To understand what, in fact, the “market question” consists of, it is best to compare the Narodnik and Marxist conceptions of the process illustrated by the diagram (showing exchange between the capitalists of sphere A and the direct producers of sphere W) and by the table (showing the conversion of the natural economy of 6 producers into capitalist economy).
If we take the diagram we get no explanation at all. Why does capitalism develop? Where does it come from? It is represented as a sort of “accident”; its emergence is attributed either to “we took the wrong road”.., or to ‘implantation” by the authorities. Why do “the masses become impoverished”? This again is not answered by the diagram, and in place of an answer the Narodniks dispose of the matter with sentimental phrases about a ‘Lime-hallowed system,” deviation from the true path, and similar nonsense which the celebrated “subjective method in sociology” is so good at inventing.
The inability to explain capitalism, and preference for utopias instead of a study and elucidation of reality, lead to a denial of the significance and strength of capitalism. It is like a hopeless invalid who has no source from which to draw strength for development. And we shall introduce into the condition of that invalid an insignificant, almost impalpable improvements if we say that he can develop by producing “means of production as means of production.” That requires the technical development of capitalism, and “we see” that precisely this development is lacking.. For that capitalism must embrace the whole country, but we see that “it is not possible for the development of capitalism to become universal.”
If, however, we take the table, neither the development of capitalism nor the impoverishment of the people will appear to be accidental. They are necessary concomitants of the growth of commodity production based on the division of social labour. The question of the market is entirely eliminated, because the market is nothing other than the expression of that division of labour and commodity production. The development of capitalism is now seen not only as a possibility (something the author of the paper would at best have proved), but also as a necessity, because once social economy is based on the division of labour and the commodity form of the product, technical progress must inevitably lead to the strengthening and deepening of capitalism.
The question now arises: why should we accept the second view? By what criterion is it correct?
By the facts of contemporary Russian economic reality.
The pivot of the table is the transition from commodity- to capitalist economy, the differentiation of the commodity producers into capitalists and proletarians. And if we turn to the phenomena of the contemporary social economy of Russia we shall see that the foremost of them is precisely the differentiation of our small producers. If we take the peasant agriculturists, we shall find that, on the one hand, masses of peasants are giving up the land, losing economic independence, turning into proletarians, and, on the other hand, peasants are continually enlarging their crop areas and adopting improved farming methods. On the one hand, peasants are losing farm property (livestock and implements) and, on the other hand, peasants are acquiring improved implements, are beginning to procure machines, and so forth. [Cf. V. V., Progressive Trends in Peasant Farming.] On the one hand, peasants are giving up the land, selling or leasing their allotments, and, on the other hand, peasants are renting allotments and are greedily buying privately-owned land. All these are commonly known facts, established long, long ago, the only explanation of which lies in the laws of commodity economy, which splits our “community” peasants, too, into a bourgeoisie and a proletariat. If we take the village handicraftsmen we shall find that in the post-Reform epoch not only have new industries emerged and the old ones, developed more rapidly [the result of the differentiation of the agricultural peasantry just mentioned, the result of the progressing social division of labour ], but, in addition, the mass of handicraftsmen have been growing poorer and poorer, sinking into dire poverty and losing economic independence, while an insignificant minority have been growing rich at the expense of that mass, accumulating vast amounts of capital, and turning into buyers-up, monopolising the market, and in the overwhelming majority of our handicraft industries, have, in the end, organised a completely capitalist domestic system of large-scale production.
The existence of these two polarising trends among our petty producers clearly shows that capitalism and mass impoverishment, far from precluding, actually condition each other, and irrefutably proves that capitalism is already the main background of the economic life of Russia.
That is why it will be no paradox to say that the fact of the break-up of the peasantry provides the answer to the “question of markets.”
One cannot help noting, also, that the very (current) presentation of the notorious “market question” harbours a number of absurdities. The usual formula (see § 1) is based on the most incredible assumptions—that the economic system of society can be built or destroyed at the will of some group of persons—“intellectuals” or the “government” (otherwise the question could not be raised—”can” capitalism develop?, “must” Russia pass through capitalism?, “should” the village community be preserved? and so forth)— that capitalism precludes the impoverishment of the people, that the market is something separate from and independent of capitalism, some special condition for its development.
Unless these absurdities are corrected, the question cannot be answered.
Indeed, let us imagine that in answer to the question: “Can capitalism develop in Russia, when the masses of the people are poor and are becoming still poorer?” somebody would say the following: “Yes, it can, because capitalism will develop not on account of articles of consumption, but on account of means of production.” Obviously, such an answer is based on the absolutely correct idea that the total productivity of a capitalist nation increases chiefly on account of means of production (i.e., more on account of means of production than of articles of consumption); but it is still more obvious that such an answer cannot advance the solution of the question one iota, just as you cannot draw a correct conclusion from a syllogism with a correct minor premise but an absurd major premise. Such an answer (I repeat) already presupposes that capitalism is developing, is embracing the whole country, passing to a higher technical stage (large-scale machine industry), whereas the question itself is based on the denial of the possibility of capitalism developing and of small-scale production being replaced by large-scale production.
The “market question” must be removed from the sphere of fruitless speculation about “possibility” and “necessity” to the solid ground of reality, that of studying and explaining what shape the Russian economic order is taking, and why it is taking that shape and no other.
I shall confine myself to quoting some examples from the material in my possession in order to show concretely on what data this proposition is based.
To illustrate the differentiation of the small producers and the fact that not only a process of impoverishment, but also of the creation of large-scale (relatively) bourgeois economy is taking place among them, I shall quote data for three purely agricultural uyezds in different gubernias of European Russia: Dnieper Uyezd in Taurida Gubernia, Novouzensk Uyezd in Samara Gubernia, and Kamyshin Uyezd in Saratov Gubernia. The data are taken from Zemstvo statistical abstracts. To forestall possible statements that the uyezds chosen are not typical (in our outlying regions, which hardly experienced serfdom and largely became populated only under post-Reform, “free” conditions, differentiation has, indeed, made more rapid strides than at the centre) let me say the following:
1) Of the three mainland uyezds of Taurida Gubernia I have chosen Dnieper Uyezd because it is wholly Russian [0.6% are colonist farms] and is inhabited by community peasants.
2) For Novouzensk Uyezd the data concern only the Russian (community) population [see Statistical Returns for Novouzensk Uyezd, pp. 432-39. Column a], and do not in-dude the so-called farmstead peasants, i.e., those community peasants who have left the community and have settled separately on purchased or rented land. The addition of these direct representatives of capitalist farming would show an even greater differentiation.
3) For Kamyshin Uyezd the data concern only the Great-Russian (community) population.
The classification in the abstracts is—for Dnieper Uyezd—according to dessiatines of crop area per household; for the others—according to number of draught animals.
The poor group includes households—in Dnieper Uyezd— cultivating no land, or with crop areas of up to 10 dessiatines per household; in Novouzensk and Kamyshin uyezds— households having no draught animals or one. The middle group includes households in Dnieper Uyezd having from 10 to 25 dessiatines of crop area; in Novouzensk Uyezd— households having from 2 to 4 draught animals; in Kamyshin Uyezd—households having from 2 to 3 draught animals. The prosperous group includes households having over 25 dessiatines (Dnieper Uyezd), or having more than 4 draught animals (Novouzensk Uyezd) and more than 3 (Kamyshin Uyezd).
From these data it is quite evident that the process going on among our agricultural and community peasants is not one of impoverishment and ruin in general, but a process of splitting into a bourgeoisie and a proletariat. A vast mass of peasants (the poor group)—about a half on the average—are losing economic independence. They now have only an insignificant part of the total farming of the local peasants—some 13% (on the average) of the crop area; the area under crops is 3-4 dessiatines per household. To show what such a crop area means, let me say that in Taurida Gubernia, for a peasant household to subsist exclusively by independent farming, without resorting to so-called “outside employments,” it must have 17-18 dessiatines under crops. Obviously, the members of the bottom group already subsist jar less by their farming than by outside employment, i.e., the sale of their labour-power. And if we turn to more detailed data characterising the conditions of the peasants in this group we shall see that precisely this group provides the largest contingent of those who give up their farming, lease their allotments, have no working implements and seek employment elsewhere. The peasants in this group represent our rural proletariat.
But, on the other hand, from among these very same community peasants quite another group, of an entirely opposite character, is emerging. The peasants in the top group have crop areas 7 to 10 times larger than those of the peasants in the bottom group. If we compare these crop areas (23-40 dessiatines per household) with the “normal” number of dessiatines under crops that a family needs in order to live comfortably by its farming alone, we shall find that they are double or treble that amount. Obviously, these peasants already engage in agriculture to obtain an income, to trade in grain. They accumulate considerable savings and use them to improve their farms and farming methods; for example, they buy agricultural machines and improved implements. In Novouzensk Uyezd as a whole, for instance, 14% 0f the householders have improved agricultural implements; of the peasants in the top group 42% of the householders have improved implements (so that the peasants in the top group account for 75% of the total number of households in the uyezd possessing improved agricultural implements) and concentrate in their hands 82% of the total improved implements owned by the “peasantry.” The peasants in the top group can no longer manage their crop sowing with their own labour force and therefore resort to the hiring of workers: for example, in Novouzensk Uyezd 35% of the householders in the top group employ regular wage-workers (not counting those hired, for instance, for the harvesting, etc.); it is the same in Dnieper Uyezd. In short, the peasants in the top group undoubtedly constitute a bourgeoisie. Their strength now is not based on plundering other producers (as is the strength of the usurers and “kulaks”), but on the independent organisation of production: in the hands of this group, which constitutes only one-fifth of the peasantry, is concentrated more than one-half of the total crop area [I take the general average area for all three uyezds]. If we bear in mind that the productivity of labour (i.e., the harvests) of these peasants is immeasurably higher than that of the ground-scratching proletarians in the bottom group, we cannot but draw the conclusion that the thief motive force in grain production is the rural bourgeoisie.
What influence was this splitting of the peasantry into a bourgeoisie and a proletariat [the Narodniks see nothing in this process but the “impoverishment of the masses” I bound to have on the size of the “market,” i.e., on the proportion of grain that is converted into a commodity? Obviously, that proportion was bound to grow considerably, because the mass of grain possessed by the peasants in the top group far exceeded their own needs and went to the market; on the other hand, the members of the bottom group had to buy extra grain with money earned by outside work.
To quote exact data on this point we must now turn not to Zemstvo statistical abstract,s, but to V. Y. Postnikov’s book: Peasant Farming in South Russia. Using Zemstvo statistical data, Postnikov describes peasant farming in three mainland uyezds of Taurida Gubernia (Berdyansk, Melitopol and Dnieper) and analyses that farming according to different groups of peasants [divided into 6 categories according to crop area: 1) cultivating no land; 2) cultivating up to 5 dessiatines; 3) from 5 to 10 dessiatines; 4)10 to 25 dessiatines; 5) 25 to 50 dessiatines; 6) over 50 dessiatines]. Investigating the relation of the different groups to the market, the author divides the crop area of each farm into the following 4 parts: 1) the farm-service area—as Postnikov calls the part of the crop area which provides the seed necessary for sowing; 2) the food area—provides grain for the sustenance of the family and labourers; 3) the fodder area—provides fodder for the draught animals, and lastly, 4) the commercial or market area provides the product which is converted into a commodity and disposed of on the market. It goes without saying that only the last area provides income in cash, whereas the others yield it in kind, i.e., provide a product that is consumed on the farm.
Calculating the size of each of these plots in the different crop-area groups of the peasantry, Postnikov presents the following table:
Note to table:
1) Postnikov does not give the penultimate column; I compiled it myself.
2) Postnikov calculates the cash income on the assumption that the entire, commercial area is planted to wheat, and taking the average yield and the average price of grain.
We see from these data that the bigger the farm, the more it assumes a commodity character and the larger is the proportion of grain grown for sale 112-36-52-61% according to group 1. The principal grain growers, the peasants in the two top groups (they have more than half the total area under crops), sell more than half of their total agricultural product [52% and 61%].
If the peasantry were not split up into a bourgeoisie and a proletariat, if. in other words, the area under crops were divided among all the “peasants” “equally,” all of them would then belong to the middle group (those cultivating l0 to 25 dessiatines), and only 36% of the total grain, i.e., the product of 518,136 dessiatines of crop area (36% of 1,439,267 =5318,i36), would appear on the market. But now, as can be seen from the table, 42% of the total grain, the product of 608,869 dessiatines, goes to the market. Thus, the ‘impoverishment of the masses,” the complete decline of the farms of 40% of the peasants (the poor group, i.e., those cultivating up to 10 dessiatines), the formation of a rural proletariat have led to the produce of 90,000 dessiatines of land under crops being thrown on to the market.
I do not at all want to say that the growth of the “market” as a consequence of the differentiation of the peasantry was limited only to this. Far from it. We have seen, for example, that the peasants acquire improved implements, i.e., turn their savings to the “production of means of production.” We have seen that, in addition to grain, another commodity, human labour-power, has come on to the market. I do not refer to all this only because I have quoted this example for a narrow and specific purpose: to show that here in Russia the impoverishment of the masses is actually leading to the strengthening of commodity and capitalist economy. I deliberately chose a product like grain, which everywhere and always is the last and the slowest to be drawn into commodity circulation. And that is why I took an exclusively agricultural locality.
I shall now take another example, relating to a purely industrial area—Moscow Gubernia. Peasant farming is described by the Zemstvo statisticians in volumes VI and VII of Statistical Returns of the Moscow Gubernia, which contain a number of excellent essays on the handicraft industries. I shall confine myself to quoting one passage from the essay on ‘The Lace Industry” which explains how and why the post-Reform epoch saw a particularly rapid development of peasant handicrafts.
The lace industry arose in the twenties of the present century in two neighbouring villages of Voronovo Volost, Podolsk Uyezd. “In the 1840’s it began to spread slowly to other nearby villages, although it did not yet cover a big area. But beginning with the sixties and especially during the last three or four years, it. has spread rapidly to the surrounding countryside.”
Of the 32 villages in which this industry is practised at the present time it began:
|in 2 villages in 1820|
|" 4 " " 1840|
|" 5 " " the 1860’s|
|" 7 " " 1870-4875|
|" 14 " " 1876-1879|
“If we investigate the causes of this phenomenon,” says the author of the essay, “i.e., the extremely rapid spread of the industry precisely in the last few years, we shall find that, on the one hand, during that period the peasants’ living conditions greatly deteriorated and, on the other hand, that the requirements of the population—that part of it which is in more favourable circumstances—considerably increased.”
In confirmation of this the author borrows from the Moscow Zemstvo statistics the following data, which I give in the form of a table.
“These figures,” continues the author, “are eloquent proof that the total number of horses, cows and small livestock in that volost increased, but this increased prosperity fell to the lot of certain individuals, namely, the category of householders owning 2-3 and more horses…
“...Consequently, we see that, side by side with an increase in the number of peasants who have neither cows nor horses, there is an increase in the number of those who stop cultivating their land: they have no animals, and, therefore, not. enough manure; the land becomes exhausted, it is not worth tilling; to get food for themselves and their families, to avert starvation, it is not enough for the males alone to engage in some industry—they did that previously, when they were free from farm work—now, other members of the family must also seek outside employment…
“...The figures we gave in the tables showed us something else; in those villages there was also an increase in the number of people having 2-3 horses, or cows. Consequently, the prosperity of those peasants increased, and yet, at the same time, we said that ‘all the women and children in such and such a village engage in industry.’ How is this to be explained?... To explain this phenomenon we must see what sort of life is lived in those villages, and become more closely acquainted with their domestic conditions, and then, perhaps, ascertain what accounts for this strong urge to produce goods for the market.
“We shall not, of course, stop here to investigate in detail under what fortunate circumstances there gradually emerge from the peasant population stronger individuals, stronger families, what conditions give rise to their prosperity and what social conditions enable that prosperity, once it has appeared, to grow rapidly and cause it to grow to such an extent as to considerably distinguish one section of the village inhabitants from the other. To follow this process it is sufficient to point to one of the most ordinary occurrences in a peasant village. In a village, a certain peasant is reputed among his fellow villagers to be a healthy, strong, sober working man. He has a large family, mostly sons, also distinguished for their physical strength and good traits. They all live together; there is no dividing up. They get an allotment for 4-5 persons. It does not, of course, require the labour of all the members of the family to cultivate it. And so, two or three of the Sons regularly engage in some outside or local industry, and only during the haymaking season do they drop their industry for a short time and help the family with the field work. The individual members of the family do not keep their earnings, but pool them. Given other favourable circumstances, the combined income considerably exceeds the expenditure necessary to satisfy the family’s requirements. Money is saved and, as a consequence, the family is able to engage in industry under better conditions: it can buy raw materials for cash at first hand, it can sell the goods produced when they fetch a good price, and can dispense with the services of all kinds of ‘hirers-out of labour,’ men and women dealers, and so forth.
“It becomes possible to hire a worker or two, or give out work to be done at home by poor peasants who have lost the possibility of doing any job quite independently. Due to these and similar circumstances, the strong family we have mentioned is able to obtain profit not only from its own labour. We are not speaking here, of course, of those cases where individuals known as kulaks, sharks, emerge from those families; we are examining the most ordinary occurrences among the peasant population. The tables given in Volume II of the Abstract and in Part I of Volume VI clearly show that as the conditions of one section of the peasantry grow worse, in the majority of cases there is an increase in the prosperity of the other, smaller section, or of individual members.
“As industrial occupation spreads, intercourse with the outside world, with the town, in this case with Moscow, becomes more frequent, and some of the Moscow customs gradually penetrate into the village and are met with at first precisely in these more prosperous families. They buy samovars, table crockery and glass, they wear ‘neater’ clothes. Whereas at first this neatness of clothing takes the shape, among men, of boots in place of bast shoes, among the women leather shoes and boots are the crowning glory, so to speak, of neater clothing; they prefer bright, motley calicoes and kerchiefs, figured woollen shawls, and similar charms…
“...In the peasant family it has been the custom ’for ages’ for the wife to clothe her husband, herself and the children.... As long as they grew their own flax, less money had to be spent on the purchase of cloth and other materials required for clothing, and this money was obtained from the sale of poultry, eggs, mushrooms, berries, a spare skein of yarn, or piece of linen. All the rest was made at home. It was such circumstances, i.e., the domestic production of all those articles which the peasant women were expected to make, and the fact that they spent on it all the time they had free from field work, that explain, in the present case, the extremely slow development of the lace industry in the villages in Voronovo Volost. Lace was made mainly by the young women of the more prosperous or of the larger families, where it was not necessary for all the women to spin flax or weave linen. But cheap calico gradually began to oust linen, and to this other circumstances were added: either the flax crop failed, or the wife wanted to make her husband a red calico shirt and herself a smarter dress, and so the custom of weaving various sorts of linen and kerchiefs at home for peasants’ clothing gradually died out, or became very restricted. And the clothing itself underwent a change, partly because homespun cloth was displaced by factory-made cloth…
“...That explains why the majority of the population do all they can to make articles for sale, and even put their children to this work.”
This artless narrative of a careful observer clearly shows how the process of division of social labour takes place among our peasant masses, how it leads to the enhancement of commodity production land, consequently, of the market], and how this commodity production, of itself, i.e., by virtue of the very relations in which it places the producer to the market, leads to the purchase and sale of labour-power becoming “a most ordinary occurrence.”
 That is, the replacement of small industrial units by big ones, the ousting of hand by machine labour. —Lenin
 That is, if he correctly appraised and properly understood he significance of the production of means of production. —Lenin
 The peasants themselves very aptly call this process “depeasantising” (See Agricultural Survey of Nizhni-Novgorod Gubernia for 1892, Nizhni-Novgorod, 1893, Vol. III. pp. 186-187.) —Lenin
 One of Mr. Nikolai—on’s biggest theoretical mistakes is that he ignores this phenomena. —Lenin
 Indeed, 2,294 farmstead peasants have 123,252 dessiatines under crops (i.e., an average of 53 dessiatines per farmer). They employ 2,662 male labourers (and 234 women). They have over 40,000 horses and oxen. very many improved implements: see p. 453 of Statistical Returns for Novouzensk Uyezd. —Lenin
 In Samara and Saratov gubernias the amount will be about a third lower, as the local population is less prosperous. —Lenin
 Altogether, the peasants In the uyezd have 5,724 improved implements. —Lenin
 Which, of course, is also based on plunder, only not, the plunder of independent producers, but of workers. —Lenin
 90,733 dessiatines— 6.3% of the total crop area. —Lenin
 Statistical Returns of the Moscow Gubernia,. Section of Economic statistics. Vol. VI, Issue II, Handicraft Industries of Moscow Gubernia, Issue II, Moscow. 1880. —Lenin
 I have omitted data on the distribution of cows (the conclusion is the same) and added the percentages. [See table on p. 119.—Ed. Eng. ed.] —Lenin