Leon Trotsky

Nationalized Industry
and Workers’ Management

Written: May or June 1938.
Source: Fourth International [New York], Vol. 7 No. 8, August 1946, pp. 239 & 242.
Translated: Duncan Ferguson.
Transcription/HTML Markup: David Walters.
Copyleft: Leon Trotsky Internet Archive (www.marxists.org) 2004. Permission is granted to copy and/or distribute this document under the terms of the GNU Free Documentation License.

In 1938, when the Cardenas government of Mexico expropriated the oil industry from the Anglo-American imperialists, such newspapers as the NY Daily News ascribed the act to the influence of Leon Trotsky then in exile in Mexico. This, of course, was untrue.

Trotsky had made an agreement, which he scrupulously observed, that in return for asylum he would not intervene in Mexican politics. He was forced consequently to limit himself to stating his position in general on the expropriation. He supported the act, explaining his views in an article dated June 5, 1938, published in the Socialist Appeal (now The Militant) of June 25, 1938. It was not known that Trotsky had written more fully on another aspect of the expropriation: the placing by the Mexican government of the oil industry under the management of the workers.

In April 1946, Joseph Hansen, former Secretary of Leon Trotsky, visited Natalia Trotsky. He also called on friends of Trotsky. Among them was one who had made a study of the expropriation. This friend told about talking with Trotsky for a whole afternoon on the uniqueness of workers’ management of an expropriated industry in a capitalist country.

Trotsky promised to consider the subject more fully. Some three days later, Trotsky’s French secretary called on the telephone that Trotsky had written a short article.

This remarkable article had never been printed anywhere. Comrade Hansen examined the manuscript. Typewritten in French, it was undated and unsigned but the interpolations and stylistic corrections in ink appeared to be Trotsky’s handwriting. The style, and, above all, the method of analysis and the revolutionary conclusions were Trotsky’s, beyond question. Comrade Hansen immediately had a copy typed and brought it to Natalia. She was convinced of the authenticity of the article. The probable date it was written can be fixed as May or June 1938. – Editors, Fourth International, New York

In the industrially backward countries foreign capital plays a decisive role. Hence the relative weakness of the national bourgeoisie in relation to the national proletariat. This creates special conditions of state power. The government veers between foreign and domestic capital, between the weak national bourgeoisie and the relatively powerful proletariat. This gives the government a Bonapartist character of a distinctive character. It raises itself, so to speak, above classes. Actually, it can govern either by making itself the instrument of foreign capitalism and holding the proletariat in the chains of a police dictatorship, or by maneuvering with the proletariat and even going so far as to make concessions to it, thus gaining the possibility of a certain freedom from the foreign capitalists. The present policy [of the Mexican government – Translator] is in the second stage; its greatest conquests are the expropriations of the railroads and the oil industries.

These measures are entirely within the domain of state capitalism. However, in a semicolonial country, state capitalism finds itself under the heavy pressure of private foreign capital and of its governments, and cannot maintain itself without the active support of the workers. That is why it tries, without letting the real power escape from its hands, to place on the workers’ organizations a considerable part of the responsibility for the march of production in the nationalized branches of industry.

What should be the policy of the workers’ party in this case? It would of course be a disastrous error, an outright deception, to assert that the road to socialism passes, not through the proletarian revolution, but through nationalization by the bourgeois state of various branches of industry and their transfer into the hands of the workers’ organizations. But it is not a question of that. The bourgeois government has itself carried through the nationalization and has been compelled to ask participation of the workers in the management of the nationalized industry. One can of course evade the question by citing the fact that unless the proletariat takes possession of the power, participation by the trade unions in the management of the enterprises of state capitalism cannot give socialist results. However, such a negative policy from the revolutionary wing would not be understood by the masses and would strengthen the opportunist positions. For Marxists it is not a question of building socialism with the hands of the bourgeoisie, but of utilizing the situations that present themselves within state capitalism and advancing the revolutionary movement of the workers.

Participation in bourgeois parliaments can no longer give important positive results; under certain conditions it even leads to the demoralization of the worker deputies. But this is not an argument for revolutionists in favor of antiparliamentarism.

It would be inexact to identify the policy of workers’ participation in the management of nationalized industry with the participation of socialists in a bourgeois government (which we called ministerialism). All the members of the government are bound together by ties of solidarity. A party represented in the government is answerable for the entire policy of the government as a whole. Participation in the management of a certain branch of industry allows full opportunity for political opposition. In case the workers’ representatives are in a minority in the management, they have every opportunity to declare and publish their proposals, which were rejected by the majority, to bring them to the knowledge of the workers, etc.

The participation of the trade unions in the management of nationalized industry may be compared to the participation of socialists in the municipal governments, where the socialists sometimes win a majority and are compelled to direct an important municipal economy, while the bourgeoisie still has domination in the state and bourgeois property laws continue. Reformists in the municipality adapt themselves passively to the bourgeois regime. Revolutionists in this field do all they can in the interests of the workers and at the same time teach the workers at every step that municipality policy is powerless without conquest of state power.

The difference, to be sure, is that in the field of municipal government the workers win certain positions by means of democratic elections, whereas in the domain of nationalized industry the government itself invites them to take certain posts. But this difference has a purely formal character. In both cases the bourgeoisie is compelled to yield to the workers certain spheres of activity. The workers utilize these in their own interests.

It would be lightminded to close one’s eye to the dangers that flow from a situation where the trade unions play a leading role in nationalized industry. The basis of the danger is the connection of the top trade union leaders with the apparatus of state capitalism, the transformation of mandated representatives of the proletariat into hostages of the bourgeois state. But however great this danger may be, it constitutes only a part of a general danger – more exactly, of a general sickness. That is to say, the bourgeois degeneration of the trade union apparatuses in the imperialist epoch, not only in the old metropolitan centers, but also in the colonial countries. The trade union leaders are, in an overwhelming majority of cases, political agents of the bourgeoisie and of its state. In nationalized industry they can become and already are becoming direct administrative agents. Against this there is no other course than the struggle for the independence of the workers’ movement in general, and in particular through the formation within the trade unions of firm revolutionary nuclei, which, while at the same time maintaining the unity of the trade union movement, are capable of struggling for a class policy and for a revolutionary composition of the leading bodies.

A danger of another sort lies in the fact that the banks and other capitalist enterprises, upon which a given branch of nationalized industry depends in the economic sense, may and will use special methods of sabotage to put obstacles in the way of the workers’ management, to discredit it and push it to disaster. The reformist leaders will try to ward off this danger by servile adaptation to the demands of their capitalist providers, in particular the banks. The revolutionary leaders, on the contrary, will draw the conclusion, from the sabotage by the banks, that it is necessary to expropriate the banks and to establish a single national bank, which would be the accounting house of the whole economy. Of course this question must be indissolubly linked to the question of the conquest of power by the working class.

The various capitalist enterprises, national and foreign, will inevitably enter into a conspiracy with the state institutions to put obstacles in the way of the workers’ management of nationalized industry. On the other hand, the workers’ organizations that are in the management of the various branches of nationalized industry must join together to exchange their experiences, must give each other economic support must act with their joint forces on the government on the conditions of credit, etc. Of course such a central bureau of the workers’ management of nationalized branches of industry must be in closest contact with the trade unions.

To sum up, one can say that this new field of work includes within it both the greatest opportunities and the greatest dangers. The dangers consist in the fact that, through the intermediary of controlled trade unions, state capitalism can hold the workers in check, exploit them cruelly, and paralyze their resistance. The revolutionary possibilities consist of the fact that, basing themselves upon their positions in the exceptionally important branches of industry, the workers can lead the attack against all the forces of capital and against the bourgeois state. Which of these possibilities will win out? And in what period of time? It is naturally impossible to predict. That depends entirely on the struggle of the different tendencies within the working class, on the experience of the workers themselves, on the world situation. In any case, to use this new form of activity in the interests of the working class, and not of the labor aristocracy and bureaucracy, only one condition is needed: the existence of a revolutionary Marxist party that carefully studies every form of working class activity, criticizes every deviation, educates and organizes the workers, wins influence in the trade unions, and assures a revolutionary workers’ representation in nationalized industry.

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Last updated on: 12 September 2015