The USSR

Where it's at today

By Sam Marcy (Aug. 8, 1991)

Almost to the end of his life, Frederick Engels, the life-long collaborator of Karl Marx, maintained a continuing study of the great French revolution.

The Russian Social-Democrats, and in particular the Bolsheviks, also paid a great deal of attention to the various stages of the revolution, led first by the Girondists (the moderates), then the Jacobins (the revolutionary dictatorship), followed by the Thermidor period (the reaction), and finally Bonapartism (the expansionist period).

The French revolution absorbed the interest of the workers' movements in Europe and Russia, but also in other parts of the world — the Western hemisphere, Asia and Africa. When Deng Xiaoping visited France some years ago, he was compelled to remark on "the brilliant, revolutionary history of France."

Lenin drew the most important lessons from the experience of the Paris Commune of 1871. And Bolshevik leaders during the Leninist period occasionally invoked the Committees of Public Safety — "the eyes and ears of the French revolution" — to justify harsh measures against counterrevolutionary elements in order to sustain the proletarian dictatorship.

When Napoleon's armies were sweeping through Europe, he was often idolized by the revolutionary intelligentsia as the symbol of the struggle against monarchist tyranny, and entrenched feudal reaction in general.

Thus the disappointment was keen when Napoleon, the plebeian leader of a people's army which drew most of its ranks and even its generals from the peasants, had himself declared Emperor. He went through a Papal coronation with great pomp and ceremony, discarding his role as a plebeian leader.

But did this signify a restoration of feudalism in France? By no means. The bourgeoisie had won their battle against feudalism. What followed were different forms of bourgeois rule. The feudal social system, in the words of Engels, had been "cut down root and branch."

Similarly, after the execution of Charles I and the victory of the Cromwellian revolution in England, the monarchy was eventually restored. Did that signify the return to power of the old landed aristocracy and nobility? No, the bourgeoisie ruled through the monarchy, reducing it over time into a completely subservient tool so that today it is nothing more than a big business public relations enterprise serving British finance capital.

Inauguration of Yeltsin

One is apt to remember all this in connection with the inauguration of Boris Yeltsin in the Kremlin's Great Hall.

Yeltsin, of course, doesn't bear the slightest resemblance to Napoleon. He is part fraud, part buffoon, and part demagogue. Nothing in his career would make him stand out as more than an ordinary careerist, bureaucratic politician who rose to the summits of the Communist Party leadership. Yet suddenly, after his resignation from the Party, he was catapulted to the presidency of the biggest republic in the USSR, the Russian Federated Republic.

The ceremony during a session of the Russian Parliament in which he was inaugurated as president was carried out with the full pomp and panoply befitting the old czarist regime. The patriarch of the Orthodox Russian Church administered the oath of office and the ceremony ended with the collective singing of a czarist hymn.

How could any progressive, any class-conscious worker, any communist view this vulgar exhibition with anything but utter revulsion?

If we add to this Gorbachev's collaboration with the imperialists in the brutal invasion of Iraq, his adventures with the G7 — the most powerful imperialist governments — and his attempt to "integrate" (if not liquidate) the Soviet economy into the imperialist system, one can understand how dismay and despondency may well grip large sections of the Soviet population, bringing repercussions to the progressive, working class, communist, and national liberation movements of the world.

Fortifying all of this are irrefutable facts of economic life in the Soviet Union today, such as the emergence of hundreds of millionaires. The sudden appearance of stock and commodity exchanges in the two principal cities of the Soviet Union — Moscow and Leningrad — are grim testimony to the emergence of a pro-capitalist social stratum.

Cooperatives and banks

Cooperatives in the Soviet Union, even in their best days, were compromises between private property and public ownership. Now they have been converted intonothing but a thinly disguised cover for private ownership. It is said that these so-called cooperatives now employ several million workers.

Who pays the social security, health needs, childcare, etc., for these workers? This is one of the secrets not yet revealed. Should the workers' state subsidize private enterprises disguised as cooperatives?

Then there are joint ventures with the imperialist governments, and a good deal of foreign investment. However, their social significance could be grossly exaggerated. During the New Economic Policy under Lenin, they were regulated and completely controlled by the revolutionary workers' government and were helpful in a limited way. However, they are a concession and not a virtue, as the Gorbachev administration makes them out.

Above all, there is the seemingly ominous growth of commercial banks. Here we have to separate out, as we do under capitalism, bank deposits from bank capital.

The bankers themselves own the capital. It is their money in the form of an investment.

The deposits could be from ordinary workers, government officials, or business entrepreneurs. In capitalist banking, these are considered the assets of the bank. Banks not only pay interest to the depositor but can loan the deposits out to borrowers at higher interest rates and thereby make a profit. This interest may become part of the capital of the bank. This is what makes it a capitalist commercial enterprise.

What will happen in the Soviet Union when, as we see in the capitalist banks today, many loans become non-performing — meaning they are not paid back — and the bank becomes insolvent? Will the depositors be insured by the government? Do the commercial banks rival the government savings banks? This problem needs not only more information but further study.

If these banks are established just to serve business entrepreneurs — a narrow social grouping in the Soviet Union — that is one thing. But if they are permitted to accept deposits from ordinary workers and lure them away from the government savings banks, it's a form of expropriating the funds of the workers' state.

Furthermore, who insures the deposits? What in truth is a commercial bank in the USSR? It is difficult to believe it would not be riddled with fraud and corruption like so many commercial banks in the U.S., especially when a crisis hits. Again, further study is needed. It may be more precarious than any of the so-called free enterprises themselves.

Meanwhile, the Gorbachev governing group is under ever greater pressure to dismantle if not altogether wreck socialist planning and wipe out the achievements of the great October socialist revolution. Never before has it been so open, so brutally frank in promoting collaboration with the imperialists.

The Gorbachev administration says it can only avoid collapse by subordinating everything to getting the U.S. trade embargo lifted and convincing the other imperialist governments to allow Soviet purchases of high technology. Then it will become a full-scale member of the "community of industrialized democracies."

In the meantime, privatization on a small scale has been proceeding ever more rapidly while the economic crisis continues to deepen.

What's behind the market

Ever since the Gorbachev administration was ushered in following the 1985 Central Committee meeting, until this day, the perestroika economists of the USSR have urged the introduction of "the market." As time went on they openly promoted the concept of the "market economy" as the magic formula that would transform the USSR from a technologically more backward country into one capable of competing with the imperialists on an equal footing.

Gorbachev in his report to the July 1991 plenum of the Central Committee is reported to have said that "a market economy is not incompatible with socialism." He pushed the market economy as the one element that will ensure the growth and development of a prosperous society capable of competing with the imperialist countries. It is a blatantly false assertion.

Until recently Gorbachev and his perestroika economists almost invariably failed to add that a market economy entails the private ownership of the means of production. They tried to separate out the process of capitalist exchange from the mode of capitalist production.

This is an old stratagem of bourgeois economists who wish to convey the impression that the process of exchange is independent of the process of capitalist production and that the purchase and sale of commodities is altogether divorced from the exploitation of the working class by the capitalist class.

It is true that the purchase and sale of commodities existed in previous modes of production, such as ancient slave society and feudal society. But then the market was auxiliary and peripheral to the slave or feudal mode of production.

Even before capitalism was fully developed, the market entailed the private ownership of the means of production.

Shakespeare had the Merchant of Venice say: "I will buy with you, sell with you, talk with you, walk with you," adding, "What news on the Rialto?" The Rialto is often understood to mean an island and theater district in Venice. But in reality, it was the market place where commercial and financial transactions took place.

"What news on the Rialto?" was an early allusion to the market economy. When Shakespeare wrote ``The Merchant of Venice'' sometime in the 16th century, capitalism had already been in its infancy in Venice since 1300, according to Engels. The purchase and sale of commodities entailed the existence of the private ownership of the means of production, although by scattered individual producers at first.

The modern capitalist version is, "What's doing on the stock exchange?" Buying and selling.

Capitalist production can't be separated from exploitation of labor

In contemporary society, the purchase and sale of commodities is inseparably connected with the capitalist mode of production. The marketing aspect is merely a bourgeois term for the process of exchange which results from the capitalist mode of production. The two cannot be separated artificially.

Marx in his monumental work Capital presents an analysis of the process of capitalist production demonstrating that the characteristic features of capitalism are wage labor and the monopoly of the means of production by the capitalist class based upon the exploitation of the workers.

The ownership of the means of production by the capitalist class is central to the capitalist mode of production, which is for profit and not for use. The market and the process of purchasing and selling is to facilitate capitalist production.

Describing capitalism as a market economy describes only its external feature, just as price is merely the monetary expression of value, which in turn reflects the amount of socially necessary labor needed to produce a commodity.

But all of this is drowned out by the constant repetition of the term "market economy," which covers up the most quintessential fact: the exploitation of the working class by the capitalist class and the monopoly of the means of production by the capitalists.

Whichever class owns the means of production rules over society. It was so during slavery and feudalism, and is of course true under capitalism. It will not be otherwise until there is a truly socialist society where the class antagonisms have been dissolved and the state itself is slowly withering away, to use Marx's terminology.

Has capitalism been restored?

What then is the situation in the USSR today? Have the bourgeois reforms accumulated to the extent of having transformed the collectivized planned society of the USSR? Has it been dismantled and disrupted sufficiently so that for all intents and purposes, the social system based on a planned economy and the ownership of the means of production by the state has in fact virtually disappeared?

Do all these economic measures decreed by the Gorbachev ruling group — beginning with the encouragement and promotion of small-scale privatization all the way up to the mushrooming of millionaires and the menacing growth of commercial banks — add up to a restoration of capitalism in the USSR?

Do they constitute a qualitative change in the class character of the USSR? Has the USSR already been transformed into a capitalist state?

The answer must emphatically be no.

The bourgeois elements in the governing group are publicly admitting that they cannot transform the social system in the USSR on the basis of their own social resources — they urgently need the intervention of imperialist finance capital. And it should be emphatically stated that they do not have the public support needed politically for such purposes.

One basic reason lies in the fact that all of the economic reforms, all the bourgeois innovations — the development of small commodity production, of private ownership of the means of production on a small scale, of all sorts of commercial enterprises based on private ownership and the growth of banks in particular — all these phenomena are not for the most part the products of the spontaneous growth of capitalist tendencies in the USSR.

Lenin stressed during the NEP period that commodity production "grows spontaneously, daily and even hourly" and could overwhelm the socialist tendencies in the USSR if the workers' government was unable to deal with it.

The difference between the growth of commodity production in the NEP period and now is this: whatever capitalist development exists in the USSR is mostly the result of state-promoted, state-inspired bourgeois enterprises, including the most menacing features such as the mushrooming of millionaires and the growth of commercial banks.

These commercial banks, whatever their size, can only exist if the government supports and promotes them. Commercial banks everywhere are in a precarious situation. Even the imperialist governments cannot support all the banks that are failing. In an economy like the USSR, where production is plummeting and there is general chaos, these banks can exist only if the government supports them.

The spontaneity of commodity production which Lenin referred to in his writings is not what characterizes the USSR today. The commodity production which has grown up spontaneously in the Soviet Union ever since the end of the civil war has been marginal to the economy. (We reserve discussion of the so-called black market for a later article.) This was so up until the early 1980s, when the governing group in the USSR under Gorbachev began to promote and cultivate it.

It did so in response to the dangerous growth of a bourgeois social stratum, frequently referred to as the capitalist class in the USSR. Some political tendencies attempting to analyze the social character of the USSR assume it to be the governing class. The bourgeois stratum today, however, notwithstanding its menacing growth, is still a narrow grouping in the Soviet Union.

It grew up and was cultivated by the bureaucracy and the bourgeois intelligentsia, especially the technical and managerial elite.

It was Lenin who, in a debate on the trade union question in 1921, first characterized the USSR as "not just a workers' state but a workers' state with bureaucratic deformations." These are Lenin's own words. The bourgeois social grouping grew and developed with the growth of bureaucracy and privileges of the officialdom, and the resultant widening of social inequality.

Socialization of labor

Feudalism was a static society. Preservation of the old social system and in particular the means of production was one of its principal attributes. In contrast, the bourgeoisie as a class was constantly revolutionizing the means of production. That is its historic contribution.

In his pamphlet Karl Marx, Lenin says in a section entitled "Socialism": "From the foregoing, it is evident that Marx deduces the inevitability of the transformation of capitalist society into socialist society wholly and exclusively from the economic laws of the development of contemporary society."

Marx's conclusion that socialism is inevitable was not based on some imaginary, abstract principle or utopian tour de force, but rather was derived from the economic laws of development. Marx approached the question of the inevitability of socialism from a scientific viewpoint. Socialism is inevitable not just because it is desirable but because it grows out of the economic laws of contemporary capitalist society.

Lenin adds, "The socialization of labor which is advancing ever more rapidly in thousands of forms and has manifested itself very strikingly during the half century since the death of Marx in the growth of large-scale production, capitalist cartels, syndicates and trusts, as well as in the gigantic increase in the dimension and power of finance capital, provides the principal material foundation for the inevitable advance of socialism."

More than a century ago Marx saw, in the rapid advance of monopoly in such forms as cartels and syndicates (today we would say transnational corporations), the principal material foundation for the inevitable advance of socialism.

It is the bourgeoisie which has socialized the labor process with the growth of large-scale production, trusts, cartels and the like. The socialization of labor is developed by capitalism. It is precisely large-scale production which is the material foundation for the inevitability of socialism. That is the fundamental contribution of the bourgeoisie.

This socialization process was not achieved just through the automatic processes of economic laws. In some of the most important chapters of Capital, Marx describes in the fullest detail how the bourgeoisie achieved this socialization of labor. It ruthlessly and cruelly uprooted the peasantry by every conceivable means. Landless and homeless, they were driven into the factories to provide the material force for large-scale production.

Small independent producers in the villages, towns and rural areas were just as ruthlessly deprived of their independence and driven to become wage slaves of the capitalist class.

Marx's analysis was based on official reports of the British government. He spent days writing down the cruel details of what was taking place in the workplace at the time — like the 12-hour day and child labor.

The raw materials for the large-scale growth of industry which made possible the socialization of labor were appropriated from all parts of the globe, where the capitalists committed unspeakable atrocities against the native peoples, including genocide. That too was a material foundation for the socialization of labor, which is a prerequisite for the inevitability of socialism. That's how the social system of capitalism was built.

What makes socialism inevitable

Capitalism's fundamental contribution to the inevitability of socialism is the socialization of labor. Without that socialism is impossible.

But how did the socialization of labor come about in the USSR? Bourgeois historians are quick to tell us that the proletariat in the Soviet Union was a minority class and that it was concentrated in and around the principal cities of old Russia. True.

The most favorable factor enabling the proletariat to overthrow the bourgeoisie in 1917 was its concentration in huge production units, especially around the St. Petersburg and Moscow areas.

Because it was profoundly class-conscious and receptive to the boldest, revolutionary Marxist thought, it was able to forge an alliance with the peasantry and seize power from the czarist autocracy, the bourgeoisie and the landlords.

However, the socialization of labor which the Western bourgeoisie had accomplished a century earlier had not happened in old Russia. The working class at the time of the revolution was still a minority. The development of socialist construction required not only technology and raw materials. It needed millions of new workers.

The bourgeoisie will tell you of all the cruelties committed in connection with the collectivization of agriculture. The process was a dreadful one. But they fail to say that it drove the peasants, rural workers and handicraft people into industry by the millions.

The socialization of labor was a task the bourgeoisie should have performed. Instead, the workers' state had to do it.

Today, however, the socialization of labor has been accomplished. The bourgeoisie has no progressive task to perform, no objective need to fill. It was all done in the course of constructing the second or, if you will, the third largest economic power in the world.

It was socialism which collectivized the individual producers and brought about the development of the gigantic modern scientific-technological apparatus in the USSR.

This socialization of labor has advanced so far that individual commodity production is a minor factor in the USSR. What has capitalism to contribute in a progressive way to the Soviet Union? Privatization will break up the collectivized labor into smaller units and retard economic and industrial development.

If we were to address the bourgeois reformers in the USSR, we would ask them: Don't you see what the imperialist bourgeoisie is doing in the underdeveloped countries? It retards their development. Its objective is to prevent them from having large-scale industrial and technological enterprises, even on the level of France, Britain and Germany in the 19th century.

Not one of the underdeveloped countries, no matter how large — whether India, China before the revolution, Brazil, Argentina, or certainly any of the Arab countries — has been able to develop into an independent capitalist country.

India has just had to reopen its economy to the ravages of imperialist penetration and lift the restriction that had limited foreign ownership to 50%. And this after more than half a century of independence!

The road of the capitalist reforms in the USSR leads to neocolonialism. That is why the imperialist countries are making it a precondition of any aid that the Gorbachev leadership first destabilize, decentralize, disrupt and wreck the socialist aspects of Soviet society. Only then will they contribute large-scale credits or loans or permit them to trade the ruble on an equal basis with the imperialist currencies.

The real world

Experience is the test of all things. The six years of bourgeois reform in the USSR are at last showing their reactionary character. The toll they are taking in hardship and misery for the masses is bound to revive that revolutionary class consciousness which the Russian working class showed in three revolutions, from 1905 to 1917.

What will objectively assist the workers in overthrowing the whole kit and kaboodle of bourgeois reformers and turning again toward building socialism should now be as plain as daylight. It is that another capitalist breakdown is emerging, the kind of crisis it went through in the early 1930s.

Is it possible that the bourgeois reformers in the USSR are so blinded by avarice, bribery and corruption, as well as imperialist intrigue and intimidation, that they cannot see what is literally in front of their noses?

The capitalist world, and in particular the U.S., is experiencing bankruptcies, shutdowns, layoffs, budget deficits, homelessness, an enormous growth of the prison population, and a cut in the living standards of the people. The U.S. government cannot overcome its own indebtedness, and now the budget deficit has taken in tow the principal cities, beginning with the richest financial center of the world, New York.

How can the bourgeois reformers in the USSR fail to see that? Only the masses will open their eyes.





Last updated: 19 February 2018