Ted Grant

Yugoslavia: The meaning of Tito’s “reforms”

Written: July 1966
Source: Militant, no. 18 (July-August 1966)
Transcription: Francesco 2008
Markup/Proofread: Emil 2008

Great excitement and enthusiasm has been aroused in certain circles by the alleged “democratic” reforms to be introduced by Tito in Yugoslavia. What is the meaning of these “reforms” and what significance do they have for the Labour Movement and the sincere Communists in the so-called Communist Party?

Whether the projected reforms are carried out or not remains to be seen. The suggestion has been made that Tito will “disestablish” and “de-professionalise” the Communist party and sack large numbers of the old bureaucrats who have been in power since the Tito-led partisan army was led to victory and the overthrow of capitalism in Yugoslavia.

According to the Observer report of June 19th: “The real power will be transferred from the Communist party apparatus to the elected bodies already existing of the national, republican and provincial assemblies.” What a shattering change! As shattering as if they decided the official government functionaries would use blue ink instead of black!

A bloodless purge

Stalin in his day, before the nightmarish and bloody purges of the late thirties, introduced what was called “the most democratic constitution in the world”. It deceived such Labour Fabians as Sidney Webb. The only problem was that the reforms remained a dead letter, and a one-sided civil war was waged against those who stood for the principles of the 1917 revolution. Of course no such bloody purge is contemplated in Yugoslavia. But the original idea of Stalin the Bonaparte, the “Leader” or the arbiter between the different sections of the ruling apparatus, managers, army officers, state officials, collective farm managers, and the workers and peasants, was to use the so-called “parliament” of Communist Party and non-party members as a whip against the bureaucracy.

Successes of nationalisation

The basis of the state in Yugoslavia as in Russia has been the nationalisation of all industry, collectivisation of agriculture, the monopoly of foreign trade. On this basis brilliant achievements in planned production were possible, instead of the anarchy of the capitalist market with private ownership of the resources of the nation.

But since the time of the usurpation of power by Stalin for the benefit of the millions of officialdom—the bureaucracy—there has been in reality in all the so-called Socialist States a caricature of socialist democracy, a bureaucratic dictatorship without the control of the workers, peasants and the people generally. The state power has been used to enhance the power, privileges, economic inequality and prestige of the ruling caste of party, army, industry and agriculture. This in its turn, without the check of democratic control, has led inevitably to corruption, waste, nepotism at the top and dissatisfaction and discontent at the bottom.

Yugoslavia can serve as a model for this process, precisely because they were the first to break from the stranglehold of Russian bureaucratic control, only to introduce their version of so-called “building of Socialism in one country”, i.e. in the interests of the Yugoslav bureaucrats. They were quite prepared to manoeuvre in this process between world imperialism and the Russian bureaucracy, and succeeded in getting large sums of money from American Imperialism to sustain them in the process.

Contradictions remain

But like all the other workers’ states, including Russia, they are subject to two processes: the world economy to which all countries are tied, and the contradiction between the economic base and the stranglehold of the greedy and inefficient bureaucrats. Every socialist conscious worker in big industry in capitalist countries recognises the waste, miscalculations, luxury living, and downright inefficiency of the top management of their firms. Every worker in the nationalised industries in Britain for example knows that there too the same thing happens, and is happily commented on by the capitalist press, while they keep silent about what happens in Big Business enterprises. In a country of state ownership these excesses can be multiplied a thousandfold, just because the entire economy is nationalised. On the one hand, this provides the structure for immense economic advance; but on the other hand, with an uncontrolled officialdom, it also results in the snaring up and entanglement of the economy.

The dictator, in this case Tito, balances between the classes and between the different strata of the bureaucratic apparatus itself. At the same time—and this is their only progressive role—they are forced to defend the basis of their power and pomp: the nationalised property against Imperialism or internal reaction. But as the economies of these formerly backward countries have become more and more complicated, the contradictions have multiplied. Tito has zig-zagged in policy, like Stalin and his successors, between different sections of the bureaucrats, and different economic policies, in a vain endeavour to overcome the contradictions created by a plan without the genuine participation of the people, and the pressures of the world economy. Yugoslavia is a small country and to talk of building “Socialism” there “alone” is ludicrous. The so-called workers’ management and workers’ control is a bureaucratic farce, worse than the rigged elections which have taken place by both the right wing and the Stalinists in the unions in Britain. But, here, at least there were different sets of candidates. In the one-party state only one list is permitted in elections, whether in the “unions,” factories, or “parliament.” The whole system is “rigged,” so the change from Peter to Paul does not make much difference.

Policy due to crisis

It is the economic crisis—different to capitalist crisis—which has caused Tito, the Yugoslav boss, to change course. In the last year Yugoslavia has felt more and more the pressures of the world economy, and the slowing down of economic progress, due to the mismanagement of the élite who rule in the state and industry. Last year a drastic devaluation of the Yugoslav currency, the dinar, took place; twice within a month. The former rate of exchange was 2,100 dinars to the pound, this was changed in July 1965 to 3,500 dinars to the pound. This was a vain attempt to halt the inflation and the growth in prices which hit the workers and peasants hard, particularly in the less developed republics of Yugoslavia. The cost of living rose by a quarter, while that of agricultural products increased by nearly a third. Prices of cigarettes, bread and sugar, rail and road transport went up by from 20 percent to 50 percent. Unemployment has made its appearance. 200,000 workers have emigrated and 200,000 more have become unemployed. When the size of the populations are taken into account, this is the equivalent of a million unemployed in Britain.

Industrial employment was down by 2 percent in January 1966, though production was up by 4 percent in comparison with last January.

An example of the bureaucratic contradictions which this involves is quoted approvingly in the Financial Times of June 29th, 1966: “The Rade Koncar Electrical Plant is carrying out a £31 million modernisation plan… Rade Koncar is having to keep down its wages in order to find money for the investment, and the result is that the workers are actually tending to earn less than workers in the less go-a-head enterprises.”

The so-called reform of giving more initiative to the individual managers of the factories has failed miserably to solve the problem of maximum economic growth. Yugoslavia was compelled to get a loan from the International Monetary Fund. It is true that even under these adverse conditions, economic growth has been extremely high, in comparison with capitalist countries. Between 1955 and 1964 the increase was nearly 180 percent. Compare this with the Lilliputian figures of the capitalist countries of the West, and especially of the underdeveloped countries (of which Yugoslavia was formerly one), and the benefits of even a mangled or corrupted nationalised economy are thus obvious: just as even the most bureaucratically and undemocratically controlled union is better than an unorganised industry.

Even last year the Times reported, as late as November 11th, that “the question of who is responsible for the sorry state of the national economy is now being asked openly and bluntly, and confidence in the regime put to the test in a way unheard of in a Communist country.” Tito, like Stalin before him is shifting the blame onto one set of bureaucrats while leaning on another. The basic system remains the same.

Socialist democracy [and] international[ism]

This can only postpone the problem. What is required in Yugoslavia is a system of genuine workers’ democracy, with participation and control by working people themselves, with full rights of free speech and discussion, genuinely independent trade unions to defend the state, and to defend the workers from the state, i.e. a full Socialist democracy. With the genuine control and participation of the workers, excesses could be eliminated and at the same time, if all strata of the population were involved democratically in formulating a centralised and de-centralised plan, the economy should be able to take even greater steps forward than in the past. But just like the capitalists, the privileged caste will not give up without a struggle, and Hungary in 1956 showed how the workers will ultimately react.

But even the building of one really democratic Socialist state could not solve the problem. What is required, first and foremost, is a Socialist Federation of the Balkan peoples, with one plan of production for the whole area, as a step towards a Socialist United States of Europe.

Instead of this, the bureaucracies of all these countries are appealing to the worst forms of nationalism, even against one another. Not “National” Socialism or so-called “National” Communism can solve the problems of these countries but only Socialist Internationalism.