Encyclopedia of Anti-Revisionism On-Line

Ben Phillips

USSR: Capitalist or Socialist?

First Published: The Call, Vol. 10, No. 8-9, November-December 1981.
Transcription, Editing and Markup: Paul Saba
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It is no secret that the capitalist restoration thesis is in some difficulty. Critics have challenged its theoretical coherence while new and more systematic studies of Soviet society have demolished much of its empirical support. Unfortunately, communists whose analysis of the international situation rests on the contention that the Soviet Union is an imperialist superpower have not really confronted this situation squarely or even acknowledged it publically.

The sharpest challenge comes from the so-called “anti-dogmatists,” especially Michael Goldfield and Melvin Rothenberg’s The Myth of Capitalism Reborn. This book is well worth reading. Goldfield and Rothenberg accurately identify major weaknesses in the main arguments produced during the 1970s-for example, Martin Nicolaus Restoration of Capitalism in the USSR published by the October League; Red Papers 7 published by the Revolutionary Union; and the many articles over the years in Peking Review and Albania Today.

The empirical material offered often amounted to little more than reporting rumor and gossip as fact; data was not assessed in a comprehensive and scientific way; experiments and theoretical debate were confused with policy. The interest aroused by The Myth of Capitalism Reborn is another signal of the end of a period in which it seemed possible to rely on China’s prestige instead of making an independent analysis of such issues as what happened in the Soviet Union.


Many of the current policies of the Communist Party of China (CPC) contradict in practice the restoration thesis as Marxists have popularized it. The expanded role of enterprise profit, the increased reliance on market signals, the greater importance accorded to individual material incentives, a return to competitive and elite educational system, and the enthusiasm for Western influences all seem little different from policies once cited to demonstrate the return of capitalism in the Soviet Union.

Marxists obviously have a problem here. If we don’t want to jump to hasty conclusions about China then we have to begin rethinking the basis of the capitalist restoration thesis.

Communists in this country who support the three worlds thesis have to tackle these problems – they are not going to go away by themselves. But we face a somewhat paradoxical situation. Whatever the weakness in our current understanding of the Soviet Union, world events increasingly confirm that the Soviet Union is in fact an imperialist superpower bent on seizing world hegemony from a declining U.S. imperialism.

The basic elements of the three worlds thesis provide the only view that consistently accounts for major international events in the post-Vietnam era, from U.S. paralysis around Angola and failure to impose its will on third world countries such as Iran and Nicaragua to Soviet occupation of Afghanistan and initiative in its confrontation with the U.S.

This is a major reason for confidence that in the long run we will resolve the debate over the nature of the Soviet Union along the lines of the capitalist restoration thesis. It is striking, for example, that the Communist Workers Party almost totally ignores the evidence of Soviet aggression and domination in its recent rejection of the restoration thesis, at least in the arguments it chose to publish recently in The Guardian (6/3/81, 6/10/81).

* * *

There are basically four distinct contending positions among Marxists on the class character of the Soviet Union:
1. The Soviet Union is socialist;
2. The Soviet Union is in transition to socialism;
3. The Soviet Union is a new, stable, exploitative mode of production;
4. The Soviet Union is state capitalist.

We should reject the position (advanced, for example in Nicolaus’s 1975 book) that the Soviet Union is a monopoly capitalist society “just like” the U.S., and we should not be drawn into futile attempts to prove that it is. But this does not mean we must jump over to the view that it is socialist, as the CWP has. In the long run, we can rely on the working class and oppressed people in the U.S. to distinguish between socialism and what exists in the Soviet Union today.

At the same time, we should avoid going overboard running down Soviet life. After all, it should not be surprising that the Soviet people have held onto some of the gains made during socialist construction. In the U.S. too, gains made by the working class can be reversed only after a serious offensive on the part of the ruling class.

We can acknowledge that the Soviet working class does not live under the same kind of ferocious insecurity suffered in the U.S. (although facts here are quite mixed) without saying it is a socialist country. Life is better in Sweden, yet its welfare state is not socialism.

The key question is political: Which class holds state power? It is striking that not a single book or article arguing the socialist character of the Soviet Union can demonstrate that the working class holds state power there. The struggle of the Polish working class makes no sense if you think that class holds state power through “its” communist party. Irwin Silber calls this struggle a reactionary one–the only possible conclusion since he thinks the Soviet Union is socialist.

The growth of anti-semitism and national oppression in the Soviet Union and the absence of mass progressive movements such as an anti-war movement, an anti-nuclear movement, or, indeed, an anti-revisionist movement, at the very least throws doubt on the existence of working class rule in the Soviet Union. The construction of socialism has turned out to be more complex than people once thought, but if we hold to the significance of which class predominates in this construction then it cannot be argued that the Soviet Union is socialist.


The idea that the Soviet Union is in transition to socialism is a compromise that doesn’t work. This argument depends first of all on the incorrect idea that socialism is a stable mode of production. Aside from this, sixty years of socialist construction should produce something closer to socialism than has been achieved in the Soviet Union. A recent review of Goldfield and Rothenberg’s book in the Guardian (1/14/81, 1/21/81) points out that their own evidence shows the Soviet Union is not moving toward socialism.

The third position, that the Soviet, Union is a new form of “post-capitalist” or “post-revolutionary” society, is growing in popularity. People tend to see the USSR as some sort of state collectivism in which the ruling class is the state bureaucracy. One big problem is that this focus on the state’s role in organizing society and extracting a surplus doesn’t specify an underlying mode of production. On the other hand, this difficulty might be resolved and it might be wise for us to reserve judgment, if for no other reason than a lot of East European Marxists with direct experience of Soviet-dominated societies seem to believe in it.

The state capitalism thesis is associated primarily with French Marxist Charles Bettelheim. This thesis shares features of the third position but specifies the underlying mode of production – capitalism. A lot of work needs to be done, but we can say the most common criticisms miss the mark. Goldfield and Rothenberg argue that the concept of state capitalism is not Marxist; they say that the existence of many capitals competing in the market is the essence of Marx’s concept of capitalism.

This is wrong. The exploitation of wage labor by capital and the extraction of surplus value is the essence of capitalism. Goldfield and Rothenberg’s criticism of the state capitalism thesis replaces the class struggle with intra-capitalist competition. Naturally this leads to a confused conception of socialism, too, one which is introduced from above rather than fought for by the people.

A further error is Goldfield and Rothenberg’s confusion between legal “private property” and actual control over the means of production. While we should not commit ourselves blindly to the state capitalism thesis, the criticisms of it have little value.

The immediate political stake in all this is the connection between the nature of the Soviet Union and the role it plays in the world today. The four views stack up as follows. If the Soviet Union is socialist then it is certainly not an imperialist power. Irwin Silber therefore interprets every Soviet occupation and (Soviet-supported occupation) as a defense of socialism.

The transition to socialism idea winds up in this position too, giving “critical” rather than all-out support to Soviet expansion. The subtle distinction is of little use to the Kampuchean and Afghan peoples.

Supporters of the third hypothesis have said little systematic about the Soviet role in the world today, but they seem to argue as follows. In the last analysis the Soviet Union may be a reactionary force, but this must be assessed concretely by looking at the relationship between capitalism and “post-capitalist” society. Because the latter is a “higher” stage than capitalism it is progressive in comparison, just as capitalism is progressive in comparison to feudalism.

Thus, they say, the Soviet Union’s role is objectively progressive whenever it goes up against U.S. imperialism. Furthermore, since no one has proven that the Soviet Union must conquer foreign markets or export capital as a matter of internal economic necessity, we cannot say it is imperialist and for this reason too it is progressive in comparison. Thus while the “post-capitalist” society hypothesis does not lead to support for all Soviet actions, it does tend to support those which can be interpreted as directed against U.S. imperialism.


One weakness of this position is the assumption that the “later appearing” mode post-capitalist society is always “higher” and more progressive. This is a mechanistic stage theory of the same type proposed in more extreme form by the Communist Labor Party: “Once something has developed from a lower to a higher quality it cannot change back.” (Jonathon Aurthur, Socialism in the Soviet Union, p. 8)

In fact, the defeat of U.S. imperialism by Soviet social-imperialism (all other things being equal) would be an historic defeat for the world’s people. Furthermore, the working class always has its own aims, independent of the needs of the ruling class. Lenin forcefully opposed the idea that the working class supported the development of capitalism in Russian, even “critically.”

Oftentimes people seem to reject the state capitalism thesis mainly because they do not want to abandon the “progressive character” implications of the “post-capitalist” society hypothesis, if, indeed, these implications are valid. But it must be recognized that even Bettleheim has not had that much to say about the Soviet role in the world (aside from his rejection of the three worlds thesis). Neither he nor his co-workers have convincingly drawn the explicit connections between state capitalism and Soviet expansionism.

Part of the problem may lie in a disagreement over what it means to say that imperialism is a stage of capitalism. Many people understand capitalism as the “internal” (to the nation-state) relations of production, and imperialism as the “external” effect of those relations of production. In other words, they see the problem as proving the Soviet Union is capitalist from which it will then follow it is imperialist.

But this is wrong since in the stage of imperialist production relations link together the various social formations. Lenin referred to this as the “imperialist chain.” Imperialist exploitation and domination are not a side effect of capitalism, but are constitutive of it. Therefore it is not possible to determine the nature of the Soviet Union without discussing Soviet invasions, occupations and expansion. Among other things this has to lead to great nation chauvinism.

Even if state capitalism best describes Soviet society, and this still seems most reasonable, the Soviet Union is, in a sense, a new type of social formation. This means there is a lot of theoretical work to be done, and we can’t wait for someone else to do it for us. But we cannot stop struggling against Soviet expansion until we figure everything out. Soviet expansion itself confirms the assessment that the USSR is a class and exploitative society which the Soviet people must overthrow.