positions ith less hesitation. 4he -ourth &nternational as noti!!une fro! these pressures. 4he 4rots2yists< @ustifiable hatred of Stalinis!for betraying co!!unis! helped push the! in a social#de!ocratic direction/ith different ings !oving in different degrees. D&ronically/ the hatedStalinists often adopted parallel positions.E A !a@or stress tearing at the -& asthe fight by the faction led by +a6 Shacht!an in the ,.S. Socialist =or2ersParty DS=PE that led it to a treacherous split of the vanguard party on the eve ofthe ne =orld =ar.

Closely tied to the Shacht!anites as a ing of the -& that believed that

orld history had been set bac2 so far that the fight for socialis! as no longeron the agenda. &n their !a@or docu!ent they rote of the class struggle in5urope that 7Goever one vies it/ the transition fro! fascis! to socialis!re!ains a ,topia ithout a stopping place/ hich is in its


1. 8rell/ 7+y Country ight or Left/7 Collected &ssaysA Eournalism and ettersA Vol.1/ pp. $90#1

y g g yadaptation to bourgeois de!ocracy/ it re@ected the Leninist conception of theepoch and recapitulated the +enshevi2 and social#de!ocratic position during=orld =ar &. +ar6ists had learned to oppose every ar by an i!perialist

poer even against less de!ocratic i!perialists. =hatever the stated ar ai!s/the result ould be not de!ocracy and certainly not 7an end to ar7 but the re#

division of the orld. Although not stated e6plicitly/ the retrogression position<s inevitable but unforeseen logic as to support the Allies/ the allegeddefenders of national liberation De6cept in their on coloniesE in the ar7against fascis!.7

4he leaders of the &nternational opposed such vies no!inally. 'ut toooften they adapted to the popular vie that a victory of de!ocracy overfascis! as a necessary stage in the or2ers< struggle. So despite the oftenheroic arti!e deeds of 4rots2yist cadres/ the -ourth &nternational<s leaders!ore than once acco!!odated politically to the Allies in the ar.

&n the ,.S./ the S=P co!pro!ised ith the anti#er!an !ood and avoideda head#on confrontation ith 7its on7 i!perialis! through the slogan/ 74urn

the i!perialist ar into a ar against fascis!.7 4his echoed the for! of Lenin<s=orld =ar & slogan # 74urn the i!perialist ar into a civil ar7 # but invertedits content. 4he -rench section in 19*0 7held out its hand7 to the pro#'ritishand A!erican !a@ority of the -rench bourgeoisie to help it 7save itself. 4his

position as repudiated as social patriotic by a 5uropean conference of4rots2yist sections in 19**.3 'ut at the end of the ar the -rench section stillcalled on the or2ers to vote for the ne bourgeois constitution.


). 74hree 4heses/7 7ourth .nternationalA :ece!ber 19*)/ and 7Capitalist 'arbaris!or Socialis!/7 :e .nternational DSepte!ber 19**E/ by the &nternationalCo!!unists of er!any D&J:E in e6ile. -or opposing vies/ see . . ohnson DC.L. . a!esE/ 7Gistorical etrogression or Socialist evolution/7 :e .nternationalA anuary and -ebruary 19*(/ and 5. er!ain D5rnest +andelE/ 78nthe 8pportunist ,tili?ation of :e!ocratic Slogans/7 7ourth .nternationalA

ove!ber 19*(.3. 74he ational Question in -rance and the Socialist ,nited States of 5urope7 and

74heses on the Situation in the =or2ers< +ove!ent and the Perspectives for:evelop!ent of the -ourth &nternational7F in es Con+res de la uatrieme .nternationale Vol. )/ pp. 9"/ )*).

42:

P)STWAR ADAPTAT,)!S

Political concessions !ade under conditions of !urderous attac2s byene!ies on all sides and separation fro! an international !ove!ent in arti!eere bad enough. 'ut after the ar the -& re!ained isolated fro! the advanced

proletariat because of continued Stalinist hege!ony. 4he crushing of theor2ers< uprisings after the ar as the 2ey factor infecting the! ith the

of living/ since other for!s of public spending ould have to be cut bac2 infavor of ar!s $

:espite these errors there as also an ele!ent of revolutionary opti!is!Dli2e that of osa Lu6e!burg in the =orld =ar & periodE in a theory that triedto prove that the overthro of capitalis! did not have to be indefinitely

postponed. &n any case/ 74rots2yist orthodo6y7 as funda!entally not a refusal



or2ers uprisings after the ar as the 2ey factor infecting the! ith thecynicis! toards proletarian revolution already ra!pant a!ong the petty#

bourgeois intelligentsia. At the sa!e ti!e/ the i!perialist boo! !ade possible by the postar defeats began to enlarge the !iddle classes beyond previous bounds. 4rots2yists then turned their revisions into codified theoretical syste!s.

4he co!bination of Stalinist e6pansion and the boo! see!ed to herald a holene epoch of capitalis!. 4hat the ne orld situation as based on the defeatof the or2ers # and that this condition could only be te!porary B asoverloo2ed.

4he first reaction of the 4rots2yist leadership to the postar situation asthat nothing had changed> 4rots2y<s prognosis of a revolutionary outbrea2 afterthe ar that ould spell the end of capitalis! and Stalinis! as unchallenged.&n part this as a reaction against the retrogressionists/ ho had the tacitsupport not only of Shacht!an but also of i!portant S=P figures li2e -eli6+orro and Albert old!an/ as ell as international leaders based in the,nited States during the ar. 4he S=P rote in ove!ber 19*(>

74he folloing conclusion flos fro! the ob@ective situation> ,.S.

i!perialis!/ hich proved incapable of recovering fro! its crisis andstabili?ing itself in the ten#year period preceding the outbrea2 of the Second=orld =ar/ is heading for an even !ore catastrophic e6plosion in the current

postar era. 4he cardinal factor hich ill light the fuse is this> the ho!e!ar2et/ after an initial and artificial revival/ !ust contract. ... =hat is really instore is not unbounded prosperity but a short#lived boo!. &n the a2e of the

boo! !ust co!e another crisis and depression hich ill !a2e the 19)9#3)conditions loo2 prosperous by co!parison.7* 4he S=P<s catastrophe theoryrested on the underconsu!ptionist reasoning that the poverty of the !asses afterthe ar in 5urope and Asia as ell as A!erica ould prevent the! fro!

buying the output of ,.S. industry. 4he folloers of Shacht!an/ also relying onunderconsu!ption#is!/ clai!ed that ar!s production could ta2e up the slac2 in!ar2et de!and as it had done during the ar and 2eep the econo!y rolling.4hey too assu!ed that this ould !ean a rapid decline in the or2ers< standard


*. 74heses on the A!erican evolution/7 in a!es P. Cannon/ Speeches to the PartyA

pp. 3)*#$/ 330

to recogni?e reality( but a cover for practical adaptation to it. -or e6a!ple/ the'ritain#based Gealy tendency beca!e notorious for its catastrophe#!ongering/

perennially arning that the collapse of capitalist econo!y as right aroundthe corner. 4his as co!bined/ hoever/ not ith a defense of revolutionary

principles but instead ith a blatant adaptation to left refor!ists ithin social

de!ocracy # a practice defended by arguing that tu!ultuous events oulddrive the refor!ists/ despite their consciousness/ into the ar!s of revolution.

!7)'CAP,TAL,SM

4he !ain orthodo6 4rots2yist adaptation to refor!is! as +andel<s/ ane!pirical reaction to the postar boo!. &n the course of the postar period hediscovered a ne stage of capitalis! hich he labeled 7neo#capitalis!7 or 7latecapitalis!.7 8ther 4rots2yist theorists ere nor!ally not so blatant B so!ecritici?ed +andel in the strongest ter!s for revising Lenin<s conception of theepoch B but al!ost all accepted political conclusions that floed fro! theideas !ade e6plicit by +andel.

7& a! uite convinced that/ starting either ith the great depression of 19)9#

3) or ith the Second =orld =ar/ capitalis! entered into a third stage in itsdevelop!ent hich is as different fro! !onopoly capitalis! or i!perialis!described by Lenin/ Gilferding and others as !onopoly capitalis! asdifferent fro! classical 19th#century laisse?#faire capitalis!.7 %

4his ne epoch as distinguished by a nu!ber of factors/ including stateintervention into the econo!y/ per!anent ar!s spending/ and above all/ 7thestepping up of the general rate of technological innovation7 brought about bythe ar!s race. +andel does cite the historic defeats of the or2ing classes asan additional reason for the postar boo! Dhe cites


$. 4.. Vance/ 74he Per!anent =ar 5cono!y/7 The :e .nternationalA 19$1Freprinted in :raper/ ed./ The Permanent War &conomy D19%0E.

(. As has been suggested/ for e6a!ple/ by the LC&<s +ar2 Gos2isson> 74he4ransitional Progra! 4oday/7 Permanent eolution o. % D19""E/ p. "1. See7Go ot to :efend 4rots2yis!/ Part )/7 Proletarian eolution o. 33 D19"9E.

%. +andel/ 7=or2ers under eo#Capitalis!/7 .nternational Socialist eie D19("E.". +andel/ 74he 5cono!ics of eo#Capitalis!/7 The Socialist e+ister D19(*E.

424

every possible e6planation at least onceE/ but that is not 2ey to his theory. Laterhe adopted a subtler cover for his refor!ist ideas> the theory of 7long aves.774he history of capitalis! on the international plane thus appears not only as asuccession of cyclical !ove!ents every % or 10 years/ but also as a successionof longer periods/ of appro6i!ately S8 years/ of hich e have e6periencedfour up till no.7 5ach rising ave is based on a 7technological revolution.7

productive techniue.7 1) 4hus the very decadence of capitalis!/ e!bodied in asee!ingly per!anent cold ar/ shos its per!anent capacity for develop!entO

+andel<s co!bination of a technologically deter!ined e6pansion coupledith a per!anently innovative ar!s econo!y describes a capitalis! that !ust

be funda!entally crisis#free. &t is not necessarily a universally benevolentsociety/ but it is at least one that doesn<t propel the proletariat into



4he third/ post#=orld =ar && e6pansion as founded on electronics andauto!ationF the earlier ones on stea! poer after 1"*" and electric andco!bustion !otors in the 1"90<s. 9

Such technological deter!inis! is highly superficial> it doesn<t e6plain hyinnovations occur in one period and not another. 10 'ut there is a deeper fla.

+andel<s vie echoes the theory of $0#year capitalist cycles D)$ years up and)$ donE developed by the non#+ar6ist Soviet econo!ist Jondratiev in the19)0<s. 'y postulating the recurrence of successive aves of develop!ent/ thelong#ave theory i!plies that capitalis! has not e6hausted its progressive

potential. 4his point and the generally anti#+ar6ist nature of Jondratiev<stheory as de!onstrated by 4rots2y in 19)3.

+andel denies that he has any difference ith 4rots2y/ i!plying that4rots2y too had a long#ter! cyclical theory. 'ut 4rots2y replied to JondratievDand +andelE that the long#ter! effects ere the result of non#periodic e6ternalhistorical conditions # conuests of ne countries and continents/ discoveries ofnatural resources/ ars and revolutionsF they ere not inherent in the operation

of the syste!>7As regards the large seg!ents of the capitalist curve of develop!entDfifty yearsE hich Professor Jondratiev incautiously proposes to desig#nate also as cycles/ their character and duration are deter!ined not by theinternal interplay of capitalist forces but by those e6ternal conditionsthrough hose channel capitalist develop!ent flos.711

+andel ent further/ calling the postar ave of innovation a 7per!anenttechnological revolution.7 74o the degree that e are involved in a per!anentcold ar/ hich is characteri?ed by a per!anent search for technical changes inthe sphere or ar!a!ents/ e have a ne factor here/ a so#to#spea2 e6tra#econo!ic source/ hich feeds continuous changes into


9. +andel/ ate Capitalism D19%)F 5nglish edition 19%$E/ Chapter *.10.+andel later denied/ unconvincingly/ that he had a technological e6planation of

long aves> see on+ Waes o% Capitalist eelopment D19"0E/ p. 9. Gis dispute islargely ith ichard '. :ay/ 74he 4heory of the Long Cycle> Jondratiev/ 4rots2y/+andel/7 :e e%t eie D19%(E.

11. 4rots2y/ 74he Curve of Capitalist :evelop!ent/7 Pro(lems o% &eryday i%e D19%3E/ pp. )%(#%

revolutionary opposition B and one in hich refor!ist solutions are possible.4he point of a theory li2e +andel<s # and its funda!ental fla B is to locatecapitalis!<s inner drive so!ehere other than ith the pursuit of value and thee6ploitation of the proletariat.

4his various for!s of the neo#capitalis! theory @ibed ith the political

progra!s adopted by +andel and his fir!/ the 7,nited Secretariat of the-ourth &nternational/7 starting ith long#ter! 7deep entris!7 into the refor!istCo!!unist and Socialist Parties in the 19$0<s. +any national 4rots2yistgroups ere already de!orali?ed enough at the end of the ar to burythe!selves in these rightard#!oving parties. D4his strategy contrasts ith4rots2y<s advocacy of te!porary entry into certain or2ing#class parties in the1930<s/ based on the leftard !otion of the or2ers.E 4he +andel ing did note!erge until the upheavals of 19(" # and then it turned to student vanguardis!and third#orld guerrillais!. &n the refor!ist spirit/ +andel advocated that theor2ing#class !ove!ent underta2e not revolution but 7a basicallyanticapitalist policy/ ith a progra! of short#ter! anticapitalist structural

refor!s7>74he funda!ental goal of these refor!s ould be to ta2e aay the leversof co!!and in the econo!y fro! the financial groups/ trusts and!onopolies and place the! in the hands of the nation/ to create a publicsector of decisive eight in credit/ industry and transportation/ and to

base all of this on or2ers< control. 4his ould !ar2 the appearance ofdual poer at the co!pany level and in the hole econo!y and ouldrapidly cul!inate in a duality of political poer beteen the or2ingclass and the capitalist rulers.713

=ith its reliance on the 7public sector/7 this passage could have beendrafted ithout a ual! by the refor!ists of 'ernstein<s day/ ho ould onlyhave specified that revolution as not the ay forard because the or2ers

ill conuer poer through parlia!entary !ethods. Placing the !a@orenterprises 7in the hands of the nation7 is precisely ho 'ernstein ould haveinterpreted a ter! li2e dual poer/ ith its otherise unco!fortablei!plications of class conflict. +andel added @ust a touch of


1).+andel/ .ntroduction to ar!ist &conomic TheoryA p. $"13.+andel/ .ntroduction to ar!ist &conomic TheoryA p. %".

42-

anti#capitalist cover> 74his stage in turn could usher in the conuest of poer by the or2ers and the establish!ent of a or2ing#class govern!ent hichcould proceed to the construction of a socialist de!ocracy free of e6ploitationand all its evils.7

So stagist a description of creating a public sector in order to constructsocialis! has nothing in co!!on ith the !ass upheavals in real revolutions

or2ers at their current level of consciousness. =or2place de!ocracy and!ilitancy beco!es the chief focus of their activity/ ith little attention paid tothe longer#run interests of the or2ing class.

4he trouble ith this approach is that in the nor!al course of events/ theran2s of or2ers do not all hold one progra!F their consciousness is inevitably!i6ed. -or the !ost part they accept the syste! they live under as a fact of life.



li2e the dual poer period in 191% # and even that !et only a pale foretaste ofthe violence the capitalists have since learned to e!ploy against revolutionary!asses.

+andel<s faith in 7structural refor!s7 is a sharp brea2 fro! the co!!unisttradition. Lu6e!burg/ for e6a!ple/ pointed out that the difference beteen

refor!ists and revolutionaries as not their support for refor!s/ hich are inany case li!ited and te!porary/ but rather that revolutionists sa the !a@orgain fro! refor!s to be the advance of or2ers< consciousness throughstruggle. -or +andel/ the or2ers< social poer follos as a for!al ad@unct toi!prove!ents under capitalis!. 4he ter! 7structural refor!7 itself shos thee!phasis on technical change rather than consciousness.

+andel<s ne epoch of late capitalis! contrasts to the decadent epoch henno class forces other than the proletariat are consistently revolutionaryF hisorld vie contains !any ne revolutionary forces li2e students/ reliable

bourgeois nationalists and petty#bourgeois guerrillas. 4hat as the reason for itsinvention> all these benevolent forces/ unli2e the de!ons of the past/ can help

rescue the underconsu!ing victi!s of capitalis! fro! the conditions hich the!asses are in no position to change by the!selves. +andel<s theory is a clearadaptation to the !iddle#class technical intelligentsia<s idea that 7e7 organi?esocial progress for the !asses. =or2ers Dor peasants/ in the third#orldcountriesE need serve only as battering ra!s for !anipulation by sociallyconscious benefactors.

THE PERMANENT ARMS ECONOMY

4he leading alternative to the degenerating -ourth &nternational fro! the4rots2yist tradition as the Shacht!an#Cliff current/ defined by its ne#classtheories of the ,SS. 4rying to escape pitfalls that had entrapped orthodo64rots2yis!/ they denied that the Stalinist states ere progressive and atte!pted

to orient their political activity in the light of the postar boo!. 'ut in theireffort to be practical at a ti!e hen revolutionary struggle in the advancednations see!ed to be ruled out/ they dongraded the crisis#ridden reality of theepoch. 4hus they too abandoned funda!ental lessons of +ar6is! # ith evenless disguise than +andel.

4he Shacht!an and Cliff tendencies also share a co!!on attitude and practice toards the or2ing class at ho!e. 4heir characteristic idea is that the2ey ele!ent for socialis! is the 7ran2 and file/7 that is/ the !ass of

'ut once they begin to !ove and recogni?e their on poer/ their politicalhori?ons iden> they fight for things they didn<t believe possible before. 7an2and filists7 ignore this dyna!ic. 4hey accept !ilitant but bac2ardconsciousness/ raising as their progra! not even hat they thin2 is needed buthat they i!agine ill attract the ran2s. &t is the opposite strategy to that of a

revolutionary party/ hich !ust point to the future of the !ove!ent/ the tas2sahead.1*

an2 and filis! arose in the 4rots2yist tradition out of antagonis! toardsthe 7overcentrali?ation7 of Stalinist ussia. &t breathes a cynicis! toards theor2ers parallel to +andel<s> the !asses concern the!selves only ith day#to#day struggles at the or2place/ hile the cognoscenti handle the deep politicaland econo!ic theories and lin2 all the struggles together. 4he 7de!ocratic7ran2 and file e!phasis !ar2s the difference beteen good intellectuals and evilStalinists> or2place de!ocracy serves as a corrective for the intellectuals atthe center/ !a2ing sure that they stay in touch ith their base.

4he Cliff ing of the tendency is centered around the 'ritish Socialist

=or2ers Party and calls itself &nternational Socialis! D&SE. &ts interpretation ofthe postar period as based on the 7per!anent ar econo!y7 theory devised by the Shacht!anites. efined by the Cliffites in the 19$0<s and 19(0<s Dandlater rena!ed the 7per!anent ar!s econo!y7 for peaceti!e applicationE/ itscurrent presentations rely on borroings fro! +ar6/ Lenin and 'u2harin andtherefore reuire careful refutation.

&n his early for!ulation of the theory Cliff accentuated its inherentunderconsu!ptionist !ethodology. Peaceti!e ar!s spending/ he said/ a

per!anent feature of postar capitalis!/ as the 2ey to the econo!ic boo!. &tsoa2ed up the e6cess production that the underpaid !asses could not buy/diverted funds aay fro! capital accu!ulation that ould only end up asconsu!ption goods later/ and distributed the surplus in the for! of increased

ages and state spending. &nvest!ent as thereby sti!ulated and profitabilityincreased by 7the increasing purchasing poer of the people/ together ith thene State de!and for ar!s/ ar!y clothing/


1*. See 7Co!!unist =or2 in the 4rade ,nions/7 Proletarian eolution o. )$D19"$#"(E.

428

barrac2s/ etc.71$

As a description of post#=orld =ar && capitalis!/ Cliffs picture containedele!ents of truth. 4he state budget # for ar!s in the ,.S. and 'ritain/ for socialelfare in 5urope Dbut less so in the ,.S.E # as used to !oderate cyclical crisesand reduce opposition fro! the or2ing classes. Cliff also pointed to li!its ofar!s spending as a solution to capitalis!<s proble!s> the ar!s burden could

bi d h b i h < d d f li i hi h h

Subseuently Cliffs folloers have atte!pted to discount the theory<s blatant underconsu!ptionis!. Chris Gar!an patroni?ingly e6plained that Cliffpresents the argu!ent # for si!ple e6position in a popular publication # in<underconsu!ptionist< rather than <rate of profit< ter!s.7 Peter 'inns insistedthat Cliff gave 7the first theoretically sound analysis of the per!anent ar!secono!y7 because he lin2ed it to the falling rate of profit D-PE la based onh i i i i i f i l ' i f h i h li 2



gro too big and thereby cut into the !asses< standard of living # hich hasindeed happened. 'ut another supposed proble! that Cliff cited e6poses theea2ness of his reasoning>

74he Poers !ay co!pete so fiercely on the orld !ar2et that each/ inorder to strengthen its position/ ould start to cut ar!s e6penditure. ...

4he ar econo!y !ay thus less and less serve as a cure for over# production/ a stabili?er of capitalist prosperity. =hen the ar econo!y beco!es e6pendable/ the 2nell of the capitalist boo! ill surely toll.7Cliff overloo2ed that the peaceti!e ar!s buildup as not chiefly an

econo!ic uestion. &t had critical political and !ilitary purposes as ell>2eeping rival i!perialists at bay and suppressing the colonial revolutions. &t asalso a necessary co!ponent of the Cold =ar strategy/ using the ussian !enaceto eld the =estern bourgeoisies and the or2ing classes together under ,.S.hege!ony. 4hus ar!s spending as in no ay 7e6pendable/7 especially henco!petition beteen poers beca!e increasingly fierce. 4he fact that particularsections of the bourgeoisie benefited econo!ically fro! the ar!s race is of

secondary i!portance co!pared to the !ilitary/ social/ political and econo!ic benefits it brought the ruling class as a hole.-or these reasons !ilitary spending e6panded/ if at a lesser rate/ even after

serious econo!ic crises re#e!erged in the early 19%0<s. Contrary to Cliff/ the postar boo! died and econo!ic stability disappeared despite continuing!assive ar!s budgets # hether they declined as a proportion of national

product as in the 19(0<s or e6panded as under eagan in the 19"0<s. 4heunderconsu!ptionist or Jeynesian 7solution7 to capitalist crises has provedfalse.

&n the last uoted passage Cliff uses the ter! 7overproduction/7 but his is notan overproduction theory of crises. &n such a theory/ crises are due tocapitalis!<s ine6orable drive to increase production beyond all bounds # in all

spheres of production/ not @ust consu!er goods. Accordingly/ a large peaceti!ear!s budget can only delay but not prevent crises. 4hat Cliff believes ar!sspending at a constant level prevents crises is further indication that his crisistheory is based on insufficient consu!er de!and.


1$. Cliff/ 7Perspectives of the Per!anent =ar 5cono!y/7 Socialist eieA +ay 19$%Freprinted in :either Washin+ton nor osco D19")E/ p. 10*

the rising organic co!position of capital. 'ut in fact there is no such lin2atte!pted in Cliffs ritings.

4he per!anent ar!s econo!y theory as reor2ed on a !ore sophisticated basis by +ichael Jidron. Ar!s production is unproductive/ according toJidron/ because eaponry does not re#enter the productive circuit of capital

either as production or consu!ption goodsF it is paid for out of surplus value/si!ilar to lu6ury goods bought by the bourgeoisie for personal consu!ption.4herefore the surplus value available for e6panding production is constantlyreduced by ar!s spending/ and this slos don the rate of econo!ic groth.'ecause accu!ulation is retarded/ so are all the las of !otion that follofro! it/ including the rising organic co!position of capital and the falling rateof profit. 4hus the -P tendency operates only sloly/ and cyclical crises can

be forestalled or at least !ade infreuent. &n Jidron<s ords>7&n +ar6/ the !odel assu!es a closed syste! in hich all output flos

bac2 as inputs in the for! of invest!ent goods or age goods. 4here areno lea2s. et in principle a lea2 could insulate the co!pulsion to gro

fro! its !ost i!portant conseuences. ... &n such a case there ould beno decline in the average rate of profit/ no reason to e6pect increasinglysevere slu!ps/ and so on.7Capitalis! has never for!ed a closed syste! in practice. =ars andslu!ps have destroyed i!!ense uantities of output/ incorporating hugeaccu!ulations of value/ and prevented the production of !ore. Capitale6ports have diverted and fro?en other accu!ulations for long stretchesof ti!e. A lot has/ since =orld =ar &&/ filtered out in the production ofar!s. 5ach of these lea2s has acted to slo the rise of the overall organicco!position Mof capitalN and the fall in the rate of profit.7 1"

4his reasoning is full of fallacies. -irst of all/ it cannot e6plain ho the boo! got started. -or even if it ere true that ar!s spending slos the decline

in profit rates/ Jidron<s 7lea27 cannot be responsible for the initial


1(.Gar!an/ &!plainin+ the CrisisA p. 1((.1%.'inns/ 7,nderstanding the e Cold =ar/7 .nternational Socialism o. 19 D19"3E.1".Jidron/ 7Capitalis!> the Latest Stage7 D19%1E/ in Capitalism and Theory D19%*E/ pp.

1(#1%.

429

high level of profits fro! hich the decline as retarded. 4hat depended on thehigher level of e6ploitation achieved by the proletariat<s defeats/ and on the

possibilities for ne invest!ent resulting fro! unprecedented arti!e capitalconcentration. =hen it as a uestion of !obili?ing labor and capital resourcesfro! depression levels of activity/ ar!s spending played a !a@or role in gettingthe boo! started # but by raising production/ not loering it.

S d th th l f il t l i th t d d d ti f th t

'ut in reality the opposite occurred. Since !uch ne invest!ent aschanneled into the !ilitary budget Din the ,.S./ ,SS and 'ritainE instead of

productive invest!ent Das in postar apan and =est er!anyE/ accu!ulationsloed don in so!e countries but accelerated in others. As a result the ar!secono!y has been a desta(ili3in+ econo!ic force internationally. 4hat reflectsour general point that the -P operates unevenly ithin the econo!y/ loeringth fit t f th b 2 d it l 4h h th , S



Second/ the theory also fails to e6plain the e6tended duration of the postar boo!. =ith the econo!y in full sing/ ar!s costs are an unproductivededuction fro! surplus value> they retard accu!ulation and also the nor!al risein the organic co!position. Ar!s spending can therefore be said to slo theoperation of the -P tendency as Jidron clai!s # but only by diverting industry

into !a2ing co!!odities that contribute no further to surplus#value production.&n other ords/ in the rate#of#profit for!ula SKDCVE/ the ar!s budget 2eeps thedeno!inator Dcapital investedE fro! rising # but only by holding the nu!eratorDsurplus value producedE don as ell. 4his does not !a2e for a prolonged

boo! # as has been shon by the relative decline of the leading =estern ar!s producing country/ the ,nited States.

+oreover/ Jidron<s theory assu!es that cyclical crises are caused directly bythe -P. 4his is not the case> the cycles and the -P are intertined/ and thecrises carry out the countertendencies to the -P by iping out less profitablecapital DChapter 1E. 4o the e6tent that ar!s spending/ li2e !ost stateintervention into the econo!y/ helps postpone crises/ it forestalls thecountertendencies to the -P/ pro!otes the buildup of fictitious capital andthereby hastens the fall in the rate of profit.

8nly in an e6tre!e case ould ar!s spending be guaranteed to halt the -P>if all surplus value ere ta6ed for ar!s and therefore no ne productiveinvest!ent ere possible. 'ut this i!aginary case e6poses the absurdity of thetheory. Since the effect of the -P is to induce stagnation/ ar!s spendingsi!ply displaces the !ode of stagnation ithout eli!inating it. &nstead ofalloing the -P to reduce the rate of accu!ulation by loering the rate of

profit/ ar!s spending reduces the rate of accu!ulation directly. 4he effect ofthe -P is carried out by another !ethod.

Jidron raises another argu!ent. 4he virtue of ar!s spending is that one poer<s build#up forced other co!peting poers to do the sa!e> 74he very

e6istence of national !ilitary !achines of the current si?e ... both increases thechance of econo!ic stability and co!pels other states to adopt a definite type ofresponse and behavior hich re/uires no policin+ by so!e overall authority.719


19. Jidron/ Western Capitalism Since the War D19("E/ Chapter 3

the profit rates of the !ore bac2ard capitals. 4hus/ hen the ,.S. ar!s budget hindered do!estic invest!ent/ alloing er!an and apanese industryto surpass A!erican productivity/ it thereby helped to carry out the -P in the,.S./ not retard it.

&S theorists freuently argue that cutbac2s in ar!s spending account for the

occurrence of crises in the short ter!. 'ut according to Jidron<s theory/ anar!s cutbac2 ould lead/ first/ to an upsurge in productive invest!ent/ hence arising organic co!position of capital B in a ord/ a boo!. 8nly in the longter! ould it accelerate the falling rate of profit. 4hat declines in ar!sspending are thought of as the triggers of recession shos again that &S in

practice does not bother ith Jidron<s atte!pt to invo2e the -P. &t reallyoperates under an underconsu!ptionist notion of crises/ here the !ilitary

budget absorbs the surplus.4he basic proble! ith any version of the per!anent ar!s econo!y theory

is the clai! that i!perialis!<s necessary but asteful drain of eapons production is econo!ically healthy for capital accu!ulation. o doubt it has been beneficial for so!e capitalists. 'ut the thesis that ar!s spending helpedthe syste! gro for decades only conceals the real e6planation # deepenede6ploitation of the or2ing people of the orld.

T>7 7!D )& ,MP7R,AL,SMG

Per!anent ar!s econo!y theory is !ore than an atte!pt to e6plain the postar boo!. &t also @ustifies &S<s re@ection of the Leninist theory ofi!perialis!. iving an underconsu!ptionist tist to Lenin/ &S reasons that inLenin<s day the e6port of capital siphoned e6cess value out of the econo!y andtherefore eli!inated crises caused by insufficient de!and. &n the !odernorld/ ar!s spending has replaced capital e6port as capitalis!<s device foravoiding collapse. Since Lenin<s analysis is no longer applicable/ &S !oc2inglylabels i!perialis! 7the highest stage but one. 2"

&S shares the social de!ocratic vie that capital e6port is out!oded>7!etropolitan capital as a hole is scarcely dependent on its !arginalinvest!ents in bac2ard countries.7)1 4his i!plies/ in the absence of any


)0. Jidron/ 7&!perialis!> Gighest Stage but 8ne/7 .nternational Socialism D19()EFreprinted in Capitalism and Theory D19%*E.

)1. Jidron/ 7&nternational Capitalis!/7 .nternational Socialism D19($EF reprinted inCapitalism and TheoryA p. 1()

0::

i!perialist drive to e6ploit foreign sources of surplus value/ that the third orldis econo!ically too insignificant to be relevant for the struggle for socialis!.4here as a superficial basis for this opinion in the 19(0<s/ but it is clearlyout!oded in the 19"0<s hen/ on the one hand/ a default by the debtor countriescould cripple =estern ban2s/ and on the other/ third#orld or2ing#classstruggles have had orldide i!pact.

&t i t i2i h l hi liti l l i b d d d f

'ritish S=P chose to stay neutral ith a policy of 7revolutionary defeatis!7toard both sides. ,nli2e the rulers of the =estern poers ho understoodthat Argentina<s ta2eover threatened to destabili?e i!perialist control in generaland unifor!ly bac2ed 4hatcher<s ar/ the S=P insisted that 7no ital interestsof 'ritish capitalis! are at sta2e.7)*

&n these cases it as clear that the distinction beteen oppressor andd t i t t f th &S th ti th t



&t is stri2ing ho clashing political conclusions can be deduced fro! verysi!ilar theories. 'aranKSee?y and the &S both argue that long#ter! crisis#freegroth co!es fro! ar!s spending that sops up e6cess de!andF the for!er<sclai! that the or2ing class in the i!perialist countries is irrelevant and the &S<ssi!ilar vie toards the third orld both depend on this underconsu!ptionist

theory. Such a theory is certainly no reliable guide to analysis or action/ but itreveals hat 'aranKSee?y and CliffKJid#ron have in co!!on> a re@ection of

proletarian e6ploitation as the !otor of capitalis!.Jidron subseuently asserted that i!perialis!<s drive to a!ass surplus value

is very !uch alive/ citing 7the forced drain of resources fro! the periphery ofthe syste! to its industrial heartlands # a reflection of the need to createincreasingly huge !ini!u! capital concentrations in order to survive in theintegrated orld !ar2et of today.7 )) Si!ilarly/ :uncan Gallas/ in theintroduction to a reprinting of &S<s basic theoretical docu!ents/ noted that the7highest stage but one7 for!ula as unfortunate> 7it !ay suggest thati!perialis! no longer e6ists.7 78f course i!perialis! still e6ists/7 Gallascontinued/ only to add> 7the point is that it is no longer central to the survival of

capitalis!.7 )3 =hatever it believes/ the &S continues to use the ter! i!peria#lis! as if it had never issued pole!ics against it. 4hat is not because the &S hasreverted to Leninis! in practice but because it has a great conte!pt for theory/including its on.

8ne purpose of a co!!unist theory of i!perialis! is to clarify the fightagainst it. 8ver the years/ the Cliff tendency has had an inconsistent record incarrying out the ele!entary tas2 of supporting anti#i!perialist struggles/especially those of the victi!s of its on D'ritishE ruling class. &t re@ectedsupport for China and Jorea against the i!perialist forces in the Jorean ar of19$0. &n orthern &reland/ hen the Catholic uprising intensified in the late19(0<s/ it hesitated to de!and the recall of 'ritish troops/ e6pecting that the

oppressors forces ere a better alternative than an unsupervised bloodbath. &n19")/ hen 'ritain ent to ar against Argentina over the +alvinas D-al2landE&slands in the South Atlantic/ the


)). Jidron/ 7Capitalis!> the Latest Stage/7 p. )".)3. Gallas/ .nternational Socialism o. (1 D19%3E

oppressed countries as not a top concern for the &SF the notion thati!perialis! is an obsolete theory contributed to this rationali?ation. &t alsoenabled the S=P to line up ith a hole spectru! of the 'ritish left/ fro!Stalinists to Labourites/ ho are hostile to ,.S. i!perialis! but have littleob@ection to a nationalist 'ritain Dor 5urope/ in so!e versionsE carving out its

on i!perialist niche in opposition to the A!ericans and ussians. &n thislight/ hen the S=P decided to support &ran<s ar against &ra in 19"% becauseof i!perialist naval intervention in the ulf/ all its Leninist argu!entation asa cover. 4he basic reason as that the ulf ar as not the doing of #ritish

i!perialis!/ so an anti#,.S. stance could !asuerade as revolutionary policy. )$

&S<s funda!ental difference ith Lenin over i!perialis! is not over third#orld struggles. &t is the uestion of the revolutionary character of the epoch>hether the ob@ective drives of capitalis! toard sociali?ation and decay forcethe proletariat onto a revolutionary road. Cliffs doubts ere for!ulated in hisnotion of 7deflected per!anent revolution.7 4his theory purports to e6plainhy successful revolutions ere led by non#proletarian forces in China andCubaF its anser is that the proletariat as aristocratic/ bought off andindifferent DCubaE or irrelevantly s!all in areas here the Stalinists held sayDChinaE. &n general/ 74hose forces hich should lead to a socialist/ or2ers<revolution according to 4rots2y<s theory can lead/ in the absence of therevolutionary sub@ect/ the proletariat/ to its opposite/ state capitalis!.7)(

o/ the proletariat as not 7absent7F it had to be first defeated or betrayed before statified capitalist regi!es could be set up. &n the conte6t of theorldide defeat/ nationalist petty#bourgeois revolutionists ere able to sei?ethe stage. 'ut contrary to Cliff the class struggle operates even here the

proletariat is ea2. =hen the old regi!es can no longer rule/ the or2ers haveno choice but to fightF the las of capital drive the!


)*. Socialist eieA +ay )0/ 19").)$. 4he S=P even urged or2ers in &ran to avoid stri2es that could endanger the ar

effort # at a ti!e hen or2ing#class unrest as intensifying and ith +ar6istleadership could have posed a challenge to the regi!e. Dational Conferenceresolution/ ove!ber 19"%.E

)(. Cliff/ 7Per!anent evolution/7 .nternational Socialism o. 1) D19(3E.

0:4

over and over again into battle. 'ut so!eti!es they lose. Stalinis!/ resting onthe usurpation of proletarian conuests/ has been a for!idable foe.

-or Cliff it as the or2ers< failure to achieve revolutionary consciousnessthat falsified 4rots2y<s perspective and saved capitalis!. As he su!s up/ 78ncethe constantly revolutionary nature of the or2ing class/ the central pillar of4rots2y<s theory/ beco!es suspect/ the hole structure falls to pieces.7 =elea e aside the false e ation of 4rots2 <s Dand +ar and Lenin<sE con iction

onder &S !isrepresents the underlying capitalist nature of Stalinis! # it doesthe sa!e for ordinary capitalis!. +ore co!!only/ &S does !a2e a distinction

beteen traditional and Stalinist capitalis!F it ad!its that the =est is not uiteas devoid of internal co!petition as the 5ast and still retains its internalcapacity to e6pand. D4hat is/ the &S does not fully believe Cliffs notion thataccu!ulation in the West as ell as the &ast is driven by use values.E &f/therefore the =est is forced to de ote efforts to !ilitar ri alr that is beca se



leave aside the false euation of 4rots2y<s Dand +ar6 and Lenin<sE convictionthat the proletariat is inherently a revolutionary class ith the ludicrous notionof constant revolutionary consciousness. 4he conseuence of Cliffs outloo2 isto bla!e the or2ers/ not their Stalinist and social#de!ocratic betrayers/ for thefailure of the +ar6ist perspective. 4he second danger is to be unprepared/

pessi!istically conservative/ or allied ith treacherous forces hen the or2ersdo brea2 out of their ideological strait@ac2et.

Stalinis!<s victories after =orld =ar && convinced !any leftists that the proletariat as dead. Cliff holds a left#centrist version of that vie. Li2e thedefor!ed or2ers< state theory of the orthodo6 4rots2yists DbeloE/ Cliffsdeflected per!anent revolution describes the or2ers as replaceable by non#

proletarian ele!ents in building a ne orld/ even if that orld is not a progressive one. 4hat is the logic of a theory of a ne epoch.

M,L,TAR# STAT7 CAP,TAL,SM

4he Cliff theory of state capitalis! points to very different conclusionsabout Stalinis!<s orld role fro! our on.

Cliff argues that the ar!s race has co!pelled the poers of both =est and5ast to dedicate their econo!ies to use value rather than value production.+oreover/ &S<s analysis leads it to treat the class struggle itself as a secondaryconflict/ subordinate to international !ilitary co!petition. Chris Gar!an put it

baldly>74he logic of the ne i!perialis! as si!ple> grab/ and e6ploit as !uch of

the orld as possible so as to build up the !ilitary potential to stop your rival

grabbing and e6ploiting areas to build up its on !ilitary potential.7)%

-or +ar6/ the ai! of !ilitary and every other capitalist advantage is furthere6ploitationF for Gar!an/ in contrast/ the ai! of e6ploitation is !ilitaryadvantage in order to accu!ulate !ore !eans of destruction. )" o


)%. Gar!an/ &!plainin+ the CrisisA p. "".)". &ronically/ the &S shares its !ethodology ith the pro#Stalinist Spartacists ho

ascribe every evil in ,.S. capitalis!/ including e6ploitation itself/ to anti#Sovietis!.4hus 7eagan<s class ar on blac2s and labor7 is only the 7do!estic reflection7 ofthe 7anti#Soviet ar drive.7 DWorkers )an+uardA Septe!ber )9/ 19"*.E

therefore/ the =est is forced to devote efforts to !ilitary rivalry/ that is becauseit has to !atch ussiaF Soviet capitalis!/ unli2e the =est/ is too bac2ard toco!pete peacefully. 4he result of this logic is disastrous>

74he ussian and A!erican ruling classes did not <choose< to create anar!s econo!y because of its positive conseuences in creating the

longest boo! in capitalis!<s history. o choice at all as involved in the!atterF rather/ it folloed fro! the specific features of the orld inhich they found the!selves. A!erican capital<s ability and illingnessto co!pete co!!ercially and financially as uite un!atched by that ofussia. ... -or the ussian ruling class/ !ilitary poer as all they

possessed to defend the!selves against =estern capital. -or theA!erican ruling class/ this fact/ in its turn/ i!plied the need tosupple!ent their financial and productive poer ith a !ilitary poerthat as eually overhel!ing.7 )"9

4hat is/ the ,.S. ar!s build#up is not part of its nature as the leadingi!perialist poer but rather a reaction against the Soviet !ilitary threat. Such a

position leans dangerously toards the +aoist line of conde!ning ussia asthe 7have#not7 poer that needs to destroy the peaceful balance of poer inorder to e6pand/ li2e er!any before =orld =ars & and &&. 4his as not anaccidental for!ulation> a si!ilar line as ta2en by the &S tendency<s A!ericansection in analy?ing the revived Cold =ar of the 19"0<s. 4he ,nited Statesloo2ed toard an eventual ar!s reduction> 7&n the late <%0<s and early <"0<sunder Carter and eagan/ the ,.S. pursued an ar!s buildup to brea2 the,SS<s econo!y and defeat it in the ar!s race. &n this ay/ the ,.S. couldloer its ar!s spending later hen the ,SS as no longer a threat.7 'ut forthe Soviets the ulti!ate goal as a !ilitary buildup # even if the i!!ediatetactic as the reverse> 7orbachev ... needs to increase the ability of hiscivilian econo!y to co!pete in the orld !ar2et and therefore cut the share of

the econo!y that goes into the !ilitary. 4his is the only ay to rebuild theecono!ic basis of !ilitary poer in the long run.7 30


)9. Peter 'inns/ 7,nderstanding the e Cold =ar/7 .nternational Socialism o. 19D19"3E/ p. )*.

30. Socialist Worker D&nternational Socialist 8rgani?ationE/ anuary 19"".

0:-

4he result of this distinction beteen the !ilitary drives of 5ast and =est isto place the chief bla!e on the Soviets for the international rivalry that broughtabout the Cold =ar. 4his ignores orld reality/ the ,.S.<s do!inant i!perialistrole. &t also forgets history> Stalinis! cannot have been the sti!ulus for=estern 7!ilitary state capitalis!/7 since Das the &S itself arguesE thei!perialists had already reached that status in =orld =ar &.

4he underlying proble! again is that the &S denies the epoch of i!

class7 to end the ar danger. Second/ the &S see!s unaare of the developingrealign!ent of the poers/ that an acco!!odation beteen the ,.S. and ,SSis possible ithout putting an end to the danger of inter#i!perialist conflicts.4his again reflects a little#5ngland nationalis!> the bla!e for the orld<s illsalays falls on so!ebody else<s i!perialis!.

&t is orth noting that the i!!ediate danger of ar is not as for!idable asclai!ed 5ven the intensifying crisis is not enough to co!pel the poers to



4he underlying proble!/ again/ is that the &S denies the epoch of i!# perialis! and is therefore searching for another rationale for the ar!s race.Atte!pts to construct a +ar6ist theory hile ignoring the epoch of the decayinvariably point to reactionary conclusions. &ronically/ the &S tendency/ hich

based its analysis of the restoration of capitalis! in the ,SS on the fact that

ussia had to accu!ulate capital under !ilitary pressure fro! the =est/ nosays that Soviet pressure deter!ines the nature of =estern accu!ulation. Suchdile!!as are inherent in a theory that finds the i!pulse to capitalis!<saccu!ulation co!ing fro! outside. 4here are further proble!s. &!perial rivalryis no longer a uestion of dividing up the spoils of =orld =ar && and ofcoe6isting in a period of stability and prosperityF ere that the case/ says the &S/the superpoers ould 7reach a ne acco!!odation beteen the!selves7 and7there ill be no need to !obili?e the or2ing class to get rid of the ris2 ofnuclear ar B the natural functioning and e6pansion of the orld syste! illdo that for us instead.7 o/ no the revived econo!ic crisis !a2es arinevitable in the absence of proletarian revolution.

7&n its essential details the current period of rear!a!ent rese!bles notthe early 19$0<s/ but rather the years preceding the 191*#1" ar. =e cantherefore e6pect the continued crisis to push the ruling classes of the tosuperpoers Dand their hangers on in the A48 and =arsa PactalliancesE further along the road of all#out confrontation. &n an i!portantsense/ therefore/ it is ine6act to refer to this period as that of the eCold =ar. 4here is nothing intrinsically <cold< about the nature of theconfrontation that e are currently itnessing/ uite the opposite is thecaseF e are seeing/ rather/ the accelerating ar drive of aging/!ilitari?ed state capitalis!s in crisis.731

A revealing argu!ent. -irst/ even to raise the possibility that an i!perialistsyste! could end the ris2 of nuclear ar through its on e6pansion is a

reflection of the long#discredited Jauts2y !odel of i!perialis!. &t isincredible that a revolutionary +ar6ist can conceive that at any ti!e in thisepoch there can be 7no need to !obili?e the or2ing


31. 'inns/ pp. 3"#39. 4his 19"3 prediction contrasts ith ours of the sa!e yearforeseeing the great poer realign!ent DChapter (E

clai!ed. 5ven the intensifying crisis is not enough to co!pel the poers torush headlong into ar. As e shoed in Chapter (/ the i!perialists learnedfro! =orld =ar & that an unde%eated proletariat ill turn against its !asters ifit suffers ar depredationsF =orld =ar && beca!e safe for the bourgeoisie onlyhen a?is! and Stalinis! had brought the !asses to their 2nees.

As is so often true/ political capitulation is lin2ed to bad theory. otunderstanding the Soviets< ea2ness B its technological dependence on the=est and their eagerness to retreat fro! the ar!s race # derives fro! denyingthat the ,SS<s defor!ed capitalis! in any ay reflects its origins out of thecorpse of a or2ers< state. And i!agining that the drive of capitalis! is to

produce use values leaves the &S unable to see hy the ar!s race is a proble!.&t is the la of value/ the drain of labor ti!e fro! productive resources/ thatforces the Stalinists to pull bac2.

;=?>AR,!,SM VS ?A=TS?#,SM

4he &S vie of the cold ar is closely lin2ed to its overall theory oftentieth#century capitalis!. 4his is based on 'u2harin<s 7!ore rigorousversion of the theory of i!perialis!7 Dco!pared to Lenin<sE. 3) 'u2harin

postulated that the drive toard statification as !a2ing internalcontradictions and crises obsolete DChapter 1EF they ere replaced by e6ternalco!petition and above all by ar/ the !ilitary e6pression of internationalco!petition. Callinicos observes>

7'u2harin<s analysis/ ith its vision of a orld syste! co!posed of!ilitari?ed state capitals/ infor!ed the cornerstone of our tradition/ 4ony Cliffstheory of state capitalis! in ussia. &t is also i!plicit in Jidron<s e6planationof the long boo! of the 19$0<s and 19(0<s as a conseuence of the per!anentar!s econo!yF indeed/ an e!bryonic version of this analysis is to be found in

Cliffs boo2 on ussia.733

'u2harin as indeed the &S<s theoretical predecessor. Ge too called histheory of a !onolithic state capitalist trust 7state capitalis!7 B because of itse6ternal trade relations on the orld !ar2et and the class relations


3). Callinicos/ 7&!perialis!/ Capitalis! and the State 4oday/7 .nternational Socialism

o. 3$ D19"%E/ p. "1.33. Callinicos/ p. ").

0:8

beteen the proletariat and the bourgeoisie. Cliff also follos 'u2harin in hisopposition to Stalin<s industriali?ation of 19)"#)9 # on the grounds that any

accu!ulation of capital in a bac2ard country ould establish a ne rulingclass. 4he alternative fought for by 4rots2y and the Left 8pposition as anindustriali?ation drive to preserve the social gains of the or2ers. &n re@ectingthis strategy along ith Stalinis!/ Cliff has only one alternative left> 'u2harin<sslo paced groth for a peasant based econo!y DChapter 3E

stronger third#orld countries/ the state itself no longer plays a necessaryaccu!ulative role. +oreover/ this is true in capitalis! generally> the role of thestate is only supportive. :irect state intervention in the econo!y/ as the rottingStalinist e6a!ples de!onstrate/ is unproductive and irrational fro! thestandpoint of capital. 'ut if this ere true/ Callinicos observes/ then !ilitaryrivalry beteen countries ould decline. Garris reluctantly agrees> 78ne ofthose sources of opti!is! is the ea2ening of the drive to arF as capital and



slo#paced groth for a peasant#based econo!y DChapter 3E.Callinicos presents a partial critiue of 'u2harin<s theory of a crisis#free

state capitalis!. 'u2harin/ he says/ overloo2ed the possibility of econo!iccrises because he thought centrali?ed planning under state capitalis! ouldeli!inate econo!ic disproportions. 8n the contrary/ Callinicos replies/ another

tendency of capitalist develop!ent is the groing internationali?ation of production/ hich forces the poers to intensify co!petition ith one another #thereby restoring the drive toard crises. Callinicos does not dispute 'u2harin<seli!ination of internal contradictionF he agrees that 7state capitalis! couldoverco!e this disproportion beteen production and consu!ption.73* Geob@ects to 'u2harin<s restriction of e6ternal contradiction to !ilitary e6pansionand ar. Li2e his a!end!ent to Cliff on the Soviet proletariat DChapter $E/ thiscure !isses the !ain proble!.

An alternative as offered by the 'ritish S=P<s igel Garris. =hereas'u2harin and his !odern disciples eli!inated internal contradictions butstressed the role of the state in international co!petition/ Garris suggests thatstate capitalis!s and their international rivalry are doo!ed. enerali?ing fro!the success of so!e third#orld countries in e6panding industrially by

participating in the orld !ar2et # not see2ing to escape it as in the Stalinist!odel of econo!ic independence # Garris concludes> 74he !ore successful thegovern!ents of nely industriali?ing countries ere in pursuing groth/ the!ore poerful private capital at ho!e and the !ore closely integrated ithe6ternal !ar2ets and orld capital abroad/ the !ore the poer of thegovern!ent to shape the do!estic econo!y declined ... 4he changes in both!ore developed and nely industriali?ing countries thus pro!ised thecontinuing erosion of the foundations of the econo!ic poer of the statesconcerned/ the basis of any revival of state capitalis!. Privati?ation # and itstheoretical underpinnings in neoclassical econo!ics # as the ideological and

practical recognition of this e!erging ne orld order.73$

4hat is/ because of the increasing poer of private capital in the


3*. Callinicos/ p. "(.3$. Garris/ The &nd o% the Third World D19"(E/ p. 1(9

those sources of opti!is! is the ea2ening of the drive to arF as capital andstates beco!e slightly dissociated/ the pressures to orld ar are slightlyea2ened.7 3(

8f course/ since ar is a function of states/ under Garris< sche!e !ilitaris!cannot be the pri!ary for! ta2en by capitalist co!petition. Garris< theory/

therefore/ is an indirect challenge to Cliffis!. -or Callinicos the proble! lies inGarris< one#sided 7treat!ent of the global integration of capital as anacco!plished result.73% 4rue enough/ but again his critiue falls short ofna!ing things by their true na!es> Garris Dalong ith 'inns/ as e previouslysaE is abandoning 'u2harinis! in favor of Jauts2yis!/ the theory of oneinternational 7ultrai!perialist7 capitalis! capable of eli!inating the syste!<sdrive toard ar DChapter )E.

'u2harinis! and Jauts2yis! are not far apart. Jauts2y held thatultrai!perialis! as possible and therefore that crises and conflicts could beeli!inated on the international level. 'u2harin thought ultrai!perialis!i!possible but nevertheless sa crises re!ovable on the national level. 4hedistinction is not funda!ental> in the history of capitalis!/ !onopoly hasreplaced the s!all#capital stage only to beco!e co!petitive itself/ and thesa!e is true of national capitals. 4he la of value alays reappears beteenand ithin the ever#larger blocs of capital.

Jauts2y<s theory is not counterposed to 'u2harin<s but e6tends it. Jaut#s2y<s version is !ore consistent in that he dras out the logical conclusionfro! the pre!ise that crises can be eli!inated> capitalis! can be !ade

peaceful. 'u2harin<s theory is !ore in tune ith the pervasive nationalis! thatinheres in capitalis!. 'oth are third#syste! theories that pose a collectivistclass society as capitalis!<s successorF both are therefore orthy theoretical

predecessors for the &nternational Socialists. 4hese roots/ together ith the politics they rationali?e/ de!onstrate that the &S tendency is no alternative to

7orthodo6y7 for re#establishing the 4rots2yist heritage.


3(. Garris/ p. )0).3%. Callinicos/ p. 9%.

0:9

4 D7&)RM7D W)R?7RS6 STAT7 T>7)R#

A defining characteristic of 7orthodo6 4rots2yis!7 has been its conceptionof the ne Stalinist states. 4he invention of the theory of defor!ed or2ers<states in the 5ast is closely related to the adaptation to refor!ist and !iddle#class forces in the =est.

the 2ingOE.4he ruling Stalinists even adopted a for!ally bourgeois ter!inology for

their states> 7people<s de!ocracies7 in 5ast 5urope and 7ne de!ocracy7 inChina. Cos!etic though these bourgeois titles ere/ they indicated Stalin<s

purpose of 2eeping the satellites as states hose underlying class relationsere capitalist. 4hey also reflected his desire to !aintain the alliance ithbourgeois forces internationally that had characteri?ed Stalinis! since the



4he theory originated in the late 19*0<s/ hen 5ast 5urope under ussianrule as transfor!ed to appro6i!ate the Soviet !odel in politics andecono!ics. 4he old bourgeoisies ere overthron/ industries nationali?ed andcapitalist relations see!ingly abolished # ithout a revolution by the or2ing

class. 4he Co!!unist Parties/ hich according to 4rots2y had been !archingdon the road to refor!is!/ no appeared capable of destroying the bourgeoisie instead of preserving it. 4he old theory of Stalinis! as patentlyinadeuate/ and so!ething had to give.

T>7 <P7)PL76S D7M)CRAC,7S<

4he central uestion to be resolved as the class character of the neStalinist states. 4rots2yists ho believed that the ,SS as still a or2ers<state ere dran to conclude that the ne syste!s had to be the sa!e. 'ut itas not easy to accept that Stalinis! had created or2ers< statesF !uch +ar6istheritage had to be overco!e. As a!es Cannon/ the leader of the A!ericanS=P/ put it>

7& don<t thin2 you can change the class character of the state by!anipulations at the top. &t can only be done by a revolution hich is

folloed by a funda!ental change in property relations. ... &f you once begin to play ith the idea that the class nature of the state can be

changed by !anipulations in top circles/ you open the door to all 2inds of

revisions of basic theory.73"

'ut the door had already been opened through adaptations to the !iddle#class progra!s of de!ocracy and nationalis! and acco!!odations ithrefor!ists in the unions. &n purely logical ter!s/ the -ourth &nternationalcould have reasoned the other ay> that is/ the fact that the Soviet satellites had

been transfor!ed fro! above should have proved they eren<t or2ers< states #and therefore Soviet ussia asn<t either. &ndeed/ at first the -& insisted that thene Stalinist states could only be capitalist. =ith good reason> !any capitalistsin 5ast 5urope still held their property/ the old parlia!ents had been revived/and bourgeois politicians ere in the govern!ents Das ere a fe leadingfascists/ and/ in o!ania/


3". Cannon/ S=P D,.S.E .nternal #ulletinA 8ctober 19*9/ pp. )$#(

bourgeois forces internationally that had characteri?ed Stalinis! since the1930<s.

5rnest +andel correctly insisted for a ti!e that 7=e ill continue/ until ehave sufficient proof to the contrary/ to consider as absurd the theories of a ...degenerated or2ers< state being installed in a country here there has not

previously been a proletarian revolution.739 Pole!ici?#ing against Shacht!an<stheory that the Stalinist states ere bureaucratic collectivist and therefore non#capitalist/ +andel !oc2ed/ 7:oes he really thin2 that the Stalinist bureaucracyhas succeeded in overthroing capitalis! in half of our continentH Shacht!anagain finds hi!self in this hardly enviable position of having to share his viesith the StalinistsO7

'y early 19*" the Co!!unists had salloed the other or2ing#class parties/ ousted their bourgeois coalition partners and co!pleted thenationali?ation of !a@or industry. o there ere fe differences in propertyfor!s beteen 5astern 5urope and the ,SS. 'ut the -& did not change itsanalysis. &ts position that the Soviet ,nion as a or2ers< state hile the othersere capitalist as inherently unstable/ de!onstrating that its theory as toofragile to confront real changes in the orld.

So hen 4ito<s ugoslavia as 2ic2ed out of the Stalinist fraternity/ the -&abandoned its theory overnight and declared ugoslavia both proletarian andrevolutionary. 'y 19$1 the contradiction as resolved through the for!ula ofthe &nternational<s leader/ +ichel Pablo> the 5astern 5uropean countries ereall redefined to be or2ers< states # not 7degenerated7 li2e the ,SS but7defor!ed/7 because they had never been genuine or2ers< states to beginith.

Cannon<s arning as apt/ although he too ent along ith Pablo. 4hecreation of a or2ers< state is not @ust a !atter of econo!ic for!sF it is theresult of a social revolution that places state poer in the hands of the or2ing

class. Since it inaugurates the period of transition to co!!unis!/ it is in factthe socialist revolution. And it !ust be a conscious achieve!ent of the or2ersDthat is/ it reuires leadership by a revolutionary partyE> as e have seen/ thetas2 of a or2ers< state is to fight against the pressures of capitalis! and itslas/ unli2e the bourgeois revolution hich overturns restrictions on theoperation of the blind la of value. 'y


39. +andel/ 74he Conflict in Poland/7 7ourth .nternational D19*%E.

03:

asserting that the socialist revolution as a tas2 acco!plished by the petty# bourgeois Stalinists after s!ashing the or2ers< on efforts/ the Pabloite7defor!ed or2ers< state7 theory turned +ar6is! upside don.

T>7 DAT7 =7ST,)!

A specific difficulty never resolved by the -& as to deter!ine the 7date7 ofthe revolutionary changeover =hen e6actly had these socialist revolutions had

or2ers< revolt. &n reality/ at that ti!e Stalin hesitated to brea2 ith the Alliedi!perialists and the local bourgeoisies for several reasons> he hoped to!aintain the arti!e alliance/ folloing the agree!ent ith ChurchillDChapter (EF and the or2ing class as as yet undefeated. So the Stalinistsocial turnover ca!e only later. As 4rots2y had noted/ nationali?ed propertyould prove too te!pting an ob@ect to place ithin the grasp of an active/undefeated or2ers< !ove!ent



the revolutionary changeover. =hen e6actly had these socialist revolutions hadta2en place> in 19**#*$ at the ti!e of the Stalinist conuests/ or in 19*%#*"hen the old bourgeoisies ere ousted fro! their share of poerH 5itheralternative led to insuperable difficulties.

4o place the revolutionary date at 19*%#*" or later says that the social

transfor!ation left the state apparatus unchanged/ since the Stalinists controlledthe ar!ed forces and the state bureaucracy both before and after. 4his directlycontradicts the +ar6ist principle that a state is the organ of its ruling classF thesa!e state cannot serve first an e6ploiting ruling class/ then participate in therulers< overthro and end up serving the for!erly e6ploited or2ing class.5ven if e accept for the sa2e of argu!ent the contention that the Stalinistsheld state poer 7in trust7 for the or2ers/ this still !eans that class poer astransfor!ed peacefully ith no change in the state/ for previously the Stalinistshad ruled in trust for the bourgeoisie.

Such a theory echoes the revisionist !ethod of 'ernstein/ and it is noabstract for!ality. 4he principle it violates had been the historical de!arcation

beteen refor! and revolution/ a lesson paid for ith the blood of !illions ofor2ers. &t as learned by +ar6 and 5ngels fro! the e6perience of the ParisCo!!une<s failure to s!ash the bourgeois state !achinery. 4he point as sofunda!ental that it led the! to a!end the Co!!unist +anifesto> 78ne thingespecially as proved by the Co!!une/7 they rote in their preface to the1"%) er!an edition/ 7that <the or2ing class cannot si!ply lay hold of theready#!ade state !achinery and ield it for its on purposes<.7 'ut that is

precisely hat the ne theory clai!ed that the Stalinist party did in the na!e ofthe or2ing class.

Such a theory ould also i!ply that the ussian revolution had not created aor2ers< state until at least a year after the 'olshevi2 revolution. -or it as notuntil late 191" that the industrial property of the bourgeoisie as nationali?ed/

and that only in the li!ited territory controlled by the ed Ar!y. 8f course/ no+ar6ist analysis of the ,SS has ever !ade this clai!/ since it is undeniablethat the or2ing class too2 state poer in 191%.

8n the other hand/ if the date of the 5ast 5uropean revolution is put at 19**#*$/ then the Stalinist forces beco!e the agent of proletarian revolution at thevery !o!ent hen they ere crushing the !ove!ent of

undefeated or2ers !ove!ent.A further difficulty in seeing a socialist revolution in 19**#*$ is that in to

regions originally occupied by the Soviet forces/ -inland and 5astern Austria/the troops ere later ithdran. &f Soviet occupation in itself !eant proletarianrevolution/ then these territories ould have reverted peacefully to capitalis!

after being or2ers< states. A peaceful social counterrevolution violates+ar6ist theory @ust as !uch as a peaceful social revolution.

&n either case/ labeling the Stalinist states proletarian !eans that socialisttransfor!ation can be achieved ithout overthroing the bourgeois state # thehall!ar2 of refor!is!. o onder the different ings of Pablois! De usethis ter! for all those ho accept the defor!ed or2ers< state theoryE have hadto concoct a never#ending series of rationali?ations in place of theory. 4heycannot decide precisely hich states are defor!ed or2ers< states # even ithinthe sa!e international organi?ation.*0 o onder/ decades later/ that so !anyof the Pabloites Dor Soviet 7defensists/7 as they prefer to call the!selvesEac2noledge that there are still deep proble!s in e6plaining thetransfor!ations. *1

Pablo<s 7solution7 had an interesting predecessor/ the !inority in theA!erican S=P led by a!es 'urnha! and oseph Carter in 193% Dbefore theShacht!an splitE. 'urnha! and Carter argued that the ,SS as no longer aor2ers< state and not yet a bourgeois state B but since it as based onnationali?ed property/ it as still socially progressive and !ust be defendedagainst capitalist i!perialis!.*) 4heir !ethod as to grant


*0. Pol Pot<s bloody regi!e in Ca!bodia proved a particularly tric2y case to handle. &f itas a or2ers< state it as one that 2illed or deproletariani?ed the entire or2ing class.-or atte!pts to suare the circle/ see the debate in .ntercontinental PressA une */ 19%9.

*1. 7& thin2 it is @ust to say that e have not yet achieved a fully satisfactory unifiedtheory.7 Doseph Gansen/ 74he Social 4ransfor!ations in 5astern 5urope/ China and

Cuba/7 in The Workers and 7armers =oernmentA S=P 5ducation for Socialists pa!phlet/ 19(9E. 74he orthodo6 4rots2yists ... could not construct a theory to e6plainthe 5ast 5urope transfor!ation ithout e!bracing non#revolutionary conclusions.7D7enesis of Pablois!/7 Spartacist o. )1/ 19%)E.

*). 'urnha! and Carter/ 7A!end!ent to esolution on the Soviet ,nion/7 in . 'reit!an/ed./ The 7oundin+ o% the Socialist Workers Party D19")E. 4rots2y<s pole!ic/ 7ot a=or2ers< and ot a 'ourgeois StateH7 GWritin+s 19*0-*8@ as ritten in reply to thisdocu!ent.

034



slogan/ revolutionaries could prove the inability of the petty#bourgeois partiesto fulfill the !asses< needs/ hether they dare ta2e office or not. 4rots2yadvocated a si!ilar tactical use of the or2ers< govern!ent slogan as a de!andon the leaders of or2ing#class parties in the crisis conditions of the 1930<s.Such a govern!ent could only occur under revolutionary conditions/ since itould be a life#and#death challenge to the bourgeoisie # ousting the ruling classfro! the govern!ent of its on state. And even then it could have only a

+oreover/ since placing Stalinists in office does not lead to their !a2ing asocial revolution/ all the less does it !ean that Stalinis! in office already

signifies the proletarian dictatorship. =hat is 7!erely a short episode on theroad7 is not the thing itselfF the 7short episode7 ends ith the proletarianrevolution. 4he 7or2ers< and far!ers< govern!ent7 slogan is a revolutionarytactic/ not a shortcut for bypassing the revolution.

4he Pabloites developed the 7or2ers< govern!ent7 dodge further/ using it



fro! the govern!ent of its on state. And even then it could have only afleeting e6istence> either it leads to the or2ers< revolution/ or it is defeated and

bourgeois order is bloodily restored.Pabloites insist that 4rots2y<s position !eans that Stalinis! could

acco!plish the proletarian tas2 of socialist revolution/ even though

+enshevis! could not. Gere is the passage they cite as evidence> 7&s thecreation of such a govern!ent by the traditional or2ers< organi?ations

possibleH Past e6perience shos ... that this is to say the least highlyi!probable. Goever/ one cannot categorically deny in advance the theoretical

possibility that/ under the influence of co!pletely e6ceptional circu!stancesDar/ defeat/ financial crash/ !ass revolutionary pressure/ etc.E the petty#

bourgeois parties including the Stalinists !ay go further than they the!selvesish along the road to a brea2 ith the bourgeoisie. &n any case one thing is notto be doubted> even if this highly i!probable variant so!ehere at so!eti!e

beco!es a reality and the Ror2ers< and far!ers< govern!ent< in the above#!entioned sense is established in fact/ it ould represent !erely a short episodeon the road to the actual dictatorship of the proletariat.7 4he 7orthodo67 readingof this passage is that the Stalinists Dor social de!ocratsE could create a or2ers<govern!ent and then find the!selves propelled to establish the proletarianstate. 4his is alleged to be hat happened in the 19*$#*" period> the @ointStalinist#bourgeois regi!es ere 7or2ers< govern!ents7 on the road toor2ers< states.

'ut that is not at all hat 4rots2y says. Ge does state that the Stalinists/unli2e the +enshevi2s in 191%/ !ight be forced to ta2e govern!ental office7independent of the bourgeoisie7 # that is/ ithout bourgeois parties in thegovern!ent # and that such a step ould help bring about the or2ers< state. 'utthis does not !ean that the Stalinists ould !a2e the socialist revolution. 8nthe contrary/ 4rots2y<s e6plicit analogy to Lenin<s slogan in 191% D7the above#

!entioned sense7E shos that he !eans @ust the opposite. &f the Stalinists< andrefor!ists< unillingness to brea2 ith capital is e6posed/ the revolutionariescould in leadership of the or2ers/ and the socialist revolution ould then be!ade # a+ainst the!. 4hat is hy putting the! in office ould 7represent!erely a short episode7 on the road to socialist revolution> it ould be a shortstep to their overthro.

4he Pabloites developed the or2ers govern!ent dodge further/ using itto suggest that the Stalinist ta2eovers ent through a stage here the state as!o!entarily neither bourgeois nor proletarian. 'ac2 in 19*3/ they roteretrospectively/ in those areas here the ugoslav CP had ta2en poer/ 7this

part of ugoslavia ceased to be a bourgeois stateF under a or2ers< and

peasants govern!ent it advanced toard the final acco!plish!ent of the proletarian revolution.7 8nly in late 19*$/ hen the last bourgeois !inistersleft the central govern!ent/ could it be said that 7the transition beteen theor2ers< and peasants< govern!ent and the dictatorship of the proletariat as

being co!pleted.7*( &n this case the or2ers< govern!ent as evidentlyso!ething beteen a bourgeois and a or2ers< state in the spirit of 'urnha!and Carter/ a handy ay of avoiding the difficulties inherent in choosing aspecific historical !o!ent for the alleged or2ers< revolution.

4rots2y had given a sharp anser to Co!intern theorists/ predecessors ofthe Pabloites/ ho insisted on an inter!ediate stage before the socialistrevolution. =riting about the Spanish revolution in 1931/ he said> 74hese

people drea! of a process of evolutionary transfor!ation fro! a bourgeois intoa socialist revolution/ through a series of organic stages/ disguised underdifferent pseudony!s> Juo!intang/ <de!ocratic dictatorship/< Ror2ers< and

peasants< revolution/< <people<s revolution< # and hat is !ore/ the decisive!o!ent in this process hen one class rests the poer fro! another isunnoticeably dissolved. ...

7&t is not the bourgeois poer that gros over into a or2ers< and peasants<and then into a proletarian poerF no/ the poer of one class does not <groover< fro! the poer of another class but is torn fro! it ith rifle in hand. 'utafter the or2ing class has sei?ed poer/ the de!ocratic tas2s of the

proletarian regi!e inevitably gro over into socialist tas2s. An evolutionary/organic transition fro! de!ocracy to socialis! is conceivable only under the

dictatorship of the proletariat. 4his is Lenin<s central idea.7*%


*(.74he ugoslav evolution/7 resolution of the 4hird =orld Congress 7ourth

.nternationalA 19$1.*%. 4rots2y/ 74he Spanish evolution in :anger/7 in The Spanish eolutionA pp. 1)1#

3.

038



that crushes the! is 7!etaphysical7 only to one ho sees a 7or2ers< state7 asthe e!bodi!ent of structural property for!s rather than class relations. 4hesa!e refusal to dra 7!etaphysical dividing lines7 characteri?es the legions of

bourgeois historians ho regard the Soviet state of Lenin<s day and the e!pireof Stalin as one and the sa!e totalitarian !onstrosity.

,nfortunately/ 4rots2y<s principled insistence that social transfor!ationsreuire !ass revolutions as borne out only negatively after the ar. 4hen the

because the or2ing class as not involved. 'y the 1930<s the CCP under +aohad abandoned its for!er proletarian base in the cities and sta2ed its hopes onthe peasant !ove!ent in areas ruled by the ed Ar!y. 4rots2y rote>

74he Stalinist press is filled ith co!!unications about a <sovietgovern!ent< established in vast provinces of China under the protectionof a ed ar!y. =or2ers in !any countries are greeting this nes ithe6cite!ent. 8f courseO 4he establish!ent of a soviet govern!ent in a



y g yStalinist ta2eovers ere precisely the 7bureaucratic revolutions7 he denied

before the ar. 4o clai! 4rots2y<s authority for calling the! socialistrevolutions B at a ti!e/ !oreover/ hen the specific history of anti#proletariancounterrevolutionary !easures as clearly established B is not only 7incorrect

and disloyal7 but deceitful as ell.Gansen<s theory at least had the !erit of trying to find so!e proletarian

content in the birth of the 7defor!ed or2ers< states.7 Subseuently the -&denied the proletarian role/ a !ore accurate position historically but an even!ore cynical one ith respect to +ar6ist theory. 4he resolution on 5astern5urope at the 4hird =orld Congress in 19$1 ad!itted that 74hese states havearisen not through the revolutionary action of the !asses but through the!ilitary#bureaucratic action of the Soviet bureaucracy/ than2s to e6ceptionalcircu!stances created by the last ar ... .7 =hat as not ad!itted/ hoever/as that the Stalinist conuests reuired a great defeat of the or2ing class.4hus the -& as left clai!ing that a progressive ne society has been created byStalinis!. 4he door as left ide open for holesale revisions of basic

principles and a cynical adaptation to !iddle#class politics.

TR)TS?# )! C>,!A

&t as possible to interpret 4rots2y disloyally about the post#=orld =ar &&events because he as dead. 'ut he as alive during a parallel situation/ thecreation of 7soviet govern!ents7 in the areas of China ruled by the ChineseCo!!unist Party DCCPE in the 1930<s. 4his presents a clear test of the defor!edor2ers< state theory. =hat as the class character of these statesH =ere theyor2ers< states/ or in so!e sense destined to beco!e so hen the CCPconuered all of !ainland China in 19*9H And if they ere/ hy did 4rots2ynot ta2e note of so significant a factH$)

&n fact 4rots2y did discuss the areas ruled by the CCP/ and he re@ected theidea that they could be considered proletarian or genuinely soviet/


$). 8ur argu!ent in this section is ta2en fro! 7=as 4rots2y a PabloiteH Part )/7Socialist )oice o. * D19%%E. Si!ilar reasoning fro! a different point of vie can

be found in Alan =estoby/ Communism Since World War .. D19"1E/ pp. 3%%#3"%

gsubstantial part of China and the creation of a Chinese ed ar!y ould

be a gigantic success for the international revolution. 'ut e !ust stateopenly and clearly> this is not yet true$

7:espite the scanty infor!ation hich reaches us .../ our +ar6ist

understanding of the developing process enables us to re@ect ithcertainly the Stalinist vie of the current events. &t is false and e6tre!elydangerous for the further develop!ent of the revolution. ... 7=hen theStalinists tal2 about a soviet govern!ent established by the peasants in asubstantial part of China/ they not only reveal their credulity andsuperficialityF they obscure and !isrepresent the funda!ental proble!of the Chinese revolution. 4he peasantry/ even the !ost revolutionary/cannot create an independent govern!entF it can only support thegovern!ent of another class/ the do!inant urban class. 74he peasantry atall decisive !o!ents follos either the bourgeoisie or the proletariat. ...4his !eans that the peasantry is unable to organi?e a soviet syste! on itson. 4he sa!e holds true for an ar!y. +ore than once in China/ and inussia and in other countries too/ the peasantry has organi?ed guerrillaar!ies hich fought ith inco!parable courage and stubbornness. 'utthey re!ained guerrilla ar!ies/ connected to a local province andincapable of centrali?ed strategic operations on a large scale. nly the

predominance o% the proletariat in the decisie industrial and political

sectors o% the country creates the necessary basis for the organi?ation ofa ed ar!y and for the e6tension of the soviet syste! into thecountryside. 4o those unable to grasp this/ the revolution re!ains a boo2closed ith seven seals.7$3

4rots2y<s critiue of isolated peasant Soviets as !issed in a debate overVietna! beteen to factions of +andel<s ,nited Secretariat in the early

19%0<s. eplying to Pierre ousset of the !a@ority tendency/ the A!ericanS=P rote>

7ousset tells us that the e!bryo of a or2ers< state as created in peasantliberated ?ones # here there ere no or2ers. =hat as


$3. 4rots2y/ 7+anifesto on China of the &nternational Left 8pposition/7 eon Trotskyon ChinaA pp. *%(#*"0.

04:



of the revolution/ ill gro into a proletarian revolution at a later stage.4his is the current doctrine of the Co!intern/ not only for China but forall the 5astern Mi.e./ 7third#orld7N countries. &t is a co!plete departurefro! the teachings of +ar6 on the state and the conclusions of Lenin onthe function of the state in a revolution. 4he de!ocratic dictatorshipdiffers fro! the proletarian in that it is a (our+eois-democratic

dictatorship. 4he transition fro! a bourgeois to a proletarian dictatorship

distinguish internationalis! fro! nationalis!.4he conclusive case as the 19$) revolution in 'olivia. Gere the &nter#

national had an influential or2ing#class section/ the P8/ that could have seta crucial 'olshevi2 e6a!ple> Pablo rote of 'olivia and Ceylon that 7poer isithin reach.7$" 'ut the PabloitesR groing acceptance of non#proletariannationalist revolutionary forces led the! to capitulate to the 7anti#i!perialist7

bourgeoisie/ a policy that had already been prepared at the -&<s 19$1 Congress.



cannot occur as a peaceful process of <groing over< fro! one to theother. A dictatorship of the proletariat can replace a de!ocratic/ or afascist/ dictatorship of the bourgeoisie only through ar!ed

insurrection.7$(

4his is the sa!e argu!ent e raised above against the 7defor!ed or2ers<state7 thesis for 5astern 5urope. 4he Chinese case !a2es clear not only thatsuch a theory has no basis in 4rots2y<s thin2ing/ but also that 4rots2y hadargued specifically against itO &f China in the 19$0<s could 7gro over7 fro! aor2ers< govern!ent to a or2ers< state/ hy couldn<t the Chinese Stalinist7Soviets7 do the sa!e to decades beforeH 4rots2y had re@ected the theory ofdefor!ed or2ers< states hen the uestion arose during his on lifeti!e.

&n the 19"0<s the A!erican S=P abandoned its clai! to 4rots2yis! andannounced that 4rots2y as totally rong about countries li2e China> he hadunderesti!ated the revolutionary capacity of the peasantry Dthe old StalinistslanderE. 4his gross !isreading of 4rots2y is i!plicit in any version ofPablois!F it is !ade e6plicit/ unfortunately/ not only by the rightard#!ovingS=P but also by so!e left Pabloites.$%

T>7 7!D )& T>7 &)=RT> ,!T7R!AT,)!AL

8nce the theoretical leap out of proletarian +ar6is! had been !ade/ practical adaptation as inevitable. 5very petty#bourgeois nationalist/ Stalinistor not/ as dee!ed capable by the Pabloites of !arching don the roadtoards a or2ers< state. 4ito as first. =hen he bro2e ith Stalin for reasonsof ugoslav nationalis!/ the -& not only declared ugoslavia proletarian butinvited the 4itoists to @oin the -ourth &nternational # as internationalistsOD&nstead/ ugoslavia soon allied itself ith =estern i!perialis! and supportedthe ,nited States in the Jorean =ar.E 4his as only the first ti!e the -& leaders

proved unable to


$(. 7+anifesto on China of the &nternational Left 8pposition/7 eon Trotsky on ChinaA

pp. *")#3.$%. -or e6a!ple/ the ruppo 8peraio ivolu?ionario of &taly and the evolutionary

=or2ers Party of Sri Lan2a in their @oint =uidelines %or the estoration o% the

Trotskyist Pro+ram and %or the e(uildin+ o% the 7ourth .nternational D19"%E

4he esolution on atin <merica called on the 4rots2yists to participate/ 7freefro! all sectarianis!/7 in !ass populist#nationalist !ove!ents such as thePeronists in Argentina/ APA in Peru and the + in 'olivia. Specifically>

7&n the event of a !obili?ation of the !asses under the preponderant

i!pulsion or influence of the +/ our section should support the!ove!ent ith all its strength/ should not abstain but on the contraryintervene energetically in it ith the ai! of pushing it as far as possibleup to the sei?ure of poer by the + on the basis of a progressive

progra! of anti#i!perialist united front.7... if in the course of these !ass !obili?ations/ our section proves to bein a position to share influence over the revolutionary !asses ith the+/ it ill advance the slogan of a =or2ers< and Peasants<overn!ent of the to parties on the basis/ hoever/ of the sa!e

progra!/ a govern!ent based on co!!ittees of or2ers/ peasants and

revolutionary ele!ents of the urban petty bourgeoisie.7$9

4his as an openly +enshevi2 strategy> a class#collaborationist to#classgovern!ent of the or2ers< and bourgeois parties. &t as opposed by no sectionof the -& # to our 2noledge/ only by one s!all faction in the A!erican S=P.=hen the actual revolution bro2e out in 19$) along the lines predicted/ theP8 carried out the &nternational<s policy. -orsa2ing proletarian independenceand ruthless criticis! of all anti#or2ing class forces/ it chose instead tosupport the rise to poer of Pa? 5stenssoro and his + # hich then used itsstate poer to pave the ay for reaction. And the &nternational did nothing tocorrect the P8<s policy once it as seen in actionF on the contrary/ it

encouraged it.(0

Lenin had renounced the Second &nternational hen it proved itself ban2rupt in 191*F each of its sections supported its on nation in the

i!perialist ar. 4rots2y li2eise deter!ined that the 4hird &nternational


$". Pablo/ 74he 'uilding of the evolutionary Party/7 7ourth .nternationalA =inter19$". 4he !a@ority of the -& later capitulated to bourgeois politics in Ceylon too

$9. 7ourth .nternationalA ove!ber#:ece!ber 19$1/ pp. )11#1).(0. -or docu!entary evidence see the Proletarian eolution pa!phlet #oliia the

eolution the 7ourth .nternational #etrayed D19"%E.

04-

as dead in 1933 hen it failed to protest the er!an CP<s collapse in the faceof Gitler<s assault. &n the sa!e ay the -ourth &nternational perished as arevolutionary organi?ation because of its inability to correct or even protest theP8<s betrayal in action in 'olivia. D4hat several organi?ations still callthe!selves 7the7 -ourth &nternational or so!e leading co!!ittee of it isirrelevant. a!es are easy.E

=hile the 4hird &nternational had been both a vanguard and a !ass

for their debacle in 'olivia. After all/ if the petty#bourgeois Stalinists could!a2e the socialist revolution/ hy not radical nationalists li2e the +H &n the19$0<s the 4rots2yists 7discovered7 or2ers< states e!erging throughout 5ast5urope and in China/ Jorea and Vietna!. Although they so!eti!es labelledthe! 7defor!ed/7 the very notion of 7or2ers< states7 created ithout

proletarian revolutions had corrupted the -ourth &nternational<s perceptions. &tcould no longer appreciate hat a genuine or2ers< revolution ould have



organi?ation/ the -ourth as largely restricted to a fragile vanguard. 'ut 'oliviaas an e6ception. Although the -& had capitulated to Stalinis! and refor!is!

before/ this had been done !ainly through resolutions/ theories and ideas.'olivia as a decisive test in practice/ and for +ar6ists #!aterialists # practice

is the decisive proof. 4rots2yists above all !ust understand that or2ing#classgains !ust be defended until every possibility is e6hausted. 4hat is hy e datethe restoration of capitalis! in the ,SS as late as 1939. Li2eise e place theend of the -& as late as possible> hen it as absolutely clear in practice that the

proletarian character of the organi?ation as e6tinguished.8f course/ 'olivia in 19$) did not have the sa!e historical i!portance as

er!any beteen the =orld =ars. 4he er!an defeat signified an i!!ediate/!assive s!othering of the proletarian struggle on a orld scale as ell as thedestruction of the &nternational. 4he 'olivian debacle as a conclusive defeatfor the &nternational/ and in this sense it as also an i!portant setbac2 for theorld proletariat.

&!agine hat a successful proletarian revolution ould have acco!plished.+ass upheavals ere soon to ta2e place in 5ast 5urope/ Latin A!erica/ Asiaand AfricaF ob@ective conditions e6isted for a !a@or reversal of the history ofor2ing#class setbac2s. A victorious or2ers< revolution even in a s!allcountry could have established the -ourth &nternational as the revolutionary

proletarian leadership so desperately needed in all these revolts. A state visiblycontrolled by genuine or2ers ould have shattered the groing iron curtain ofcynicis! descending across the orld. A or2ers< 'olivia ould have stood asa beacon to the orld proletariat li2e the revolutionary Soviet or2ers< stateafter =orld =ar &.

4he 4rots2yists< capitulation to Stalinis! as an essential preparation BBBBBBBBBBBBBBBBBBBB

(1. 8ur !ethod contrasts ith the idealis! of ultra#leftists ho date the end of the4hird &nternational to the introduction of a theory/ socialis! in one country.Si!ilarly/ so!e left Pabloites date the end of the -& to the 7centrist positions7adopted in 19$1 on ugoslavia and Stalinis! in general> see the pa!phlet by theLC&/ The eath <+ony o% the 7ourth .nternational D19"3E/ p. 3$. An essentiallyidentical position as ta2en by the ,.S. evolutionary Socialist League in 19"3 onits road fro! 4rots2yis! to anarchis!

!eant/ ho differently it ould have acted toard fello revolutions/ hat aco!pelling i!age it ould have presented to or2ers everyhere.

4he collapse of the -ourth &nternational does not !ean that its progra! asrendered obsolete. 8n the contrary/ its progra! as abandoned. 4he central

tas2 of 4rots2yists today is to re#e6a!ine that progra! and the distortions!ade of it under the pressures of the or2ers< defeats # and to re#create the-ourth &nternational ith an updated progra! based on the foundationsestablished in 193".

T>7 P7TT#';)=R7),S VA!=ARD

4he -&<s capitulation as reflected in its brea2#up into a bloc of nationalgroups/ each finding its on particular brand of Stalinis! or social de!ocracyto adapt to. &ts !a@or split too2 place in 19$3. 4he ing led by Pablo and+andel/ the &nternational Secretariat/ strove to bury itself indefinitely in theStalinist and social#de!ocratic partiesF the rival &nternational Co!!ittee D&CEof Cannon D,.SE/ Gealy D'ritainE and La!bert D-ranceE declared its dedication

to 7orthodo6y7 but its leaders carefully 2ept their on national satrapiesindependent. =e use the ter!s 7Pablo#ite7 and 7orthodo6 4rots2yist7interchangeably> the 7anti#Pabloite7 &C bloc !aintained Pablo<s defor!edor2ers< state theory and drove it to conseuences as bad as any of Pablo or+andel<s. 4heir orthodo6y can only be ta2en in the sense that Jauts2y as an7orthodo6 +ar6ist7> they left old for!ulas undeveloped and therefore could notcope ith revolutionary changes in the orld.

4he crucial dispute in -rance/ for e6a!ple/ as not over the ussianuestion nor hether to surrender the revolutionary party<s independence

# but over hich refor!ist trend to tail> the Co!!unist Party and the C4union federation for Pablo/ versus the social#de!ocratic S-&8 and -orce

8uvriere for La!bert. &n the ,nited States/ the !ain disagree!ent beteenCannon and Pablo as that Cannon ould not per!it the 5uro pean center totell the S=P hat to do on its ho!e ground. 4he sub seuent re#fusing ofCannon and +andel only proved that the original brea2 as not funda!ental.espect for national boundaries is also the 2ey to the pact that 2eeps the openlyanti#4rots2yist ,.S. S=P of the 19"0<s in the sa!e 7international7 ith+andel.

048

-urther capitulations ere outrageous but consistent. A resolution of the-ourth =orld Congress Dof +andel<s ingE in 19$* distinguished China andugoslavia as non#Stalinist or2ers< states/ noting that 7=e do not call uponthe proletariat of these countries to constitute ne revolutionary parties or to

prepare a political revolution.7 4he -ifth =orld Congress in 19$% hailed thene o!ul2a regi!e in Poland hen it gained control of the ruling party/asserting that 74he political revolution in Poland had on a first decisive

7forgotten7 that the change of one govern!ent for another is not a socialistrevolutionF the bourgeois state and its ar!ed poer have to be s!ashed. -ore6a!ple/ +andel<s ,nited Secretariat labeled the nationalist Algerian regi!e a7or2ers< and far!ers< govern!ent7 in the 19(0<s/ thereby helping to disorientthe !asses in the face of the 19($ !ilitary coup. 4he !ilitant Chilean or2ers<illusions in the 7popular7 or socialist nature of the Allende govern!ent of classcollaboration # fallacies encouraged by a variety of pseudo#4rots2yists # set



stage/7 # as if a populist#sounding nationalist Stalinist as a genuine or2ers<leader. 4he sa!e resolution hailed o!ul2a and +ao 4setung for defending theright to stri2e/ ta2ing Dat bestE paper resolutions for reality. 4he underlyingreason for this acco!!odation as that the Pabloites could not see the

Stalinists as !e!bers of an alien class/ but rather as fello co!!unists ithunfortunate centrist tendencies.

+andel/ endeavoring as usual to provide a theoretical cover/ declared that74he global policy of the bureaucracy can be characteri?ed/ as 4rots2y did/ bythe notion of (ureaucratic centrism by its social nature the bureaucracy tendsto pass fro! one e6tre!e to the other. () 4his as +andel<s analysis of therulers of all the Stalinist states/ not @ust revolutionary ones Din their ti!eE li2eChina and ugoslavia. 'ut as e shoed in Chapter */ 4rots2y abandoned7bureaucratic centris!7 once the Stalinists proved the!selves consistentlycounterrevolutionary in the Spanish civil ar. +andel<s cover is transparentlythin.

8ver the years not only +ao/ Go and Castro/ but also Algeria<s 'en 'ella/

Ca!bodia<s Pol Pot and icaragua<s Sandinistas have received the proletarian pal! fro! !ost sections of Pablois!. As a rationali?ation for granting petty# bourgeois ele!ents credit for proletarian tas2s/ the theory of per!anentrevolution as reconstructed # not as a strategy for the or2ing class and itsrevolutionary party based on ob@ective conditions but as a co!pulsion ofhistory. Proletarian activity and consciousness as replaced by a purelyob@ective historical process ta2ing place behind the or2ers< bac2s> the

pressures of i!perialis! forced nationalist leaders don the socialist path. &nthe ords of +ichael Loy/ a leading +andel#ite theorist/ 74rots2y/ andclassical +ar6is! in general/ underesti!ated the revolutionary potentialitiesand the political i!portance of the radical sections of the intelligentsia in the

peripheral capitalist societies.7(3

&t is the @ob of refor!ists to pro!ote confusion beteen the or2ers< stateand radical for!s of bourgeois govern!ent in order to delude the or2ing classand forestall revolution. 4he tas2 of +ar6ists is to tell the truth and dispel allsuch illusions. 'ut 4rots2yists have repeatedly


(). +andel/ e la #ureaucratie D19%%E/ p. 3$.(3. Loy/ The Politics o% Com(ined and 5neen eelopment D19"1E/ p. 1$9

the! up for slaughter at the hands of the 19%3 counterrevolution.An indication of the death of the -ourth &nternational has been the failure of

the large pseudo#4rots2yist organi?ations to construct cohesive internationalorgani?ations Dnot to spea2 of the 7orld party of socialist revolution7E during

the opportunities provided by the revived or2ing#class !ove!ent in !anycountries since the late 19(0<s. 4he Cliffites< approach is to ait until strongnational sections e6ist/ a policy that leads to a sort of 7national 4rots2yis!/7

building a party in one country ithout an internationalist practice. &n apparentcontrast/ the +andelites have fabricated a !ultinational organi?ation/ ithseparate and often co!peting practices in different countries. 4his is lin2ed tothe theory of 7ob@ective per!anent revolution/7 hich interprets petty#

bourgeois nationalist !ove!ents as sufficient substitutes for the proletariat sothat no proletarian vanguard party is needed at all. &n the last analysis all thesenotions are reflections of the post#=orld =ar && defeats of the proletariat andthe i!pressive but te!porary rise of Stalinis! throughout the orld.

PA;L),SM S=MM7D =P=hereas 4rots2y<s 7degenerated or2ers< state7 as an analysis of a

contradictory and highly te!porary reality/ the post#4rots2yists< notion ofdefor!ed or2ers< states e!bal!s a historical !o!ent for an entire neepoch. D+andel freuently says that Stalinis! is 7fro?en7 halfay beteencapitalis! and socialis! # for half a centuryOE 4he degenerated Soviet state as!oving bac2ard fro! advances it had once !ade on the road fro! capitalis!to socialis!F its 7defor!ed7 co!panions are allegedly retreating fro! positionsnever achieved. 4hey had to have been born dead> this accounts for theabsolutely undialectical idea of societies fi6ed in place. &t replaces the

per!anent revolution of the proletariat ith the per!anent counterrevolution

of the bureaucracy.4he collapse of Stalinis! has created a right#left division a!ong the4rots2yist currents of !iddle#class +ar6is!. 4he !ost opportunist Pablo#itesand so!e Shacht!anites/ for e6a!ple/ ad!ire the Sandinistas ho govern the

icaraguan state and guide the econo!y. 4hey see no need to bother ith finedistinctions a!ong or2ers< govern!ent/ or2ers< state and socialis!F after all/these are all stages in the society that results after

049

the bourgeoisie is sent pac2ing and e or people li2e us are in charge. 7Post#capitalis!7 is a perfectly adeuate ter! for the!> it e!braces the different

possibilities hile assuring the end of capitalis!/ ithout pro!ising too !anyspecifics to the !asses.

4he right#ing Pabloites retain all the old rhetoric about internationalis! butidentify it ith a !ultiplicity of nationalis!s/ each see2ing to unify and defendits national capital. 4hey e!pathi?e ith popular figures ho echo !ass

created 7defor!ed or2ers< states7 ere social and anti#capitalist but notsocialist. 4hey !ean that the class nature of the countries as changed/ but not

by the proletariat. 4his reflects their self#identification ith the proletariat/ butit also reveals the essence of their orld vie. Shacht!an had a si!ilar

position> the Stalinist ta2eovers ere not socialist # but they ere anti#capitalist because capitalis! had obviously been abolished. 4o call a social syste!7progressive7 at the sa!e ti!e that it is supposed to be 7fro?en7 or bloc2ed



outrage against oppression and e6ploitation and advocate holesale changes inthe syste! through increasing the poer of the state. 4hey have continuallyadapted to bourgeois and petty#bourgeois ele!ents standing for statification ofthe national capital> not @ust the third#orld 'onapartists but types li2e 'ritish

Labourites Aneurin 'evin and 4ony 'enn B and no the Soviet populist 'oriseltsin. DSo!e even tail open bourgeois de!agogues li2e esse ac2son.E

Left#ing Pabloites/ on the other hand/ feel a stronger allegiance to theor2ing class and a fear of the i!plications of deep#going !ar2et concessions

by the Stalinists. 'ut they fall into !ost of the sa!e traps. -or e6a!ple/ none ofthe! Ddespite their political criticis!s of the ,nited SecretariatE have gone

beyond the theoretical confusions contributed by +andel.(* 4he funda!entalnotions of hich he has been the pri!ary defender # the or2ers< state as a post#capitalist society/ Stalinis!<s ability to overco!e the la of value but notscarcity/ and the petty bourgeoisie<s capacity to replace the proletariat in !a2ingthe socialist revolution # are retained by all pseudo#4rots2yist defensists.

A useful illustration is the League Dfor!erly +ove!entE for a evolutionary

Co!!unist &nternational DLC&E. LC& clai!s to have basic theoreticaldifferences ith +andel.($ &n fact it holds all the above +andelian notions/ soits differences are not funda!entalF even the differences it has are e6aggerated/since +andel is eclectic enough to assert so!ehere or other !ost of the

positions that the leftists clai! for the!selves. -or e6a!ple/ LC& arguesagainst +andel that 7bureaucratis! is not si!ply an inefficient fetter on thefunctioning of the planned econo!y. &t actually bloc2s and threatens thee6istence of the planned econo!y.7 4his is true/ of course/ and is the basis forLC&<s assertion that Stalinis! is counterrevolutionary. 'ut it is none other than+andel<s clai! that Stalinis! is a 7fro?en7 society.

LC&/ li2e !ost left Pabloites/ insists that the Stalinist revolutions that


(*. 4he &nternational Co!!ittee led by erry Gealy included so!e prolifictheoreticians riting on philosophical and econo!ic uestions. 'ut in forty yearsthey produced not one !a@or or2 on Stalinis!.

($. LC&/ The e+enerated eolution D19")E/ pp. 9)#3

against progress toard socialis! i!plies that it is really a third !ode of production inter!ediate in progressiveness beteen capitalist and proletariansociety.

Left#defensists< atte!pts to get around the contradictions of Pablois!

inevitably de!onstrate their si!ilarity ith Shacht!anis!. 8ne group insiststhere is a ualitative/ not @ust uantitative/ difference beteen the or2ers< stateand the degenerated or2ers< state. Another refers to the need for the Staliniststate to be 7s!ashed7 by the or2ers as if it as an alien class structure. etanother credits Stalinis! ith an 7e6ploitation of its on 2ind.7(( All of thesedefine the Stalinist states as proletarian/ yet their theories belie their label and

point in reality to a state ith an unspecified ne ruling dyna!ic. &ndeed/Shacht!an hi!self/ at the start of his tra@ectory to the right after leaving4rots2yis!/ held that the Soviet ,nion as a third for! of society/ progressiveith respect to capitalis!. =e ill see in the ne6t chapter that the logic ofPablois! is difficult to distinguish fro! Shacht!anKCliffis! hen it co!es to

political progra!s as ell as theory.


((. espectively> 74he Progra!!atic Principles of the &nternational 4rots2yistCo!!ittee/7 .nternational Trotskyist eie o. 1 D19"$EF 74enty#to 4heses in:efence of 4rots2yis!/7 by the LC& D19"%EF 7ot a 4rue =or2ers< State/7 KKComunista o. % D19")E/ by the ruppo 8peraio ivolu?ionario. A si!ilar vie isheld by the Spartacists.

00:



4he +JS<s econo!ic de!ands included euali?ing the distribution ofconsu!ers< goods through rationing and abolishing no!en2latura privilegesF!aternity leave and child careF and special de!ands concerning retire!ent/

pensions and housing allocation. 4here ere political de!ands for freedo! ofspeech and the press Dincluding the dangerous de!and for access to nationaltelevision for the Church ithout si!ilar guarantees for or2ers< organi?ationsE.4here ere trade union de!ands> the rights to stri2e and to organi?e unionsi d d t f th t t d li t 4h d d fl ti f th

party to play a si!ilar treacherous role. 'oth of these capitulatory forces ereaccepted as trusted advisers by the or2ers< leadership under Lech =alesa/ho hi!self reflected the outloo2 of the petty#bourgeoisified sector of theor2ing class/ the labor aristocracy.

8n the other side/ the Stalinists @oined in an unholy alliance ith the Churchas ell as =estern states!en and business!en to 2eep the !ove!ent ithinsafe bounds. :espite assertions of enthusias! for the or2ers< achieve!ents/

h t th ll t d d ti - th fift th f S lid it <



independent of the state and ruling party. 4here ere de!ands reflective of the4rots2yist 4ransitional Progra! Dsee beloE> the sliding scale of ages tocounter inflation/ or2ers< control of production and opening the boo2s ofenterprises to the or2ers.3

+ore i!portant than the specific de!ands as the +JS itself/ an instru!entof dual poer. 4he Stalinists 2ne that it as a threat to their class rule thelonger it lasted and the deeper gre or2ers< consciousness of their on abilityto run society. 4hey could not deal ith it by ordinary !ethods of pro!ises andrepression. 4hat is hy the regi!e as ready to yield to any concession/te!porarily in its vie/ in order to get the +JS to vote itself out of e6istence.

4he or2ers< only adeuate response ould have been to go further> tocreate a revolutionary proletarian party to contest for state poer. &t as a step

bac2ard to abandon the +JS in favor of a trade union/ as as done throughthe dans2 Accords. 4he union the or2ers for!ed/ Solidarity/ gre tonational !ove!ent of 10 !illion or2ers and supporters/ "0 percent of theor2force nationide. 'ut it as a !a@or retreat politically/ e!bodying illusion

that an econo!ic struggle/ as opposed to a struggle for state poer/ assufficient to in the or2ers< needs.

4he Solidarity period as a +ar6ist te6tboo2 on the roles of therevolutionary and reactionary classes. 8n the one side/ the or2ers fought asthe tribune of the entire people for freedo! and euality # a fulfill!ent of

per!anent revolution/ despite their !isguided and self#disar!ing re@ection oftheir bosses< 7socialist7 ter!inology and their faith in the Church. 4he centralrole of the or2ing class as established once again/ since all the petty#

bourgeois forces loo2ed to the or2ers to solve their proble!s. 4he or2ers<!ove!ent opened the field to all political tendencies/ inside and outside theor2ing class. So!e of Solidarity<s !iddle#class supporters/ notably the for!er

+ar6ist ace2 Juron/ pro!oted a 7self#li!iting revolution7 that ould notchallenge Stalinist rule. 4he Catholic Church too2 advantage of its social privileges and independence of the


3. 4he co!plete set of de!ands/ along ith other progra!s/ is in a(our 7ocus on

&astern &uropeA Spring#Autu!n 19"0

hat they all anted as !oderation. -or the fifteen !onths of Solidarity<slegal e6istence/ its leaders avered in the face of the govern!ent<s

provocations and sheer inability to run the econo!y. 4he union de!anded ashare of poer through a tripartite arrange!ent ith the Church and partyF the

party hesitated and te!pori?ed/ encouraging !ass discourage!ent to build upagainst the incessant stri2es and also alloing ti!e for !ilitary preparations. &n:ece!ber 19"1 the regi!e too2 advantage of Solidarity<s disarray to s!ash the7counterrevolutionary7 threat. -ar better prepared than the allegedcounterrevolutionaries/ the !ilitary sept up the leadership and outlaed theunion.*

<S7L&'MA!A7M7!T< PR)P)SALS

Since its Congress in 19"1/ Solidarity has advocated an econo!ic policy of7self#!anage!ent7 to solve the Polish crisis. 4he ter! had been used

previously notably in ugoslavia/ but this ti!e the progra! as advancedfro! ithin the or2ing class/ not @ust the bureaucracy. Self#!anage!ent

entails to things> independence of the individual enterprises so that the bossesare not directly beholden to the ruling partyF and elected or2place councilsrepresenting the or2ers. 4he Polish regi!e put forard/ and partially carriedout/ a si!ilar policy under the sa!e na!e/ ith a less independent role for theor2ers.

=ithin Solidarity there ere to !ove!ents for self#!anage!ent. 8ne/ the etor2 of Large#Scale 5nterprises/ as !ade up of factory delegates fro!hundreds of enterprises. 4he etor2 advocated a 7La on Social 5nterprises7to be adopted by the Se@!/ the Polish parlia!ent. According to this proposal>

74he social enterprise !anages its affairs in an autono!ous fashion onthe basis of an econo!ic calculation. &t is endoed ith a @uridical

personality that e!braces all its e!ployees. 4he latter !anages that portion of the national ealth hich has been entrusted to the!/ and


*. -or ongoing analyses see the Socialist )oice articles 7Poland> Solidarity -oreverH7/ o. 13 D1""1EF 7Polish =or2ers ,nder Siege/7 o. 1$ D19"1EF 7Go SolidaritySnatched :efeat fro! the as of Victory/7 o. 1( D19")E. 4he last refutes theregi!e<s clai!s of counterrevolution.

00-

ad!inisters it through their self#!anage!ent body. ... 4he entire body ofself#!anage!ent e!ployees disposes of the property of the enterprise/lays don the general lines of its activity and develop!ent and decideson ho profits should be redistributed.74he self#!anage!ent council ould e6ist separately but side#by#side ith a

trade union Dpreferably Solidarity/ not the govern!ent#sponsored unionE.According to one sy!pathetic observer/ 7=hile the latter had the @ob ofd f di th i t t f th 2 d th il t d th

sharing hereby the or2ers and the bosses ould each have their separatehouses of parlia!ent. 'ut the rulers understood that their poer ould bethreatened by a separate econo!ic cha!ber/ especially one that as seen byor2ers as an independent institution of or2ing#class state poer. Decall4rots2y<s co!!ent about nationali?ed property as a te!pting ob@ect for the

proletariat.E As a refor! de!anded of the bureaucracy/ this as doo!ed to bere@ected.

8th i th t 2 d d th li t l ll f d l



defending the interests of the or2ers as producers/ the council represented theishes of the personnel as e!ployers.7$ 4his ould be a highly contradictorysituation/ especially since the independence of the enterprises as advocatedould inevitably pit the or2ers of one factory against those of another in

co!petition for !ar2ets and invest!ent funds. State planning ould be !ostly7indicative/7 not co!pulsory. ust ho the separate enterprises ould becoordinated as not settled. So!e advisers pro!oted a free !ar2et/ othersco!binations of planning ith the !ar2et. 4he regi!e denounced all such plansas 7anarcho#syndicalist.7 4he etor2 replied that nothing decentralist orrevolutionary as involved>

7=e are accused of anting to prevent society fro! influencing thedefinition of econo!ic ob@ectives and the !eans of attaining the!/ and todeprive the socialist state of any poer in the running of the econo!yand the attain!ent of social ob@ectives. ... Goever/ our pro@ect hasnothing to do ith group property or ith the idea of transfor!ingSolidarity !e!bers into shareholders in the or2places. ... =e do not

ant to change the syste!/ but e do ant to go bac2 to a or2ing#classversion of socialis!. ... Go could e accept the idea that the or2forceof an enterprise should play a role analogous to that of a capitalist

property onerH 4he etor2<s pro@ect clearly declares that theenterprise !ust !eet overall social ob@ectives because it belongs to thehole people.7(

Goever/ a proposal that stresses the autono!y of the separate enterprises isnot 7a or2ing#class version of socialis!7 # and it inherently raises the idea thatat least the self#!anage!ent council of a fir! Dif not the or2ers as a holeEould operate li2e a capitalist property oner.

4he refor!ist character of the proposal is also clear fro! another etor2

notion/ that the self#!anage!ent councils should be represented in the Se@! ina ne cha!ber. +any sa this as a device for assuring the authorities that 7edo not ant to change the syste!/7 a 2ind of poer#


$. ean#ves Potel/ 7Solidarity and Self#+anage!ent/7 a(our 7ocus on &astern

&uropeA Su!!er 19").(. Ada! Sinars2i/ uoted in Ibignie Joales2i/ 7:ebate over =or2ers< Self#

+anage!ent/7 Poland The 7i+ht %or Workers' emocracy D19""E

8thers in the etor2 regarded the parlia!entary proposal as a call for dual poer/ an arrange!ent that ould sooner or later under!ine the bureaucrats<control of the state. 4he current CPKSolidarity coalition !ight be ta2en as aclose appro6i!ation of this idea/ and the result has been to incorporate the

7or2ers< representatives7 into the bosses< state/ not to give the or2ers a shareof poer. As +ar6 and Lenin long ago pointed out/ or2ers< poer can onlyco!e into e6istence by s!ashing the ruling#class state apparatus/ not by tryingto nibble it aay.

4he second !ove!ent for or2ers< self#!anage!ent as 2non as theLublin group. 4heir proposal as !ore radical than the etor2<s in that ite6cluded !anage!ent fro! the enterprise councils and also called for regionaland national coordination of councils/ including a per!anent national organ ofcoordination. As ell/ the Lublin group e6pected to adopt self#!anage!ent notthrough deals ith the regi!e but by direct or2ers< action. &n the fall of 19"1/or2ers in Lod?/ one of the group<s strongholds/ used 7active stri2es7 Din hichthe or2ers stay on the @ob but distribute their products as they/ not the bosses/

decideE to co!pel local authorities to step aside. 4he Lod? or2ers succeededin ta2ing control over food distribution and the rationing syste!. 4his asindeed an ele!ent of dual poer.%

8n the other hand/ the Lublin group<s 74en Co!!and!ents for =or2ers<Councils7 repeated the etor2<s notion of a second cha!ber of parlia!ent.4heir hope as that sharing the poer ould counter the state<s ability tointervene in industrial disputes on the rong side. 'ut by trying to establishor2ers< poer in the fra!eor2 of the e6isting state the Lublin leftists alsocontributed to refor!ist illusions.

S7L&'MA!A7M7!T ,! PRACT,C7

8n the eve of the Solidarity ational Congress in Septe!ber/ the CP drafteda self#!anage!ent bill of its on/ based on the 7three S<s7 Din PolishE>enterprise autono!y/ self#financing and self#!anage!ent. 4he bill


%. Ibignie Joales2i/ 7A Polish Petrograd/7 in Poland The 7i+ht %or Workers'

emocracy D19""E. See also 4i!othy arton Ash/ The Polish eolution

Solidarity D19"3E/ p. )$*.

008

specified that the or2ers ere to be 7consulted7 on appoint!ents to!anage!ent positions/ but the poer to decide ould re!ain ith the party. &nresponse/ the Solidarity Congress affir!ed its acceptance of or2ers< self#!anage!ent in refor!ist for!. &ts progra! read>

7enuine or2ers< self#!anage!ent ill be the basis for a self#governingrepublic. 4he syste! hich binds together political and econo!ic poerand is founded on continual interference of Party activists in thefunctioning of econo!ic enterprises is the !ain cause of the crisis in

group of Solidarity advisers/ =alesa bro2ered a coalition govern!ent under aSolidarity pri!e !inister/ 4adeus? +a?oiec2i eneral aru?els2i assu!edthe presidency/ and Stalinist !inisters re!ained in charge of the ar!y and

police B people ho ill not flinch hen it ca!e to using ar!ed force againstor2ers.

4he !assive electoral defeat of the Stalinists as no real victory for theor2ing class itself/ although it reflected the continual class struggle. =alesa<sfaction of Solidarity bac2ed by the Church and =estern authorities too2



functioning of econo!ic enterprises/ is the !ain cause of the crisis inhich our econo!y finds itself. &t is also the cause of an absence ofeuality of opportunity in professional life. 4he Party <no!en2latura<syste! !a2es any rational staffing policy i!possible/ and !a2es !illions

of non#Party personnel into second#class or2ers. 4oday/ the only possible ay of changing this situation is the creation of genuine or2ers<self#!anage!ent councils/ hich ould !a2e each or2force into an

authentic !anager of the enterprise.7"

4he idea of 7unbinding7 political and econo!ics is an i!possibility thatreflects illusions in the =estern econo!ies. 4he progra! again called for asecond econo!ic cha!ber of the Se@!/ adding that parlia!ent 7should have therole of the highest authority in the land returned to it and/ by changes in the la/regain a genuinely representational character.7 4he proposal left the stateapparatus intact # but by this ti!e its specifics ere secondary. 5vents # ta2en inhand/ ironically/ by the overloo2ed state apparatus B did not ait for theresolution of policy debates.

After the !ilitary coup/ the regi!e 2ept denouncing the union<s self#!anage!ent ideas hile at the sa!e ti!e espousing its on. aru?els2i<s planas si!ilar to progra!s already carried out in ugoslavia/ Gungary and China/involving !aterial incentives and increased privati?ation of the econo!y at thes!all business level. 4his sche!e de!anded further dependence on foreigninvest!ents and loans/ hence !a2ing Poland even !ore debt#dependent and asource of cheap#labor goods for the orld !ar2et. So the unstated reuire!entas severe repression or a reserve ar!y of the une!ployed to 2eep ages le/serious age cutbac2s and higher consu!er prices so the or2ers don<t eat uphat they produce.9 7Self#!anage!ent7 or not/ this has been the story ofaru?els2i<s Poland.

'ut the Stalinist regi!e could not hold its on against the econo!ic crisisand the !asses< non#cooperation. &n 19"9 the Solidarity leadership ca!e to therescue of the beleaguered Stalinists. After the party agreed to partly freeelections and then lost the! disastrously to a parlia!entary


". Colin 'ar2er and Jara =eber/ Solidarnosc 7rom =dansk to ilitary epression

D19")E/ p. (%.9. See Socialist )oice o. 1( D19")E/ p. "

faction of Solidarity/ bac2ed by the Church and =estern authorities/ too2responsibility for holding bac2 the or2ers< struggle in order to guarantee thestate<s econo!ic interests. 4he Polish govern!ental bloc a!ounts to a classical

popular front designed to save a hated and ea2ened ruling class fro! !ass

opposition. +ost of the Solidarity parlia!entarians have abandoned any idea ofself#!anage!ent and have turned to bourgeois liberal econo!ic theoriesD!any had had such vies all alongE. 4hat the 7social de!ocrats7 as ellaccept the anti#or2er progra! that the bloc pro!otes shos that thefunda!ental logic of 7self#!anage!ent7 is not or2ers< control but enterpriseindependence. And fro! that base/ a !ar2et free for e6ploitation is not asurprising conclusion.

8ne organi?ation that still defends self#!anage!ent is the Polish SocialistPartyK:e!ocratic evolution DPPSK:E/ hich split fro! the social#de!ocratic PPS in 19"". 4he PPSK: supported the 19"" stri2es hen the PPSleaders opposed the!/ and it appealed for a boycott of the 19"9 election

because of the pre#arranged bloc beteen Solidarity and the CP. 'ut despite its

radicalis! the PPSK: lac2s a revolutionary progra!. =hen thearu?els2iK+a?oiec2i regi!e as installed/ the PPSK: issued a state!entarning that Solidarity in govern!ent 7does not !ean that the society hasta2en poer7 B but adding that 7nevertheless/ the establish!ent of thisgovern!ent opens up the possibility of reali?ing social aspirations.7 &n thisspirit the state!ent advocates such progra!s as 7putting the econo!y under thedirect control of the producers7 and 7setting up of social control over

production e6ercised by self#!anaging councils of or2ers/ agriculturalor2ers and artisans organi?ed in self#!anaging cha!bers regionally andnationally.7 4he i!plication is that the ne cabinet could be instru!ental incarrying out such ideas. 74adeus? +a?o#iec2i<s govern!ent/7 the docu!ent

says/ should e!poer or2ers< food co!!issions created by Solidarity and 7inagree!ent ith Solidarity/ !ust underta2e a radical refor! of the agesyste!.710

Such notions reveal great illusions in the intentions of a regi!e that ascreated to incorporate the or2ing class into an austerity progra!. 'ut


10. 7:eclaration of the =rocla egional =or2ers< Co!!ittee of the PPSK:/7 .nternational )iepointA 8ctober 1(/ 19"9.

009

that is again the logic of self#!anage!ent. 4he proble! is deepened by the factthat !iddle#class left#ing for!ations that have sprung up in the other post#Stalinist 5ast 5uropean states are producing si!ilar refor! progra!s. 4heco!!on the!e is or2ers< self#!anage!ent of the econo!y co!bined ith a7de!ocratic7 state structure.11 =hat is never proposed is a specifically

proletarian state based on or2ers< organi?ations in poer B the onlyguarantee of genuine !ass de!ocracy. 8n the other hand/ the or2ers<i!pulsion to class struggle against super e6ploitation ill inevitably brea2 the!

fetters. 4hen begins an epoch of social revolution.7Iaslavs2aya<s +ar6is!/ hoever/ is e!pty verbiage. She uses 7relations of

production7 only in the narro sense of personnel !anage!ent relations Bho to discipline the or2ersF in no ay is she challenging the e6isting classrelations. 4hus she goes on> 78ne outco!e ... is the inability of productionrelations to provide !odes of conduct for the or2ers in the socioecono!icsphere that are needed by society.7

&n the guise of bla!ing the syste! for the or2ers< faults Iaslavs2aya<s



i!pulsion to class struggle against super#e6ploitation ill inevitably brea2 the!fro! the !iddle#class leaderships that lead to disaster.

T>7 !)V)S,;,RS? R7P)RT

Solidarity as suppressed in 19"1 but its i!pact as idely felt. =henSoviet chief Leonid 're?hnev died in 19")/ he as replaced by a bureaucraticrefor!er/ uri Andropov/ ho had to conte!plate the i!age of a crisis#rac2ed ,SS in the crac2ed !irror of Poland. And although Andropovhi!self died a year later after acco!plishing little/ his prot(g( +i2hailorbachev gained the top post in 19"$ and set about on an earth#sha2ing

progra! of do!estic and foreign policy refor!s. 4hese loosened the reins of poer and paved the ay for the e6plosions of 19"9. =hat the or2ing#class!ove!ent soed it no has a chance to reap.

&n order to understand the orbachev refor!s/ e turn to the secret7ovosibirs2 eport7 of 19"3. =ritten by Acade!ician 4atyana Iaslav#s2aya/a Soviet sociologist ho has been one of the !ost consistent advocates of

refor! before and during the orbachev years/ it as issued by a leadingecono!ics institute and lea2ed to the =est. &t provides a 2ey theoreticalfoundation for perestroi2a. 'ecause of its historical and theoretical i!portancee su!!ari?e its proposals and ideology.1)

Iaslavs2aya begins by denouncing the bureaucratic !is!anage!ent rife inthe Soviet syste!/ even !a2ing her !ain point in apocalyptic +ar6isti#callanguage> 74he present syste! of production relations has substantially fallen

behind the level of develop!ent of the productive forces. &nstead of enablingtheir accelerated develop!ent/ it is beco!ing !ore and !ore of a bra2e on their

progressive advance!ent.74hese ords are a direct echo of +ar6 in the Pre%ace to the Criti/ue o%

Political &conomy 7At a certain stage of their develop!ent/ the !aterial forcesof production co!e into conflict ith the e6isting relations of production ...ithin hich they had been at or2 before. -ro! for!s of develop!ent of theforces of production these relations turn into their


11. See/ for e6a!ple/ 'oris Jagarlits2y<s version in .nternational Socialism o. *$D19"9E/ p. 10*.

1). =e use the 5nglish translation published in SureyA Spring 19"*

&n the guise of bla!ing the syste! for the or2ers faults/ Iaslavs2aya s purpose is to bla!e the or2ers for the syste!<s faults. She lists the proble!s> part#ti!e effort/ absenteeis!/ passivity and disinterest in or2/ alcoholis!/even 7stoppages7 # in general/ a lac2 of discipline. 'ut fro! these ills she

e6onerates the elite of Soviet labor/ 7the !ain nucleus of s2illed or2ers/7 ho7or2 honestly.7 Clearly she believes that the great !a@ority of Soviet or2ersare less than honest.

=hat she is really saying # and here of course she avoids using +ar6istter!inology # is that the underlying reason for Stalinis!<s crisis is itsinefficient e6ploitation of the or2ing class. Iaslavs2aya does not grasp orish to ac2noledge that the proble!s she lists are @ust !anifestations of theclass struggle/ the day in and day out resistance that or2ers put up against thei!positions of their bosses. =hether or not the bosses< de!ands are !ade inthe interest of efficiency/ the or2ers fight bac2. &t is not dishonesty that !a2esthe! do it/ but capitalist relations.

=hy should the situation be so badH =hy can<t the or2ers< 7dishonesty/7

their lac2 of cooperation ith the needs of the syste!/ be controlledHIaslavs2aya recalls the old days under Stalin/ hen or2ers ere disciplinednot only by a strong police state but also by concealed econo!ic pressures>

7Although for!ally spea2ing there as no une!ploy!ent in the country/in !any areas and branches there ere hidden structural labor surpluses.-ear of losing his @ob and difficulties in finding a do!icile ha!pered theor2ers<s !obility and fir!ly bound hi! to the enterprise. +igration ofthe rural population to the tons as li!ited by the in#e6istence of

passports ... 4herefore the !ain body of or2ers did not have a choice beteen or2 and leisure> the !a@ority strove to or2 at full capacity.7'ut no things are different. &n an intervie in .3estia she e6plained>

74he overall level of ell#being in the country has risen significantly.4his has lessened the econo!ic necessity of or2ing hard in order toearn one<s living. +any people have the opportunity to choose> if theyant to/ they dedicate the!selves to their or2/ and if they don<t ant

0-:

to their participation in social production is very li!ited. 13

'ut hat is needed is not @ust !ore and better discipline/ order/ regulationand control B although the ovosibirs2 report advocates all of these. 4he realsituation is orse than si!ple !alfeasance by the or2ers. :iscipline as it has

been applied/ through orders fro! above/ does not or2. Central regulators areignorant of specific/ local conditionsF arbitrary rules that obviously don<t applyare flouted both in letter and in spiritF the proliferation of contradictory rulesgives !alingerers the choice of hich ones to obey

interference get in the ay of efficient planning and productionF and )E to setup for!s of econo!ic incentives for or2ers. &n her .3estia intervie shespelled this out/ again paraphrasing +ar6>

7-irst of all/ !ost of Mthe for!sN are in full accord ith the econo!ic lasof socialis!. 4hat<s the !ost i!portant thing. =hen things are organi?edefficiently/ people receive re!uneration according to their or2. &n the

process/ of course/ pay differentiation increases/ as a rule. 'ut that is a directand natural result of the rising labor productivity of active people 7 Goever



gives !alingerers the choice of hich ones to obey.Above all/ it see!s that the bosses also under!ine the econo!ic discipline

needed by the syste!. Gere Iaslavs2aya is on treacherous ground. =hereasunder capitalis!/ she argues/ the conflict beteen productive forces and

productive relations leads to an intensified class struggleF under socialis!/ onthe other hand/ there is nothing of the 2ind B yet things are pretty !uch thesa!e. Citing the prevailing vie 7developed in political econo!y te6tboo2s7that i!prove!ent of out!oded production relations can ta2e place 7ithoutsocial conflict/7 she responds carefully> 7e !ust e6press doubt.7

74he process of perfecting production relations under socialis! runs a!ore co!plicated course than is co!!only suggested/ to the e6tent thatthe reorgani?ation of the e6isting syste! of production relations is givenover to social groups that occupy a so!ehat !ore elevated positionithin this syste! and accordingly are bound to it through personalinterest.74here are no privileged classes/ of course/ @ust a fe groups in 7a so!ehat

!ore elevated position ithin this syste!7 # ho have the poer/ !oreover/ toorgani?e production in their on personal interest/ and if necessary even

prevent the 7perfection7 of the productive !ethods. 4he ay to get around theobstacles created by self#interested bureaucrats/ she says/ and at the sa!e ti!eto enforce econo!ic discipline on the or2ers/ is to !a2e discipline itself a!atter of or2ers< self#interest. &t should be regulated not by distant officials

but/ on the one hand/ by local !anagers hose individual interests ill intheory coincide ith the need to !a2e their on enterprises or2 productivelyFand/ on the other/ by the central state planners ho genuinely have the interestsof all of 7socialist society7 at heart. 4he tools these layers are to be given arecalled 7econo!ic !ethods of !anage!ent7 or 7incentives7 # both carrots andstic2s. =hat Iaslavs2aya proposed concretely as 1E to eli!inate layers ofinter!ediate bureaucrats in the !inistries and depart!ents D7hich

patently suffer fro! hypertrophy7E/ officials hose suabbling and


13. Iaslavs2aya/ .3estiaA une 19"$F translated in Current i+est o% the Soiet Press

and natural result of the rising labor productivity of active people. Goever/the for!ula 7to each according to his or2/7 i!plied by +ar6 in his Criti/ue o%the =otha Pro+ramA has nothing in co!!on ith increasing pay differentiationDsee Chapter 3E. &t entailed the revolutionary abolition of classes/ !oney/ ages

and the other re!nants of capitalis!. &t described the distributive !ethods ofthe loer stage of co!!unis!/ a classless society based on co!!ononership and collective production in hich the ulti!ate of 7bourgeois7euality ould be achieved> if you or2 eight hours you receive goodseuivalent to eight hours< or2/ ithout differentiation.

&n echoing +ar6<s ords Iaslavs2aya as really echoing Stalin<s lyingtranslation of the early 1930<s/ hen he tried to e6punge the 'olshevi2 goal ofreducing ineuality. ,nder a labor#co!!odity syste!/ the for!ula 7to eachaccording to his or27 is an essential part of the la of value/ a !eans for oneclass controlling another. 4he only thing 7natural7 about increasing paydifferentiation is that it naturally occurs in capitalis!/ under hose econo!iclas or2ers are co!pelled to co!pete against one another. 4he virtue of

Iaslavs2aya<s report is that it reveals the class#based nature of the refor! progra! # through a thinner layer of veils than e get fro! the refor!ist politicians the!selves. 4he bureaucracy has to be strea!lined in order to !oreeffectively e!ploy the la of value B for stricter discipline and deepere6ploitation of the or2ing class.

)R;AC>7VS P7R7STR),?A

As it has developed over the years/ orbachev<s econo!ic restructuring ishardly a scientifically or2ed#out pac2age. evertheless its general directionhas been clear/ along the lines dran by Iaslavs2aya. 4here has been obviousresistance ithin the bureaucracy # even ithin the Politburo/ given thefreuency of sha2e#ups at the top. &n !id#19"% !easures ere announced thatrepresent a victory for the radical ing of the restructuring spectru!F but bylate 19"9 the changes had been carried out in li!ited fashion only. =esu!!ari?e its chief ele!ents.

+ost enterprises are no longer to be sub@ect to directive planning butinstead ill have to !eet profitability criteria. Abel Aganbegyan/ orba#

0-4

chev<s adviser and an advocate of =estern#style !anage!ent techniues/ saidthat 7the state#controlled sector of the econo!y ill be reduced fro! (0U ofthe total to )$U/ leaving little but !ilitary production under central control.7 Asell/ fir!s ere pro!ised financial autono!y and ill therefore face an end tostate subsidies and controlF they ill have legal freedo! to trade in producergoods.1* orbachev spelled it out>

74he ne econo!ic !echanis! !eans funda!ental changes in thesyste! of !aterial and euip!ent supplies to factories # transition fro!

in/ e6ecuted in 193" by Stalin as a cri!inal spy and rec2er of the econo!y.'u2harin<s reputation is being resurrected in order to give historical legiti!acyto 5P#li2e policies of encouraging individual incentives and perhapsindividual far!ing. 'u2harin<s favoring of openings to the orld !ar2et/ inopposition to Stalin<s national autar2y/ is also ad!ired.

4he ,SS has indeed !ade changes in the sphere of foreign trade. &treduced its oil e6ports/ crucial for obtaining =estern currency/ in order toavoid undercutting 8P5C<s oligopolistic but decreasingly effective price



syste! of !aterial and euip!ent supplies to factories # transition fro!centrali?ed !aterial and euip!ent supplies to holesale trade in !eansof production goods. -actories should be able to buy ith !oney theyhave earned anything they need for !anufacturing/ construction and

!oderni?ation sche!es/ and social services.71$ 4his speech ca!e at the Central Co!!ittee plenary !eeting in une 19"%.

4he !a@or result of this session as a ne la on state enterprises hichfor!ally strengthened the independence of fir!s as 7@uristic persons7Dre!iniscent of the ,.S. legal syste!<s e6tension of Constitutional rights tocorporationsEF they are no longer bound but no only guided7 by the state

plans>7uided by control figures/ state orders/ long#ter! scientifically

substantiated econo!ic nor!atives and ceilings/ as ell as consu!ers< orders/the enterprise independently or2s out and confir!s its on plans andconcludes contracts. ... 5nterprises operate in conditions of econo!icco!petition a!ong the!selves/ a highly i!portant for! of socialist

co!petition/ for the fullest possible satisfaction of consu!er de!and forefficient/ high#uality and co!petitive output ith the s!allest possible outlays.4he enterprise hich ensures the production and sale of the best output ith thes!allest possible costs obtains a large econo!ic#accountability inco!e and anadvantage in its production and in pay for its e!ployees.7 1(

4his reads as if orbachev and his allies ere trying to !a2e clear that stateonership is no barrier to operation according to capitalist principles. 8fcourse/ these !easures represent not a return to la of value but a !ore directapplication of it. 4he orbachev changes are intended to get the co!petitivedrives to or2 !ore effectively. Proposing the! is significant evidence of therulers< intentions and needs # even though they have been very inco!pletelycarried out.

A significant sy!bolic gesture as the rehabilitation of i2olai 'u2har# BBBBBBBBBBBBBBBBBBBB

1*. Aganbegyan/ intervieed in e ondeA une )"/ 19"%.1$. orbachev/ osco :es SupplementA uly 1)/ 19"%.1(. 4he La on State 5nterprises &/7 .3estiaA uly 1/ 19"%F translated in Current i+est

o% the Soiet Press

avoid undercutting 8P5Cs oligopolistic but decreasingly effective pricecontrolsF it has offered to @oin A44/ the capitalist trading groupF and hascalled for @oint production arrange!ents ith =estern fir!s interested inoperating in the ,SS. +ost startling as the announce!ent in 19"( that )0

!inistries and %0 large industrial fir!s ill soon have the right to trade directlyith foreign fir!s # in effect cancelling the state#centrali?ed !onopoly offoreign trade. 4his partial opening is an atte!pt to force internal refor!s uponthe reluctant ings of the bureaucracy through foreign co!petition.

orbachev has dis!issed hundreds of high#level officials/ ranging fro!'re?hnev<s cronies in the Politburo to party and state leaders of national/regional and local bodies. &n theory he is carrying out the ovosibirs2 plan ofeli!inating unnecessary and inefficient !iddle bureaucrats/ in the interest ofthe national capital as opposed to localis! and parochialis!. 'ut he has nottargeted only the e6alted. Iaslavs2aya<s incentive age sche!es have beenofficially pro!ulgated as ell/ although it is too early to tell ho deeply theycan be carried out in the face of or2ing#class opposition and resistance.

According to the Soviet nes agency 4ass/ echoing Iaslavs2aya<s Stalinisticdistortion of +ar6>

74he !ain ai! is to enhance the entire pay syste!/ to create a directdependence beteen the a!ount and uality of or2 and pay/ and to!a2e the groth of pay dependent on the increase of labor productivity.4he restructuring of the pay syste! is ai!ed at insuring that the agesof each person are strictly in accordance ith the volu!e of his or hercontribution to national ealth.71%

orbachev pro!ised that the refor!s ill allo or2ers to increase agesto hatever they can earnF but this is a cover for introducing une!ploy!entand inflation/ leading to a reduction of the average or2er<s real age. Along

ith the greater age differentiation pro!ised through perestroi2a co!es the prospect of shutting don enterprises dee!ed to be unprofitable # although thearbitrariness of prices !eans that such a deter!ination ould be grosslyinaccurate. &n any case/ Aganbegyan has proposed 7restructuring7 hundreds ofobsolete fir!s out of business/ and


1%. :e Hork TimesA Septe!ber )/ 19"(.

0--

Pri!e +inister y?h2ov announced that 13 percent of enterprises !ight beforced to close. Another econo!ist predicted that 13 to 19 percent of all non#service @obs !ight be eli!inated by the end of the century. 1"

orbachev and his allies do not ish to restore traditional capitalis! or evento decentrali?e the econo!y in the interest of local bureaucrats or !anagers. 8nthe contrary/ their purpose is to ea2en the !inisterial satrapies in the interestof the national ruling class as a hole. &nefficient local !anagers ill be !adeto !oderni?e or get out of the ay 4he state ill increasingly co!e to serve the

P7R7STR),?A A!D LAS!)ST

5fforts are being !ade to enlist sectors of the or2ing class/ the upperlayers especially/ behind the refor!s # along ith the already enthusiasticintelligentsia. 4his is a !a@or purpose of glasnost/ the groing series ofrefor!s that first re!oved restrictions on public activity li2e riting/ spea2ingand !eeting # and then alloed partially free elections to a ne governing

body/ the Supre!e Soviet. 4hese !easures give the illusion of !assparticipation in decision#!a2ing and are designed to in the population to



to !oderni?e or get out of the ay. 4he state ill increasingly co!e to serve the particular interests of the strongest fir!s as !ost representative of the generalinterests of the ruling class. &ndeed/ the epochal trend toard econo!icconcentration and centrali?ation applies under Stalinist refor!is!> even though

central ad!inistration is reduced the !onopolies ill still gro at the e6penseof their rivals.

As an e6a!ple of an enterprise operating under the ne refor!s/ considerthe evs2y =or2s in Leningrad hich the author visited as part of a group ofvisiting econo!ists and trade unionists in 19"9. 4his !achinery factory ith10/000 or2ers had been re!oved fro! !inisterial control under perestroi2a/

but it had uic2ly @oined an association of 1( enterprises/ 5nergo!ash/ hichno !onopoli?es Soviet production of oil pu!ping !achinery. 4he directorclai!ed that the association operates si!ilarly to an A!erican corporation. 7=eno produce our euip!ent to order/ in contrast to before hen e had tofollo osplan<s orders. =e deal directly ith custo!er#enterprisesF e haveour on foreign trade fir! and e6port#i!port operations.7 A or2ers< council

elects the !anager every five yearsF in addition/ it has the right to controlinvest!ents fro! the fir!<s do!estic sales/ hich it uses !ainly for increasinghousing and leisure facilities. 'ut the fir!<s foreign sales/ hich supply hardcurrency/ are invested at !anage!ent<s discretion/ !ainly in the e6pansion and!oderni?ation of productive euip!ent.

:espite occasional success stories/ perestroi2a has not had a positive overalli!pact. &n brea2ing the !inistries< !onopoly of econo!ic poer/ the center hascreated/ in effect/ independent econo!ic statelets throughout the country.epublics and regions use the idespread shortages to reserve local output forthe!selves # a practice hich only intensifies shortages. 'y the end of 19"9living standards had declined perceptibly/ supplies of food and consu!er goodsere orsening/ and as a result stri2es/ absenteeis! and @ob turnovers ere up.Published reports shoed 7a failure to !eet targets in al!ost every !a@orecono!ic sector.719 4he syste!ic crisis that engendered perestroi2a has only

been e6acerbated.


1".Vladi!ir Josta2ov/ uoted in the &conomistA :ece!ber )(/ 19"%.19. 7inancial TimesA anuary )(/ 1990

participation in decision !a2ing and are designed to in the population tosupport perestroi2a by !ethods of persuasion rather than force. orbachev is a!aster politician facing an un!asterable tas2. :uring the Soviet coal !iners<stri2e ave in uly 19"9/ for e6a!ple/ he announced that the !iners ere

acting on behalf of perestroi2a/ and he too2 the opportunity to eli!inate a fe!ore reluctant bureaucrats # but he subseuently gave the ga!e aay by

proposing a ban on stri2es. Ge clearly needs to open safety valves in the face ofthe developing and inevitable austerity !easures. Aganbegyan supplied theideological @ustification> 7Perestroi2a is a difficult and painful process. &tssuccess is deter!ined by the socio#political cli!ate of the society in hich itoccurs. ... Jarl +ar6 rote> <An idea beco!es a !aterial force hen it ta2eshold of society.< 4he idea of perestroi2a !ust co!e to grip society for

perestroi2a to !ove into gear. 'ut ho can this transition to a ne ay ofthin2ing and an understanding of ne tas2s be assuredH Gere the !edia of!ass infor!ation are of inesti!able help. lasnost/ truth/ criticis! and self#criticis! are the instru!ents that ill effectively prepare for the ne

consciousness.7)0

4hat the refor!ers regard a degree of openness as a necessaryacco!pani!ent to their econo!ic proposals is a victory for Soviet or2ers.'ut it is still necessary to be on guard> perestroi2a is a tool of e6ploitation/ andglasnost/ as Aganbegyan says/ is its instru!ent. 4ragically/ this is not cleareven to non#bureaucratic Soviet leftists in the -ederation of Socialist Clubs/hose founding !anifesto asserts that 7the life and death of socialis! in the,SS hang on hether perestroi2a succeeds.7)1 &n this spirit/ 'orisJagarlits2y/ a leading figure in the -ederation and the !ost idely cited and

published Soviet leftist in the =est/ advocates a strategy of co!pro!ise iththe refor!ers> 7=e don<t ant to destabili?e the situation ourselves. =e antto be loyal to the orbachev e6perience insofar as it re!ains progressive and

brings !ore de!ocrati?ation.7)) Such a strategy forgets that in reality it as theor2ers< struggle that created


)0. Aganbegyan/ The &conomic Challen+e o% PerestroikaA p. 31.)1. Cited by Ale6ander Coc2burn/ The :ationA :ece!ber 1)/ 19"%.)). Jagarlits2y/ intervieed in .nternational )iepointA ove!ber )"/ 19"".

0-8

orbachev/ not the reverse.orbachev is plainly eager to in greater legiti!acy for the ruling party by

establishing recogni?ed lin2s ith the population. &t is not @ust a !atter ofcurrying popular favor but also of institutionali?ing the regi!e<s poer through

plebiscitary !ethods of !ass approval. &n this ay he see2s to increase his onindividual authority as Soviet president and that of leading local bureaucrats by

placing the! in top positions in the nely e!poered parlia!entary Soviets. &fhe succeeds/ he ill have laid the basis for a ne Soviet 'onapartis! ith the

lective and the threat of scarcity is overco!e/ the incentive for or2 ill not be7natural7 starvation but the hu!an need for individual and cooperativecreativity and develop!ent. 4he fact that nothing of the sort ever occurs to

people ho are supposed to be for!ally trained in +ar6is! is a deep reflectionof the anti#or2ing class basis of Soviet society.

4he cynicis! of the intellectual bureaucrats is profound. &n effect they aresaying> =e or2ed hard to create a productive/ hu!ane society and to educatethe or2ers and peasants out of their brutish bac2ardness. 'ut hen they get



he succeeds/ he ill have laid the basis for a ne Soviet 'onapartis! ith the potential of hipping recalcitrant sectors of the populace/ notably the !ass ofor2ers/ into line.

:espite their uotations fro! +ar6/ orbachev and his aides have el#

co!ed viciously anti#or2ing class ideas fro! so!e theorists in order toco!bat or2ers< resistance to the loss of hard#on gains. A leading andunusually fran2 liberal econo!ist in the perestroi2a ca!p rote>

74he real possibility of losing one<s @ob/ of being shifted to a te!poraryune!ploy!ent subsidy/ of being forced to !ove to a ne place ofe!ploy!ent is not at all bad !edicine to cure sloth and drun2enness.+any e6perts believe it ould be cheaper to pay une!ploy!entco!pensation than to 2eep on loafers ho can Dand doE ruin any efforts toraise efficiency and uality.7)3

&t goes ithout saying that the refor!ers ho be!oan Soviet econo!ic perfor!ance also glorify =estern capitalis!. Sh!elev for one regards theecono!ic pressures operating under traditional capitalis! as 7natural las of

econo!ic life7 and 7!otives for or2 that are natural to the hu!an being7)* #ignoring the fact that hu!anity e6isted for centuries ithout the benefits of!ass une!ploy!ent and enslave!ent to ages. Aganbegyan as ell is said tothin2 that +ar6 and 5ngels ere overly idealistic in denying the bourgeoisob@ection that 7upon the abolition of private property all or2 ill cease anduniversal la?iness ill overta2e us.7 2,

'ut as +ar6 and 5ngels understood/ under capitalis! those ho or2acuire nothing and those ho acuire property do not or2. 4he notion thatevery or2er can @ust or2 harder in order to beco!e a s!all property oner isthe central petty#bourgeois illusion refuted by the historical develop!ent ofcapitalis! itself/ hich destroys s!all property. Aside fro! the te!porary

pro!ise of a fe !aterial goods/ the only 7incentive7 capitalis! offers toor2ers is the threat of starvation. 8n the other hand/ under co!!unis!/ hen

property has beco!e genuinely classless and col# BBBBBBBBBBBBBBBBBBBB

)3. i2olai Sh!elev/ cited in the &conomistA :ece!ber )(/ 19"%.)*. Sh!elev/ uoted by :aniel -ord in the :e HorkerA +arch )"/ 19""/ p. %3.)$. Aganbegyan/ uoted in -ord/ p. %)F he is referring to the Communist ani%estoA Part

&&

the or2ers and peasants out of their brutish bac2ardness. 'ut hen they geta better life than under the C?ar or Stalin/ hat happensH 4hey get la?y/ drun2and dishonest/ and on<t do a day<s or2 for a day<s pay. 4hey deserve the lashof capitalist !ethods to hip the! into shape. 4he 7Co!!unist7 intellectuals<

thin2ing is li2e that of pseudo#leftists in the =estern intelligentsia/ ho alsoconclude that the !asses have failed the! and that co!!unis! is therefore,topian.

4 P)ST'STAL,!,ST CAP,TAL,SM

Co!pared ith the econo!ic refor!s in other Stalinist countries/ the Soviet pro@ect has ta2en a long ti!e to prepare and shos !ini!al results.orbachev<s inability to achieve thoroughgoing 7refor!/7 despite all hisadroitness and publicity/ is funda!entally due to the resistance of Sovietor2ers. 4heir egalitarianis! is a distinct achieve!ent of the 191% revolutionF

it as an obstacle to the brutal Stalinist accu!ulation drives in the past and it blocs the !ore sophisticated Stalinis! of today. 4hat is/ the real barrier fororbachev is not the party conservatives but the proletariat in the land of thedefeated but not forgotten proletarian revolution. 4he egalitarian resistance isnot a heritage of Stalinis!/ as so!e bourgeois observers clai!/ but a legacy ofthe fight against it/ an echo of the or2ing#class struggle against Sta2hanovis!in the 1930<s.

T>7 R7&)RMS 7LS7W>7R7

&n the other Stalinist countries there is no direct revolutionary proletarianheritage. evertheless resistance there is groing as ell/ because of the

stepped#up e6ploitation of the or2ers.China after +ao<s death ent farther and faster than orbachev<s ussia.Agriculture as uic2ly decollectivi?ed and petty#bourgeois productionencouraged in ton and country/ leading to a great inco!e differentiationa!ong the peasantry and an e6odus of poor peasants to the cities. &ndustrial!anagers ere granted great leeay over ages and invest!ent. 4heco!bined effect as to create sub#proletarians ith no guaranteed @ob stability/forced to sell their labor at !inuscule ages. 4his

0-9

encouraged enthusiastic foreign invest!ent.Preserving super#e6ploitation/ the only capitalist road available/ as the

!ain reason for the bureaucracy<s !assacre of unar!ed or2ers and students inune 19"9/ to orldide revulsion. 4he regi!e could not accede to de!ands forde!ocracy/ especially hen e6pressed by groing nu!bers of or2ers andillegal independent or2ers< organi?ations. 4he or2ers ere !oved not @ust bya desire to vote or to support the protesting students/ but by inflation/une!ploy!ent and poverty/ all accelerated by the refor!s. :eng W Co.<s drea!

4he Polish 7e6peri!ent7 is being atched in the other 5ast 5uropean capitalsand in +osco/ as ell as by =estern i!perialists. +ar6ists have every reasonto e6pect that the Polish or2ers ill overco!e their illusions in 7free !ar2et7capitalis!. As an editor of a =arsa business !aga?ine said/ denouncing theor2ers< opposition to capitalis!<s so#called efficiency> 78ur people hateCo!!unis!/ but hen you start tal2ing about privati?ation/ !any of the! actli2e Co!!unists.7)%

=hereas the Soviet refor!s have not yet left the real! of Stalinist



une!ploy!ent and poverty/ all accelerated by the refor!s. :eng W Co. s drea!of a ne China/ profiting on the orld !ar2et and sharing the e6ploitation of itscheap labor/ could not be reali?ed in a state here or2ers had votes and a tasteof their on poer.)(

&n 5ast 5urope li2eise/ open capitalistic !ethods have already beenintroduced but have not helped ste! the crisis. ugoslavia and Gungary havehad the longest e6perience ith refor!F their free !ar2et policies havee6acerbated social tensions and sub@ected their peoples to the austerity

progra!s of the &nternational +onetary -und D&+-E. &n ugoslavia/ ho!elandof refor!ist Stalinis! and 7self#!anage!ent/7 inflation reached over 1000

percent in !id#19"9/ une!ploy!ent hit 1( percent nationally and over $0 percent in so!e regions Dnot to spea2 of the 10 percent of or2ers e!ployed as7guest or2ers7 abroadE. Gungary<s te!porary prosperity depended on a large

per capita foreign debt and as highly unevenF it led to !ore availableconsu!er goods but also greater ineuality and a continuing decline in

productivity. A report by the Gungarian trade unions< research institute su!!ed

up> 74he rich ... are getting richer/ the poor are getting poorer and the !iddleclass is thinning out.7

As a result of the failures of 7!ar2et socialis!7 on top of the econo!icdecay of Stalinis!/ even !ore far#reaching changes have been discussed and

partly introduced. Since the overturns of late 19"9/ the CP<s have been totallydiscredited/ to the point here !ost have abandoned their party na!es and theircountries< 7socialist7 or 7people<s7 titles. e provisional govern!ents have

been installed to ta2e advantage of the or2ers< hatred of Stalinis! D7anythingis better than this syste!7E and sub@ect the! to 7de!ocratic7 e6ploitation. So!eof these regi!es have si!ply dropped their pretensions to +ar6is! andsocialis!F others have openly announced their goals of establishing capitalis!.

&n Poland/ draconian 7refor!7 !easures ere introduced by the CPKSolidarity coalition govern!ent at the start of 1990/ folloing the prescriptionsof the &+-. Severe price hi2es ere co!bined ith reduced subsidies fori!portant consu!er goods in order to drive ages don to bare subsistence.,ne!ploy!ent ill soar as state industries are shut.


)(. See our analysis in Proletarian eolution o. 3*

=hereas the Soviet refor!s have not yet left the real! of Stalinistcapitalis!/ in 5ast 5urope devolution is no accelerating at a brea2nec2 pace.

e bourgeois ele!ents have sprung up/ and alongside the! state fir!s are being privati?ed through sales to foreign investors or their on !anagers. 8ne

feature of privati?ation/ hether ith bureaucratic or independent oners/ isthat the or2ers lose their li!ited trade#union rights.

An interesting e6a!ple of the union of the to sectors of capital is the !anho as !inister of industry in the last Polish CP govern!ent in 19""#"9/+iec?ysla =ilc?e2. 4his gentle!an is a !illionaire private factory onerho/ according to an ad!iring =estern account/ 7lives in a <s!all house in the5nglish style/< ith/ as you ould e6pect/ si!!ing pool/ tennis court and

peacoc2s.7)" =ilc?e2 said> 7=e no recogni?e that =estern countries haveachieved high living standards using certain !ethods/ and it is @ust a !atter ofcoincidence that these !ethods are called capitalist.7

4he self#buyout pheno!enon is especially significant. Layers of the bureaucracy have found a ay to 2eep their econo!ic poer even ith the

state yielding its co!!anding econo!ic authority. &n Poland and Gungary/!anagers have bought at bargain rates the factories they previously ran for thestate. Since one category slides easily into the other/ the bureaucrats and

bourgeois are proving the!selves ele!ents of the sa!e ruling class hoe6ploit the sa!e or2ers/ even though they dra their co!pensationdifferently. 4he post#Stalinist ruling class is being reorgani?ed to center not

@ust on the bureaucracy and !anagers but on the big bourgeoisie as ell.

T>7 &=T=R7 )& P)ST'STAL,!,SM

4he bureaucratic buyouts illustrate the ea2/ regent#li2e character ofStalinist statified capitalis!. eal though its property onership has been/ the

bureaucracy<s lac2 of legal title to the !eans of production !eans that its poer rested ulti!ately on the suppression of the or2ing class. o that theor2ers are in !otion/ the bureaucrats are fleeing to individual property titles/ta2ing advantage of the or2ers< illusions in de!ocracy and


)%. :e Hork TunesA ove!ber 30/ 19"9.)". &conomistA :ece!ber 3/ 19"".

05:

private property. Jeeping property out of the hands of the proletariat is hat issacrosanct to the bureaucrats # not state onership.4he rulers< overall solution/ already being proposed in Gungary andC?echoslova2ia/ !ay be to appro6i!ate the situation of 19*$#*"/ hen theStalinists ruled in collaboration ith social de!ocrats and bourgeois forces. Atthat ti!e econo!ic Stalini?ation had yet to reach full force> 7!i6ed econo!ies7ere the rule. All#out nationali?ation of industry had to aait the defeat of theor2ers/ as e sa in Chapter (. 8nly hen the proletariat as finally crushed

state pro!otion of capitalis! under the C?ars is one lin2 beteen thenationalists and reactionary StalinistsF another is the populist/ even 7socialist/7rhetoric adopted by fascis!.

&n 5ast er!any/ nationalis! and racis! have been used to pro!oteunification ith =est er!any B in reality a for! of se!i#colonial subor#dination. ,ltra#nationalist anti#eish forces are also groing in Poland/a!ong Stalinists and anti#Stalinist clerical ele!ents. 4here have also beenvicious chauvinist incidents in 'ulgaria and ugoslavia. &n o!ania they ere



/ p y p ycould the ne CP rulers oust the ea2 bourgeoisie and e6ploit the or2ers solelyon their on account.4he Stalinists today are deepening their interpenetration ith the rising bourgeois

ele!ents to for! hybrid regi!es. 4hey hope that this ill lead to so!ething li2ethe social#de!ocratic societies in the =est> !i6ed state and private econo!iesdo!inated by private capital/ ith a strong elfare co!ponent to pacify theor2ers and to sociali?e the costs of !aintaining critical but bac2ard fir!s.iven the econo!ic crises of the 5ast/ of course/ such a future is out of theuestion. 4here is little fat to be distributed and no basis to believe that the rulersill soon find any.4hat leaves the 5ast 5uropean rulers fe options. 4hey are hopeful of obtaining=estern econo!ic aid and political support. All the 5ast 5uropean rulers have ineffect suggested subordinating their countries to i!perialis!F it ill eventually bethe strategy for the ,SS too. 4hrough both privati?ation and furtherdecentrali?ation/ enterprises in the 5ast ill be !ade hospitable to capitalist

intervention and control. 'ut ith the postar boo! long over/ the =est ill loo2carefully at the ris2 of even larger 5astern debts and restive or2ing classes

before signing on.+eanhile the !ass upsurges have brought to the fore intellectuals and !iddle#class de!ocrats/ co!parable to the popular#front co!binations of intellectuals/technicians and politicians in the =estF they share poer ith the no!en2laturistsand the fe private capitalists. 4he co!bination of !ar2et refor!s and pseudo#de!ocracy is unli2ely to fool the or2ers for long. Sooner or later the bureaucratsand their !iddle#class allies ill have to change their line fro! de!ocracy todiscipline. As upheavals intensify and social revolution threatens/ the 7de!ocrats7ill turn increasingly to 'onapartist !ethods in order to shield the state and

private capitalists fro! the !asses. 4hey ill have to end the e!erging or2ers<institutions/ legal and illegal/ and crush the daily resistance to intensifiede6ploitation. 4heir !ost or2able solution is not de!ocracy but strong#!an rule.8ne portent of the rulers< future direction is the si!!ering of national chauvinis!and even fascis!. &n the ,SS/ the ussian fascist organi?ation Pa!yat/ openlyhostile to the 8ctober revolution/ has been nurtured by Stalinist bureaucrats. &tdefends one#party rule and state property and opposes orbachev<s liberali?ationand or2ers< stri2es. 4he heritage of

g g yte!porarily avoided by the universality of hatred for the old regi!e.

4he fuel for the fla!es of chauvinis! is not !ystical 7ancient pre@udices/7as the =estern press e6plains/ but !aterial conditions # scarcity/ poverty/

repression # and the conseuent search for scapegoats in the absence of +ar6istunderstanding. Capitalis! ith its inherent nationalis! and ineuality fans thefla!esF the !iddle#class refor!ists de!anding !ore capitalis! add fuel to thefire. ,nless overco!e by or2ing#class !ove!ents/ the burgeoningnationalis!s that !o!entarily e6press the liberation of countries fro!Stalinis! ill be transfor!ed to subordinate the !asses to capital. A positivesign is that the Soviet coal stri2e in 19"9 e6tended across the ,SSF the !inersre@ected atte!pts to divide the! along national lines. &n general/ the 2ey factoris that the or2ers< !ove!ent has not been beaten don by a succession of!assive defeats li2e that suffered under a?is! and the rise of Stalinis! in the

postar years.orbachev and his bac2ers have already ta2en steps to !a2e 'onapart#is!

possible. Gis refor!s are not all de!ocratic even in appearance. Ge hascentrali?ed party leadership and the state presidency in his on hands/ and hehas been granted e6tensive individual poers to bypass state and partystructures. 4here are proposals for a ne/ !ore poerful 7e6ecutive

presidency.7 &n Poland/ the great de!ocrat =alesa also has advocated a !a@orabrogation of de!ocratic rights> hen the Se@! as debating the &+-sausterity !easures/ he as2ed that the Solidarity#CP coalition be given ide

poers to pro!ulgate its 7refor!s7 by decree/ in order to overco!e oppositionfro! the or2ing class. &n other countries here the CPs have !ore or lesscollapsed/ the !ilitary !ay be the alternative hich the post#Stalinist rulingclass loo2s to for 7stability.7

=e stress that the 'onapartist trend is toard political/ not econo!ic/centrali?ation. &t is not designed to restore the days of old under Stalin Dhich/as e have seen/ already !eant de %acto decentrali?ation of production despite

political dictatorshipE but to unleash the full force of the la of value againstthe or2ing class. A reversion to Stalinis! is not possible until the or2ers aredefeated/ that is/ until fascis! triu!phs.

054

R7&)RMS A!D T>7 !AT=R7 )& STAL,!,SM

4he changes in the 5astern bloc add to our understanding of per!anentrevolution applied to Stalinist society. ecall 4rots2y<s point that the

bourgeoisie hesitates to !a2e its on revolution in the epoch of capitalist decayfor to reasons> 1E the interpenetration of bourgeois property ith pre#capitalist

property for!s/ including the close ties and fa!ily relations beteen the bourgeoisie and old landonersF )E the fear of sti!ulating the or2ing !assesin revolutionary periodsF an attac2 on one for! of property ould be 7too

defend their 7socialist7 or 7or2ers<7 states for very long.Secondly/ the eagerness of the state apparatus to adopt open capitalis!

places the uestion of 7capitalist restoration7 on the agenda/ as !ost or2ers<state theorists are arning. &ndeed/ if the post#Stalinist rulers have their ay/the establish!ent of open bourgeois relations ithout a civil ar cannot be

precluded. =hen this happens it ould establish not that capitalis! has peacefully been restored but that the syste! has been funda!entally capitalistall along.



in revolutionary periodsF an attac2 on one for! of property ould be 7toote!pting7 for the !asses in !otion and ould endanger all private property.=e have since seen that the Stalinists/ too/ feared to challenge bourgeois

property e6cept hen the or2ing class had been s!ashed or otherise

re!oved fro! the political arena.A parallel concern is no evident a!ong the =estern bourgeoisie. &t

encourages privati?ation and @oint onership in the Stalinist countries/ but it isno clearly interested !ore in preserving social stability that in abolishingnationali?ed property. After the 'ush#orbachev su!!it in +alta in late 19"9/the ,.S. e!phasi?ed discouraging both the centrifugal nationalist !ove!ents inthe ,SS Ddespite ritualistic ords for the 'altic 7captive nations7E and theradical pro#capitalist politicians in +osco. 8vertures ere !ade to !ilitaryleaders across the region ho could serve as stabili?ing forces. 4he !ostnotorious !ove as 'ush<s diplo!atic concessions to the Chinese rulers/ in theface of ra public !e!ories of the 'ei@ing !assacre. All the =estern rulers

endorsed orbachev<s !ilitary invasion of A?erbai@an/ even though it asclearly !eant not to save lives but to prevent national self#deter!ination. And'ush<s ar!s control proposals envisioned the Soviets< 2eeping to hundredthousand troops in 5ast 5urope Dith a si!ilar nu!ber of ,.S. forces in the=estE # against the clear ishes of the popular !ove!ents he supposedlyrespects.

4he reasons for these acco!!odations are first/ that the =est is increasinglyinterpenetrated ith the 5astern bloc and China # not via direct onershipDalthough that is groingE/ but in trade/ contracts and @oint invest!ent [email protected] all/ under!ining state property in the 5ast ould threaten property ingeneral. 4he bourgeoisie is still frightened of the or2ing classes inrevolutionary periods # even in the ho!elands of its Stalinist 7!ortal ene!y.7

4he !ass revolt brought the rival ruling classes together and furtherde!onstrated the co!!on interest in e6ploitation that in the final analysistranscends their national and property#for! differences.

4he collapse of Stalinis! illu!inates the debate over the nature of thesyste!. -irst/ the econo!ic brea2don and the rulers< obvious loss of con#fidence in their 7socialis!7 raise the uestion> ho can this syste! be socially

progressive in co!parison ith capitalis!H &f it is a funda!entally differentsyste! it is clearly retrograde. :efensists ill not be able to

g4he or2ers< state theorists have a serious proble!> hen and ho do they

decide that or2ers< states no longer e6istH 4he post#=orld =ar && 4rots2yists<criteria for a or2ers< state ere central planning and the state !onopoly of

foreign trade # plus/ of course/ state property in the !eans of production. 8fthese/ the first to have been abandoned across 5ast 5urope/ hile state

property re!ains an increasingly hollo for! ithout a shred of proletariancontent. 4he inability of enterprises to buy and sell factories and producers<goods has been another @ustification for denying the capitalist nature ofStalinist econo!yF no that too is disappearing as state property beco!esincreasingly decentrali?ed and privati?ed.

=e really do not e6pect the orthodo6ist rationali?ers to be able to offer anycriteria. After all/ their ancestors in the 19*0<s did not recogni?e the 7socialrevolutions7 that created 7or2ers< states7 until years after the alleged fact. 8ne2ey proble! is that the overthro of a or2ers< state reuires the or2ers<defeat in a civil ar beteen the ne ruling class and the proletariat. As e

shoed in Chapter */ there as such a ar in the Soviet ,nion in 193(#39F4rots2y called it a 7preventive civil ar/7 although he did not recogni?e itscapitalist#restorationist conclusion. &f a state beco!es capitalist ithout a civilar/ can it really have been non#capitalist to begin ithH 'y the sa!e to2en/ inthe one country here there as a violent if brief civil ar in 19"9/ o!ania/defensists ought to have sided ith the last#ditch defenders of nationali?ed

property. ,nfortunately that !eant the Ceausescu dynasty and the !urderousSecuritate. 4he understandable refusal of leftists to sign up only shos thattheir co!!on sense belies their inadeuate theory.

+andel/ unli2e !ore left#ing defensists/ re@ects the possibility of capitalistrestoration by the ruling bureaucracy. So!e in the no!en2latura/ chiefly theindustrial !anagers/ !ight be able to transfor! the!selves into privatecapitalists/ he says/ but not the ar!y of bureaucrats in its entirety.)9 =hat heoverloo2s is that !any of these loer officials ould 2eep their state posts inthe co!ing transfor!ation Dhich ould not return to the 19th century byeli!inating the bul2 of the state apparatusEF others


)9. +andel/ .nternational )iepointA 8ctober 30/ 19"9.

05-

ould indeed be defeated in the tu!ultuous upheavals that are ta2ing place.Above all it is the hybrid nature of the ne regi!es and syste!s that he ignores.Gis refusal to see the bureaucracy as e6ploiters of the proletariat !a2es hi!deny the changes actually occurring.

4he disintegration of Stalinist rule has produced one ne line of reasoning by or2ers< state theorists. =e ta2e a version by the ,nited Secretariat duringthe Polish struggle of 19"1>

74he Polish events confir! that the bureaucracy in poer in the

that funda!entally describe 7third syste!s.74he changing reality also annihilates the open third#syste! theories. &f

Stalinis! ere really a ne !ode of production/ it ould have lasted !orethan half a century ithout collapsing into capitalis!. +ore specifically/ thelatest events refute Shacht!an<s e6planation Dco!!on to !any third#syste!ists/ conscious or notE that the bureaucracy ons the !eans of pro#duction because it runs the state.3) 4oday the bureaucrats are abandoningcontrol of their states hile tightening their hold on property. 4his establishes



y p bureaucrati?ed or2ers< states is not a ne ruling class. 4here is noco!!on !easure beteen the resistance that the bourgeoisie is capableof putting up against the rise of socialist revolution in capitalist countries

as deeply industriali?ed as Poland/ and the e6tre!e ea2ness hich thePolish bureaucracy has e6hibited faced ith the rise of the !ass!ove!ent.7 30 4his is a poor argu!ent. 4he characteristic of a revolutionary situation is

that even a strong ruling class beco!es ea2. =hen Stalinis! as confident ofits poer it as perfectly capable of s!ashing or2ers< uprisings/ as in the,SS in the late 1930<s and in 5ast 5urope in the 19*0Rs. Conversely/ itnessthe feebleness of the ussian bourgeoisie in 191%. 4here is a great deal of7co!!on !easure7 beteen Jerens2y in 191% and aru#?els2i in 19"1. 4hedifference is that the latter too2 advantage of the or2ers< refor!ist leadershipand found the police strength to put don the !ove!ent hen it avered.4oday the post#Stalinist ruling classes ill do the sa!e/ bac2ed by both

=estern and Soviet i!perialis!/ if the or2ers fail to find their revolutionarycourse. 4he clai! that the syste! has no alien ruling class because Stalinis!has disintegrated paves the ay for supporting the ne refor!ers as the heraldsof genuine revolution.

4he very possibility of a transfor!ation toard traditional capitalis!destroys the defor!ed or2ers< state theory. &t also refutes Cliffs 7statecapitalis!.7 Cliff in fact has long held that there is no possibility for internalforces to restore individual capitalis!.31 4heoretically this forecast as falsefro! the start/ as e have e6plainedF practically it has been plainly disproved.Cliffs position/ parallel to +andel<s/ follos logically fro! his conception thatStalinis!<s class relations are different fro! those of capitalis!. &t again shosthe underlying si!ilarity of all the theories


30. esolution published in .ntercontinental PressA :ece!ber )1/ 19"1.31. 7'efore the e6perience of =orld =ar &&/ it as an understandable if incorrect

assu!ption that private capitalis! could be restored in ussia ithout its occu# pation by an i!perialist poer. 'ut the victory of the concentrated/ statified ussianecono!y over the er!an ar !achine silenced all tal2 of such a possibility.7Dussia < ar!ist <nalysisA p. 1*1F State Capitalism in ussiaA p. 3)(.E

g g p p y beyond uestion that the bureaucracy<s onership of the !eans of production ishat !a2es it the ruling class/ not the other ay around.

4he theoretical significance of the 19"9 upsurges is that they have brought

out the possibility of hybrid bureaucraticKbourgeois regi!es. =e sho in thene6t section that the refusal to recogni?e this alternative leads directly to arefor!ist stance toard the post#Stalinist states.

0 PR)RAM &)R R7V)L=T,)!

evolutionaries are interested in theory not for its on sa2e. +ar6is! is aguide to action/ and the ai! of theoretical or2 is progra!!atic conclusions.As the Communist ani%esto says/

74he Co!!unists are distinguished fro! other or2ing#class parties bythis only> 1. &n the national struggles of the proletarians of the different

countries/ they point out and bring to the fore the co!!on interests ofthe entire proletariat/ independent of all nationality. ). &n the variousstages of develop!ent hich the struggle of the proletariat against the

bourgeoisie has to pass through/ they alays and everyhere representthe interests of the !ove!ent as a hole.7,nder the present circu!stances the uestion of the revolutionary progra!

that addresses 7the interests of the !ove!ent as a hole7 under Stalinis! is ofgreat urgency. 8ur or2 is based on 4rots2y<s 4ransitional Progra! of the1930<s/ the first !a@or progra!!atic docu!ent to deal ith the proble!. &tneeds updating both because of the i!!ense historical changes since that ti!eand the theoretical errors in 4rots2y<s analysis of Stalinis!. 4he !ass strugglesof the proletariat against Stalinist rule are an inspiration for and a test of all

progra!!atic proposals.

S)C,AL VS P)L,T,CAL R7V)L=T,)!

&n the 1939#*0 struggle in the A!erican Socialist =or2ers Party/ 4rots2ychallenged Shacht!an> 7Let us concede for the !o!ent that the


3). Shacht!an/ The #ureaucratic eolutionA p. **.

058

bureaucracy is a ne <class< and that the present regi!e in the ,SS is a specialsyste! of class e6ploitation. =hat ne political conclusions follo for us fro!these definitionsH733

=e do not 2no hether the Shacht!anites replied directly. &n practice their progra! for the Stalinist states as de!ocracy/ little different fro! that oftoday<s 7orthodo67 Pabloites despite superficially counterposed analyses. 8uranser to 4rots2y<s challenge begins/ of course/ not fro! Shacht!an<s positionthat Stalinis! is a ne syste! of class e6ploitation but that it is an old one/

revolution ould have to not @ust regenerate the or2ers< Soviets but recreatethe! B as class#based organs of the proletariat/ they ere gutted by theStalinist counterrevolution and officially abolished under the Constitution of193(. Calling for their regeneration cannot no aa2en a living heritageithin the Soviet or2ing class as it still could in the 1930<s # and it stri2es nochord at all in the other Stalinist states. +oreover/ orbachev<s refor!ists havere#established the Supre!e Soviet as a parlia!entF 7restoring de!ocracy7 inthis ruling#class body is not at all hat 4rots2y !eant by his proposal.



capitalis!/ bearing the scars of its destruction of the short#lived or2ers< state.4rots2y/ first of all/ sa the need to overthro the ruling bureaucracy of the

Soviet ,nion through a political revolution. 4oday e call for a revolution that

is social and not @ust political> it has to destroy the Stalinist state and itsapparatus/ not @ust refor! it. Although our progra! goes beyond 4rots2y<s/ euse the !ethod inherent in the 4ransitional Progra!. Gere is ho 4rots2ydescribed the political revolution>

7&n order better to understand the character of the present M193(N Soviet,nion/ let us ... assu!e first that the Soviet bureaucracy is overthron bya revolutionary policy having all the attributes of the old 'olshevis!/enriched !oreover by the orld e6perience of the recent period. Such a

party ould begin ith the restoration of de!ocracy in the trade unionsand the Soviets. &t ould be able to/ and ould have to/ restore freedo!of soviet parties. 4ogether ith the !asses/ and at their head/ it ouldcarry out a ruthless purgation of the state apparatus. &t ould abolish

ran2s and decorations/ all 2inds of privileges/ and ould li!it ineualityin the pay!ent of labor to the life necessities of the econo!y and thestate apparatus. &t ould give the youth free opportunity to thin2independently/ learn/ critici?e and gro. &t ould introduce profoundchanges in the distribution of the national inco!e in correspondence iththe interests and ill of the or2er and peasant !asses. 'ut so far asconcerns property relations/ the ne poer ould not have to resort torevolutionary !easures. &t ould retain and further develop thee6peri!ent of the planned econo!y. After the political revolution # thatis/ the deposing of the bureaucracy # the proletariat ould have tointroduce in the econo!y a series of very i!portant refor!s/ but not

another social revolution.7

3*

4oday to call for a political revolution !a2es little sense. 4he only ay toachieve a proletarian revolution # the establish!ent of genuine or2ers< ruleover the state B is no through social revolution. A proletarian


33. 4rots2y/ 74he ,SS in =ar/7 .n e%ense o% ar!ismA p. *.3*. 4rots2y/ The eolution #etrayedA pp. )$)#3

4he revolution ould also need to s!ash the officer corps and the secret police/ hich have nothing in co!!on ith the 'olshevi2 ed Ar!y finallydestroyed in the purges of 193%#3". D&n 5ast 5urope the old secret police are

already under attac2 fro! belo.E As Lenin rote in a pole!ic againstJauts2y/ 74he point is hether the old state !achine Dconnected by thousandsof threads ith the bourgeoisie and co!pletely saturated ith routine andinertiaE shall re!ain/ or be destroyed and superseded by a ne one.7 3$ =ith7bourgeoisie7 replaced by 7bureaucracy/7 this is e6actly the uestion facing the

proletariats under Stalinist or post#Stalinist rule today. ationali?ed property in the Stalinist states has beco!e a shell concealing

an anarchic/ unplanned structure. 4oday e can see plainly that a ne proletarian revolution ould face the tas2 of transfor!ing the econo!y. Acentrali?ed/ planned econo!y has to be created fro! the start # not 7retainedand further developed7 Dor even 7drastically changed/7 as the 4ransitionalProgra! saysE. 4he refor!s proposed and carried out by the bureaucrats sho

that even the vestigial or2ers< gains e!bodied in the state property for!s arealready on the verge of destruction. 4he only ay to save or recover the! is tooverthro the state that defends nationali?ed property only to the e6tent that itcan be used against the or2ers. 4hat Polish or2ers have had to stri2e to

protest the govern!ent<s privati?ation of the dans2 shipyards confir!s the+ar6ist understanding that nationali?ed property is inherently a proletarianfor!/ not an inherent interest of the bureaucracy.

4he final proof that a or2ers< 7political revolution7 is not on the order ofthe day has been the !ove!ent of the or2ers the!selves in four decades ofclass struggle against Stalinis!. 4hey have fought to create ne institutions/independent of the ruling bureaucrats/ not to reorgani?e the old ones.So!eti!es these ne institutions have been genuine proletarian ones> Soviets.'ut alays their actions point to s!ashing the state apparatus/ not refor!ing oreven purging it. 4hey have risen up against e6ploi#


3$. Lenin/ The State and eolutionA Chapter (.

059

tation at the point of production/ not @ust against ineualities in distributionF ithas been a revolt against the la of value. ,nfortunately the progra!s of theirleaders have not !atched the or2ers< actions.

4he tas2 of +ar6ists is to de!onstrate that the necessary progra! is for aorkers' stateA the alternative both to the bosses< refor!s and refor!ist self#!anage!ent. 4rots2y devoted !uch effort to elaborating progra!!atic!ethods to in !asses of or2ing people to the revolutionary cause through adirect connection ith their e6perience. Gis 4ransitional Progra! of 193" is

4he 7refor!7 progra!s in the Stalinist countries reaa2en the need todefend the interests of or2ers in enterprises that are scheduled to be shutdon for lac2 of profits. 4he 4ransitional Progra! raises a series of de!andsfor such situations. 8ne is the slidin+ scale o% hours to end une!ploy!ent/ allthe necessary or2 ould be divided a!ong the available or2ers inaccordance ith a standard or2ee2/ the average age of every or2erre!aining the sa!e. &n the Stalinist countries the hours of o!en or2ershave notoriously been lengthened by the 7double burden7 of age and



built around a syste! of transitional de!ands 7ste!!ing fro! today<sconditions and fro! today<s consciousness of ide layers of the or2ing classand unalterably leading to one final conclusion> the conuest of poer by the

proletariat.73(

TRA!S,T,)!AL D7MA!DS

=e outline ho the !ethod of the 4ransitional Progra! applies to the classstruggle in the pseudo#socialist countries. =e do so to sho hat the advancedor2ers/ the e!bryo of a revolutionary party/ can do on the tactical level to

build their party. 4his proble! is rarely addressed. 8n the one hand/ Cliff andhis folloers deny the applicability of transitional !ethods to capitalis! ingeneral. 8n the other/ or2ers< state theorists see no need to apply de!andsritten for capitalist states to the Soviet#!odel countries. 8ur approach is tosho that transitional de!ands raised by 4rots2y for bourgeois countries areapplicable to present#day Stalinis!. 8ther de!ands in the 4ransitional Progra!

are o!itted here/ not because they do not apply to the Stalinist orld but only because their application ould be in all funda!entals the sa!e as undertraditional capitalis!.

'ecause of the inflation that is rac2ing the Soviet bloc/ the de!and for a slidin+ scale o% a+es is criticalF it as raised by the Polish or2ers in theirspring 19"" stri2e ave. &t !eans that labor agree!ents should include anauto!atic/ proportional rise in ages ith respect to prices of consu!er goods.Since official statistics on prices are suspect/ all the !ore so in Stalinistcountries here statistics are often treated as state secrets/ prices have to be!onitored by local co!!ittees of unionists and une!ployed or2ing#class

people. BBBBBBBBBBBBBBBBBBBB

3(. 4his uotation co!es fro! 74he :eath Agony of Capitalis! and the 4as2s of the-ourth &nternational/7 the full na!e of the 4ransitional Progra!. 4he only editionidely available in the ,nited States is in the S=P<s boo2/ The Transitional Pro+ram %or Socialist eolutionA hose title is very !isleading. Although the4ransitional Progra! is indeed designed to bring about the socialist revolution/ it isnot 7the progra! for socialist revolution.7 See our article 7+yth and eality of the4ransitional Progra!/7 Socialist )oice o. " D19%9E

do!estic labor. 4o solve this proble! reuires at least the construction offacilities for the sociali3ation o% houseork$

4he Progra! also advocates 7opening the boo2s7 of the corporations

through the slogan of orkers' control$ 4his ter! !ight better be understood as7or2ers< supervision/7 since it does not refer to or2ers< replacing the bossesin the !anage!ent of enterprises. &n 4rots2y<s ords/

74he i!!ediate tas2s of or2ers< control should be to e6plain the debitsand credits of society/ beginning ith individual businessunderta2ingsF to deter!ine the actual share of the national inco!eappropriated by individual capitalists and by the e6ploiters as a holeF toe6pose the behind#the#scenes deals and sindles of ban2s and trustsFfinally/ to reveal to all !e!bers of society that unconscionablesuandering of hu!an labor hich is the result of capitalist anarchy andthe na2ed pursuit of profits.73%

Anarchy and unconscionable suandering are certainly no less under

Stalinis!. &s there any reason hy this analysis ould not apply to the Polishgovern!ent<s shutdon of the dans2 shipyardsH 4he fact that the Stalinistrulers cannot continue to produce needed ships Dthey are sold !ainly to the,SSE proves again that their econo!y is governed not by use value but byordinary/ crass/ value. 4he decision to shut don the dans2 shipyards asopposed through stri2e action by the or2ers hose @obs ere at sta2e # andthey de!anded opening the boo2sO 4he or2ers ere perfectly right to sei?eon a de!and fro! the 4ransitional Progra!/ consciously or not. 4he4ransitional Progra! e6presses the logic of the or2ers< struggle # undercapitalis! of every for!.

As under traditional capitalis!/ so!e enterprises ill illingly bare theirfinancial souls and 7prove7 to the !asses that they are indeed operating at aloss and !ust therefore shut don # hatever the cost to their e!ployees. 4hatreuires investigating not @ust individual enterprises but the econo!y as ahole. 4rots2y therefore added>

74he or2ers cannot and do not ish to acco!!odate the level of theirliving conditions to the e6igencies of individual capitalists/


3%. 4rots2y/ The Transitional Pro+ram .../ p. 1)0.08:

the!selves victi!s of their on regi!e. 4he tas2 is one of reorgani?ingthe hole syste! of production and distribution on a !ore dignified andor2able basis. &f the abolition of business secrets is a necessarycondition to or2ers< control/ then control is the first step along the roadto a socialist guidance of the econo!y.74hat is/ or2ers< control is a de!and transitional to or2ers< poer in a

or2ers< state. Goever/ the Soviet bosses li2e those in the =est !ay be forcedto shut don operations. So the 4ransitional Progra! continues>

their on or2ers< state/ and a preparation for running it.&n the co!!on case here an enterprise is producing asteful or dangerous

products/ it !a2es little sense to continue operations unchanged. -urthertransitional de!ands should be raised # for e6a!ple/ to ree!ploy or2ers inrebuilding obsolete enterprises rather than leave the! @obless. &n a si!ilarconte6t 4rots2y called for pu(lic orks$ D,nder statified capitalis!/ of course/al!ost all or2s are 7public7E

7Public or2s can have a continuous and progressive significance for



74he socialist progra! of e6propriation/ i.e./ of political overthro of the bourgeoisie and liuidation of its econo!ic do!ination/ should in no caseduring the present transitional period hinder us fro! advancing/ hen the

occasion arrants/ the de!and for the e6propriation of several 2ey branches of industry vital for national e6istence/ or of the !ost parasiticgroup of the bourgeoisie.73"

4he ai! of the e!propriation o% key industries de!and is to force the rulingclass as a hole/ through its state/ to ta2e responsibility for the ell#being of itsor2ing people # despite the inconvenience for profits this !ay entail/ or thedisruption of capitalist euilibriu!. 4here is no contradiction in de!andinge6propriation by a bourgeois state/ as long as revolutionaries openly e6plain toour fello or2ers that this is no lasting solution/ and that the de!and and itsfulfill!ent are lin2ed ith preparing the proletariat for revolution.

&n the case of the Stalinist countries the euivalent of the e6propriationde!and is to call for re!oving enterprises fro! the hands of their local

bureaucratic !anagers and !a2e the! the direct responsibility of the state.Such a call places the responsibility for social needs on the ruling class as ahole through its state/ and e6poses the state<s unillingness and inability toaccept this duty. 4his i!plies as ell canceling the reuire!ent that individualenterprises be run along strict profitability criteria. &t also !ay !ean re#euipping factories ith up#to#date !achinery to continue production. As forthe !a@or state industries privati?ed by the refor!ist Stalinists and their allies/ it!eans re#nationali?ation through e6propriation ithout co!pensation. -urther/the fictional structure of costs !ust be overhauled through close or2ing#classsupervision so that !uch !ore accurate values of every co!!odity can becalculated.

&n su!/ henever the state de!ands that or2ers< sacrifice for the nationalgood/ it is proper for or2ers to de!and that they see the boo2s and have theright to control hatever !easures the regi!e ta2es. 4he or2ers< directintervention into econo!ic !anage!ent is an e6cellent e6posure of the trueoperation of a class society/ an incite!ent to fight for


3". 4rots2y/ The Transitional Pro+ram .../ p. 1))

society ... only hen they are !ade part of a general plan/ or2ed out to covera considerable nu!ber of years. =ithin the fra!eor2 of this plan/ the or2ersould de!and resu!ption/ as public utilities/ of or2 in private businesses

closed as a result of the crisis. =or2ers< control in such cases ould bereplaced by direct or2ers< !anage!ent.7 4his reasoning leads to thede!and for orkers' mana+ement of enterprises that the ruling bureaucracy

proves unable to operate effectively. &t is one ay to counter the anticipatedob@ection fro! !any or2ers that e6propriation of industry is too re!iniscentof returning the econo!y bac2 to the ay it as under pre#refor!ist

bureaucratic rule. =or2ers< !anage!ent/ hoever/ cannot be interpreted asthe autono!ous functioning of factories envisioned by 7self#!anage!ent7sche!es Dand certainly not as the 7tea! concept7 and other arrange!entsadvocated by capitalist bosses to !a2e or2ers ta2e part in their one6ploitationE. =or2ers< !anage!ent in our sense only or2s in the conte6t ofsociety#ide decision#!a2ing by the central or2ers< councils/ co!bined ith

total control of each enterprise by the or2ers.&t is also necessary to co!e to grips ith or2ers< illusions that the !ethods

of =estern bosses are to be desired because anything is better than Stalinist!anage!ent. 4o this end it ill be necessary to raise de!ands coveringor2ers in the groing nu!ber of private shops and enterprises. -or e6a!ple/or2ers have hesitated to leave @obs in the state sector for fear of losing their

pension/ housing and other rights attached to the specific @ob or !inistry. Anational pro+ram %or pensionsA housin+A etc$ ould apply to or2ers in bothstate and private industries/ and ould allo the! to !ove ithout hindrance/should they choose/ beteen @obs in either sector.

4hese econo!ic de!ands all point to econo!ic centrali?ation/ not thedecentrali?ation raised by the de!ocrats. =ithout the! there ill be or2ing#class people lac2ing @obs/ ages or leisure. 4here is no other ay to guaranteetrue de!ocracy/ hereby every or2er has the ti!e and resources to engage in

political life.


39. 4rots2y/ The Transitional Pro+ram .../ p. 1)1.

084

W)R?7RS6 S)V,7TS

4he uestion of Soiets has particular force in the orbachev period/especially because the current rubber#sta!p Soviets are being revived asdecision#!a2ing bodies. 4he original revolutionary Soviets of 190$ and 191%ere councils of delegates fro! every stratu! of or2ing#class life/ reflectingall the struggles of the classF the Stalinist counterrevolution replaced the! ithfictitiously de!ocratic parlia!entary bodies.

o orbachev and his allies see the need to incorporate the or2ing

fully ith our on ar!s. 8f course/ after this deception of the or2ers/unprecedented in the history of hu!anity/ it ill ta2e a certain a!ount ofti!e for the course of de!ocracy and glasnost to yield fruit> thedictatorship of the or2ing class/ its full poer through its on

institutions # the Soviets/ in their Leninist understanding.7*0

8ne of the re!aining gains of the 191% revolution is that so!e Sovietor2ers still 2no Lenin as the revolutionist he as rather than the icon the7bureaucratic bourgeoisie7 has !ade of hi!. udging fro! this e6cerpt/ these



o orbachev and his allies see the need to incorporate the or2ing!asses/ to allo the! a say in deciding ho to co!e up ith the reuiredecono!ic sacrifices. &n fact the slogan 7All poer to the Soviets/7 an echo of191%/ has gained ide appeal because of its de!ocratic ring> it sy!boli?es an

end to the arbitrary poer of the ruling Co!!unist Party. 'ut the revivedofficial Soviets have nothing in co!!on ith 191%/ or the dans2 +JS. 4heyare at best arenas for debates beteen factions of the ruling class/ ith anoccasional voice of opposition alloed as a safety valve.

Soviet or2ers can ta2e advantage of the openings provided by orbachev by raising the call for genuine Soviets Dor2ers< councilsE/ soviet congressesand a per!anent central soviet. 4his is a de!and not on the ruling bureaucrats

but on the or2ers< leaders. &t ould present to the or2ing class the need forits political and organi?ational independence fro! the rulers. &t ould alsoe6pose the fraudulence both of orbachev<s de!ocrati?ation and of the localistself#!anage!ent sche!es.

4he or2ers of 5ast 5urope have begun the for!ation of independent tradeunions Das distinct fro! the govern!ent unions under Stalinis!E. 'ut unions areno substitute for or2ers< councils that ta2e up all uestions vital to the or2ingclass/ political as ell as econo!ic. ,nfortunately the or2ers so far have acteden masse but not as a or2ing class. :ecades of Stalinis! have convinced!any that politics is a sphere fit only for opportunists and the corrupt.5cono!ic conditions ill undoubtedly force the!/ hoever/ into !ass stri2eactivity. :e!ands for strike committees to run +eneral strikes against austerityill help or2ers in struggle organi?e the!selves as a class and beco!e aareof the conflicting class interests of the !iddle#class leaders.

&n addition to the coal !iners ho began the building of genuine Soviets inaction in 19"9/ other Soviet or2ers have raised the de!and for or2ers<

Soviets. An interesting e6a!ple is the letter by a group of Soviet or2ers fro!the ,rals already !entioned in Chapter $>

74he local bureaucrats MareN opponents of the revolutionary reneal/ inhose hands/ unfortunately/ the real political poer rests. 4his is atreacherous class of e6ploiters of the toilers hich uses as a cover thathich is !ost sacred to the or2ing class # +ar6is! # and passes itselfoff as the true representatives of the party of the or2ing class/ of Soviet

poer/ of the peopleF and against the! one !ust fight s2ill#

or2ers see! to trust orbachev<s glasnost and 7revolutionary reneal7 and tothin2 that only the local bureaucrats for! an alien capitalist class. &f so/ theseare errors they ill have to learn to correct. 4heir overall lac2 of illusions ill

be of i!!ense value in doing so.4he inherent tendency of proletarian Soviets is to drive for state poer/ as

in 191%. A state ruled by such Soviets ould give the or2ers a predo!inantrepresentation # even above their proportion of the population/ in states herethe proletariat is still a !inority. Such a structure as incorporated in the firstSoviet constitutions and as for!ally abolished by Stalin in the 1930<s. &t is aviolation of pure DbourgeoisE de!ocracy but is necessary because the

proletarian dictatorship is a higher goal and the only ay to achieve the !ostfunda!ental de!ocratic tas2s.

,nder the conditions created by the 19"9 revolutions in 5ast 5urope/ the posing of a genuine or2ers< state through the e!poer!ent of or2ers<Soviets is necessary to counter the de!ocratic appeal of the various post#

Stalinist govern!ents that have been erected by the refor!ists. &n the !eanti!ea critical slogan is no support to the proisional +oernments; they areinstru!ents of the ruling class for reconsolidating its on poer. 4he Soviet!iners< stri2es brought to the fore another 2ey slogan fro! the 4ransitionalProgra!> the for!ation of orkers' militias$ :uring the stri2es or2ers

patrolled the streets of the !ining tons/ and the regular police practicallydisappeared. As so often happens in ti!es of revolutionary action by the!asses/ 7cri!inality sharply di!inished.7 As in dans2 in 19"0/ there as asharp reduction in alcohol consu!ption/ even a prohibition against it.*1 Clearlythis display of !uscle and control by the or2ers helped dissuade the regi!e to

bring in the ar!ed forces to stop the stri2e. 4he further develop!ent oforgani?ed and ar!ed detach!ents of or2ers to defend their stri2es and sit#insould be a signal of


*0. Socialist e+ister 1989A p. 1)(. =e note also that so!e ussian nationalist7=or2ers< ,nited -ronts7 ith de!ands for or2ers< Soviets have been for!ed by

bureaucrats to counter national !inority !ove!ents and entrap or2ers.*1. &nfor!ation fro! 'ernard uetta<s reports in e ondeA uly 1"/ 19"9 and

surrounding days.

08-

recognition that the states< ar!ed forces are not the or2ers and/ as 4rots2y putit/ an 7i!perative conco!itant ele!ent to Mthe proletariat<sN struggle forliberation.7

&t is critical to in the support of the peasants. 4herefore in specificcountries +ar6ists ill call for a orkers' and %armers' +oernment in theor2ers< state. :e!anding the division of the land by the peasants !ay also benecessary in so!e countries. &n others/ or2er#peasant control over genuinelycollectivi?ed agricultural units ould be possible. &n Poland/ here the Stalinist

i ll d ll f i d i h l l h d

e6cept sloly and under controlled conditions.E 4he spectacle of 7socialist7states lining up at the ban2 to hand over cash seated out of their or2ers is astanding insult to the !e!ory of the 8ctober revolution.

4he debt uestion/ together ith the supra#nationality of the crisis ofStalinis!/ necessitates a further de!and> %ederations o% socialist states$ Asi!ilar de!and/ the 7socialist united states of 5urope/7 as raised by 4rots2yand other revolutionists during the -irst =orld =arF it as initially supported

but later opposed by Lenin on the grounds that it see!ed to call for holdingb 2 i l l i i d i i l 5 id



regi!e alloed s!all#peasant far!ing to predo!inate/ the nely unleashedcapitalist !ar2ets ill ipe out !any peasant holdings. iant corporate far!saided by =estern i!perialist financing ill increasingly do!inate.

evolutionaries !ust defend the dispossessed peasants lest they re!ain tied toreactionaries li2e Cardinal le!p and beco!e tools of a fascist revival.

,!T7R!AT,)!AL,SM

An i!portant de!and not in the original 4ransitional Progra! is torenounce the de(ts oed to i!perialist ban2s and govern!ents. 4he 5astern

bloc countries/ @ust as !uch as those of Latin A!erica/ Asia and Africa/ aresub@ect not only to the i!perialist orld !ar2et in general but also the directsupervision of i!perialist institutions li2e the &+-/ because of their !assivedebts. 4he 'olshevi2s repudiated the debts of the C?ars/ and a revolutionaryor2ers< state today ould do li2eise ith the obligations of their for!ere6ploiters. 4hat principle does not e6clude subseuent diplo!atic agree!ents to

pay the debts in hole or in part in return for concessions by the i!perialists Difdire e!ergency reuiresE.

:ebt renunciation !eans defying capitalist principles and their i!perialistenforcers. 4he depth of the econo!ic crisis in the Stalinist countries and the!isery of the or2ing people shos that such action is necessary for econo!icsurvival. &t ould also help resolve or2ers< illusions in the beneficence of the=est. An avalanche could be loosed if a or2ers< !ove!ent stood up to itsrulers and de!anded that the bloodsuc2ing pay!ents cease. 4hat ould ignitee6plosions throughout 5astern 5urope Dand Latin A!ericaE/ and govern!ents<hands ould be forced. 4he result ould be to disrupt the bourgeois orldecono!y and inspire anti#capitalist actions everyhere.

Such a step ould in reality only be carried out by genuine or2ers< states/

but it !ust still be de!anded of Stalinist and third#orld nationalistgovern!ents. 4he aru?els2is ill never repudiate their debts in principle Dtheyill do so only if bro2eEF that ould !ean attac2ing the principle of property. &tould threaten their national capitalist base in state property @ust as !uch as the

private property of the =est. D-or the sa!e reasons the =estern poers hesitateto press for denationali?ation in the 5ast

bac2 national revolutions in order to aait a si!ultaneous 5urope#ideupheaval.*) 4oday/ hoever/ national revolutions are held bac2 by the fear thatthey ill re!ain isolated. 8n the other hand/ the e6istence of si!ultaneous

crises and si!ultaneous struggles in 5ast 5urope/ although at different levels ofintensity and consciousness/ calls for an internationally coordinated !ove!entand syste! of de!ands. 4here is also every reason to e6pect the crisis tointensify in the =est/ and sooner or later the level of class struggleF this illalso have the beneficial internationalist effect of puncturing illusions a!ongor2ers of the 5ast. aturally er!an or2ers !ust be assured that a unifieder!an or2ers< state is theirs to choose under a socialist federation.

4o counter the poisons of racis! and great#poer nationalis!/ co!!unistsde!and all ri+hts %or immi+rant orkers and sel%-determination %or all

oppressed nationalities$ And to end the great#poer threat that overshadosthe 5astern revolutions/ it is necessary also to a(olish the Warsa Pact andremoe Soiet troops fro! 5ast 5urope and the non#ussian republics in he

,SS. 5ven though they !ay be seen as a benevolent presence because ofillusions in orbachev/ these occupying ar!ies ill be used to crush or2ers<!ove!ents against the provisional govern!ents/ in the interests of =esterni!perialis! as ell as of the local ruling classes. A ca!paign for thesede!ands ould help puncture illusions in the =est as ell. DLi2eise =esternrevolutionists !ust de!and the abolition of A48 and the re!oval of all ,.S.troops fro! 5urope # hich ould also under!ine the =arsa Pact and theSoviet forces.E As 4rots2yists called for an independent Soviet ,2raine in the1930<s/ today e stand for independent orkers' repu(lics united in a socialistfederation.

4here are other 2ey de!ands besides those appropriate for a transitional progra!/ hich e ill not elaborate here. -or years/ the de!ocraticaspirations of or2ers/ intellectuals/ o!en and oppressed nations have beencrushed. 4he proletarian revolution stands for the liberation of all the oppressedand is the only ay to in it. Freedom %or all parties of the


*). Lenin/ 78n the Slogan for a ,nited States of 5urope/7 Collected WorksA Vol. )1/ p.3*).

088

or2ing class and oppressed peoples/ the ri+ht to or+ani3e unionsA %ree speech J all the de!ocratic de!ands are part of the revolutionary progra! as ell. &fthey are not ta2en up by revolutionaries and the or2ing class as a hole/ thede!ocratic slogans ill be detoured de!agogically into props for thestabili?ation of capitalist regi!es.

&n the course of the 5ast 5uropean revolutions of 19"9 it beca!e clear that particular strategic de!ands ere crucial> 7no support to the provisionalgovern!ents7 and 7end the =arsa Pact.7 =ithout the! revolutionists cannotfi ht th l < tt t t l th i t t f it li d d

ritings on the sub@ect cover !any years and illustrate his co!!it!ent torefor!is! in the guise of 7political revolution.7 -irst/ in a particularly e6plicite6a!ple he co!!ents on the proble!s faced by bureaucratic refor!ers hofavor restoring !ar2et !echanis!s in order to !odify the Stalinist !odel of

planning>7As soon as the proble! is seen fro! the standpoint of an efficiently

functioning socialist or2ers< de!ocracy/ the dile!!a in hich the !a@ority ofthe <refor!ers< in the 5ast and their apologists in the =est are trapped ... is

iti t d t it b - th i t f i f th f 2 ifi



fight the rulers< atte!pt to corral the !asses into support for capitalis! and de %acto alliances ith i!perialis!. =ith the! or2ers can see that their allies inthe =est are those fighting to end A48/ not the ruling classes see2ing ays to

preserve it. 4he poers of both 5ast and =est ould prefer to see Soviet troopsready to suppress any sign of 7instability7 # that is/ independent or2ing#classuprisings.

4he intensifying !ove!ent for !ass e!poer!ent throughout the 5astChina !a2es !uch !ore of 4rots2y<s 4ransitional Progra! applicable directlyor in closely parallel for!s. &n raising these de!ands it is irrelevant hetherthe syste! can afford to grant the!. 4rots2y noted> 7&f capitalis! is incapableof satisfying the de!ands inevitably arising fro! the cala!ities generated byitself/ then let it perish. <eali?ability< or <unreali?ability< is in the given instancea uestion of the relationship of forces/ hich can be decided only by thestruggle. 'y !eans of this struggle/ no !atter hat its i!!ediate practicalsuccesses !ay be/ the or2ers ill best co!e to understand the necessity of

liuidating capitalist slavery.7*3 4he orsening conditions and decisivestruggles facing the or2ers of the 5astern bloc !a2e this revolutionary

progra! all the !ore urgent. 4he absolutely necessary condition for the victoryof the or2ing classes over capitalis!/ ar and barbaris! is the building ofrevolutionary proletarian parties throughout the region. As 4rots2y rote/ 7the

present crisis in hu!an culture is the crisis in the proletarian leadership.7 Goright he asO 4oday there is not yet a visible alternative to the !iddle#classdo!inated left and the right#inRr populists appealing to the or2ing class. oris there an internationalist pole of attraction against the fla!es of nationalis!.4he solution can only be the re#creation of the orld party of socialistrevolution/ the -ourth &nternational.

D7M)CRAC# VS R7V)L=T,)!

4o clarify the revolutionary progra! under Stalinis! e contrast it ith the progra!!atic vies of the +andel and Cliff tendencies. +andel<s


*3. 4rots2y/ The Transitional Pro+ram .../ p. 11(

vitiated at its base. -ro! the point of vie of the !ass of or2ers/ sacrificesi!posed by bureaucratic arbitrariness are neither !ore nor less <acceptable<than sacrifices i!posed by the blind !echanis!s of the !ar2et. 4hese

represent only to different for!s of the sa!e alienation. 5ven hen certainsacrifices are ob@ectively inevitable/ they lose their bitterest edge only henthey are the result of free debate and !a@ority vote/ that is/ hen they are freelyconsented to (y the proletariat as a hole$

74he real anser to this false dile!!a then is neither overcentrali?edand overdetailed planning on the Stalin !odel/ nor too fle6ible/ toodecentrali?ed planning along the lines of the ne ugoslav syste!/ butde!ocratic#centralist planning under a ne national congress ofor2ers< councils !ade up in its large !a@ority of real or2ers. D4hisshould be assured by setting a !a6i!u! inco!e for the great !a@orityof the !e!bers of this congress so as to prevent the or2ers< councilsfro! being essentially represented by bureaucrats.E 4his congress ould

choose a!ong different planning variants and the !a@ority of its debatesould be public and ith an opposition present. 4he planning authorities

ould be strictly subordinated to it.7**

+andel situates hi!self here as a critical adviser to refor!ing bureaucrats/not as a class ene!y dedicated to overthroing their state. Gis argu!ente6poses the true !eaning of 7de!ocracy7 # even hen e!bellished as7or2ers< de!ocracy.7 =hy are or2ers< congresses a good ideaH 'ecause theyseeten the sacrifices the rulers de!and of the or2ersF they give the or2ersthe opportunity to 7freely consent7 # to hat the rulers have already decided forthe!/ as alays happens in !ass de!ocracy in class society. Li2e Shacht!anand all liberal capitalists Dand in contrast to reactionary national capitalists/including 7hard#line7 StalinistsE/ +andel understands that an econo!y or2s!ore efficiently if or2ers are given a say in production and feel that they havea sta2e in the syste!.

+andel<s progra! !i!ics the bureaucrats< goal of a socially engineered


**. +andel/ 75cono!ics of the 4ransition Period/7 in +andel/ ed./ 7i%ty Hears o%

World eolution D19("E/ pp. )"$#(.089

societyF he adds a left tist only to incorporate the or2ers. Ge accepts the7ob@ective inevitability7 of sacrifices/ hether reuired by the !ar2et or by the

plannersF he !erely suggests that they not be i!posed but obligingly voted for.Li2e his plan for structurally refor!ing traditional capitalis! DChapter (E/ this

progra! is identical in spirit to 'ernstein<s anti#revolutionary revisionis!.4here is no reason hy a liberal folloer of orbachev could not adopt+andel<s teachings.

Significantly/ +andel e6plicitly per!its the bureaucracy<s continuedi t h l d i th t it t b hi d th :i t ti +

having the right to veto candidates.7*$

+andel ignores the reality that orbachev<s Soviets are parlia!entary bodies for the privileged classes/ not or2ers< organi?ations of struggle. 'ystressing the legalities of de!ocracy/ he in effect pro!otes 7structural refor!s7DChapter %E and denies the need for revolution. Gis absurd !ethod evenassu!es that real or2ers< poer ould allo the continued e6istence of theJ'/ the Stalinist secret policeO

Si!ilar progra!s have co!e fro! +andel<s ,nited Secretariat in practice.: i th P li h h l f 19"0 "1 it i t i d li f iti l t



e6istenceF he only advises that it operate behind the scenes. :istorting +ar6/ho learned fro! the Paris Co!!une that officials !ust be paid no !ore thans2illed or2ers/ +andel prescribes an unspecified !a6i!u! inco!e for the

congress maLority only/ leaving the !inority of officials represented ith their bureaucratic poer and privileges intact. e@ecting 4rots2y/ ho advocatede6pelling the bureaucrats fro! the or2ers< Soviets/ +andel allos the! tostay. 4his as not a !inor point for 4rots2yF it is !eant to ensure that thecouncils ould be or2ing#class organs independent of the bureaucrats.

4here is another serious ualification to +andel<s 7de!ocracy.7 ot onlyould a fraction of the congress be non#or2ers/ not only ould they not havetheir inco!es held to the or2ers< !a6i!u!/ but only 7the maLority of itsdebates ould be public and have an opposition present7O 4hat is/ the

bureaucratic !inority plus its supporting layer of aristocratic or2ers ould bealloed to e6clude the opposition fro! crucial decisions. ote finally that+andel observes that the sacrifices de!anded by !ar2et and bureaucracy

7represent only to different for!s of the sa!e alienation.7 Although alienationof the laboring classes is a general pheno!enon of class society/ or2ing#classalienation is specific to capitalis!. &t arises along ith the e6istence of private

property held separate fro! the proletariatF it is a product of the capitalist for!of e6ploitation that 7frees7 the or2er fro! the !eans of production. atherthan seeing alienation co!ing fro! a capitalist production process/ +andelignores the significance of his on observation in order to advance ade!ocratic progra!. 4he general propositions advanced by +andel in the pastare brought to fruition in his reco!!endations for orbachev<s ,SS. 4a2ingup the revived Soviets/ for e6a!ple/ +andel rites>

7eal Socialist de!ocracy/ real e6ercise of political poer by theor2ing !asses/ genuine soviet poer are inco!patible ith the single#

party regi!e. 4he Soviets ill beco!e sovereign and real organs of<popular poer< only hen they are freely elected/ only hen they arefree to decide on political strategy and political alternatives. All of this

presupposes the e6istence of as recogni?ed legal opposition ... . &t also presupposes the right of or2ers and peasants freely to elect those ho!they ish to elect... ithout the party/ not to spea2 of the J'/

:uring the Polish upheaval of 19"0#"1 it !aintained a line of uncritical supportfor the refor!ist =alesa leadership. 'ut e ill loo2 !ost closely at its recipesfor the Chinese !ove!ent in the revolutionary spring of 19"9. 4o start/ the

Gong Jong @ournal cto(er eie rote>7Political revolution !eans the overthro of this parasitic bureaucracy/the abolition of its privileges/ and its replace!ent ith true people<s

poer # !eaning the or2ing class/ s!all peasants/ independenttraders/ and the honest ran2#and#file ele!ents of the party.7*(

'ut if the 7political revolution7 !eans poer to a !ulti#class !elange ofor2ers/ peasants/ petty#bourgeois and 7honest7 party officials/ then it has littleto do ith proletarian revolution. =or2ers< poer reuires not an abstractde!ocracy for all classes but a state built on political privileges for theor2ing class. &n China above all/ here the peasantry is still "0 percent of the

population/ a classless de!ocracy # 7people<s poer7 #ould give electoraldo!ination to the petty bourgeoisie. And real poer ould rest in the hands of

the bureaucratic capitalists.4he Gong Jong#based Chinese evolutionary Co!!unist Party had the

sa!e line> 7=e call on the people of all classes to for! a self#governingorgani?ation against the bureaucratic suppression and to sei?e political poer

for the advance!ent of socialis! in China.7*% 4his conscious avoidance oforkers' revolution co!es right after urging the or2ers to for! co!!itteesfor a national general stri2e. A general stri2e as necessary as a defensiveaction and a step toard increasing or2ers< consciousness of their strengthand capacity to run society. 'ut to call on or2ers to si!ply stri2e and on7people of all classes7 to ta2e political poer is a recipe for using the or2ingclass as a battering ra! for non#proletarian social forces.

&n the sa!e spirit/ the +andelites< on state!ent called for 7thereplace!ent of the bureaucratic regi!e by revolutionary de!ocratic insti#


*$. +andel/ #eyond Perestroika D19"9E/ p. ").*(. Socialist <ctionA uly 19"9.*%. 7Letter to All Citi?ens of China/7 +ay )1F #ulletin in e%ense o% ar!ismA uly#

August 19"9.

01:

tutions/ designed to guarantee the self#organi?ation of the !asses andde!ocratic planning of the econo!y7 # ith no concrete !ention of the needfor revolution or of sei?ing state poer. 4he slogan 7:on ith the

bureaucratic dictatorshipO7 and the call for 7replace!ent7 of the bureaucraticregi!e ere vague enough to be acceptable to party refor!ers. *"

-urther confusion as added by the 7Letter to +e!bers of the ChineseCo!!unist Party7 ritten by the Chinese evolutionary Co!!unist Party>7=e call on all CCP !e!bers ho are real fighters for co!!unis! to resignfro! the CCP to @oin in the people<s struggle to assist in the organi?ation of the

orthodo6ists. 7Post#capitalis!7 isn<t so 7post7 after all.

RA!? A!D &,L,SM VS R7V)L=T,)!

4he Cliffite &nternational Socialists< strategy against Stalinis!/ based on itsran2 and filist !ethod DChapter %E/ is oriented toards bac2ard consciousnessithin the or2ing class. As ith the +andelites/ the Polish or2ers<!ove!ent of 19"0#"1 posed a progra!!atic test.

4here as a crucial @uncture in the fall of 19"1/ hen Poland as on theedge of econo!ic collapse and a giant stri2e ave as under ay =alesa



fro! the CCP/ to @oin in the people<s struggle/ to assist in the organi?ation of the people/ and in this ay to build a ne political party hich ill lead Chinatoard the advance!ent of socialis!.7*9 Gere not only are the or2ers

forgotten but !e!bers of the ruling party are called upon to lead the ay. DAndnot @ust toard socialis! but toard its 7advance!ent/7 as if socialis! alreadye6ists.E

4he ,nited Secretariat also bac2handedly supported the various provisionalgovern!ents in 5ast 5urope by tailing oppositional bodies Dthe Polish PPSK:/the 5ast er!an ,nited Left/ the Left Alternatives in Gungary andC?echoslova2iaE hich/ hoever critical of the post#Stalinist regi!es/ refuse toopenly oppose the provisional govern!ents.$0 Li2e the Stalinists hoseecono!y produces no goods to offer rebellious or2ers/ the pseudo#4rots2yistloyal oppositionists have but one suggestion> Let 4he! 5at :e!ocracy.

&t has alays been true that the notion of defor!ed or2ers< states hasnothing to do ith the real or2ing class/ either as the !a2er of the revolution

or as the ruler of the state. o that these regi!es are foundering and theuestion of hat replaces the! is i!!ediately on the agenda/ the 7orthodo67conception of a political revolution is also in uestion. -or 4rots2y it asintended to overthro the bureaucracy and transfor! the degenerated or2ers<state into a genuine one. 'ut today the 7antibureaucratic revolution7 turns out to!ean no revolution at all but a replace!ent of bureaucrats at the top by neones ith a greater popular !andate. All that is de!anded to overco!e

bureaucratic degeneration is a de!ocratic refor! # hether the or2ers achieve poer or not.

4he theory of per!anent revolution says that proletarian socialist revolutionis the only ay to carry out the de!ocratic tas2s left undone by the ruling class.&t is profoundly suggestive that this theory/ designed for capitalist and pre#

capitalist societies/ should apply perfectly ell to the 7post#capitalist7 regi!es #and should be so blatantly overloo2ed by the


*". .nternational )iepointA une )(.*9. #ulletin in e%ense o% ar!ismA uly#August/ 19"9.$0. -or a sa!ple/ see .nternational )iepointA :ece!ber 11/ 19"9

edge of econo!ic collapse and a giant stri2e ave as under ay. =alesasearched desperately for a co!pro!ising ay out. 4he 'ritish S=P arnedthat the !asses !ight loo2 to the ruling party for a strong#!an regi!e/ and

countered ith a proposal for the 7radicals7 in Solidarity> 74he alternative ... isfor the radicals to start pressing for the structure of direct or2ers< delegatesthat !a2es up Solidarity to ta2e over the running of society.7 4he delegatescould then adopt an urgent progra! to stop the drain of resources to the

bureaucrats/ +osco/ and =estern ban2ers. Goever/ local control as noanserF !ore as needed>

7M4he progra!N could not be i!ple!ented ithout a co!plete trans#for!ation of society. At the local level it ould reuire the !ost thorough#going struggle for hat the Solidarity radicals call <self#!anage!ent< # in each

plant and office/ the or2ers ould have to sei?e poer and i!pose tightcontrols on the operations of all levels of !anage!ent. 'ut it ould alsoreuire so!ething that the radicals have hardly spo2en of yet # a struggle at the

national level/ to overturn the hierarchies of control in the police/ the ar!y and!inistries/ replacing the! ith direct representatives of the or2ersorgani?ations.7$1 4his agenda accepts the radicals< leadership and their notionsof 7self#!anage!ent/7 not their illusions in a second house of parlia!ent or!ar2et regulation of the econo!y. 'ut/ typically/ the &S<s 7revolutionary pro#gra!7 suggests that the crucial revolutionary !easures can be addedA not

counterposedA to the petty#bourgeois decentrali?ation notions of Solidarity. one of the radical leaders too2 a clear stand in favor of replacing the Stalinistregi!e ith or2ing class poer. -or that !atter/ they didn<t even stand forreplacing the =alesa leadership at the head of the or2ers< on Solidarity. 4heonly ay to consolidate a solid revolutionary current ould have been tosharply distinguish the revolutionary proletarian progra! fro! the radicals<. &f

indeed so!e of the radical leaders had revolutionary potential/ a principledfight ould have been the only ay to in the! fro! their decentralistillusions # as opposed to an appeal based on those very illusions. 4he Cliffitesfailed this tas2 because they the!selves


$1. Chris Gar!an/ Socialist eieA ove!ber 1$/ 19"1.014

conceive of the revolutionary party as an organi?ational netor2 unitingseparate struggles rather than a political alternative challenging all e6istingleaderships of the or2ing class. 4his !ethod ould subseuently guide the!to endorsing or2ers< leaderships far to the right of the 19"1 Solidarity radicals.

&n the late 19"0<s the &S tendency/ li2e the +andelites/ applauded the revivalof the Polish Socialist Party as 7a !a@or victory for the left.7 $) 4he Cliffitesrecogni?ed that 7the PPS does not see itself as a revolutionary party/ but as areborn Polish social de!ocratic party.7 &ndeed/ initial docu!ents of the PPSidentified ith the pro bourgeois Second &nternational and noted that 7the social

process they have called for a stri2e !oratoriu! hich ill ea2en theor2ing class. Solidarity should be trying to strengthen factory

organi?ation in order to build a real poer base.7$$

4he last thing any proletarian +ar6ist could ant is for =alesa/ Juron WCo. to have deeper base in the or2ing class. 4he or2ers already have too!uch faith in parlia!entary Solidarity/ or at least too !uch illingness to givethe ne govern!ent the benefit of the doubt. &t is not @ust the Solidarityleaders< deals ith the CP that are betrayals/ as the S=P suggests/ but their

f i t - i t th t t t b t



identified ith the pro#bourgeois Second &nternational and noted that the socialteachings of the Catholic Church/ and above all the teaching of ohn Paul &&/ are

closer to us than +ar6is!.7$3 4he PPS also endorsed the econo!ic proposals of

the regi!e as ell as Solidarity<s self#!anage!ent.4he &S @ustified its support by citing the PPS<s devotion to class struggle and

the e6istence of its left ing/ hich cohabited as a centrist faction ithin a predo!inantly social#de!ocratic body before brea2ing aay. 4he &S<s uncriticalattraction to 7ran2#and#file7 leaderships led it to endorse an openly refor!istdevelop!ent and then a centrist one/ a policy having nothing in co!!on ith

building a revolutionary party that 7alays and everyhere represents theinterests of the !ove!ent as a hole.7

4he &S<s distorted version of the revolutionary party is a left version of+andel<s centris!. 4hey appeal not directly to refor!ist bureaucrats as do thegrosser Pabloites/ but indirectly/ through the ran2 and file or2ers under theirinfluence. As ith the Pabloites/ the Cliffites< acco!!odation to refor!is! in

the 5ast is a reflection of their policy at ho!e. &n 'ritain the S=P conde!ns therefor!ist 'enns and Scargills for not going far enough # but does notcounterpose an alternative.$* A genuine revolutionary party has to be able toca!paign relentlessly for a political line sharply challenging the refor!istleaders.

Perhaps the !ost egregious instance of the &S tendency<s capitulation torefor!is! through non#confrontation is its attitude toards the Solidar#ityKCPcoalition govern!ent in Poland. =hen the +a?oiec2i cabinet as already inoffice so that there could be no doubt of the Solidarity leaders< class#collaborationist character/ the S=P rote>

74he Solidarity leaders are atte!pting to do deals ith the Co!!unistParty/ but this can only !a2e their old ene!ies stronger. &n the


$). 7Poland> 4he Left 5!erges/7 Socialist Worker eieA une 19"".$3. 7Political State!ent of the PPS/7 .nternational )iepointA +arch )1/ 19"".$*. See Proletarian eolution o. )) for a critiue of the S=P<s strategy during the

great !iners< stri2e of 19"*#"$

on refor!ist progra!. -or co!!unists/ the necessary strategy !ust be toseparate Solidarity<s base fro! its leaders. &!agine Lenin calling on the+enshevi2s to strengthen their factory baseO

As if to prove that this bac2handed endorse!ent of the !iddle#classopponents of Stalinis! as no flu2e/ the &S adopted the sa!e attitude inC?echoslova2ia/ here the opposition as not even lin2ed to the or2ing classas in Poland. 4hey called on the opposition to 7in the loyalty of or2ers7 andto 7press its advantage7 by deepening its lin2s ith the or2ers.7$( ust as thisas published/ the sa!e Civic -oru! entered the govern!ent/ pro!oting thefa!iliar pac2age of 4hatcherKeaganite 7refor!s7 to force the or2ers tosacrifice further. 4o find an analogy to this piece of advice you have to i!agineLenin urging the bourgeois Cadets to build their base in the proletariat.

4hus &S finds itself not @ust enthusing over or2ers< !ilitancy but nofor!ulating strategy for the non#Stalinist partners in the ne provisionalgovern!ents # all capitalist regi!es. 4his conclusion is a logical if not

inevitable conseuence of ran2 and filis!> tail the !asses/ no !atter hat political illusions they !ay have. &t also follos fro! Cliffs theory that nointernal change is possible under Stalinis!. Since restoration of privatecapitalis! is ruled out and since or2ers there have nothing to defend/ anychallenge to the e6isting syste! is good as long as it goes far enough.

,! C)!CL=S,)!

4he bourgeois politicians and pundits ho are croing about the donfallof +ar6is! ill sooner or later have to eat their ords. Victorious !assstruggles are the best teachers of the true nature of class society/ and the crisesthat triggered revolutions in the 5ast are inevitable as ell in the =est. 4herere!ains the uestion of revolutionary leadership.

+andel<s and Cliffs are not the only tendencies to defend pseudo#de!ocratic provisional govern!ents. udging fro! their records/ it is safe tosay that fe of the present left leaderships ill have the capacity to


$$. Andy Iebros2i/ Socialist Worker eieA Septe!ber 19"9.$(. Socialist Worker D,.S.E/ :ece!ber 19"9.

01-

counter opportunis! and the dedication to the proletariat that it ta2es to standfir!.

A useful analogy presents itself. -e 'olshevi2 leaders in 191% could resistsupporting the class#collaborationist Provisional overn!entF it too2 a fight byLenin and his allies/ along ith the or2ers< struggle/ to set the party straight. &nLenin<s place the opportunists ould have tailored the 'olshevi2 line to fit the+artovs and Jauts2ysF the sharp de!arcation/ the absolutely necessaryhostility/ beteen refor! and revolution ould have been buried. =ithout it thefighting or2ers ould have been left to follo ell !eaning but treacherous



fighting or2ers ould have been left to follo ell#!eaning but treacherousvacillators B and the ussian revolution ould have been droned in blood.

&t ill ta2e a si!ilar fight to defeat the !isleaders and in potential

proletarian co!!unists today. All the ould#be revolutionary tendencies in theor2ing class are being tested/ under revolutionary conditions in countrieshere the or2ing class is the !a@ority of the population. 4he crucialde!arcation is the class independence of the proletariat/ the refusal to dronor2ing#class interests in the sa!p of ,nited Lefts/ Left Alternatives and:e!ocratic evolutions. 4hose ho cannot choose the side of the or2ersagainst all their ene!ies and false friends # those ho still see salvation in the

petty pressures of the !ar2et/ the benevolence of liberal de!ocrats or thededication of concerned intellectual planners #ill find the!selves on the rongside of the barricades.

As e pointed out in the &ntroduction/ !iddle#class 7+ar6ist7 theories boildon to the idea that the day of the proletariat is ended. e people/

uncorrupted by the heritage of capitalis!/ have to lead the ay to liberation andeven socialis!. 4he enlightened !iddle class provides the revolutionaryconsciousness that socialis! reuiresF the or2ing class is si!ply the batteringra! for social change. 4oday/ as the revolution against Stalinis! unfolds/!iddle#class ele!ents are bra?enly asserting their right to do!inate. 4he centraltas2 for +ar6ists everyhere is to assist the or2ing classes Dand individualsfro! the !iddle classes ho brea2 fro! radicalis! and learn to see the orldfro! the proletarian vantage pointE in creating their on independentorgani?ations and leaderships.

4he !asses of the 5ast are going through funda!ental transfor!ations intheir lives and orld vies. As 74he &nternationale7 proclai!s/ the 5arth isrising on ne foundations. Gu!an creativity is being reborn in the factories and

!ines/ the suares and streets of the 5ast. 4he producers ill be soon forced to battle their ne rulers. 'efore long they ill also create the leadership theyneed # a internationalist vanguard party dedicated to authentic co!!unis!.4heirs ill be the ne battle#cry of our epoch> 74he old <+ar6is!< is deadOLong live +ar6is!O7

018

Daum - The Life and Death of Stalinism

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Transcript of Daum - The Life and Death of Stalinism