Chris Harman


Bother on the Baltic

(February 1971)

From Survey, International Socialism (1st series), No.46, February/March 1971, pp.5-6.
Transcribed & marked up by Einde O’Callaghan for the Marxists’ Internet Archive.

The riots in Gdansk and other Polish ports just before Christmas were the most significant expression of working class discontent to hit Eastern Europe since the crushing of the Hungarian revolution in 1956.

The immediate cause of these disturbances – a sharp increase in food prices and the introduction of new wage systems – were not just accidents or governmental mistakes. They were deeply rooted in the problems that confront the Polish bureaucracy.

Poland, like all the East European regimes, suffers from a long run tendency for economic growth rates to fall. As reserves of surplus labour and untapped raw material resources are used up, a rational costing of the different sectors of production become necessary. But this is prevented by the form of organisation of the economy (and the accompanying bureaucratic interests). The productivity of labour also becomes more important. But the resentments which workers hold against the system make improvements here – particularly in the most advanced area of industry, and in agriculture – very hard to obtain. (For a fuller description of these points, see Prospects for the Stalinist States in IS 42).

Failure to come to terms with problems, leads to low growth rates and – particularly for the smaller state capitalist regimes massive bottlenecks in industry that can only be overcome by increasing exports. The failure of raw material resources to grow at the same speed as the rest of the economy necessitates the buying of these abroad. Growing technological lag with the west (due to the low productivity in advanced industry) can only be overcome by imports of advanced engineering products. But imports have to be paid for. As the Polish economist Kalecki has put the matter

‘Another obstacle to the acceleration of growth is the difficulty of balancing foreign trade, which is more a problem the higher the rate of’ growth.’

The significance of these factors can be seen by what has taken place over the last few years in Poland (a process predicted in the pamphlet by Kuron and Modzelwski). The five year plan for 1966-70 provided for an expansion of industry (particularly heavy industry, but also arms production which has grown between 8 and 10 per cent per annum recently) in excess of what was possible given the level of resources and the inefficient organisation of the economy. Construction projects which were begun could not be completed. This in turn increased the general lack of resources (since such projects were supposed to supply the rest of the economy). Industry could be kept going only if exports were were raised. Still worse, industrial products which were intended for sale in the west could not find markets because of their low quality (yet another expression of the alienation of workers from production). The overall result was that 60 bn more zlotys than planned had to be spent on investment. Yet only a limited number of ‘selected’ projects were finished.

There was only one way out of this vicious circle: to cut back on the ‘consumption fund’ and use the savings to pay for the needed additional investment. In other words, real living standards of workers had to be cut. Increased prices would lower the amounts of food eaten by workers, enabling greater quantities to be exported to cover import costs.

Simultaneously, the Party leaders were forced to try and put into effect a limited and half-hearted reform. The central aim of this is to make managers more worried about production costs. High among such costs were wages. So ‘wage adjustments’ took place at the same time as price rises.

The riots have had an effect in producing political changes. But it is very doubtful if these will in themselves be of any great benefit to Polish workers. The leader of the authoritarian right, Moczar, who initiated the anti-semitic campaign of 1968, has increased his power. Although the majority of the other new leaders have been called ‘technocrats’ by commentators, it is unlikely that they will in fact do more than initiate a few temporary, palliative measures. For, if the riots have revealed the danger of not dealing with the problems of the economy before it is too late, the Polish bureaucrats (and their Russian backers) are aware of another lesson: that of Czechoslovakia in 1968 (and, for that matter of Poland and Hungary in 1956). Then efforts to put the economy on a sound basis led to the complete fragmentation of the whole apparatus. Carrying out economic reforms required dismantling the whole structure of control over society. But this permitted the mass of the population, excluded from political debate for twenty years, to discuss and agitate in their own interests. The ferment released threatened the very bases of bureaucratic class rule. Russian military occupation was required to kill that ferment.

What is more, the Czechoslovak experience was riot even successful in purely economic terms. Managers gained the freedom to set their own prices and trade with whom they want, but continued to produce expensive goods that nobody wanted. And workers took the freedom to demand decent living standards and working conditions. In 1969 the mass of Czechoslovak bureaucrats showed that they preferred collaboration with the Russian occupiers to these hazards. The society over which they rule has since grown back into the pre-1968 mould. The economy continues to stagnate (the official figures if adjusted to take account of price rises, reveal that there was no economic growth at all last year). The resentment of workers at wage freeze, as well as at Russian occupation, grows. But the leaders, if not happy, at least passively accept the situation. It is the price they pay for keeping the mass of the population under control.

If the Czechoslovak experience shows that reforms are dangerous, other examples indicate that perhaps they are not particularly useful. The Hungarian economy has undergone changes which are much praised by western experts. But it is clear that the Russians are slightly anxious that their own influence might be affected. Such anxiety would be greater were a larger and more important economy than the Hungarian involved. Moreover, recent Hungarian growth rates have been far from spectacular.

East Germany, which has witnessed reforms of a more limited character than those of Hungary, and has also been accordingly praised in the west, has been encountering increasing difficulties recently. Last year industrial production grew at only 6 per cent as against the planned 8 per cent, while the growth of investment, at 7 per cent, was half what was aimed at. This year’s targets have all been cut – planned GNP growth from 6.3 per cent to 4.9 per cent.

The Polish leadership dare not now force local managers to cut wage costs. It will be even more reluctant than previously to undermine the cohesion, and therefore political control, of its own apparatus. It will not want to run the risks involved in transforming the structure of the economy and, therefore of the internal organisation of this apparatus. In shor.t: it will be less willing than in the past to risk carrying through real reform. Yet failure to introduce such changes will mean failure to attempt to solve current problems. Polish state capitalism will not be able to crawl out of its impasse. The possibility does exist of an economic revival for a couple of years. After all, however slow progress, investment projects at present ‘frozen’ will eventually be completed and give a once and for all boost to growth. But the meagre concessions made after the government reshuffle (accounting altogether for only about 4 per cent of total government expenditure) will not lessen the alienation of workers from the productive process, even if they do stave off further physical confrontations for a time. The bureaucracy’s class goals (and Russian pressures) will force it to attempt further levels of accumulation that the economy cannot sustain. Crises of the present sort will recur on an accentuated scale.

The threat of Russian troops might continue to keep the resentment of the workers under physical control, but will not be able to end its deterious impact on production. As in Czechoslovakia, the price of security for the state capitalist system will be increasing stagnation, which will further increase the general alienation of the masses from the system and the difficulties of maintaining control. Within the bureaucracy itself the inner decay – the factionalism unrelated to anything but careerist interests, the ideological bankruptcy that resorts to crude nationalism and anti-semitism – will continue its spread.

All this would be quite depressing, were it not that the same malaise afflicts the Russian gendarme. All the economic – and therefore also political and ideological – contradictions that have come to the fore in Poland and Czechoslovakia are developing, although at a slower pace, in the Soviet Union. The social forces released when these come to fruition could shatter the Stalinist system forever. A year ago we wrote (in IS 42) that the Russian bureaucracy faced the choice between: either an inner-split which ‘could only be the prelude to an immense crisis throughout the USSR and Eastern Europe, in which the extra-bureaucratic classes would mobilise behind their own demands’; or ‘the likelihood of a minor incident causing a massive eruption of working class insurgency, as in Berlin in 1953, Budapest in 1956 or Paris in 1968, but this time on a scale unprecedented in world history.’ 1968 in Czechoslovakia gave the Russian ruling class a bitter foretaste of what was involved in the first alternative. The workers of Gdansk and Stettin have shown how real the second is. As the imprisoned Polish Marxists, Kuron and Modzelewski have written

‘Revolution is a necessity for development ... Revolution is inevitable.’

Last updated on 16 November 2009