Karl Radek

The Paths of the
Russian Revolution


The New Economic Policy of the Soviet government began with the abandonment of the policy of requisitions in the village, and its replacement by a tax in kind. The difference between the two policies first of all consists in the peasants henceforth having to pay only one tax of a fixed amount, whereas before they had been hit by requisitions varying in accordance with the current needs of the armies and the cities. The tax in kind takes much less off the peasants than hitherto. It therefore encourages them to extend the area sown, and to cultivate it more efficiently. This is because they now retain a surplus above what is needed for their subsistence and the tax, which they can exchange for industrial products. By this, concessions to the peasants involve concessions to the urban bourgeoisie and to commercial capital which preserved itself in the illegal form of speculation. In and of itself, concessions to commercial capital need not necessarily flow from concessions to the peasants. If Soviet Russia had at its disposal important stocks of merchandise, the peasant could exchange his surplus of cereals with the state against industrial goods via the cooperatives. The concessions to commercial capital result from the industrial weakness of the state, and from the lack of credits. But other consequences result from it. Even the commercial bourgeoisie does not possess sufficient stocks of merchandise. It seeks to accumulate merchandise whether by smuggling – foreign trade is in fact a state monopoly – or by purchase on the internal market. The commercial bourgeoisie can only procure merchandise among the kustari, the petty artisans. The domestic labour of the kustari, however, only produces a very restricted amount of goods – as regards quality as well as quantity. [69] If Soviet Russia does not want to aggravate artificially the lack of goods – and it is clear that it has no sensible reason to do this – it must very naturally allow the reconstruction of small and middle industry. The state must consciously renounce the management of this industry. This would in fact involve the dispersal of its forces of organisation which are none too numerous already. It is for this reason that the Soviet government has authorised the leasing of small and middling businesses by working class cooperatives as well as by private persons. But the limit of the concessions that the Soviet government is obliged to make in its retreat has not yet been reached. The Soviet government has need of foreign technical help, but its financial means are too weak to buy enough machines from abroad. To obtain these the Soviet government must seek to attract foreign capital by other means. These are the concessions, that is to say, the authorisation given to foreign capital to take over, on the basis of agreed conditions, industries which already existed or which it is necessary to start up from scratch. But great foreign capital thus rushes into an area whose control is vital for Soviet Russia: heavy industry.

The policy of the Soviet government contains concessions of very long duration, for the foreseeable historical period, and concessions of a more temporary type. The concessions to the peasants doubtless form part of the first type. In a country where the population is essentially petit-bourgeois, in a country where the small and middle peasant represent the great majority of the population, the progress to superior collective economic forms in the village can only take place when the proletarian state is capable of showing the peasants a life of progress thanks to great technical superiority, and important technical aid. For as long as Soviet Russia is not covered by a network of electric power stations, as long as modern agricultural machines have not had the widest distribution and use in the village, the peasant will remain a small, free and independent owner. Things are different as regards the concessions made to the commercial bourgeoisie and the small industrial capitalist leaseholders. As soon as large-scale industry begins to function, as soon as it is able to satisfy in one way or another the need for goods, it will vanquish small industry by means of competition. The development of the cooperatives will gain ground over retail trade, and all the more rapidly if the state supports the cooperatives more energetically. The concessions to foreign capital are linked to the international situation. They arise from a double necessity: on the one hand to obtain the means of production from foreign capital, and on the other hand to hold back the interventionist tendencies of world capital. The duration of these concessions is linked to the duration of the present and relative world equilibrium.

What social reconstruction of classes results from the New Economic Policy of the Soviet government? The peasantry forms a petit-bourgeois class. With it is linked the small and middle urban bourgeoisie in the process of restoration. Foreign concessionary capital forms the big capitalist class. The proletariat is opposed to these classes, on the one hand in the big state industry, on the other hand in small and middle leasehold industry, and finally in big concessionary industry. It is unnecessary to emphasise that this does not represent a favourable relationship of forces for the working class. The situation contains great danger in itself. The small and middle urban bourgeoisie, concentrated in the country’s cultural centres, will try, on the basis of its commercial relations with the peasantry, to organise it as a class against the proletariat. In the first place, it will attempt to ally itself with the most powerful elements in the peasantry. To begin with, foreign capital, supported by the capitalist governments, will try to modify in its favour the conditions on the basis of which it was allowed into Russia by the Soviet government. Doubtless it will attempt to break the most important obstacle to its expansion: the state monopoly of foreign trade. The type of aid offered to starving Russia such as Lloyd George proposed in his speech of 16 September makes this perfectly clear. The whole plan in fact envisaged the assigning of trade credits by the British government to British firms which would then exchange in Russia industrial goods for foodstuffs under the form of free trade. In this way foreign capital would naturally forge independent economic relations with the Russian peasants.

The Soviet government is certainly not closing its eyes to the dangers which result from this; but they are counter-balanced by the fact that the proletariat holds state power. The proletariat as the ruling class is the owner of the means of production. Even if the peasant is exploiting the land freely, it nonetheless remains nationalised, that is, it remains in the hands of the state. This juridical right has a social significance. It prevents the formation of big private land ownership, and it holds back the formation of a rich peasantry as an organised counter-revolutionary force. It provides the proletarian state power with an entire series of means as regards the Russian and foreign bourgeoisie, whose industrial activity is linked to the question of the land. To the extent to which the state only leases industrial enterprises to private persons – when it does not keep control of them itself – to the extent to which it does not denationalise industry, it keeps control of it. It not only regulates the relationship of the leaseholders with the working class, which assures it, as the representative of the interests of the proletariat, of its link with the working masses and allows it to keep them as its social base, but it also has the possibility of influencing the economic activity of the leaseholders. It has the means to make this activity conform if possible with that of the state industry. In this context the possession of the means of transport and of communications is of decisive importance for influencing the economic activity of the bourgeois elements.

The general picture of the social situation, which is the objective and result of the New Economic Policy, is this: the proletarian state rests upon the ownership of the principal branches of industry. Obliged to allow these partly into the hands of foreign capital, it seeks permanently not only to strengthen its social base, but also to enlarge it, by doing all in its power to obtain new means of production. It controls small and middle leased industries, as well as that sector of industry it has been forced to lease to foreign capital. It is not only the protector of the proletarian workforce, but also, supported by real economic power, the regulator of economic life. The concessions to the peasantry have on the one hand the aim of renewing and strengthening the alliance between the working class and the peasantry which led to the victory of October, and on the other hand of obtaining from the peasantry thanks to the development of the rural economy fresh resources for heavy industry; the concessions to commercial and industrial rented capital on the other hand allow the state to obtain the goods necessary to satisfy the needs of agriculture. The concessions to big foreign capital have as their objective the freeing of resources for the development of state industry. The result attained obviously does not represent a Communist organisation of society, but it contains an entire series of measures that assure the development of the Russian economy. It is on this basis that the power of the working class will be strengthened, and that the working class has the possibility of more and more organising economic life and controlling petit-bourgeois anarchy.


69. Kustari were cottage and small handicraft workmen producing in an amateurish fashion.

Last updated on 18.10.2011