The banks, as we know, are centres of modern economic life, the principal nerve centres of the whole capitalist economic system. To talk about "regulating economic life" and yet evade the question of the nationalisation of the banks means either betraying the most profound ignorance or deceiving the "common people" by florid words and grandiloquent promises with the deliberate intention of not fulfilling these promises.
It is absurd to control and regulate deliveries of grain, or the production and distribution of goods generally, without controlling and regulating bank operations. It is like trying to snatch at odd kopeks and closing one’s eyes to millions of rubles. Banks nowadays are so closely and intimately bound up with trade (in grain and everything else) and with industry that without "laying hands" on the banks nothing of any value, nothing “revolutionary-democratic”, can be accomplished.
But perhaps for the state to "lay hands" on the banks is a very difficult and complicated operation? They usually try to scare philistines with this very idea—that is, the capitalists and their defenders try it, because it is to their advantage to do so.
In reality, however, nationalisation of the banks, which would not deprive any “owner” of a single kopek, presents absolutely no technical or cultural difficulties, and is being delayed exclusively because of the vile greed of an insignificant handful of rich people. If nationalisation of the banks is so often confused with the confiscation of private property, it is the bourgeois press, which has an interest in deceiving the public, that is to blame for this widespread confusion.
The ownership of the capital wielded by and concentrated in the banks is certified by printed and written certificates called shares, bonds, bills, receipts, etc. Not a single one of these certificates would be invalidated or altered if the banks were nationalised, i.e., if all the banks were amalgamated into a single state bank. Whoever owned fifteen rubles on a savings account would continue to be the owner of fifteen rubles after the nationalisation of the banks; and whoever had fifteen million rubles would continue after the nationalisation of the banks to have fifteen million rubles in the form of shares, bonds, bills, commercial certificates and so on.
What, then, is the significance of nationalisation of the banks?
It is that no effective control of any kind over the individual banks and their operations is possible (even if commercial secrecy, etc., were abolished) because it is impossible to keep track of the extremely complex, involved and wily tricks that are used in drawing up balance sheets. founding fictitious enterprises and subsidiaries, enlisting the services of figureheads, and so on, and so forth. Only the amalgamation of all banks into one, which in itself would imply no change whatever in respect of ownership. and which, we repeat, would not deprive any owner of a single kopek, would make it possible to exercise real control—provided, of course, all the other measures indicated above were carried out. Only by nationalising the banks can the state put itself in a position to know where and how, whence and when, millions and billions of rubles flow. And only control over the banks, over the centre, over the pivot and chief mechanism of capitalist circulation, would make it possible to organise real and not fictitious control over all economic life, over the production and distribution of staple goods, and organise that "regulation of economic life" which otherwise is inevitably doomed to remain a ministerial phrase designed to fool the common people. Only control over banking operations, provided they were concentrated in a single state bank, would make it possible, if certain other easily-practicable measures were adopted, to organise the effective collection of income tax in such a way as to prevent the concealment of property and incomes; for at present the income tax is very largely a fiction.
Nationalisation of the banks has only to be decreed and it would be carried out by the directors and employees themselves. No special machinery, no special preparatory steps on the part of the state would be required, for this is a measure that can be effected by a single decree, "at a single stroke". It was made economically feasible by capitalism itself once it had developed to the stage of bills, shares, bonds and so on. All that is required is to unify accountancy. And if the revolutionary-democratic government were to decide that immediately, by telegraph, meetings of managers and employees should be called in every city, and conferences in every region and in the country as a whole, for the immediate amalgamation of all banks into a single state bank, this reform would be carried out in a few weeks. Of course, it would be the managers and the higher bank officials who would offer resistance, who would try to deceive the state, delay matters, and so on, for these gentlemen would lose their highly remunerative posts and the opportunity of performing highly profitable fraudulent operations. That is the heart of the matter. But there is not the slightest technical difficulty in the way of the amalgamation of the banks; and if the state power were revolutionary not only in word (i.e., if it did not fear to do away with inertia and routine), if it were democratic not only in word (i.e., if it acted in the interests of the majority of the people and not of a handful of rich men), it would be enough to decree confiscation of property and imprisonment as the penalty for managers, board members and big shareholders for the slightest delay or for attempting to conceal documents and accounts. It would be enough, for example, to organise the poorer employees separately and to reward them for detecting fraud and delay on the part of the rich for nationalisation of the banks to be effected as smoothly and rapidly as can be.
The advantages accruing to the whole people from nationalisation of the banks—not to the workers especially (for the workers have little to do with banks) but to the mass of peasants and small industrialists—would be enormous. The saving in labour would be gigantic, and, assuming that the state would retain the former number of bank employees, nationalisation would be a highly important step towards making the use of the banks universal, towards increasing the number of their branches, putting their operations within easier reach, etc., etc. The availability of credit on easy terms for the small owners, for the peasants, would increase immensely. As to the state, it would for the first time be in a position first to review all the chief monetary operations, which would be unconcealed, then to control them, then to regulate economic life, and finally to obtain millions and billions for major state transactions, without paying the capitalist gentlemen sky-high “commissions” for their “services”. That is the reason—and the only reason—why all the capitalists, all the bourgeois professors, all the bourgeoisie, and all the Plekhanovs, Potresovs and Co., who serve them, are prepared to fight tooth and nail against nationalisation of the banks and invent thousands of excuses to prevent the adoption of this very easy and very pressing measure, although even from the standpoint of the “defence” of the country, i.e., from the military standpoint, this measure would provide a gigantic advantage and would tremendously enhance the "military might" of the country.
The following objection might be raised: why do such advanced states as Germany and the U.S.A. "regulate economic life" so magnificently without even thinking of nationalising the banks?
Because, we reply, both these states are not merely capitalist, but also imperialist states, although one of them is a monarchy and the other a republic. As such, they carry out the reforms they need by reactionary-bureaucratic methods, whereas we are speaking here of revolutionary-democratic methods.
This "little difference" is of major importance. In most cases it is "not the custom" to think of it. The term "revolutionary democracy" has become with us (especially among the Socialist-Revolutionaries and Mensheviks) almost a conventional phrase, like the expression "thank God", which is also used by people who are not so ignorant as to believe in God; or like the expression "honourable citizen", which is sometimes used even in addressing staff members of Dyen or Yedinstvo, although nearly everybody guesses that these newspapers have been founded and are maintained by the capitalists in the interests of the capitalists, and that there is therefore very little “honourable” about the pseudo-socialists contributing to these newspapers.
If we do not employ the phrase "revolutionary democracy" as a stereotyped ceremonial phrase, as a conventional epithet, but reflect on its meaning, we find that to be a democrat means reckoning in reality with the interests of the majority of the people and not the minority, and that to be a revolutionary means destroying everything harmful and obsolete in the most resolute and ruthless manner.
Neither in America nor in Germany, as far as we know, is any claim laid by either the government or the ruling classes to the name "revolutionary democrats", to which our Socialist-Revolutionaries and Mensheviks lay claim (and which they prostitute).
In Germany there are only four very large private banks of national importance. In America there are only two. It is easier, more convenient, more profitable for the financial magnates of those banks to unite privately, surreptitiously, in a reactionary and not a revolutionary way, in a bureaucratic and not a democratic way, bribing government officials (this is the general rule both in America and in Germany), and preserving the private character of the banks in order to preserve secrecy of operations, to milk the state of millions upon millions in “super-profits”, and to make financial frauds possible.
Both America and Germany "regulate economic life" in such a way as to create conditions of war-time penal servitude for the workers (and partly for the peasants) and a paradise for the bankers and capitalists. Their regulation consists in “squeezing” the workers to the point of starvation, while the capitalists are guaranteed (surreptitiously, in a reactionary-bureaucratic fashion) profits higher than before the war.
Such a course is quite possible in republican-imperialist Russia too. Indeed, it is the course being followed not only by the Milyukovs and Shingaryovs, but also by Kerensky in partnership with Tereshchenko, Nekrasov, Bernatsky, Prokopovich and Co., who also uphold, in a reactionary-bureaucratic manner, the “inviolability” of the banks and their sacred right to fabulous profits. So let us better tell the truth, namely, that in republican Russia they want to regulate economic life in a reactionary-bureaucratic manner, but “often” find it difficult to do so owing to the existence of the “Soviets”, which Kornilov No. 1 did not manage to disband, but which Kornilov No. 2 will try to disband.
That would be the truth. And this simple if bitter truth is more useful for the enlightenment of the people than the honeyed lies about “our”, “great”, “revolutionary” democracy.
Nationalisation of the banks would greatly facilitate the simultaneous nationalisation of the insurance business, i.e., the amalgamation of all the insurance companies into one, the centralisation of their operations, and state control over them. Here, too, congresses of insurance company employees could carry out this amalgamation immediately and without any great effort, provided a revolutionary-democratic government decreed this and ordered directors and big shareholders to effect the amalgamation without the slightest delay and held every one of them strictly accountable for it. The capitalists have invested hundreds of millions of rubles in the insurance business; the work is all done by the employees. The amalgamation of this business would lead to lower insurance premiums, would provide a host of facilities and conveniences for the insured and would make it possible to increase their number without increasing expenditure of effort and funds. Absolutely nothing but the inertia, routine and self-interest of a handful of holders of remunerative jobs are delaying this reform, which, among other things, would enhance the country’s defence potential by economising national labour and creating a number of highly important opportunities to "regulate economic life" not in word, but in deed.