Ernest Mandel

The Soviet Economy Today:
Towards Capitalism or Socialism?

(June 1972)

From International, Vol. 4 No. 1, Autumn 1977.
The article was first published in the June 1972 issue of International Socialist Review (New York).
Scanned and prepared for the Marxist Internet Archive by Paul Flewers.
Marked up by Einde O’Callaghan for the Marxists’ Internet Archive.

Those who are acquainted with the history of the Trotskyist movement cannot but note with a certain amusement that the debates on the class nature of the Soviet Union which developed within the Trotskyist movement 30 or 40 years ago are now resounding in the public arena. That which a short time ago was considered an esoteric debate is now the object of ‘big power’ politics. Maoists and Khrushchevist leaders hurl at one another the accusation of having ‘restored capitalism’, or even having established a ‘reactionary bloody dictatorship’.

Amusement should not give way to surprise. The destiny of the USSR, from its beginnings, has been intimately tied to that of the world socialist revolution. The ebb of the world socialist revolution caused an historically unforeseen detour for Soviet society, a detour which the Trotskyist movement alone has grasped theoretically in all of its internal dialectic. Otherwise there have only been disillusioned discussions of the depth of the defeat of the revolution, or even on the more than problematical future of all socialist revolution. But the new leaps forward, the new rise of the international revolution create not only better material, social and political possibilities for the regeneration of the USSR, they also nourish a renaissance of Marxism, which makes the question of the ‘class nature of the USSR’ once again the subject of impassioned debate.

Since there were no living Marxist tendencies other than Trotskyism during the years 1933–53, the present-day discussion inevitably feeds off the products and by-products of the discussion among Trotskyists.

Two Methodological Questions

Soviet society (and a fortiori the societies of Eastern Europe more or less patterned after it) is not a definitive social formation having stable contours, occupying a precise historical place in the social evolution of humanity. It is neither a capitalist nor a socialist society but a society of transition from capitalism to socialism combining features of the socialist future with those of the capitalist past and surroundings. Without doubt, the essential achievement of Leon Trotsky’s analysis of the nature of the USSR is that of having formulated the fundamental question in this way. For a long time the exclusive possession of the Trotskyist movement, the concept ‘transitional society’ is beginning little by little to break into the broader currents of the left vanguard. [1]

Two methodological questions merit clarification, however, before approaching Soviet society in this manner.

Marx insisted that it would have proved impossible to deduce the fundamental nature of the capitalist mode of production, or even of the nature of commodities themselves, or of productive labour before capitalism arrived at maturity. [2] Before the industrial revolution, in the era of manufacturing, commercial and banking capital, it was impossible to formulate the laws of capitalist development, which explains notably why minds as profound as those of the Physiocrats could blithely declare that only agricultural labour was productive.

The same thing is true for the transitional society from capitalism to socialism. Attempting to deduce the general laws of evolution of this society from the Soviet example alone, not to mention the Chinese example – that is, from specific cases clearly lacking maturity resulting from a special combination of historical circumstances – is as impossible as attempting to deduce the laws of capitalist development from English society after 1649 or 1688.

Of course, Marxism as a method of social analysis (and therefore of social prediction) is infinitely superior to the empirical origins of bourgeois political economic theory. But no more than any other science can it detach itself completely from the conditioning of the social infrastructure on whose base it develops. We will not know, nor fully understand, the laws of development which govern the dynamic of the transitional society from capitalism to socialism (the society of the epoch of the dictatorship of the proletariat), and in particular the laws that direct the movement towards a fully-developed socialist society, until such a society has at last made its appearance under conditions which are ripe for its development. This would be in a highly-industrialised country where the proletariat is a large majority, manages the economy and the state itself, and is definitively secure from all external threats. From now till then we can try to develop a foreknowledge of these laws by successive approximation. We will not have a confirmed definitive view of them. This means that the final word on the theory of the USSR will not be said until the question has been resolved in practice. That is to say, when the question no longer exists. This conclusion would not have displeased the author of the Eleventh Thesis on Feuerbach.

But, even if there does not exist in the USSR a system of production which has already fully revealed its own laws of historical development, incontestably there does exist a definite socio-economic formation which has its own internal logic and which follows a socio-economic dynamic that must be understood and explained. The difference between a particular socio-economic formation and a mode of production is that the former, being the product of a concrete historical process, combines the features characteristic of different modes of production and is not comprehensible except in the light of combined and uneven development. But without understanding which mode of production predominates within it one cannot correctly analyse a socio-economic formation, let alone predict its future dynamic.

The distinction between a socio-economic formation and a mode of production has escaped Bettelheim. In one of his numerous approaches to the problem of the nature of the USSR, he reproaches us for putting theory ‘outside of history’. He does not understand that it is he who puts history outside of theory. [3] I have never maintained that Marxism was only capable of analysing ‘capitalism in a pure and abstract form’. I have simply said that an analysis of capitalism as it really is, as it has concretely developed, cannot be made scientifically without taking the analysis of ‘pure capitalism’ as its point of departure. If not, it will fall into the trap of vulgar empiricism. But clearly one cannot confine the analysis to ‘pure capitalism’ without falling into abstract dogmatism which eliminates history – that is, combined and uneven development.

A perfect illustration of this methodological error is offered by Bettelheim’s theory according to which the survival of commodity production in the USSR and other bureaucratised workers’ states proves the inability of the state to appropriate ‘all’ goods for itself. Bettelheim does not even ask himself whether, in the course of socialist construction, the appropriation of ‘all’ goods by the state corresponds to the ‘logic’ or necessity of planning, to the needs of the relations of production born of the overthrow of capitalism, or to the needs of the ‘associated producers’. He reasons from conditions specific to the USSR, China and Cuba – the conditions of scarcity and ‘primitive socialist accumulation’. But what about a transitional society in France or the US? What about the progressive satisfaction of basic needs? What about the expansion of centralised accounting made possible thanks to computers? Isn’t it more logical to assume that the richer society becomes, the less the state will need to ‘appropriate’ every nail, every apple, or even every transistor? Isn’t the construction of socialism essentially the withering away of commodity production? Will this withering away not be characterised precisely by a decreasing necessity for centralised appropriation of all products of labour?

It is perfectly true that at the base of all problems of the transitional society lies, after all, the insufficient development of the forces of production. [4] This development is already in conflict – on a world scale – with the capitalist relations of production. It has not reached the heights of truly socialist relations of production – at least in countries where capitalism has been overturned. But to reduce this problem to one of ‘appropriation’ of products is to evince a singularly near-sighted view of the ensemble of socio-economic and political contradictions of a transitional society in a country like the USSR which was under-developed at the start. Above all it leaves aside that which must be the point of departure for all Marxist analyses of a definite socio-economic formation: the relations of production.

To What Extent Do Market Relations Survive in the USSR?

The resurgence of discussions on the question of the USSR has given new life to a debate which was thought to have been resolved, that is, the debate on the reasons for the survival of market relations in the USSR. Gilles Martinet accuses me of dogmatism because I claim that the means of production in the USSR essentially, that is as long as they do not circulate outside the state sector, are not commodities. His conclusion is sublimely naive: ‘The misfortune is that this production and this [commodity] circulation exist. E pur si muove.’ [5] As if commodity production were a natural phenomenon that one ‘records’ like an eclipse of the sun. As if it were not a question of one of the most complex social phenomena that only a thorough analysis of social relations – the relations of production – can clarify.

In the famous Section IV of Chapter I of Capital (Volume 1), devoted to the fetishism of the commodity, Marx defines in the most clear and succinct manner the roots of commodity production and the nature of the commodity. Let two citations suffice:

As a general rule, articles of utility [use-values] become commodities only because they are products of the labour of private individuals who carry on their work independently of each other. The sum total of the labour of all these private individuals forms the aggregate labour of society. Since the producers do not come into contact with each other until they exchange their products, the specific social character of each producer’s labour does not show itself except in the act of exchange. In other words, the labour of the individual asserts itself as part of the labour of society, only by means of the relations which the act of exchange establishes directly between the products, and indirectly, through them, between producers.

And, in contrast to this characteristic situation for a society dominated by private labour and private property, Marx describes a few pages later the situation characteristic of a society based on social ownership of the means of production:

Let us now picture to ourselves, by way of change, a community of free individuals, carrying on their work with the means of production in common [gemeinschaftlich – EM], in which the labour-power of all the different individuals is consciously applied as the combined labour-power of the community ... The total product of our community is a social product. One portion serves as fresh means of production and remains social. But another portion is consumed by the members as means of subsistence. A distribution of this portion amongst them is consequently necessary. The mode of this distribution will vary with the productive organisation of the community, and the degree of historical development attained by the producers. We will assume, but merely for the sake of a parallel with the production of commodities, that the share of each individual producer in the means of subsistence is determined by their labour-time. Labour-time would, in that case, play a double part. Its apportionment in accordance with a definite social plan maintains the proper proportion between the different kinds of work to be done and the various wants of the community. On the other hand, it also serves as a measure of the portion of the common labour borne by each individual and of his share in the part of the total product destined for individual consumption. The social relations of the individual producers, with regard both to their labour and to its products, are in this case perfectly simple and intelligible, and that with regard not only to production but also to distribution. [6]

Let us remember in passing that Marx foresaw an evolution of the mode of distribution under socialism. The famous mechanical conception according to which there would be a ‘law of correspondence’ between the level of development of the productive forces, mode of production and mode of distribution everywhere and always in each socio-economic formation and even in a transitional society is perhaps a product of Stalinism, but certainly not attributable to Marx. We will return to this later.

What Marx specifies in these two passages is that commodity production does not arise from the lack of ‘centrally appropriating everything’, nor from the absence of ‘exact accounting’. It arises only from the individual character of labour. When the labour of the producers is not immediately recognised as social labour, and is recognised as such only to the extent that the products of their labour are sold on the market (and in the proportion to which their ‘individual value’ is realised), then and only then is there commodity production.

It is sufficient to travel around the USSR or any of the ‘people’s democracies’ to see whether the means of production are in fact the products of ‘the labour of private individuals’ related to one another only through the medium of the market. Obviously, this is not at all the case. One cannot go and buy a factory in a real-estate office and pick up the keys, nor can one even buy machine tools in a store. E pur si muove. Capital goods which ‘circulate within the state sector’ are not the product of ‘the labour of individuals’, are not private property, do not change owners, they are not sold on the market and therefore are not commodities, regardless of statements of ‘economists’ from these countries who are charged with defending certain social interests rather than scientifically analysing reality.

In the Grundrisse [7], moreover, Marx had already developed the same idea by opposing in advance the argument of (state) accounting. A strict book-keeping will be necessary at the heart of communal production. This accounting will be even more strict than it is today. But it must not be confused with the commodity nature of production, which means that the social character of labour is only recognised post festum, ‘after the blow’, after the sale of products, while in a society based on collective property, labour is recognised as social labour when it is performed.

What is the meaning of the formulation ‘directly social character’ or ‘non-directly social character’ of labour? Simply put: in a commodity-based economy the activity of enterprises is determined by their success on the market. If the commodities are not sold or are sold below their value (of average profit), return on investments cannot be realised, the constant capital cannot completely renew itself, part of the workforce will be laid off. The work they have performed ‘has not been recognised by the society as social labour’. In a planned economy, factories which produce capital goods maintain their activity independently of their ‘financial success’. Investments – at least the essential ones – are determined by the plan, not by the success of the ‘company’ on the market.

With regard to the question of the social nature of labour, a commodity-based economy and a planned economy are strictly opposed, one being a system of private property and the other a system of collective property. In the first case the law of value rules; that is, the social value or lack of value of the labour of individuals can be established only after the fact. In the second case it is the conscious allocation of material resources among diverse productive activities that rules. All labour performed under these conditions has an immediate social character even if it is supplied on a level of productivity below the social average. [8]

Let us now bring to bear the converse proof. What is the case with consumer goods, implements and capital goods sold on the kolkhozes and craft cooperatives? In this case there is certainly buying and selling, since a change of ownership takes place. When a state store sells a suit to a worker, the garment, once collective property, becomes private property. The transaction is not just a book-keeping transfer. And behind the juridical character of the transaction, there still remains the socio-economic consumption fund discovered by Marx. In distinction to the distribution of capital goods among the state enterprises, distribution of consumer goods among individuals is not regulated by the plan. Thus, work performed in the enterprises producing consumer goods is not automatically social labour recognised as such. A portion of these products may prove unsalable. Their use-value cannot be realised if their exchange-value is not realised. [9]

The Soviet worker cannot use a suit if it is too expensive, or seems to be too expensive. And, if the garment remains unsold, the labour expended for its production is pure loss. In contrast, nothing prevents the state from making use of the machinery even if its prime cost was extremely excessive. In the first case the use value is wasted. In the second it is realised. That is a difference which no mountain of more or less scholastic arguments can dispose of either in theory or in practice.

The Conflict Between the ‘Law of Value’ and the ‘Logic of the Plan’

Ever since Yevgeny Preobrazhensky published his New Economics, Marxists have generally admitted that the whole transitional period between socialism and capitalism will be marked by a conflict between two fundamentally different economic dynamics, that determined by the law of value, and that determined by the social relations of a planned economy. The first dynamic tends to distribute and redistribute economic resources in accordance with the dialectic of commodity production – that is, liquidity of demand, the search for excess profits, and competition. The second tends to distribute and redistribute economic resources independently of the market in accordance with the priorities consciously established by those who plan the economy.

Between the two there is an infinity of possible combinations. In the economy of monopoly capitalism, planning techniques are utilised to ‘correct’ fluctuations in the market that would prove too catastrophic. In a planned economy, the mechanisms of the market can and should be used for the more rapid realisation of the needs of the consumers, and for a better adaptation of resources to meet these needs. But all these combinations do not prevent conflict between two socio-economic dynamics which are in the long run irreconcilable. The field of decisive battle is clearly that of large-scale investment. The logic of the market economy leads investment in a direction opposed to the logic of planning. The economic movement itself embraces two different economic forms – cyclical fluctuations in the first case; uninterrupted development (although not always necessarily at the same rate) in the second.

We see here how specious is the argumentation that makes everything depend on ‘complete appropriation’. If real collective ownership of the means of production exists, the planned character of strategic investments is assured. Knowing whether the ‘state’ appropriates 99, 95 or only 90 per cent of the means of production that are produced is important for assessing the solidity of the regime, the weight of the centrifugal forces in the economy, and crises on the horizon; but it does not modify the planned nature of large-scale investments by the market.

We can also see how specious is the distinction many authors seek to introduce between ‘ownership as an economic category’ and ‘ownership as a juridical category’. Clearly there is a whole mass of sophisms in the equation ‘nationalised ownership equals peoples’ ownership’. These were completely exposed by Trotsky. [10] But what distinguishes ‘nationalised ownership of the means of production’ from private ownership in the economic and not just juridical sense of the term is the general orientation of investments. In the first case they are determined on a national level. In the second case they are decided on the company level. The rest proceeds from this.

Certain critics have accused me of ‘reifying’ planning by talking of the ‘logic of the plan’. [11] Doesn’t this term signify attributing human qualities to things, and obscuring the human relations which are behind the movements of things? On the contrary, the truth is that these critics do not understand that planning embodies definite relations between people, that is, definite relations of production.

There are too many critics who reduce the relations of production to simple relations between ‘those who work and those who command their labour’, in other words to internal relations within enterprises. This is one aspect of the relations of production in pre-capitalist society, as in capitalist society. It is equally characteristic of the post-capitalist society of transition between capitalism and socialism. But there is another aspect of the relations of production that escapes them. In all societies based on an advanced division of labour, where objectively there is socialisation of human labour, where no ‘unity of consumption’ can exist in isolation from other unities, there are but two ways in which the social nature of labour can manifest itself: a posteriori through the medium of the market or a priori through the medium of the plan. Far from being a ‘thing’, or a ‘relationship between things’, planning is, then, a definite ensemble of the human relations of production which assures the directly social character of labour furnished by the producers.

Sweezy has adopted an analogous position with respect to the historically irreconcilable conflict between the plan and the market. He has drawn the correct conclusion that the transitional society may move back towards capitalism as well as forward towards socialism. Trotsky had drawn exactly the same conclusion 35 years ago. [12] But Sweezy has improperly concluded that everything depends on ‘wilful’ decisions within the bureaucracy. The ‘technocratic’ wing of the bureaucracy would be the vehicle of capitalist restoration, while the old authoritarian bureaucrats like Brezhnev and Kosygin would try to halt the process. [13] Such a conclusion completely eliminates the ‘depoliticised’ proletariat from the process, a trait that characterises Sweezy’s ideas concerning the imperialist countries as well (see the conclusion of Monopoly Capitalism). This underestimates the key role which the relations of production play in every socio-economic formation, including that of the USSR.

The ‘passage from imperative planning to indicative planning’ – to take up Bettelheim’s thesis as presented by Martinet – means precisely the disintegration of the relations of production which, as we have just seen, underlie planning. It means concretely the reintroduction of lay-offs in industry, the reappearance of massive unemployment, the reorientation of the economy towards priority development of those branches that respond best to ‘liquid demand’ (both internal and external) rather than to those that assure economic and social growth, optimal or desirable for the long term. It is at least premature and overly pessimistic to suppose that all these radical transformations would be possible in the USSR without bringing an abrupt halt to the ‘depoliticisation’ of the Soviet proletariat. What occurred in Czechoslovakia in 1968, and above all what has occurred in Yugoslavia since the ‘economic reform’, demonstrates in any case that my ‘optimistic’ hypothesis is well-founded: it will be impossible to dissolve the planned relations of production born of the October Revolution in the USSR without first crushing the furious resistance of the Soviet proletariat. The restoration of capitalism can no more come about ‘gradually’ than its abolition. It too would come about through a sudden, violent and radical overturn of the relations of production.

To show how wrong those critics are who attempt to regard the nationalised ownership of the means of production as ‘purely formal’, I have attempted to demonstrate the logic of the economic ‘reforms’ now pending in the USSR in a polemic against the English supporters of the theory of ‘state capitalism’:

Contrary to what superficial Maoist and semi-Maoist critiques in the West assumed ... the reforms do not mean that capitalism is being reintroduced in the Soviet Union. They do not mean that profit becomes the motive force of economic growth, that is, starts to direct investment ‘spontaneously’ from branches where profit is lower towards branches where it is higher. No real competition in the capitalist sense of the word (that is, competition for selling on an anarchic market) occurs. Means of production have not become commodities. Rather, what has occurred is the use of a pseudo-market to optimise resource utilisation quite along the lines which the later Oscar Lange postulated already in the 1930s.

But do these reforms mean a smooth and rational use of the planned economy’s resources, in order to achieve the maximum growth of output? By no means. They only substitute one set of contradictions for another. Income of the bureaucracy is now increasingly tied to the factory’s ‘success’ on the ‘market’. But this ‘success’ does not depend only, or even essentially, upon a rational utilisation of given resources available to the factory. It also, and above all, depends upon the technology of the factory (that is, new investment taking place) and upon a given relationship between the ‘prices’ the factory has to pay for what it ‘buys’, the amount of labour it has to use and its wages bill on the one hand, and the ‘prices’ the same factory receives for what it ‘sells’ on the other hand. As long as these prices, the mass and form of investment, the amount of labour and wages, are determined by the plan, the bureaucrat will quickly feel cheated by the new arrangements. He will say: ‘You want us to perform “optimally”, but you fix things from the start, that such a performance is, in fact, impossible.’

So the economic reforms must unleash a constant tug-of-war of a new type between the plan and the bureaucrats administering the units of output. The old tug-of-war was essentially about allocations (the bureaucrats systematically overestimated the factories’ needs of workers and material, while they under-evaluated the productive capacity of the same factories). The new tug-of-war will be about the power of decision. The factory managers will demand the right to hire and fire workers as they like. They will demand the right to ‘negotiate’ wages (regionally, locally, or even by branch or unit) according to ‘market conditions’. They will demand the right to retain the major part of the ‘profit’ of ‘their’ factory to be invested there. They will ask for a rising (and specific) share in total investment to be realised autonomously by themselves, inside ‘their’ factory. They will above all demand that they should fix the prices of the products they ‘sell’ as they see fit to do (that is, as the ‘market’ dictates). And the ‘planners’ will of course stridently resent all these demands which run counter to the elementary principles and needs of central planning.

Let us assume for a moment that the factory managers were to be successful in their demands, and gradually conquer these supplementary rights. (This is the actual formula used today in the Soviet discussion: ‘Increasing rights for the factory managers.’) What would be the outcome of that process? Surely, we would have to drop the inverted commas around the words ‘market’, ‘buy’ and ‘sell’. Surely, each factory making its own investment, trying to establish its own prices, negotiating its own wages, would have become an independent firm, and the market would then ‘arbitrate’ between these firms and give birth to prices which would no more be determined by plan, but would result from the interplay of market forces. Surely, in that case, capital would flow from less to more profitable branches. It would no more be the plan but this flow of capital which would then determine the lines of the national economy. Surely, more and more firms would then find it profitable to export part of their goods instead of selling them on the inner market, and would establish direct connections with foreign firms which would increasingly also sell on the Russian market, as well as export capital to that country. Surely, the growth of individual investment would inevitably lead to over-investment which in a market economy could only be corrected through periodic crises of overproduction and unemployment ...

In that case, of course, the Soviet economy would have become a capitalist economy, for everybody to see and acknowledge the fact, even the dogmatic and myopic Mandel. But would it be a ‘state capitalist’ economy? The whole process started because the income of the factory manager being tied to the factory’s ‘profit’, the manager had received a strong economic incentive to determine this ‘profit’ by his own decision (that is, to establish control over most of the decisions on which that profit depends). But once he actually succeeds in doing this he has an even stronger incentive to remain tied to ‘his’ factory for the rest of his life, and to transmit these ‘ties’ to his children and family. Imagine how cheated he would feel if, after having succeeded in making a factory a ‘profitable’ concern, he would then be transferred to another factory which makes a loss (with the loss of income which this would entail for him!). So the process could only end by the reintroduction of private property. And when, even before this ultimate outcome, the ties with foreign firms become stronger, villas bought on foreign coasts and mountains, bank accounts established in foreign banks and used for some ‘profitable investment’ (for example, the purchase of foreign stocks and bonds) would become additional stepping stones in this process. [14]

In reflecting on this projection – all the points of departure of the conflicts described exist in present-day Soviet society, and are reflected in the economic literature of the USSR. The mystifying character of Bettelheim’s thesis of the ‘dual nature of factory ownership’, and on the dual nature of appropriation, is verified once again. It veils the irreconcilable struggle between two economic dynamics, which, to be sure, reflect in the last analysis two diametrically opposed class interests. Just as capitalism and private ownership of the means of production are not reconcilable with an economy in which the strategic decisions governing economic development are independent of the decisions of companies and of the criterion of individual profitability, in the same way socialist planning and collective ownership of the means of production are irreconcilable with an economy in which the central decisions governing development are determined by the market and the industrial profitability of enterprises.

Why Is There a Partial Survival of Market Relations?

Some critics have accused me of ‘surreptitiously’ reintroducing market relations through the medium of ‘a thing, that is, scarcity’ into the USSR after having peremptorily declared them in contradiction with the relations of production born of the October Revolution. Let us examine more closely why consumer goods have remained commodities in the USSR and the ‘people’s democracies’.

We have seen that, according to Marx, there will be a modification of the mode of distribution after the establishment of a new mode of production based on collective ownership of the means of production. In his Critique of the Gotha Programme, Marx distinguishes two successive modes of distribution: a) distribution according to amount of work done, through the means of labour ‘vouchers’ in the phase termed socialism; b) distribution according to need in the phase termed communism.

Moreover, Marx categorically states that distribution according to labour implies the survival of bourgeois right and corresponds to bourgeois norms of distribution. Today we can affirm, on the basis of experience and the theoretical conclusions which follow from it, that before the phase termed ‘socialism’ there will be another preliminary phase termed ‘the transitional period between capitalism and socialism’, during which not only bourgeois norms of distribution will remain in force, but the distribution of the major part of consumer goods will take place through the medium of a universal equivalent (that is, money).

The explanation has been given many times. Let us go through it once more. Let us suppose that the day following the overthrow of capitalism, money is completely suppressed, but relative scarcity of consumer goods remains. The producers are given allotments from the consumption fund in the form of ‘labour vouchers’. Non-productive members of society (children, retired people, the sick, etc.) receive the same sort of vouchers. Now, the circulation of these vouchers is inevitable. If they are expressed in terms of tangible quantities of goods and services (like the coupons of a ration book), the difference in need for different units of consumption will bring about this circulation. Non-smokers will exchange their ‘cigarette vouchers’ for ‘chocolate vouchers’. If they are expressed in common measures, the desire to differentiate certain items of consumption from others with respect to time will bring about the same circulation. (For example, the measures may be one-tenth of an hour, or one-hundredth of an hour of labour. At the present average productivity of labour this is effectively the kind of ‘unit’ that would have to be used and not the work-hour, because many consumer goods are presently produced in far less than an hour of work.)

Moreover, a voucher on which is printed ‘one-tenth of an hour of labour’ and which is freely exchangeable for a variety of different goods and services is already a universal equivalent.

Now it happens that the necessity of strict accounting of labour performed is imposed on this transitional society. But we are dealing with a society in which the growth of productivity is particularly rapid. One hour of labour today will produce only 90 per cent of what an hour of labour will produce next year, and it already produces 110 per cent of what an hour of labour produced last year. In one sector, productivity is more advanced than in another; in one enterprise it is on a higher level than in another.

In distinction to what occurs under capitalism (and in every market economy), under the regime of collective ownership of the means of production, workers will not be rewarded on the basis of the greater or lesser productivity of ‘their’ enterprise. But precisely for this same reason society has to aggregate its labour expenditures in an extremely precise manner, and compare in a manner no less precise the expenditures of units of production to the ‘average’ by national and international sectors. This aggregate accounting must be carried out with the aid of a common standard, for example a labour-hour at the average annual level of productivity between different sectors of industry. But it is clear that this ‘labour-hour’ is far from identical with the standard hour of labour (10 times one-tenth of an hour of labour) used for the assignment of vouchers to be drawn on the consumption fund. The former includes the differences in productivity, the latter excludes them. The former changes from year to year, the latter should remain relatively stable. A third difficulty arises when it is a question of making long-term projections (of the plans for development). By calculating in ‘labour-hours’ from a base year, clearly we will end up after a certain number of years with new ‘hours’ which are twice as productive. But a stable standard over time is indispensable for long-term planning. The use of a stable currency as a standard of measure is consequently preferable from all points of view: for facilitating calculations and economic accounting, for facilitating the comparison between the share of revenues going to consumers and the aggregate productive effort of society, for facilitating the standardisation of consumption by the producers over time, and if we wish, for making as clear as possible all socio-economic relations.

The monetary form of distribution of consumer goods thus flows from the relative scarcity of these goods in the transitional period between capitalism and socialism. It has a social content to the extent that private ownership of consumer goods survives, with the concomitant at least partially non-social (unplanned) character of the labour that goes into their production. The form, as well as the content, begin to disappear in proportion as fundamental needs are satisfied, as distribution ‘according to need’ can be extended to a number of essential goods and services. It is a long process which will extend throughout the transitional period and will be prolonged even under socialism. In contrast, in the production of capital goods and in economic calculation and accounting, a monetary form is a technical simplification, which does not embody the same social content. As long as collective ownership and social planning of large-scale investment decisions are in effect, monetary forms will not imply market phenomena.

Thus it is a question of two different types of relations of production – even if they are closely entwined within the Soviet economy. The dynamic of this interaction can now be specified. The survival of bourgeois norms of distribution reacts upon the planned relations of production to the extent that they create – under a regime of scarcity! – a strong incentive for linking incomes not only to the input of labour but also to the relative productivity of labour, since this has been calculated and is therefore known. This linkage may be individual or collective. It can disintegrate or accentuate the solidarity of workers within an enterprise, a locality, or an industrial sector. It will always accentuate the inequality among the associated producers, and will therefore be a subjective force for disunity among them.

The calculation of the net cost of each product and each enterprise, indispensable for serious planning of growth in the transitional epoch, just the same creates a strong incentive for calculating the individual profitability of enterprises, which then becomes a force for objective dissociation of the plan (the relations of planned production described above).

These two processes correspond to intrinsic, objective contradictions in the transitional phase which no amount of subterfuge will overcome. Correct policies in a revolutionary direction, large-scale participation of the masses in political life and economic decision-making, a high level of consciousness of the proletariat, all facilitate a solution to these contradictions. A progressive bureaucratisation of the mechanisms of management, the appearance of a privileged bureaucratic stratum monopolising the management of the economy and the state, the elimination of the masses from all conscious participation in this leadership all aggravate the contradictions.

But the roots of these contradictions are objective and historical. They correspond to a level of development of the productive forces which does not yet allow the new relations of production to consolidate themselves spontaneously in a climate of expanding social wealth and creative enthusiasm of the producers. Marx is careful in the two texts which we have mentioned always to enumerate two conditions, one objective, the other subjective. The subjective condition flows only in the last analysis from the objective condition and can at the same time temporarily be in advance of the latter. The disappearance of market relations in the area of consumer goods corresponds to the possibility of seeing both precise calculation of labour expenditures and precise ‘rewarding’ of producers according to their individual input of labour progressively die out at the same time. The more the productive forces expand, the more ‘distribution according to need’ will extend itself to successive sectors of goods and services, the more ‘private ownership’ of a series of ‘consumer goods’ will die out in the face of abundance, the more ‘increasing income’ will cease to be the motivation for the economic activity of the individual – and the more the new relations of production will be definitively consolidated without any interference from ‘market relations’, ‘monetary calculations’ or ‘tendencies toward private enrichment’.

The Role of the Soviet Bureaucracy

But let us not forget that the USSR is not a classic ‘transitional society’. It is a bureaucratically degenerated society after having been bureaucratically deformed from the time of the civil war as Lenin specified in 1921. It is impossible to describe the socio-economic dynamic of this specific socio-economic formation without mentioning the particular role the bureaucracy has played for at least 45 years.

Authors like Bettelheim and Sweezy, confronted with their own political past and with the disagreeable necessity of defining the role of Stalin and Stalinism in the process which creates the threat of capitalist restoration in the USSR, generally avoid this difficulty by not mentioning it. The Maoists enumerate ‘proofs’ of capitalist restoration which were all present in the USSR in Stalin’s time to an equal or even greater degree than today without drawing the most minor theoretical conclusions from it. [15] Bettelheim extricates himself with a sudden manoeuvre: the process is ‘political’, it has nothing in common with a more or less extended takeover by commodity production. ‘The new bourgeoisie’ took power at the Twentieth Congress of the CPSU. [16] If we ask through what changes in the relations of production did this restoration of capitalism, this counter-revolution, manifest itself, we are told that ‘politics must be put in command’. Doubtlessly the ‘transitional society’ (which these authors used to call ‘socialism’!) and ‘capitalism’ functioned for decades with the same economic mechanisms, with the same laws of development, and with the same fundamental contradictions, without our metaphysicians being in the least bit surprised by it ...

The bureaucracy is not a new ruling class. It does not play a fundamental or indispensable historic role in the process of production. It does not have an historical mission to assure ‘accelerated economic growth’. The proletariat could fulfil the same function perfectly well under certain often specified socio-political conditions. The supporters of the theory of ‘state capitalism’, as much as they hate the bureaucracy and never speak of it without foam on their lips, actually assign an infinitely more important and progressive role to it than Trotsky and the Fourth International would acknowledge. For us the bureaucracy is only the product of an accident of the historical process just as there were numerous accidents in the historical process characterising the epoch of transition between feudalism and capitalism (for example, the exercise of political power in Great Britain by the Whig nobility after the ‘Glorious Revolution’ of 1688 and by the semi-feudal caste of Prussian Junkers during the era of the triumphant, imperialist German bourgeoisie between 1870 and 1914, to mention just two instances). For the theorisers of ‘state capitalism’, the bureaucracy becomes a necessary instrument of ‘primitive accumulation’ in Russia.

Because it is not a new class but simply a parasitic outgrowth of the proletariat, the bureaucracy has no political, social or economic means at its disposal to make the defence of its own special material interests coincide with the development of the mode of production from which it draws its privileges. In capitalist society, competition based on private ownership assures such a concurrence: each capitalist attending to his own interests assures the development of the system with the maximum ‘rationality’ conceivable within the framework of the anarchy of the laws of the market. In a transitional society between capitalism and socialism, managed by the associated producers, the same concurrence comes about: the producers’ interest in reducing their labour effort, and at the same time increasing their consumption, creates the mechanism through which planned growth can be realised; not automatically in optimum proportions, but just the same within limits that assure the continued development of social wealth.

There is nothing of this in the USSR nor in any society in which the bureaucracy has usurped the management of the economy and the state. The special interests of the bureaucracy are essentially the maintenance and extension of their own privileges of consumption. The monopoly of management is conceived only as an instrument for attaining this end. Nationalised property is only defended with this end in mind. To discover a fanaticism for ‘production for production’s sake’ on the part of the Soviet bureaucrats, as comrades Kuroń and Modzelewsky have done, is to misunderstand a fundamental trait of the conduct of the Soviet bureaucracy from 1923 to today: the bureaucracy has mounted an uninterrupted series of oppositions to the needs of economic planning, all of which tend to make growth fall below the level easily attainable under the concrete conditions of time and place, not to speak of optimal growth.

No social caste in history has ever administered the social surplus product in a disinterested fashion. If the Stalinist epoch is characterised by the elevation of the bureaucracy to a social caste, conquering monopoly control of the management of the state and the economy, then it follows that the consumer interests of the bureaucracy act as the social motive force of economic growth. And since the relations of production born of collective appropriation of the means of production (that is, planning relations) demand an economic growth of a different sort, there is a constant conflict between the two. The many ‘tensions’, ‘crises’, and ‘reforms’ of the Soviet economy since the First Five-Year Plan (that is, since the private sector was largely eliminated from the Soviet economy) can be attributed to this conflict of interest. The commodity ‘form’ taken by the fiscal accounting in enterprises and by the circulation of the means of production furthers this conflict through the effect of one of the interferences mentioned above. [17] This commodity form is opposed to its content just as, for example, the ‘commodity form’ and the fiscal accounting of the circulation of car bodies on the Ford assembly lines does not in fact transform this circulation into a circulation of commodities. When the ‘value’ of machinery is computed in roubles, the bureaucrats undergo a thousand temptations to profit from this ‘value’, that is, to steal from the state and to bring about ‘primitive accumulation’ at its expense. They often apply these diverted funds towards ‘fulfilling the plan’ (to the extent that their own incomes are functions of this ‘fulfilment’). Here is where we find the kernel of truth in Bettelheim’s thesis on the ‘dual nature of the ownership of the means of production’.

To the extent that scarcity and a general desire for personal enrichment exist, and in the absence of strict control exercised by the mass of workers over all managerial decisions, the bureaucratic managers can divert a fraction of the capital-goods production from ‘planned channels’ and create for themselves ‘parallel channels’ (the black market or the ‘grey market’). But this kernel of truth in Bettelheim’s thesis serves only to refute the broader thesis even more neatly. It is clear that this diversion is not the cause but rather the effect of the survival of market phenomena. And it is no less clear that, if the capital goods which pass into ‘parallel channels’ are commodities, then those capital goods which do not do so have a different social nature, that is, they are not commodities. Everything thus brings us back to the problem posed in the beginning: what decides the essential distribution of the means of production, the plan or the market? For the present-day USSR the answer is obvious.

Two Mystifications

Pierre Naville, who has in the past accustomed us to expect more serious work from him (including Volume 1 of his New Leviathan), has attempted to elaborate his own conception of the nature of the USSR in an extremely turgid book, in which the best and the worst go hand in hand, and an enormous erudition is equalled only by contradictions which are no less impressive.

Volume 2 of Salaire Socialiste [Socialist Wages] corrects and very often contradicts the peremptory assertions of Volume 1 without the author attempting to resolve these contradictions. [18]

Holding a middle-of-the-road position between the Trotskyist and state capitalist theories, he calls the Soviet economy ‘state socialist’. He holds that the Soviet economy is part of a single world system ruled by the law of value and the accumulation of capital. Thus he falls victim to two mystifications which the partisans of the state capitalist theory have repeated ad infinitum for nearly half a century, following Otto Bauer and the Mensheviks.

First let us consider the second aspect of the question. Naville claims to deduce the commodity character of all Soviet production from the wage character of labour. The whole problem is reduced to a syllogism: where there are wages there must be exploitation in this exchange, and hence ‘capital’ – the exploitation of animate labour by inanimate labour. In the USSR, wage labour is universal. Therefore there must be exploitation. [19] The only difference from capitalism which Naville allows is that the surplus value is appropriated collectively, not individually.

This syllogism is easy to break down. Naville himself mentions the fact (as did Trotsky before him and as I have done in Marxist Economic Theory) that workers belonging to a cooperative can sell products that belong to them – in this case their labour power – to the cooperative. Must this mean ‘exploitation’? Not at all. If the difference between what this labour power produces and what the workers receive is the property of a democratic and egalitarian cooperative directed by all the producers, themselves included, it is not easy to see where the ‘exploitation’ fits in. Wages as a monetary form of allocation from the consumption fund do not automatically mean ‘exploitation’ of labour power. To be sure, the USSR is not a democratically-managed cooperative. The bureaucracy appropriates part of the social surplus product produced by the workers. But this in itself does not automatically transform this appropriation into capitalist exploitation, which is exploitation of a very specific type following specific laws of development.

Naville writes:

The pursuit of an increasing surplus value is due to the necessity, as unavoidable in state socialism as in capitalism, of overcoming the tendency of the rate of profit to fall due to a modification in the organic composition of capital to the advantage of fixed capital. (p. 132)

What we have here is a mystifying tongue-in-cheek begging of the question. The unavoidable necessity of pursuing increasing surplus value results from the fact specified many times by Marx that capital is inconceivable except in the form of ‘different capitals’, that is, as the result of competition. The ‘pursuit of increasing surplus value’ is to be explained by competition and competition alone. The capitalist is not an ‘accumulation fanatic’ for no good reason. He becomes so under the lash of competition and that reason alone.

If you eliminate the economic necessity for capital accumulation (which has as its aim the overcoming of competitors by reducing the production costs, through the purchase of more technologically advanced fixed capital), you cannot see any reason why the capitalist would always be searching for an increasing surplus value. Nor can it be seen why the ‘organic composition of capital’ continually rises. A ‘capitalism without competition’ would be a stagnant capitalism. [20]

Now, in the USSR there is no competition since there is state ownership of the means of production. There is no ‘necessity’ to ‘pursue an increasing surplus value’. Even the Soviet economists have developed schemas demonstrating (as I did before them) that continued growth at a high rate is perfectly possible while holding the percentage of consumer goods in total production steady or even increasing it. In the 1,000 pages of Naville’s book there is not a single sentence which adduces proof to the contrary, that is, proof of the ‘necessity’ of pursuing ‘increased surplus value’ in the USSR.

But, say the supporters of the theory of state capitalism, there is indeed competition between the USSR and the Western capitalist countries. The necessity of increasing accumulation of capital and behaviour similar to that of a capitalist economy flows from this competition. Naville parallels this argument without entirely embracing it. Once again we are dealing with a gross mystification.

Every non-capitalist socio-economic formation has been forced to defend itself against the pressure of capitalist industry as well as capitalist armies. This was true for China and Japan from the sixteenth to the nineteenth centuries; it was true for the Russia of Lenin and Trotsky; it is true for that of Stalin and Brezhnev. But this necessity does not automatically produce the establishment or re-establishment of capitalism or of an ‘exploitation’ of wage workers equivalent to capitalism. Adaptation is not the only form of self-defence. In order to prove that Western capitalism forces the Soviet bureaucrats through competition to exploit their own workers, it would be necessary to show that competition to sell commodities on the same market is involved. For this is the sole process which introduces the ‘iron necessity’. Clearly this is not the case in the USSR. This country trades hardly one per cent of its national product with the advanced capitalist countries, which have a higher average labour productivity than its own. To claim that it is in order to ‘sell’ this one per cent that the bureaucrats ‘ferociously exploit’ their workers, one must believe that it is the tail that wags the dog.

The existence of international capitalism imposes numerous constraints on a planned economy. It obstructs the flowering of a fully-developed socialist society. It makes the disappearance of market relations impossible. It imposes a rate of investment that introduces more rapid development than capitalism. All of this, which refutes the reactionary utopia of ‘socialism in one country’, is ABC for those who are familiar with Trotsky’s teachings and accept the broad outlines of them. But from none of these consequences does it follow that the ‘law of value’ determines the economic evolution of the USSR. Even less does it follow that there is a single economic system which unites the entire world, as Naville claims on page 9 of his book. One does not distinguish oneself for scientific objectivity by citing Preobrazhensky and Trotsky as authorities without mentioning that both of them expressly denied this ‘unification’ and justly affirmed that even the possibility of generalised industrialisation in the USSR followed precisely from the fact that the USSR could exempt itself in part (not entirely, but in part) from the effects of the law of value and above all from its regulatory role. [21]

The Laws of Development of the Soviet Economy

Let us summarise. Soviet society is a specific socio-economic formation which combines general features of a transitional society between capitalism and socialism with particular features that make it appear as an example of a transitional society stricken by immaturity: low starting point for the productive forces, capitalist encirclement imposing a thousand military and economic constraints, a weak specific gravity of the proletariat in the society from the time of its birth, the insufficient level of technical education and culture of this same proletariat, etc. The laws of development in this socio-economic formation include, then, in part, the laws of all ‘transitional societies’, combining them with the specific laws of development flowing from the phenomenon of bureaucratic degeneration and the phenomena of capitalist survivals.

Insofar as we can identify these laws today on the basis of the historical experience (which is far from having said its last word on the subject), we can extend as follows the analysis made by Trotsky in The Revolution Betrayed with respect to the Soviet economy.

  1. The contradiction between the socialised and planned mode of production and the survival of bourgeois norms of distribution is the principal contradiction of the Soviet economy. It puts the whole transitional epoch under the sign of battle between the logic of planning and the ‘law of value’ as the principal regulator of the economy. The operation of the ‘law of value’ cannot be overcome by decree, but it can become atrophied by the growth of the productive forces, the consolidation of planning, the beginning of the disappearance of market relations, and the international extension of the revolution.
  2. Under the bureaucratic management of the state and the economy this contradiction is combined with the contradiction between the logic of the plan (proportional and regular economic growth) and the private consumer interests (appropriation of material privileges) of the managerial bureaucracy as principal social motive force for the realisation of the plan.
  3. These two contradictions are related to an essential contradiction in the field of production relations: between planning on the one hand, which as an affirmation of the directly social character of labour contains a fundamentally egalitarian dynamic, and the maintenance of conditions of hierarchical subordination within the labour process in the enterprises on the other, which contains a dynamic leading toward growing inequality.
  4. This contradiction has a tendency to grow to the degree that the organisation of the economy on the basis of profitability of individual enterprises and the tying of incomes (of bureaucrats and even workers) to profitability undermines the directly social character of labour which flows from the planned relations. These measures contain the leaven for dissolution of planned relations through the reappearance of autonomy of decision-making in matters of price, investment and orientation of production.
  5. The growth of the Soviet economy assures the long-term survival of the non-capitalist mode of production only to the extent that it reduces the gap between the productivity of labour in the USSR and in the imperialist countries through a higher rate of growth. It cannot therefore free itself entirely from the constraints imposed by capitalist encirclement (not to mention the military constraints), but it can lessen their effect and keep the international capitalist market from imposing through the operation of the law of value an orientation on the economic development of the USSR which would make this development subordinate to the interests of the monopolists who dominate the world market.
  6. Historically there can be but two diametrically opposed outcomes to this five-fold conflict: either a definitive consolidation of planned relations, which requires a beginning of the disappearance of market relations and material incentives, or else a breakthrough by the ‘law of value’ which will require the disappearance of planning as a regulatory force in economic growth and the restoration of private ownership – in the economic rather than the directly juridical sense of the term.
  7. The first outcome requires a political revolution to eliminate the dictatorship of the bureaucracy and establish democratically-centralised management, that is, economic and state planning by the workers, the ‘associated producers’. This outcome is furthered by the international extension of the revolution and by the growth of the productive forces already under way.
  8. The second outcome will require a social counter-revolution of which a section of the bureaucracy may be the bearer. It could not triumph without crushing the resistance of the Soviet proletariat and could not link up with international capitalism except in an ebb-phase of the international revolution.
  9. In the last analysis, this evolution will not be decided by the struggle between economic forces or mechanisms nor by the mechanical reflections of this or that level of development of the productive forces. It will be decided by a struggle of living social forces on a world scale. In this sense, and in the entire context cited above, the ‘subjective factor’ will in fact remain the decisive factor in deciding the destiny of the Soviet Union. [22]
The Soviet Economy


1. For example, Paul M Sweeny, Charles Bettelheim, some of the oppositionist Czechoslovak communists such as Karel Bartošek (see Les Temps Modernes, December 1969), etc.

2. Karl Marx, Introduction à la critique de l’économie politique, in Contribution a la critique de l’économie politique (Editions Sociales, Paris, pp. 149–75).

3. Charles Bettelheim, La Transition vers l’Économie socialiste (Editions François Maspero, Paris 1968), p. 157. We will return to a more detailed consideration of Bettelheim’s ideological evolution, which took a new turn in his most recent work, Calcul économique et formes de propriété.

4. But only in the last analysis. There are a whole series of mediating factors between this ‘ultimate cause’ and the concrete historical process which can impose direction on the process. These include the role of revolutionary leadership, the level of consciousness of the proletariat, its level of activity and self-organisation. It would be vulgar mechanistic thinking to see all these factors as automatic reflections, pure and simple, of the level of development of the productive forces at each stage in each country.

5. Gilles Martinet, Le conquête des pouvoirs (Le Seuil, Paris 1968), p. 92. ‘And yet it moves’: words attributed to Galileo, who was forced to recant his support of the Copernican theory that the earth moves around the sun rather than forming the stationary central point of the universe as Church doctrine held – International Editors’ note.

6. Karl Marx, Capital, Volume 1 (Charles H. Kerr, Chicago 1912), pp. 83–84, 90–91.

7. Karl Marx, Fondements de la critique de l’économie politique (Editions Anthropos, Paris), pp. 110–111.

8. There is a justification for this phenomenon which is both economic and socio-political. From the socio-political point of view, since the means of production are collective property allocated to the production units by the collective whole, and since the productivity of labour depends far more on this capital endowment than on the individual or collective effort of a group of workers, it would be illogical and unjust first to allocate below-average tools of production to a group of workers and then penalise them for the consequences. From an economic point of view, from the moment that inputs and outputs are aggregated, the ‘loss’ occasioned by the use of tools of production that are below average in efficiency is clearly less than the loss that would result from not using them at all. This is true because all other more efficient productive resources are already being used.

9. Pierre Neville misses the point when he says: ‘Private appropriation of products, like consumption, has lost all individual character [in the USSR].’ (Le Salaire Socialiste (Editions Anthropos, Paris 1970), p. 70) It is one thing to say that the general quantum of the producers’ consumption is socially predetermined – it would be also in the socialist society described by Marx. It is quite another thing to claim that the specific distribution of the general quantum among a whole number of different goods and services ceases to be ‘individual’. This is not the case in the USSR. It is precisely in the area of specific distribution that ‘private appropriation of goods’ manifests its individual character. No constraint forces the workers to spend their wages ‘according to the plan’.

10. Leon Trotsky, The Revolution Betrayed (Pathfinder Press, New York 1970), Chapter 9, Social Relations in the Soviet Union.

11. For example, Chris Harman, International Socialism, December 1969–January 1970 (reprinted in Readings in State Capitalism, International Marxist Group, London 1977).

12. Trotsky, The Revolution Betrayed.

13. Monthly Review, Vol. 20 No. 10, March 1969, pp. 15–17.

14. Ernest Mandel, The Inconsistencies of State Capitalism (International Marxist Group, London 1969, pp. 14–15 – reprinted in Readings in State Capitalism).

15. Leninism or Social-Imperialism, Peking Review, No. 17, 24 April 1970.

16. Monthly Review, Vol. 20 No. 10, March 1969, pp. 5–7. This is clearly a ‘convenient’ way of brushing aside the fact that despite the ‘Cultural Revolution’, all the fundamental contradictions that characterised the Russia of Stalin, Khrushchev and Brezhnev exist in present-day China. This is true not only because the low level of development of the productive forces do not permit the disappearance of market relations, but also because there is hardly any management of the economy by the ‘associated producers’.

17. Naville argues oddly that one cannot deny that the means of production are commodities since all present-day Soviet economists speak of the universal validity of the law of value (Le Salaire Socialiste, Vol. 1, p. 25). Using the same logic one could argue as well that we cannot claim that labour is exploited in the Western capitalist countries because all present-day Western economists support the marginalist theory which disputes the existence of this exploitation. Naville seems to forget that there is a dictatorship of the bureaucracy in the USSR that exercises the strictest censorship on all works that are allowed to be published. What do we know of the opinions of Soviet theoreticians who are not allowed to publish their writings?

18. Naville, Le Salaire Socialiste. (This two-volume study constitutes the second and third volumes of a larger work entitled Le nouveau Leviathan.)

19. This is not an exaggeration. Here is what Naville writes (Le Salaire Socialiste, p. 133): ‘By definition [sic] where wages exist, whatever their form or level, there is surplus value (with respect to these wages), since wages presuppose an exchange and this exchange implies a fundamental inequality of the exchange between labour-power and product. Surplus value results from this inequality.’

20. One might respond: but doesn’t the organic composition of capital increase because of the efforts of the capitalists to reduce wages by replacing ‘animate labour’ by ‘inanimate labour’? We would reply that in the absence of competition, nothing forces the capitalists to reduce wages, especially in a period of economic stagnation, when wages will already be very low as a result of the massive unemployment inevitable under these conditions.

21. This is not the only twist that Naville practises on scientific objectivity. Thus on pages 124–25 he takes me to task because I demonstrated with an algebraic example that the maximum rate of accumulation never yields the highest increase in social product and is therefore never the optimal rate, contrary to Naville’s view that in the USSR the attempt to achieve a ‘maximum rate of accumulation’ would be a ‘law’ of the regime (Le Salaire Socialiste, p. 132). Instead of attempting to refute my argument – based on the effect of the level of consumption on the productivity of labour (on the ‘efficiency’ of investments) – Naville accuses me of ‘obscuring’ the fact that growth of productivity would mean a growth in productivity of surplus-value. Yet immediately following the passage cited by Naville, I devoted whole pages to rejecting the very view he attributes to me. I have indicated that a socialised and planned economy should see the growth of the productivity of labour first as an increase in the total product, then as an increase in use-values produced (Marxist Economic Theory, Vol. 2 (Monthly Review Press, New York 1969), pp. 628–31). What role does surplus-value play in all this?

22. One of the most extraordinary reproaches directed against Trotsky and the Trotskyist movement is that of Jorge Semprun in his preface to Crisis del Movimento comunista by Fernando Claudín (Edicione Ruedo Iberico, Paris 1970), pp. x–xi. According to Semprun, Trotsky’s method is limited to ‘a subjective and voluntaristic idealism’. The whole question is one of leadership. It would have been sufficient to replace Stalin and his group. Then the same parties in the same International would have brought about the triumph of the world revolution. Is this ignorance, ill-will or a combination of both? It seems that Semprun has never heard of Trotsky’s social explanation of the degeneration of the Soviet state and the International, namely the coming to power of a privileged social stratum in the USSR and the transformation of the Communist International into an instrument for defending its privileges. He has never heard of the call put out by Trotsky in 1933 for the creation of new parties and a new International. Coming from someone who ‘discovered’ the necessity of breaking with Stalinism some 25 or 30 years later, this ‘polemic’ is truly astonishing.

Last updated on 3 October 2014