As a result of the replacement of the old bourgeois production-relations by socialist production-relations, the economic laws of capitalism, expressing relations based on the exploitation of man by man, cease to operate. The law of surplus-value, the basic economic law of modern capitalism, disappears from the’ scene. The general law of capitalist accumulation, the law of competition and anarchy of production, together with other laws, also disappear. The categories which express capitalist relations cease to exist: capital, surplus-value, capitalist profit price of production, wage-labour, the value of labour-power, etc.
With the birth and development of socialist relations of production, new economic laws make their appearance and begin to operate: the basic economic law of socialism, the law of planned (proportional) development of the national economy, the law of steady increase in the productivity of labour, the law of distribution according to work, the law of socialist accumulation, etc.
Since commodity production continues to exist under socialism, the law of value and the categories associated with it operate in socialist economy. The new economic conditions created by the victory of socialism alter the character of commodity production and commodity circulation, restricting their sphere of operation. In socialist economy, commodity production and commodity circulation exist without capitalists and serve the socialist economy. The sphere of operation of the law of value is strictly limited.
Behind the outward form of the old categories of value lies concealed a social content that is different in principle; the nature of these categories is radically altered: money, trade and credit are used as instruments of socialist construction. The economic system of socialism gives birth to new economic categories, linked with the laws inherent in it; basic and circulating funds, economic accounting, production costs, product for society, labour-day, etc.
The development of the socialist mode of production is also ruled by economic laws which are common to all social formations, as for example the law of the necessary conformity of the relations of production to the character of the productive forces.
The economic laws of socialism express the essence of socialist relations of production. In contrast to the economic laws of capitalism, which reflect the growing exploitation of labour by capital, the economic laws of socialism reflect the relations of comradely co-operation and mutual aid existing between workers who are free from exploitation.
As with the economic laws of any other mode of production, the economic laws of socialism arise and operate independently of the will of man: that is, they have an objective character. They cannot be created, formed, transformed or abolished by the will of man. Only on the basis of these laws tan the development of socialist society be accomplished. Violation of the requirements of these economic laws causes a number of difficulties and contradictions and can lead to the dislocation of the country’s economic life.
Denial of the objective. character of the economic laws of socialism would mean the destruction of the political economy of socialism as a science, thereby depriving socialist society of the ability to anticipate the course of events in the economic life of the country and to guide the national economy. Such a denial is a departure from Marxism, to the standpoint of subjective idealism. It inevitably leads to political adventurism and to arbitrariness in the practice of economic management.
But the objective character of the economic laws of socialism does not in any way mean that they operate as an elemental force which dominates man; or that man is powerless in the face of economic laws. Such a fetishist approach to economic laws inevitably leads to the theory of laissez-faire and spontaneity in socialist construction. It is profoundly inimical to Marxism-Leninism. In the conditions of socialism, because of the replacement of private ownership of the means of production by social ownership, wide possibilities are offered for becoming cognisant and making use of the laws of economic development.
The economic laws of capitalism force their way forward as a blind and destructive force, which operates behind the backs of private commodity producers. But with the transition to socialism, anarchy of production disappears and the economic development of society takes on a planned character. With the elimination of capitalism and the socialisation of the means of production, man becomes master of his social and economic relations. Having become cognisant of objective laws, he can master and apply them with full consciousness in the interests of society as a whole.
With the transition to socialism, Engels pointed out,
“the laws of his own social action, hitherto standing face to face with man as laws of nature, foreign to and dominating him, will then be used with full understanding, and so mastered by him. Man’s own social organisation, hitherto confronting him as a necessity imposed by nature and history, now becomes the result of his own free action. The extraneous objective forces that have hitherto governed history pass under the control of man himself. Only from that time will man himself, with full consciousness, make his own history—only from that time will the social causes set in motion by him have, in the main and in constantly growing measure, the results intended by him. It is the ascent of man from the kingdom of necessity to the kingdom of freedom." (Engels, Anti-Duhring, 1954, English edition, pp. 392-3.).
This refers to freedom as conceived by Marxism, that is to say freedom in the sense of the recognition of necessity as the basis of the conscious activity of people.
In capitalist society the spontaneous nature of the development of economy and the class limitations of the bourgeoisie put narrow limits to becoming cognisant of the economic laws of capitalism, which lead in the end to the destruction of the capitalist system, to the victory of socialism. As far as the bourgeoisie is capable of becoming cognisant of objective economic laws, it makes use of them for narrow, class interests, which contradict the interests of the working masses. The class interests of the proletariat fully correspond to the objective course of the progressive development of society, which leads to the victory of communism, and coincide with the interests of the overwhelming majority of society. Under socialism there are no conditions of a social and class nature that prevent people from fully cognising the laws of economic development and using them to serve society. The working class and all working people are vitally interested in cognising and using the laws of economic development. The predominance of social ownership of the means of production and the planned nature of the development of socialist economy make the cognisance and utilisation of economic laws objectively essential, since otherwise planned .leadership of communist construction would not be possible.
The economic laws of socialism make possible the development and progress of the socialist economy along the path to communism. In order, however to make this possibility a reality it is necessary to apply these objective economic laws with expert knowledge. Scientific cognition and correct application of objective economic laws is the foundation of the economic policy of the Communist Party and the Socialist State. The more fully socialist society masters economic laws, the more accurately it reflects their requirements in its practical activity, the more successfully will it achieve its purpose.
To apply economic laws with full knowledge it is essential to learn to take into account the concrete economic and political conditions in which these laws operate in each given period.
Marx and Engels foresaw that in socialist society the purpose of planned organisation of production would be the satisfaction of the needs both of society as a whole and of its individual members. In developing this Marxist thesis, Lenin wrote in the draft programme of the Russian Social-Democratic Labour Party in 1902 that the substitution of socialist society for capitalist society would be achieved “to ensure the fullest well-being and free, all-round development of all its members." (Lenin, “Draft Programme of the Russian Social-Democratic Labour Party", Collected Works, Russian edition, vol. VI, p.12.). The objective necessity and possibility of a systematic and rapid growth of socialist industry, the electrification of the country, the development of heavy industry, as the material basis for socialism, and of achieving a productivity of social labour higher than that of capitalism and of raising the welfare and cultural level of the working masses were placed by Lenin on a scientific footing. In this way Lenin revealed the main principles of the basic economic law of socialism, which have served to guide the policy of the Communist Party and the Soviet Government. Basing himself on these principles, Stalin set forth a developed formulation of the basic economic law of socialism. The essential features and requirements of the basic economic law of socialism are
“the securing of the maximum satisfaction of the constantly rising material and cultural requirements of the whole of society, through the continuous expansion and perfection of socialist production on the basis of the highest techniques." (Stalin, Economic Problems of Socialism in the U.S.S.R., 1952, English edition, p. 45.)
The basic economic law of socialism expresses the purpose of socialist production and the means of achieving it.
The purpose of production is determined by relations of ownership of the means of production. When the means of production belong to the bourgeoisie, production is inevitably carried on for the enrichment of the owners of capital, while the working people, that is, the overwhelming majority of society, are merely an object for exploitation. Consumption by the working people is necessary to capitalism only to the extent that it is essential for the extraction of profits. Under these conditions, man and his needs cannot be the purpose of production. When the means of production belong to the working people, and the exploiting classes have been eliminated, production is carried on in the interests of the working people, that is, the whole of socialist society. Accordingly the fullest satisfaction of man’s growing material and cultural requirements becomes the direct purpose of production.
The purpose to which production is subordinated is inseparable from the means of its achievement.
The degree of satisfaction of the needs of the people depends on the level of development of production reached in the given period and on the resources at the disposal of socialist society. A steady rise in consumption by the people cannot be secured without a continuous growth of production. Uninterrupted growth of production not only ensures the creation of the output necessary to satisfy the growing requirements of society, also stimulates the emergence of new requirements. In turn, the steady growth of the material and cultural needs of the working people and of their purchasing power is a necessary condition without which production cannot continuously advance. Thanks to the systematic increase in the purchasing power of the population, a steadily expanding effective demand arises for the output from socialist industry and agriculture.
In socialist economy, the basic contradiction of capitalism between—the social character of production and the private capitalist method of appropriation—has been abolished. Consequently the inherent contradiction of capitalism between production and consumption, which reflects the fundamental contradiction of the bourgeois system, is unknown to socialism. The basic economic law of socialism provides the opportunity for harmonious co-ordination of the growing purchasing power of the population with the simultaneous growth of production. Under capitalism the low level of consumption, and of the purchasing power of the masses of the people, inevitably hinders the growth of production and lags behind it. Consequently economic development takes place with interruptions—moving from boom to crisis and from crisis to boom. Thanks to the systematic increase in consumption by the people, socialist society is insured against crises of overproduction and consequently is able to expand production continuously.
The non-antagonistic contradiction arising in the course of development of socialist society between the level of socialist production achieved at any particular time and the rapidly growing needs of the masses is solved in a planned way by increased production, which leads to a rise in consumption by the working people and a fresh increase in requirements, calling for a further expansion of production.
The development of socialist production does not consist merely in quantitative expansion. The continuous growth of socialist production requires constant perfecting of production methods and a steady increase in the productivity of social labour, enabling prices to be systematically lowered and the quality of output improved, which is of great importance in satisfying the requirements of the working people. All this is impossible without constantly raising the technical level of production. Therefore the development of the highest techniques is the necessary condition for the continuous growth and perfecting of socialist production.
The basic economic law expresses the essence of socialist relations of production and determines the chief processes of the development of the socialist method of production. Other economic laws reflect particular essential aspects of the socialist relations of production and determine particular processes of the development of the socialist method of production. The basic economic law plays the leading role in the system of economic laws operating in socialist society. Thus, the requirements of the basic economic law determine the character of the national-economic proportions which are established on the basis of the law of planned, proportional development of the national economy; the steady rise in the productivity of labour serves as the chief means of ensuring an uninterrupted growth of socialist industry; the satisfaction of the growing material and cultural requirements of the working people is brought about by means of the law of distribution according to work, etc.
Each law is not only in a state of definite interaction with the basic economic law, but also with other laws of socialist economy. Thus, for example, the proportion among the different branches of industry established on the basis of the law of planned, proportional development of the national economy depends on the level of productivity of labour in these branches. In its turn, one of the extremely important conditions of the rise in productivity of labour is the fulfilment of the requirements of the law of distribution according to work.
The operation of the basic economic law of socialism creates an opportunity for a continuous growth of production, immeasurably more rapid than under capitalism. Soviet society, relying on the basic economic law of socialism and making skilful use of it, increases year by year the mass of material goods produced in the entire national economy. Socialist industry steadily follows a rising curve, without any falls or industrial crises.
In 1939 the output of large-scale industry in the U.S.S.R. was 552 per cent of the 1929 level, while in the United States the level of industrial output compared with 1929 was only 99 per cent, in Britain 123 per cent, and in France 80 per cent. The rise of industry in the U.S.S.R. was temporarily interrupted owing to the 1941-5 war; after the war the rise was resumed. In spite of the colossal destruction suffered by Soviet national economy in the war years, the prewar level of production in the U.S.S.R. was soon considerably exceeded. As a result of this, the output of large-scale industry in the U.S.S.R. in 1954 was 18 times greater than in 1929. The industrial output of the United States marked time between 1929 and 1939, then it rose because of the increase in war production and the armaments race, and in 1954 it was a little more than twice the 1929 level. Britain’s industrial output in 1954 was only 72 per cent greater than in 1929, that of France 14 per cent greater.
The basic economic law of socialism is inseparably linked with the law of the priority development of industries producing means of production, that is to say their relatively more rapid development compared with that of industries producing consumer goods. This economic law of expanded reproduction is of special importance for socialism. Heavy industry with engineering as its core is the chief source of the steady rise of socialist industry as a whole. The priority growth of heavy industry is the essential condition for technical progress throughout the national economy, for raising the technical equipment of social labour and, consequently, for improving production on the basis of the highest techniques. Without the priority development of heavy industry, which supplies all branches of the national economy with equipment, machinery, fuel and energy, it is impossible to expand systematically the industries producing articles of consumption and to ensure satisfaction of the growing requirements of the working people.
The priority growth of the production of means of production is the most important prerequisite for a rise in labour productivity. The chief lever for raising the productivity of labour is the introduction into industry of advanced techniques and ever more perfect instruments of labour produced by heavy industry.
The priority development of the production of means of production, heavy industry, is a vitally important condition for ensuring the economic might and defensive capacity of the country. Marxist political economy rejects the vulgarised, narrow consumers’ approach to the basic economic law of socialism. This anti-Marxist approach finds expression in ignoring the determining role of production in relation to consumption, in denying the necessity for priority growth of the production of means of production under socialism, and in the assertion that in the conditions prevailing under socialism it is necessary that both departments of social production should develop equally or that industries producing consumer goods should develop even more rapidly than industries producing means of production.
“In connection with the measures recently taken for increasing the output of consumer goods some comrades are guilty of confusion in the question of the rate of development of heavy and light industry in our country. Relying on incorrect conceptions and a vulgarised interpretation of the basic economic law of socialism, these pseudo-theoreticians try to prove that at some stage of socialist construction the development of heavy industry ceases to be a main task and that light industry can and should precede all other branches of industry. This is a deeply mistaken view, alien to the spirit of Marxism-Leninism." (N. S. Khrushchev, “On increasing the output of livestock products." Report to the Plenum of the Central Committee of the C.P.S.U., January 25, 1955).
A revision of the Marxist-Leninist theses on the priority development of the production of means of production would in fact mean a reduction of heavy industry, which would inevitably lead to weakening all branches of the national economy, lowering the living standards of the working people, and undermining the economic might and defensive capacity of the Soviet Union. The priority development of heavy industry serves as the basis for a sharp rise in agriculture, for a further development of the light and food industries.
The basic economic law of socialism, which expresses the radical advantages of the socialist over the capitalist system, provides objective possibilities for the Soviet Union to overtake and surpass the chief capitalist countries in economic respects, i.e., as regards the extent of output per head of the population. The accomplishment of this task requires expansion of capital construction, continuous improvement of the organisation industry, rational use of all industrial resources and a systematic rise in the productivity of labour in all sectors of socialist economy.
Socialist relations of production provide wide scope for technical progress and, compared with capitalism, considerably extend the possibility of applying the most up-to-date techniques in all branches of the national economy. Under socialism, as already stated, new. machines are introduced whenever they provide an economy of social labour, lighten labour, make possible the introduction of new forms of production and promote the growth of the welfare of the people.
Disproportions and periodic interruptions in technical development, connected with the cyclic character of the development of industry and the narrow markets, are natural to capitalism. Socialism, on the contrary, is characterised by the continuous perfecting of technique on a scale covering the whole of the national economy.
The higher the level of technique and the organisation of production, the greater are the means at the disposal of socialist society for satisfying the growing needs of the working people. The socialist economic system creates a direct interest of the working people in increasing production and applying the most advanced techniques on an extensive scale. In turn, this interest of the people in developing socialist production is a constant factor in developing the creative initiative of the broad masses, aimed at improving production in every possible way. This is the greatest factor in the continuous growth of the socialist economy.
The basic economic law of socialism reflects the organic unity of aim of socialist production and the means to achieve this aim, the direct dependence of the increase in national consumption upon the growth of production, upon the productivity of social labour. Only socialism converts social labour into a source of continuous rise in the welfare of the people. In socialist society the priority development of the production of means of production serves as the basis for a rise in national consumption, whereas under capitalism it leads to increased unemployment and the impoverishment of the working people. Socialism has eliminated the narrow limits of consumption by the working masses, which are typical of the bourgeois system and are determined by the drive of the capitalists for the maximum profit.
The continuous growth of socialist production is the secure foundation for the constant rise of the material and cultural level of life of the people. In socialist economy there is an unfailing increase in the mass of products created by work for oneself, and used for the personal consumption of the working people; the mass of products created by work for society, and used to expand production and to satisfy material and cultural requirements of the working people, also increases.
In the U.S.S.R. there is a steady growth of real incomes and a systematic increase of the quantity of consumer goods purchased by the population at falling prices.
The real incomes of the working people in the U.S.S.R. (that is, incomes after taking into account changes in prices) increased per wage-earner, in 1954 compared with 1913, in the following way: workers approximately 6-fold (taking account of the elimination of unemployment), and peasants approximately 6.5-fold.
The volume of output of consumer goods in large-scale industry had increased over 1913, in comparable prices, 7.6-fold by 1940 and 16-fold by 1954.
A constant factor in the growth of real incomes of the working people of the U.S.S.R., is the large-scale free cultural services and amenities provided by the Soviet State. The Soviet Union has a system of social insurance and social welfare inaccessible to capitalism.
Socialism means a continuous improvement in the working and living conditions of the masses of the people. The supply of the everyday needs of life is transformed from a means of enriching the capitalists into the means of raising the standard of living of the people. Socialism provides a steady improvement of housing conditions. In the U.S.S.R., thanks to the public ownership of the main housing property in the towns and to the large-scale State housing schemes, badly constructed houses are being increasingly replaced by new and comfortable homes.
In many bourgeois countries medical assistance, being a private matter, has to be paid for at a high price and is therefore little accessible to the broad masses of the people. In the U.S.S.R. an all-round State health service has been created which provides the population free with all forms of medical assistance.
Socialism gives broad scope for the cultural growth of the working people and for the development of their abilities and talents, of which there is an inexhaustible fount in the people. Under capitalism the working people have access to education only within the narrow limits dictated by the interests of capitalist exploitation. Socialism, on the contrary, provides conditions for an ever fuller satisfaction of the rapidly growing educational, cultural, scientific and artistic requirements of the masses.
“Formerly," [Lenin said in 1918] “man’s entire intellect, all his genius, worked only to give some the entire wealth of technique and culture, and to deprive others of what they needed most-education and development. Now, however, all the marvels of technique, all the achievements of culture, will become the possession of the whole people, and man’s intellect and genius will never again be turned into a means of coercion and exploitation." (Lenin, “Concluding Remarks at the Close of the Third All-Russian Congress of Soviets", Collected Works, Russian edition, vol. XXVI, p. 436.)
In the U.S.S.R. satisfaction of the growing cultural requirements of the people is secured by extensive, measures in the sphere of cultural development: free tuition and improvement, of skill, student stipends, systematic extension of the network of schools: cultural and educational institutions, libraries, clubs, increased publication of printed materials, etc.
The number of people participating in all forms of study in the U.S.S.R. increased from 8 million in 1914 to over 50 million in 1954. At the same time, the number of scholars in secondary schools (the 8th to 10th classes) and in institutions for secondary technical education increased from 0’2 million in 1914 to 3.6 million in 1940 and 7.8 million in 1954. The number of students in higher educational institutions increased from 117,000 in 1914 to 812,000 in 1940 and to 1,732,000 in 1954. The number of teachers and tutors in all educational institutions, together with those in children’s institutions, amounted to more than 2 million in 1954, nearly ten times as many as in 1914.
Relying on the basic economic law of socialism, the Communist Party and the Soviet State are pursuing a policy which ensures a steady rise in the welfare and cultural level of the masses.
The objective economic laws operating in the economy of socialism are recognised and utilised by the Socialist State in the practice of building a communist society. The success of economic policy depends above all on the extent to which it correctly conforms to the requirements of economic laws.
The character of the Socialist State is determined by the economic basis of socialism. The political power of the working people, headed by the working class, corresponds to the socialist economic system and the social ownership of the means of production by the working people. The policy of the modern bourgeois State reflects the interests of the capitalist monopolies, is directed towards increasing their profits and is hostile to the masses of the people. The policy of the Socialist State, on the contrary—the State of workers and peasants—expresses the fundamental, vital interests of the working people and enjoys the unlimited support of the masses of the people.
The new economic role of the Socialist State, unknown in history until this time, is determined by the socialist relations of production. The Soviet State is the owner of no less than nine-tenths of all the means of production in the country. Thanks to the total predominance of social ownership—State ownership and co-operative collective farm ownership—of the means of production, the State has been enabled, on the basis of the economic laws of socialism, which are consciously applied in its activity, to exercise planned guidance of the national economy and to fulfil the function of organiser of that economy. Such a role is beyond the reach of a bourgeois State, because of the private capitalist ownership of the means of production and the spontaneous character of the economic development of capitalist society.
The basic economic law gives rise to the need for the Socialist State to be constantly concerned to satisfy to the full the steadily growing requirements of the people on the basis of rapid development of the productive forces. The activities of the Socialist State are devoted to securing an all-round improvement of the life of the working people.
The Socialist State takes account of the many and varied requirements of society and, in accordance with these growing needs, develops and perfects production, organises the introduction of advanced techniques into all branches of the national economy, a steady increase in the productivity of social labour, carries out capital construction and the location of industry, and ensures the increase of socialist accumulation. The Soviet State carries out a system of measures to produce an abundance of industrial and food commodities in the country. For these purposes it develops heavy industry to the fullest extent and on this basis ensures a powerful rise of agriculture and of the production of goods for mass consumption.
In conformity with the real conditions, both internal and international, the State lays down at each stage the concrete tasks of economic construction, establishes the direction and rate of development of the national economy and improves the method of conducting it. It takes into account not only the past results but also the anticipated tendencies of future development, and exercises its functions as economic organiser on the basis of scientific foresight. Advanced social science—Marxism-Leninism-is the theoretical foundation of the many-sided activity of the Socialist State.
The economic, organising, cultural and educational work of the Soviet State covers all aspects of the life of socialist society. The Soviet State exercises planned guidance and management of State enterprises in every branch of the economy. The State and its organs appoint the heads of State enterprises, groups of such enterprises and entire branches of the economy, and supervise their work. The State plans the national economy of the country: it determines in a planned way the volume, structure and rate of growth of industry, and of home and foreign trade; it fixes the prices of commodities. and the planned costs of production, the level of wages of workers and other employees and distributes materials, labour and financial resources, etc. The Soviet State directs the economic life of the collective farms and guides them through the medium of the local Soviets, M.T.S., and the elected bodies in the agricultural artel; in doing so it takes account of the special features of the collective farms as co-operative undertakings. It helps in every way to strengthen the alliance of the working class and the peasantry, and extend the economic links between town and country.
The Soviet State guarantees to citizens the real exercise of such important rights as the right to work and leisure, to education, and to material security during loss of earning capacity and in old age.
The Soviet State guides education and the training qualified personnel, promotes the development of, advanced science and art and the practical application of scientific and technical achievements.
The strength of the Soviet machinery of State lies in its ties with the mass of the people. It follows from the nature of the socialist system that centralised State guidance must be combined with local initiative and with practical allowance for local peculiarities.
The most important principle in guidance of the economy by the State is the unity of economic and political work.
“In practice, politics and economics are indivisible. They exist together and act together. And he who thinks that in our practical work he can separate economics from politics, and intensify economic work at the price of belittling political work or, on the contrary, intensify political work at the price of belittling economic work, is bound to find himself in a blind alley." Stalin, Shortcomings in Party Work and Measures for Eliminating the Trotskyists and other Double-Dealers, Russian edition, 1938, p. 26.
The Communist Party is the leading and organising force of the Socialist State, giving direction to the activity of all State bodies and to voluntary organisations of the working people. The Party lays down directives for compiling national economic plans, and the most important national economic measures which are of vital significance for the country as a whole. The Party, being closely linked with the working masses, rallies the workers, collective farmers, and intelligentsia for the fulfilment of economic and political tasks, educates the masses and raises their Communist consciousness. The policy of the Communist Party and the Soviet State, aimed at satisfying new and timely requirements in the economic development of society, plays an enormously progressive role.
The development of the socialist mode of production takes place in the course of a struggle of the new against the old, of that which is growing against that which is dying, of the progressive against the backward, by surmounting contradictions and difficulties. Lenin pointed out that under communism antagonisms disappear but contradictions remain. In socialist society these contradictions are non-antagonistic, since they are not connected with opposed class interests, and are overcome in the course of communist construction.
There are no exploiting classes in socialist society, but there are backward elements, imbued with tendencies and habits from the age of private property, opposed to the development of the new progressive tendencies in the socialist economy. There are still embezzlers of public property and bureaucratic elements who ignore the needs of the people. The survivals of capitalism in the consciousness of man have not yet been fully overcome. The Soviet State, guided by the Communist Party, encourages the initiative of the working people and lends support to progressive tendencies in all spheres of social life. The Soviet State assiduously supports the young shoots of what is new, strengthens them, and facilitates the diffusion of advanced production methods; it wages a persistent struggle against all forces of inertia, and all manifestations of backwardness, stagnation or routinism, which hinder the rapid development of socialist production.
One of the main forms of struggle of the new against the old in socialist society is criticism and self-criticism, which constitute a powerful motive force in the development of socialist society. Criticism and self-criticism make it possible to uncover and eliminate shortcomings and difficulties in work, and to eradicate all signs of bureaucracy, by enlisting the participation of the masses of the people. They enable new means of accelerating the rates of economic development to be discovered, and in this way help to overcome the contradictions of socialist society.
Besides the internal non-antagonistic contradictions of socialist society, there exists the external antagonistic contradiction between the countries of the socialist camp and the forces of imperialism. This is expressed in the fact that imperialist, aggressive circles endeavour to unleash war against the U.S.S.R. and the People’s Democracies and carryon undermining work in those countries. From this there arises the necessity to strengthen to the utmost the economic might and defence capacity of the U.S.S.R. and the People’s Democracies.
Arising from the Leninist thesis of the possibility of peaceful co-existence between the socialist and capitalist systems, the Soviet State consistently pursues a policy of peace, and expands peaceful construction and foreign trade relations with all countries. It strengthens economic co-operation with the countries of the camp of democracy and socialism, which represents the new, socialist type of relations between nations. The Soviet State of workers and peasants, utilising the advantages of the socialist economic system and relying on economic laws, is directing the development of the U.S.S.R. along the road to communism.
(1) The economic laws of socialism are objective laws, independent of the will and consciousness of man. They express the relations of fraternal cooperation and socialist mutual aid of workers freed from exploitation. The economic laws of socialism do not operate as a blind and destructive force: they are recognised and utilised by socialist society. The Communist Party and the Socialist State base their economic policy on the economic laws of socialism.
(2) The basic economic law of socialism determines all the main aspects and main processes of development of the socialist mode of production, the purpose of socialist production and the means to achieve this purpose. The essential features and requirements of the basic economic law of socialism are the securing of the maximum satisfaction of the constantly rising material and cultural requirements of the whole of society, through the continuous expansion and perfecting of production on the basis of higher techniques.
(3) In socialist economy the growth of requirements (the purchasing power) of the masses is the motive force of socialist production and drives it forward. The continuous growth of socialist production is the material foundation for the steady growth of consumption by the people and the growth of new requirements. The priority development of the production of means of production is the essential condition for the continuous growth of socialist production. Socialism ensures the steady development of advanced techniques, essential to the continuous growth of perfecting the socialist production and the ever fuller satisfaction of the growing needs of the working people.
(4) Corresponding to the constantly increasing mass of products for oneself and products for society, the real incomes of the working people are constantly raised. Socialism means a constant improvement in the working and living conditions of the people. It opens up the fullest opportunities for cultural development and makes the entire wealth of technique, science and culture the possession of the whole people.
(5) Expressing the vital interests of the people, the Socialist State guided by the Communist Party develops on an ever-increasing scale its economic, organising, cultural and educational activity, directed towards securing a continuous growth of production and a steady rise in the level of welfare and culture of the people. The development of the socialist mode of production proceeds through the surmounting of contradictions and difficulties. Relying on scientific knowledge of objective economic laws and making use of them, the Socialist State assures the victory of the new and progressive over the old in all spheres of the economy, and directs the development of society along the road to communism.