From Socialist Review, 16 May-14 June 1981: 5, pp.25-27.
Transcribed & marked up by Einde O’Callaghan for the Marxists’ Internet Archive.
The last weeks of April saw unaccustomed quietness on the industrial front in Poland. The regime has clearly still been on the defensive since the huge success of the warning four hour general strike of 27 March. But the feeling of intense crisis has not gone from the country. The bankers have been told that Poland cannot pay its debt repayments – and only their forbearance prevented a formal declaration of bankruptcy a fortnight ago, and now there is intense agitation within the Communist Party as preparations are made for a special congress in the summer against clear signs of Russian disapproval. Chris Harman looks at the significance of these two sets of developments.
Many commentators in the West now see the calling of a Communist Party Congress in the summer as the answer to the Polish crisis. They are wrong. Those who rule Poland cannot solve its crisis on their own terms unless they can first defeat the independent trade union movement. Nevertheless, the agitation developing inside the party is of immense importance.
It is usual to say that the Communist Party runs Poland and the other Eastern states. If you believe that, then naturally you believe that the Party congress can bring about a fundamental change in society.
But in fact it is not the party that rules, but a relatively small group of people at the top, not only of the party, but also of the other bureaucratic structures that dominate the society – the government ministries, the state economic planning mechanism, the police, the armed forces. The party is a mechanism of their rule (and of their protectors in Moscow) – perhaps the most important mechanism – but it itself does not rule.
At its highest level the party is a meeting place for the top people in the different sections of the bureaucracy. Through the politbureau (in some countries called the presidium) and the secretariat they get together, hammer out the policies that suit their goals of international military and economic competition, and choose the personnel who they think will pursue these goals at lower levels in the bureaucracy. It is here, too that decisions are made as to who will head the government, the armed forces, the economy, the .police, the party itself.
But at its lower levels, the party is also a means for integrating other social groups into acceptance of the needs of the central bureaucratic rulers. It is run by the ruling class, but its membership includes people from all other classes.
It recruits members of these classes so as to encourage them to argue for its goals among those they work and live with. In return it offers them certain rewards – material rewards once they climb up beyond a certain point in the party (better promotion prospects in industry, a greater chance of getting decent housing, access to the better schools and colleges for their children). But it also offers them rewards of a not directly material sort – in the party people can mix with their ‘betters’, or can feel that somehow they are contributing to building society. So the party recruits not only self-seekers, but a certain breed of do-gooders.
In this, of course, the Communist Parties of Eastern Europe are by no means unique – the reasons people join them are not all that different to the reasons people join, say, the Christian Democracy in Italy or the Democratic Party in the cities of America. All of these are ruling class parties which seek to mobilise popular support for their goals.
The only difference with the East European parties is that in normal times, there can be no real argument among those at the bottom as to the directives issued from above – expulsion is the instant remedy for those who argue too much, and if that does not work, there are always the political police.
The party acts as a powerful controlling mechanism because to get on in any sphere of life, you have to join it. And once inside you have to defend the decisions made at the top. So if you are a factory worker, you can certainly suggest through the party how productivity can be raised by you and your mates working harder – but most of the time your job is not to suggest, but to listen to instructions on how to agitate to achieve the goals of management.
But the real importance of the party probably lies in the mechanisms for control over the ‘middle layers’ of society – the managers, technologists, journalists and so on who have themselves to determine the actions and ideas of those below them. Journalists for instance, need to have a certain freedom to decide themselves what they write if it is to be convincing to workers, yet also have to be bound in to the needs of the regime. This is achieved by making any progress inside a newspaper office dependent on taking a party card, and any progress inside the party dependent upon zeal in fulfilling the goals of the party leaders.
A hierarchy of bodies bind those non-ruling class party members to the top bureaucrats – branches, local committees, and, just below the top, the Central Committee. The full-time officials who run these bodies are appointed by the party secretariat under the so-called Nomenklatura system.
The whole structure is self-perpetuating: the secretariat chooses the branch and area officials; these then select who enters the party, determine who will receive promotion and special favours, and choose the delegates to congresses; the congress in turn elects a new Central Committee on the basis of recommendations from the secretariat and politbureau, the Central Committee then selecting the politbureau and secretariat. In this way, a vast system of transmission belts ensures penetration by the top bureaucrats of every level of society.
In normal times the structure seems all-powerful. It can work with immense success to ruin the job prospects and careers of anyone who opposes the top bureaucracy. Only a very small hard-core of determined dissidents will risk being squeezed right out of their jobs by continuing resistance to the regime.
But there are two ways in which the mechanism can jam.
The first is when the top bureaucrats in the politbureau and secretariat cannot agree among themselves on what needs to be done to maintain international competitiveness and control over the rest of society. Each side in the disagreement is forced to appeal to the slightly lower level bureaucrats of the Central Committee to settle the differences. But an argument which rages among a couple of hundred people is not always that easy to keep quiet. For instance, some of the politbureau and Central Committee members may decide to use their control over the security forces to quieten their opponents (this happened in Russia when Khruschev fell out with ‘the anti-party group’ in the late 1950s; it happened in Czechoslovakia early in 1968), and others may respond by using their control of the press to mobilise ‘public opinion’ in their defence.
In such situations, the transmission belts cease to function for a period, and first members of the middle layers, and then workers, can begin to organise in their own interests.
A second sort of breakdown occurs when there is a mass spontaneous movement below, against the whole structure of bureaucratic control – as in Hungary and to a lesser extent in Poland in 1956. In that case, the party members suddenly find themselves isolated in the factories and the offices and respond by isolating the most dedicated supporters of the top bureaucracy within the party bodies themselves: The transmission belts begin to snap under the tensions created.
In Poland today we are witnessing a complex interaction of the two forms of breakdown. Last summer saw the upsurge of the mass spontaneous movement from below, culminating in the consolidation of Solidarity (and now rural Solidarity) as an organisation completely apart from the transmission belts. The party made a last effort to use its disciplinary powers over its members to get them to stop March’s four-hour general strike. Their refusal to comply showed that its transmission belts in the factories had snapped completely – instead of party members damping down their workmates they abandoned the party (200,000 people have left it in six months).
Of course, the regime still has considerable power – it still controls the planning mechanism, the police, the army, the prisons etc. But it knows that the forces it controls are enormously isolated from every other social group. And this at a time when its goal of restoring the competitiveness of the national economy cannot be achieved without forcing or persuading the population at large to accept big cuts in living standards and high levels of unemployment.
It was this isolation which led the Central Committee meeting late in March to opt for a party congress to reform the party.
What this really amounts to is an attempt to get the middle layers – the managers, technocrats, journalists – to identify with the reforms suggested by the top bureaucracy as the way out of the economic and social crisis. In return for acceptance of these reforms, sections of the middle layers are offered a new say inside the structures of the party. The most disliked and the most corrupt officials are to be replaced by new blood which has much greater support in the localities. To this end, the delegates to the congress are to be chosen on a much more open basis than in the past.
A reinvigorated party will then be able to impose austerity on the rest of the population in the interests of restoring the international competitiveness of the economy, in a way that is impossible at the moment.
That, at least, is the aim of Kania and his, circle. That is why they have been permitting things which would have been inconceivable six months ago – like meetings of party activists outside the ambit of the official structures.
But there is one big problem with any such scheme. Rather than overcoming the isolation of the top bureaucracy, it can deepen it.
On the one hand, those under attack as delegates are chosen for the special congress will be the only group within the middle layers it can rely upon for support – those who have feathered their own nests through wholesale corruption and systematic bullying.
On the other, once debate opens in the party, the vast mass of previously passive party members in the factories and countryside can begin to raise their voices, reflecting the impact on them of the immense prestige of Solidarity and the experience of months of massive struggles. Under such circumstances, still more of the party’s transmissions belts can snap. This is why the Russians are so worried about the party congress.
A party constituted to run society for the top bureaucrats cannot initiate the fundamental revolutionary change that is necessary if Poland is to escape the crisis without massive suffering to the working class. But its congress can serve to emphasise just how isolated and inept the old rulers are. It could be just one more nail in their coffin rather than the kiss of life which they need.
‘Spiritual bankruptcy, long tolerated, verging towards economical bankruptcy, becomes intolerable’.
Thomas Carlyle’s comments on the unleashing of the forces that produced the great French revolution of 1789-95 sum up precisely the situation in Poland today. Economic crisis has been the midwife of social and political upheaval.
In a document presented to Western bankers last month the Polish regime spelled out the scale of the crisis. (Details published in The Times, 16 April 1981). It warns that
‘Despite plans for rigorous austerity programmes at home, the country’s foreign debt will continue to rise until the end of 1985, when it will amount to £15,700m.’
This year ‘severely restricted’ imports will still cost $700m more than export earnings – and on top of this some billions have to be found to pay interest on debts.
The ‘austerity’ designed to cure this crisis is what we would call in the West a Thatcherite slump.
There will be ‘a deep deterioration’ of economic activity this year leading to a nine per cent fall in the national income. This will involve ‘some reduction in employment’.
’We have to realise that a certain number of people will not be able to find new jobs.’ Alongside this there will be a general reduction in living standards (a ‘very painful operation’) to be brought about by ‘widespread increases in prices, including prices for essential foodstuffs.’
Between this year and 1983 ‘900 mainly big and medium investment projects’ will have to be suspended – forcing their workers (700,000 or 800,000) to look for new jobs.
It is the sheer scale of this crisis and of the ‘sacrifices’, needed to pay off the bankers that lies behind the economic reform programme being floated by the regime.
The outline of one version of economic reform was published by the Polish regime early in January to be introduced in three stages starting in the early summer (details in Financial Times, 13 January 1981).
The basic idea is that factories should cease to be dictated to by the central planners, and that instead each enterprise should decide on its own production targets and find its own finance for achieving these, ‘profitability would be the measure of a factory’s efficiency’.
The link between enterprises would be the market – which, as the Polish currency became convertible, would also be the link with suppliers and buyers abroad.
For an interim period enterprises would, however, be forbidden to undertake new investments – apart from those which would increase food production, help production and exports of raw materials and introduce energy saving technology.
The reform has been compared to that operating in Hungary for a number of years now. But in one important respect it goes further than that – it talks about ‘workers’ councils’ playing a key role in the factory, as in the Yugoslav system. These would have ‘control over the factory and its administrators’, with powers over ‘production planning’, the determination of ‘promotion, bonus payments and profit distribution’, being able to propose candidates for directorships and to recommend directors’ ‘dismissal by higher authorities’.
A close look at the reform proposals, however, shows two things: that the workers’ democracy would be a sham, and that the reform would be unlikely to deal with the fundamental faults in the economy from a workers’ standpoint.
First the sham. The workers would have powers which were restricted to questions of collaborating with management in the operation of the enterprises inside a tight, unchallengeable external framework. To keep the enterprises in business, they would have to keep their costs competitive, which would mean keeping tight control over their wages and productivity. Full competitiveness would involve buying machinery based on new technology – but that would mean raising the funds by ploughing nearly all profits back into the business and borrowing from the banks. The banks in return would demand a controlling power over the enterprise: the situation would be like that in Yugoslavia, where the central banks control 50 per cent of industrial assets despite the pretence of ‘workers’ control’ (figures in Economic Intelligence Unit Quarterly Report on Yugoslavia 1971/2).
The Polish draft reform proposals spell out, in fact, that for ‘large industrial trusts containing several factories’ there are to be ‘supervisory boards containing delegates from banks, suppliers, consumers and workers councils’. In fact, the only power the workers would end up with would be that of tightening their own belts and sacking their own colleagues at the banks’ behest.
This is very much in the minds of various managers who have expressed support for the reform.
For example, a mines director in Silesia told the Financial Times:
“I’m for a joint worker-management board, if they assume responsibility by remembering that they are the co-owners of the means of production.” (23 January)
Most of the enthusiasm for the economic reform proposals comes from sections of intellectuals and managers. They see reform as a way to draw the workers’ movement into pushing their schemes for overcoming the irrationality of the economy.
The prevailing attitude of this milieu to the present economic set-up was revealed very clearly in a series of interviews with intellectuals and specialists carried out two years ago (The Report on the State of the Republic). One respondent put it:
‘We are faced with sham planning and sham implementation of plans.’
Another spelt out that:
‘In the real social and economic world there is no such thing as “the central planner”. What we are dealing with instead is a heterogenous amalgamation of central institutions which employ a wide range of different standards in arriving at their decisions ... We know very little about how the centre does its work or the way in which it drafts and adopts strategic economic decisions. ... Many professional economists and economic policy makers are unable to come up with any answers to these questions ...’
The overall impression that emerges is one that seems, on the face of it, favourable to defenders of the ‘free market’ in the West. ‘Central planning’ has produced apparently irrational structures, characterised by random decision making, immense waste and complete stagnation. So convincing does such an argument seem that it has even taken in a whole number of Western Marxists (like the people around the journal Critique in this country) who see the Eastern states as completely new forms of class societies which are intrinsically less dynamic and probably less progressive than capitalism.
Yet any such view ignores the most basic fact about the Eastern states – that it has been competition, albeit at an international level, which has produced the present chaos inside the economy. The rulers of all these countries have sought to impose on the rest of the population fantastically high levels of accumulation so as to have the means to survive in economic and military competition with the West and with China. All the irrationality within the economies can be seen to flow from the attempt to sustain a scale of accumulation beyond the resources of the various countries.
It is this which leads to ‘tension’ within plans, to continual shortages of key raw materials and components, to the continual switching of the orders given to factories as to what to produce, to huge sums being spent on investment projects that cannot be finished, to bullying of managers by planners and cynicism towards planners by managers, to a general inability to work out what is the real cost of producing goods in terms of labour and materials. It is the continual drive to over-accumulation that produces the chaos.
These trends seem absurd if the economy is looked at in isolation. After all, unless the central planners are mad, they cannot want such chaos. It is easy to draw the conclusion that these effects are inherent in the attempt to plan, and that the profit motive and market could not do worse. However, it all makes sense the moment you see the Polish ruling group as part of a world system, constrained to accumulate as fast as possible – indeed, faster than possible – on the one hand by the need to compete in Western markets to sell goods and pay off debts, on the other by the pressure to contribute to the expansion of the Russian arms economy.
The most wasteful features of the Polish economy are not unique. The unfinished investment projects are not really all that different to the brand new steel mills that British Steel has working at less than 50 per cent capacity. The useless goods that are turned out have their match in the most expensive product of the British aerospace industry in the last 15 years – the Concorde-folly which can only fly at a loss. Delorean, a former top General Motors manager, has written a book about the world’s largest private capitalist firm that shows that things within it are not so different from the state capitalist firm of Poland Inc.: he describes massive planning mishaps, bullying executives giving arbitrary instructions to plant managers, continual switches in production schedules, massive wastes of resources, general cynicism.
All these forms of waste and irrationality are a product of a world system, in which the individual units – individual firms or whole economies – are motivated only by competition with one another. But if that is so, reform within the Polish economy cannot solve its problems on more than a very short term basis.
So what can economic reform achieve?
All it can really do is operate as a cover for attempts to solve the Polish crisis at the expense of workers. Whole sections of the Polish economy, must be sacrificed while others are given the chance to forge ahead (although, in the context of world recession that too can be just a pipedream). But if you sacrifice sections of the economy, you sacrifice the workers employed there. The slogan of reform can make that easier – with workers’ council participation in management providing a means by which workers in ‘successful’ enterprises are turned against those that are chopped.
Last updated on 15 May 2010