Adequacy of Stalin and Trotsky on planned economy

[Paul Cockshott]

Joseph Ball
has an interesting article on planned economy here clogic.eserver.org/2010/Ball.pdf
I was generally sympathetic to his aims in writing it: to
defend socialist planning. I
think that it makes a very interesting point in focussing attention on innovation
and the comparative role of subsidies versus temporary prices. I had not heard
this argument before.

I am not sure that I find it entirely convincing as a long term explanation of
the slowdown in the diffusion of technology. If there was gaming over the
temporary prices, would there not have been similar gaming over subsidies
in the long run with enterprises applying for subsidies for products that
they claimed were new, but which were actually just slight mods of old ones.

Similarly if the planners forgot to downgrade the temporary prices in the 60s
might they not have forgotten to remove subsidies in the 60s had these been
retained.

My own feeling is that whilst the difference between subsidies and temporary
prices may have had some effect the existence of either of these mechanisms
depended on two key features of the soviet economy from the 30s on:

1. The continued existence of money rather than labour accounts

2. Associated with this, the existence of enterprise as accounting centres which
were proto capitals.
These factors were both there under the soviet economic system of the stalin,
kruschev and breznev eras.

On top of that you had the continued existence of the wage form which meant
that only part of the labour time that went into making something appeared as
the cost = the part that went to replace the consumer goods bought on the
market. This means that the cutof point in investment decsions replacing
living with dead labour was skewed towards the living labour end, hampering
the use of labour saving machinery.

I think he overplays the difference between Stalin and his successors.
The real break did not come in 1953 but with Gorbachov.
Both Krushchev and Chou en Lia for their different reasons wanted to
make a big thing of Krushchev being a big break with the past, but I
think looking back from more than half century later it is hard
to give as much significance to it as they did.

Stalin opposed the extension of market relations, but he gave no evidence of
a deep understanding of the labour theory of value or how Marx envisaged using
it in a socialist economy, thus his Economic Problems, whilst defensive against
proposed changes towards the market economy, did not offer a way forward.

It was better than the position put forward by Trotsky in his Soviet Economy in Danger which prefigured the Dengist or Gorbachovite policies of China in the 80s or the USSR in the late 80s.


What are the organs of constructing and applying the plan like? What are the methods of checking and regulating it? What are the conditions for its success?

In this connection three systems must be subjected to a brief analysis: (1) special state departments, that is, the hierarchical system of plan commissions, in the centre and locally; (2) trade, as a system of market regulation; (3) Soviet democracy, as a system for the living regulation by the masses of the structure of the economy.

If a universal mind existed, of the kind that projected itself into the scientific fancy of Laplace – a mind that could register simultaneously all the processes of nature and society, that could measure the dynamics of their motion, that could forecast the results of their inter-reactions – such a mind, of course, could a priori draw up a faultless and exhaustive economic plan, beginning with the number of acres of wheat down to the last button for a vest. The bureaucracy often imagines that just such a mind is at its disposal; that is why it so easily frees itself from the control of the market and of Soviet democracy. But, in reality, the bureaucracy errs frightfully in its estimate of its spiritual resources. In its projections it is necessarily obliged, in actual performance, to depend upon the proportions (and with equal justice one may say the disproportions) it has inherited from capitalist Russia, upon the data of the economic structure of contemporary capitalist nations, and finally upon the experience of successes and mistakes of the Soviet economy itself. But even the most correct combination of all these elements will allow only a most imperfect framework of a plan, not more.

The innumerable living participants in the economy, state and private, collective and individual, must serve notice of their needs and of their relative strength not only through the statistical determinations of plan commissions but by the direct pressure of supply and demand. The plan is checked and, to a considerable degree, realized through the market. The regulation of the market itself must depend upon the tendencies that are brought out through its mechanism. The blueprints produced by the departments must demonstrate their economic efficacy through commercial calculation. The system of the transitional economy is unthinkable without the control of the ruble. This presupposes, in its turn, that the ruble is at par. Without a firm monetary unit, commercial accounting can only increase the chaos.(( Trotsky Soviet Economy in Danger ))

My feeling is that although Stalin's position was preferable to that of Grobachov, Tito, Trotsky and the other market socialists, it still
did not get to the heard of the matter because of his failure to differentiate
between a system of money and a system of labour tokens as advocated
by Marx. The only people writing in the 30s who came close to understanding this were the Dutch left Communists who published this http://reality.gn.apc.org/econ/gik1.htm

[Die Neue Zeit]

The Trotsky that Trotskyists quote is the "degenerated workers state" one, not the one who was inconsistent during the NEP period:


Unlike the Soviet Union there was never an element of actual workers' democracy in Cuba (soviets) but at the same time the economy is organized on proletarian forms - collective ownership of the means of production, central planning of the economy and state monopoly on foreign trade. These are the Comintern's criteria for a workers state.

Four criteria, according to Trotsky, make a "healthy workers state" (but, yes, the money question is set aside).

[Paul Cockshott]

The quote I am giving is from 1932, is that what you call the degenerated workers state trotsky?
In any case the policies and arguments he uses seem pretty standard as those put forward by east block reformers like Dubcek in the 60s - increasing role for market mechanisms. Some of Trotsky's arguments prefigure those of Hayek and may have been derived from von Mises - impossibility of calculation and accounting without money, the impossibility of a synoptic plan thougth of according to the same problematic as von Mises - the 'single mind' that would draw up the coherent plan would have to have god like powers to do it.

Does anyone know if Trotsky had copies of von Mises polemics?

[Ocean Seal]

I haven't actually read any of this, but they both seem quite inadequate at least from my historical perspective. Or at least neither of their theories really worked out in the end despite the ability to implement them.

[themediumdog]

I would be interested in opinions on the claims made by the author about the democratic structures in Stalinist-period USSR. He cites three references (the modern, Thurston, 'Life and Terror in Stalin's Russia 1934-1941', as well as work by the Webbs, and a P. Sloan: 'Soviet Democracy').

The contention is that there were reasonably effective mechanisms for the communication of Plan priorities, by the workers at the base, up through the system to the top planners (with due qualifications, etc etc).

Is this true? It goes against everything I've learned, but I'm prepared to be disabused.

[Die Neue Zeit]

The quote I am giving is from 1932, is that what you call the degenerated workers state trotsky?

Probably not. Circa The Revolution Betrayed, I think, but again whenever he first used the term "degenerated workers state."


In any case the policies and arguments he uses seem pretty standard as those put forward by east block reformers like Dubcek in the 60s - increasing role for market mechanisms. Some of Trotsky's arguments prefigure those of Hayek and may have been derived from von Mises - impossibility of calculation and accounting without money, the impossibility of a synoptic plan thougth of according to the same problematic as von Mises - the 'single mind' that would draw up the coherent plan would have to have god like powers to do it.

Does anyone know if Trotsky had copies of von Mises polemics?

I think his argument against directive planning here rested on Bukharin's prediction of an "elephantine bureaucracy" that was necessary to implement the First Five-Year Plan and beyond, which is ironic considering that today's Russia has a bigger and more corrupt civil bureaucracy than the entire Soviet nomenklatura of the Brezhnev period.

[Paul Cockshott]

According to Spufford the GOSPLAN had only a couple of thousand people working for it in the 1950s which hardly counts as an elephantine bureaucracy in such a big economy.

[Die Neue Zeit]

Bukharin referred to the Soviet bureaucracy as a whole, not just Gosplan. Gosplan was but one element in the directive planning system from 1929 to the mid 60s. The bigger components were to be found in the industrial ministries themselves.

[Paul Cockshott]

Bukharin referred to the Soviet bureaucracy as a whole, not just Gosplan. Gosplan was but one element in the directive planning system from 1929 to the mid 60s. The bigger components were to be found in the industrial ministries themselves.

Fair point.

Surprised at how little controversy there is on the thread

[Brosip Tito]

Economic planning is not equal to "socialist" economic planning. American President's have done it, the French, etc. It's not something that is "socialist only".

The economic planning under Stalin was oriented toward a capitalist mode of production.

How can we say Trotsky would have done anything better, if he were in Stalin's position? We haven't seen Trotsky's economics put into practice, though, my personal opinion is that it would have been oriented toward worker democracy and socialist planning.

[Dave B]

There is a take on Gosplan in the link below from trotsky in 1925.

The basic argument is that the accumulation of capital and the concomitant increase in productivity of labour was proceeding faster under nationalised state industry without the overhead charges of a parasitic privileged section of the intelligentsia/bureaucratic caste.

And I suppose the frenzied friction inherent in the accumulation of capital based on a ‘market economy’ as opposed to one based on a planned accumulation of capital.




But this does not exhaust the question. The economy and therefore the social expediency of socialism has also shown itself in this, that it has freed the process of the restoration of our national economy from the overhead charges of a parasitic class.

We are approaching now the level of output of 1913, whereas the country is now considerably poorer than it was before the war. This signifies that we are attaining a corresponding productivity with less social overhead charges: such as the monarchy, the nobility, the bourgeoisie, the privileged section of the intelligentsia and finally, the frenzied friction inherent in the capitalist mechanism itself. It is precisely thanks to our socialist methods that we have been able to mobilise the still very limited material resources directly for productive purposes, and in this way to facilitate the raising of the standard of living of the people of our country during the next stage of development.




http://www.marxists.org/archive/trotsky/1925/11/towards.htm

[Zederbaum]

Joseph Ball
has an interesting article on planned economy here clogic.eserver.org/2010/Ball.pdf


It was better than the position put forward by Trotsky in his Soviet Economy in Danger which prefigured the Dengist or Gorbachovite policies of China in the 80s or the USSR in the late 80s.

(( Trotsky Soviet Economy in Danger ))

My feeling is that although Stalin's position was preferable to that of Grobachov, Tito, Trotsky and the other market socialists, it still
did not get to the heard of the matter because of his failure to differentiate
between a system of money and a system of labour tokens as advocated
by Marx. The only people writing in the 30s who came close to understanding this were the Dutch left Communists who published this http://reality.gn.apc.org/econ/gik1.htm

Hmm, a mischievous dig at old Lev Davidovich? :)

There is the issue of what was historically possible at each of these times. Trotsky's acceptance of the necessity for some degree of market forces in the 1930s and indeed when he first proposed the NEP was not unreasonable given the complete lack of computers back then. It is at least conceivable that Gorbachev could have chosen the Kantorovich option.

The costs of Stalin's choice was massive, not only in human terms but also, despite its significant accomplishments, in its ultimate failure in comparison with the western capitalist states.

There is of course the ethical hindrance - "what about the Gulags, the purges etc". Irrespective of the hypocrisy of proponents of capitalism posing the question, it has proven to be a real hurdle we have to constantly surmount.

But there is also the near complete stifling of democracy and intellectual freedom which, even after the the terror has subsided, contributed towards clogging up the ability of Soviet society to successfully innovate. Again, there are significant external factors, such as a legitimate fear of invasion, which contributed to this but nevertheless it just doesn't look good for socialism to be associated with a system that lagged behind western capitalism in technical innovation.

The costs, then, of Stalin's failed attempt to build socialism have come to reflect on the very idea of socialism itself. Even had the NEP led to where China is now, then the failure would not have been laid at socialism's door.


Stalin opposed the extension of market relations, but he gave no evidence of
a deep understanding of the labour theory of value or how Marx envisaged using
it in a socialist economy, thus his Economic Problems, whilst defensive against
proposed changes towards the market economy, did not offer a way forward.Perhaps rather than looking at these options as better or worse in themselves we should look at them as a) how useful they are in solving immediate problems and b) whether they provide a trajectory forwards towards socialism. In my view, the Stalinist level of repression tends to substantially narrow any possible trajectories to move forward. It's not so easy to unpick that from the DNA of a society.


My feeling is that although Stalin's position was preferable to that of Grobachov, Tito, Trotsky and the other market socialists, it still did not get to the heard of the matter because of his failure to differentiate between a system of money and a system of labour tokens as advocated by Marx.I tend to agree with the superiority of labour tokens, but I'd see the USSR's main problem as trying to forcibly skip a stage of history. With hindsight, given the evolution of Russia, China, Vietnam etc we can say that they attempted the impossible. There is definitely a lesson there.

[Astarte]

I don't have much input here, but I can see why Paul says these things about Trotsky, as far as his quasi Hayek/Von Mises analysis.

In one essay I read a long time ago, "If America Should Go Communist", Trotsky says:


There the lack of a stable gold ruble is one of the main causes of our many economic troubles and catastrophes. It is impossible to regulate wages, prices and quality of goods without a firm monetary system. An unstable ruble in a Soviet system is like having variable molds in a conveyor-belt factory. It won’t work.

Only when socialism succeeds in substituting administrative control for money will it be possible to abandon a stable gold currency. Then money will become ordinary paper slips, like trolley or theater tickets. As socialism advances, these slips will also disappear, and control over individual consumption – whether by money or administration – will no longer be necessary when there is more than enough of everything for everybody!

Such a time has not yet come, though America will certainly reach it before any other country. Until then, the only way to reach such a state of development is to retain an effective regulator and measure for the working of your system. As a matter of fact, during the first few years a planned economy needs sound money even more than did old-fashioned capitalism. The professor who regulates the monetary unit with the aim of regulating the whole business system is like the man who tried to lift both his feet off the ground at the same time.

Soviet America will possess supplies of gold big enough to stabilize the dollar – a priceless asset. In Russia we have been expanding our industrial plant by 20 and 30 percent a year; but – owing to a weak ruble – we have not been able to distribute this increase effectively. This is partly because we have allowed our bureaucracy to subject our monetary system to administrative one-sidedness. You will be spared this evil. As a result you will greatly surpass us in both increased production and distribution, leading to a rapid advance in the comfort and welfare of your population.
http://www.marxists.org/archive/trotsky/1934/08/ame.htm


Trotsky seems to believe that large gold reserves are important in the "stabilizing" of a socialist economy. But, in the first sentence of the second paragraph of this excerpt he also says "Only when socialism succeeds in substituting administrative control for money will it be possible to abandon a stable gold currency." Thus, it seems he ultimately favored "substituting administrative control" for any kind of currency, something I doubt Von Mises or Hayek would have ever proposed.

[Die Neue Zeit]

Economic planning is not equal to "socialist" economic planning. American President's have done it, the French, etc. It's not something that is "socialist only".

The economic planning under Stalin was oriented toward a capitalist mode of production.

How can we say Trotsky would have done anything better, if he were in Stalin's position? We haven't seen Trotsky's economics put into practice, though, my personal opinion is that it would have been oriented toward worker democracy and socialist planning.

You are merely writing of the difference between directive planning and indicative planning. The French planning was indicative. Socialist planning necessarily goes past indicative planning.

Soviet planning from 1929 to the mid 1960s was directive.


There is of course the ethical hindrance - "what about the Gulags, the purges etc". Irrespective of the hypocrisy of proponents of capitalism posing the question, it has proven to be a real hurdle we have to constantly surmount.

Official Soviet historians lambasted Stalin's purges, though:

As a political leader, along with other outstanding Party and state workers, such as Kliment Voroshilov, Felix Dzerzhinsky, Sergei Kirov, Grigory Ordzhonikidze, Valerian Kuibyshev, Yan Rudzutak and Vasily Chubar, Stalin made a great contribution to the implementation of Party policy in the course of the country's social transformations. Soon, however, all the great achievements of the Soviet people began to be associated with the name of Stalin. He came to believe in his own infallibility and violated Leninist norms of Party life.

As for the Gulags, you and I already know about the decreasing legitimacy of this argument in light of prison labour in the US, Tory "workfare," and child sweatshops in the Third World.


The costs of Stalin's choice was massive, not only in human terms but also, despite its significant accomplishments, in its ultimate failure in comparison with the western capitalist states.

Comrade, I already mentioned that much of the famine, and perhaps even the massive depression of real wages, could have been avoided had forced sovkhozization been pursued wholesale.

[Paul Cockshott]

Economic planning is not equal to "socialist" economic planning. American President's have done it, the French, etc. It's not something that is "socialist only".

The economic planning under Stalin was oriented toward a capitalist mode of production.

How can we say Trotsky would have done anything better, if he were in Stalin's position? We haven't seen Trotsky's economics put into practice, though, my personal opinion is that it would have been oriented toward worker democracy and socialist planning.

Economic planning is not equal to "socialist" economic planning. American President's have done it, the French, etc. It's not something that is "socialist only".
The problem with this is that if you look at the proposals he puts forward it is for a strengthening of market mechanisms,

The plan is checked and, to a considerable degree, realized through the market. The regulation of the market itself must depend upon the tendencies that are brought out through its mechanism. ( Soviet economy in danger , Trotsky)

This means that what he was advocating is the sort of planning that the Chinese do now or that the French did - indicative planning, rather than planning in kind.

The economic planning under Stalin was oriented toward a capitalist mode of production..

Can you explain in detail why you think the system that was developed under the Stalin government was more capitalist oriented that that being advocated by Trotsky above.

There is no doubt that the Stalin government retained money as a means of paying wages and as a means of accounting the product produced by state factories, but these were accounting prices at state fixed prices. There was not a market in the normal sense. Trotsky seems to have opposed this and advocated that the state factories should relate to one another by direct market mechanisms, this puts him on the same platform as that later occupied by Dubcek or Gorbachov.

Stalin in 1952 claimed that the persistence of commodity production was due to their still being cooperatives - the collective farms, whose products had to be bought. These constituted a large part of the real wage, so the wage had to be monetary. If agriculture was socialised, commodity production would disappear.

Of course, when instead of the two basic production sectors, the state sector and the collective-farm sector, there

page 16

will be only one all-embracing production sector, with the right to dispose of all the consumer goods produced in the country, commodity circulation, with its "money economy," will disappear, as being an unnecessary element in the national economy. But so long as this is not the case, so long as the two basic production sectors remain, commodity production and commodity circulation must remain in force, as a necessary and very useful element in our system of national economy. How the formation of a single and united sector will come about, whether simply by the swallowing up of the collective-farm sector by the state sector -- which is hardly likely (because that would be looked upon as the expropriation of the collective farms) -- or by the setting up of a single national economic body (comprising representatives of state industry and of the collective farms), with the right at first to keep account of all consumer product in the country, and eventually also to distribute it, by way, say, of products-exchange -- is a special question which requires separate discussion.

My own view is that this oversimplifies the question since it leaves aside a number of important functions of money in the soviet planning system:

The divergence in pay rates between different trades and proffessions and the extent to which this was gender based
The use of monetary aggregates as plan targets
The problem of deciding what mix of consumer goods to produce

To get rid of money it would not be enough just to bring the agricultural sector into full socialisation. It would be necessary to develop detailed planning in kind techniques, something that was probably impossible for a complex economy prior to the development of computers.

[Paul Cockshott]

But there is also the near complete stifling of democracy and intellectual freedom which, even after the the terror has subsided, contributed towards clogging up the ability of Soviet society to successfully innovate. Again, there are significant external factors, such as a legitimate fear of invasion, which contributed to this but nevertheless it just doesn't look good for socialism to be associated with a system that lagged behind western capitalism in technical innovation.
The problem with this account is that as Ball shows, technical innovation proceeded pretty rapidly in the Stalin period. In my view it also went on very rapidly in the 50s as well - as indicated by the sucess of soviet space, computer, nuclear and aviation technology in those days : these were the forefront areas of technology in the world then.





The costs, then, of Stalin's failed attempt to build socialism have come to reflect on the very idea of socialism itself. Even had the NEP led to where China is now, then the failure would not have been laid at socialism's door.

Well you can be sure that anything other than complete free market capitalism would have been vilified by western propagandists in the same way.

Your argument seems to be that because in 1990 the soviet system came to a crisis it would have been better never to have attempted it and to have settled for something like the current Chinese predominantly state capitalist economy. It is clear that had this been done, the class polarisation of soviet society would have been much more intense with income inequalities like those of China today. By creating such a polarisation, it would have created very strong class pressures for 'liberalisation', the general transition to a fully capitalist economy.



Only when socialism succeeds in substituting administrative control for money will it be possible to abandon a stable gold currency. Then money will become ordinary paper slips, like trolley or theater tickets. As socialism advances, these slips will also disappear, and control over individual consumption – whether by money or administration – will no longer be necessary when there is more than enough of everything for everybody!

This has some halting grasp of what is needed but mixed up with a lot of nonsense. He seems to think that non convertible paper currency is only possible with complete administrative control - the history of modern capitalism shows what an error that is. He misunderstands a remark by Marx that Owens labour tokens were no more money than a theatre ticket.
This is was not because they were printed on paper, but because a labour account system involves tokens which could only be gained by direct labour, and which did not circulate. Paper money does circulate and can perfectly substitute for gold currency. By saying that you can only abolish money when you can afford to distribute everything ad libitum isto make the same error as Krushchev who also thought that the key was to have massive levels of production.
This puts the abolition of money and commodity production into some indeterminate far distant future.

[Die Neue Zeit]

Trotsky's paper currency error stemmed from his belief in the gold standard. Khrushchev had the wrong approach to abolishing money, but I think that "Communism by 1980" credits-wise could have been more realistic with greater commitment to computer development.

[Paul Cockshott]

Trotsky's paper currency error stemmed from his belief in the gold standard. Khrushchev had the wrong approach to abolishing money, but I think that "Communism by 1980" credits-wise could have been more realistic with greater commitment to computer development.

Well by the end of the 80s or early 90s, depending on how much effort was put into the technology but the politics was not there.

[Zederbaum]

The problem with this account is that as Ball shows, technical innovation proceeded pretty rapidly in the Stalin period. In my view it also went on very rapidly in the 50s as well - as indicated by the sucess of soviet space, computer, nuclear and aviation technology in those days : these were the forefront areas of technology in the world then.
The USSR had a myriad of impressive achievements, no question about that. But why were they unable to keep up that pace of innovation in the Brezhnev period, particularly outside of grand projects? Why the loss of confidence in the 1980s and the introduction of capitalism? Was it the consequence of a few unlucky poor decisions or were the inherent difficulties with the system itself? If the former, why was the Soviet system not robust enough to withstand them? The USA managed to survive quite a few terrible choices.


Well you can be sure that anything other than complete free market capitalism would have been vilified by western propagandists in the same way.
For sure, but the massive scale of the forced collectivisation, the famines and the purges certainly made it easier for them given that the vilification had considerable basis in fact.


Your argument seems to be that because in 1990 the soviet system came to a crisis it would have been better never to have attempted it and to have settled for something like the current Chinese predominantly state capitalist economy. It is clear that had this been done, the class polarisation of soviet society would have been much more intense with income inequalities like those of China today. By creating such a polarisation, it would have created very strong class pressures for 'liberalisation', the general transition to a fully capitalist economy.Is your argument that the forced collectivisation and purges were worth it? Particularly worth it given its long-term outcome? That you would advocate such a policy for Europe and the UK right now? That doesn't appear to be the policy advocated in your excellent pamphlet on Socialism in 21st century Europe so why should it have been applicable in the vastly more difficult conditions of 1920s Russia?

In the circumstances of the time, I would say the advocates of the NEP, including in this case Trotsky, had their noses closer to reality given, as you yourself say, that developing planning kind techniques "was probably impossible for a complex economy prior to the development of computers." Lumping the 1920s NEPers in with the Gorbachev and Deng tendencies which arose in the computer era is too ahistorical to be informative.

I'd go further than saying the breakneck speed of collectivisation and industrialisation of a backward country shouldn't have been attempted; Lenin's strategy - insofar it can be called a strategy - of a revolutionary coup d'etat in a pre-capitalist country got socialism on the wrong track. It led Bolshevism down a very anti-democratic road and given that democracy is a prerequisite for socialism this proved to be fatal.

Having said that, the Soviet experiment should be studied and learned from. Its achievements were considerable and it is a sort of experiment in socialist development, similar to the Utopian ones of the early 19th century. It is difficult to get such data in the social sciences.


It is clear that had this been done, the class polarisation of soviet society would have been much more intense with income inequalities like those of China today. By creating such a polarisation, it would have created very strong class pressures for 'liberalisation', the general transition to a fully capitalist economy.I don't disagree that a Chinese scenario would have been quite likely, although it's not the only possible one. A less likely, but nonetheless possible one is that something akin to Schwieckart's economic democracy could have been inculcated, i.e. there is a market for consumer goods but private property, wage-labour and the private extraction of surplus value is ended. I'd be less worried about the market form per se than about their retention.

[Die Neue Zeit]

The USSR had a myriad of impressive achievements, no question about that. But why were they unable to keep up that pace of innovation in the Brezhnev period, particularly outside of grand projects? Why the loss of confidence in the 1980s and the introduction of capitalism? Was it the consequence of a few unlucky poor decisions or were the inherent difficulties with the system itself? If the former, why was the Soviet system not robust enough to withstand them? The USA managed to survive quite a few terrible choices.

The Brezhnev period had one particular turn that today's Russia is suffering from today: oil revenue addiction.


I'd go further than saying the breakneck speed of collectivisation and industrialisation of a backward country shouldn't have been attempted; Lenin's strategy - insofar it can be called a strategy - of a revolutionary coup d'etat in a pre-capitalist country got socialism on the wrong track. It led Bolshevism down a very anti-democratic road and given that democracy is a prerequisite for socialism this proved to be fatal.

I hope by "coup d'etat" you're referring to the shutting down of non-Bolshevik soviets in 1918, not to the ouster of the Provisional Government or the shutdown of the discredited Constituent Assembly. :mellow:


A less likely, but nonetheless possible one is that something akin to Schwieckart's economic democracy could have been inculcated, i.e. there is a market for consumer goods but private property, wage-labour and the private extraction of surplus value is ended. I'd be less worried about the market form per se than about their retention.

But would that not mean precisely some form of accelerated collectivization? As I said before, there were discussions on the forms of this before the final policies were adopted. Stalin's agricultural "insight" in Economic Problems of Socialism in the USSR was over two decades too late.

[Rafiq]

I hope by "coup d'etat" you're referring to the shutting down of non-Bolshevik soviets in 1918, not to the ouster of the Provisional Government or the shutdown of the discredited Constituent Assembly. :mellow:


I hate when "socialists" say that the ousting of the provisional government was a coup d'etat. It just goes to show they don't know shit, especially because they (Provisional govt) were paving the way for Kornilov and collaborating with him.

[Paul Cockshott]

You raise some interesting points here


The USSR had a myriad of impressive achievements, no question about that. But why were they unable to keep up that pace of innovation in the Brezhnev period, particularly outside of grand projects? Why the loss of confidence in the 1980s and the introduction of capitalism? Was it the consequence of a few unlucky poor decisions or were the inherent difficulties with the system itself? If the former, why was the Soviet system not robust enough to withstand them? The USA managed to survive quite a few terrible choices.

Well Ball argues that the key was a shift in the way they dealt with innovation. Up until some point in the 50s the policy had been to give state
subsidies to factories or projects that were engaged in innovating and producing new products. Thus the plan encouraged innovation.
Essentially they were encoraged to introduce new products and the state
would meet any costs they had in doing this.

Later they shifted to a system where enterprises had to recover the
cost of innovation from what were called 'temporary prices'. The price
of a new product was fixed initially at a premium which was supposed to
be reduced to closer to cost price as time went on. He claims that there
were serious problems with this mechanism. For a start it encouraged gaming
in which enterprises pretended that they had new products when the
products were little different from before, in order to get the higher
temporary price. Secondly, the planners did not reduce the temporary
prices to stable prices fast enough and as a result a large number of old
products still sold at the temporary price level.

These points by Ball are actually quite interesting and may well be one
factor in the decline in innovation.

Note of course, that free market Russia of the last 20 years has hardly
been known as a world leader in technical innovation.



For sure, but the massive scale of the forced collectivisation, the famines and the purges certainly made it easier for them given that the vilification had considerable basis in fact.
Yes but these vilifications only became ideologically important in Russia
long after the Stalin period, really they only had any purchase ideologically
from Gorbachov on. When the system worked economically, these
criticisms had little political purchase.

It is significant that the 6 to 7 million deaths in Russia alone brought about by the economic policies of the Yeltsin government are not presently held, except by Russian Communists, to similarly discredit capitalism.



Is your argument that the forced collectivisation and purges were worth it? Particularly worth it given its long-term outcome? That you would advocate such a policy for Europe and the UK right now? That doesn't appear to be the policy advocated in your excellent pamphlet on Socialism in 21st century Europe so why should it have been applicable in the vastly more difficult conditions of 1920s Russia?
No I would not advocate them now in Britain, largely because the bourgeois
social revolution acomplished the task of modernising and mechanising
agriculture long ago, so the problem simply does not arise.


Stalin followed Lenin’s path for a short while, allowing small-hold production to continue. But in 1932 he lost patience and ordered full enforcement. By the end of the year, 67% of farms were collectivised, but peasants continued to burn crops and stockpile. Famine got worse in 1932-3, so now Stalin really got the shits: he rounded up the kulaks and used that tried and true Russian method of more than two centuries – he sent them off to populate (and perish in) Siberia. Meanwhile, by 1939, 99% of Russian farms were collectivised, modernised and were using machinery.

So was it a failure? Let’s look at the following statistics:

In 1928, 73 million tons of grain were produced.

In 1933, at the height of the struggle, 69 million tons were grown.

However, by 1937, the yield was 97 million tons.

In other words, on the eve of the Second World War, production had increased by more than 24 million tons, or by about 33%. It needed a man with a bite as strong as his bark to get it done. Along with the massive reorganisation of industrial production, this put the USSR in a very strong position to resist Hitler’s attack in 1941. ( from http://stalinsmoustache.wordpress.com/?s=stalin+war+collectivisation)
On the same site there is another interesting argument I had not seen before



George Hallam Says:

“Grain production was falling short by about 20 million tons, needed to feed Russia itself, largely due to old peasant methods of agriculture that were becoming increasingly inefficient.”

It was not just an issue of the total production of food. Once it had been grown, there was the matter of procuring enough for the urban population.

The economic paradox of the First World War was that Britain with a very large urban population managed to keep them fed, while other countries, with urban populations that were proportionately far smaller, the towns starved.

Some of this was due to the supply effect mobilisation also had on agriculture as men and horses were taken away from the land and into the army. However, there were other things going that were linked to the structural differences between economies.

In Britain capitalism was well developed so production was all about using money to make more money (M – C – M). Meanwhile, in Central and Eastern Europe a significant proportion of agriculture was still at the stage of simple commodity production (C – M – C). That is, peasants produced commodities as a means of obtaining other (different) commodities.

As states mobilised for war, production was diverted away from civilian goods to military material.

In Britain and other advanced countries capitalist farmers were happy to accumulate money. In less advanced countries peasant farmers wanted goods they could use. As the supply of these dried up, so peasants became less and less willing to take their own products (essentially, grain) to market. It was more advantageous for them to do less work and eat their production themselves than to produce more and accumulate money they couldn’t spend.

Collectivisation did several things that made the Soviet economy far more resilient than the old Tsarist economy. These changes were crucial the Soviet Union’s survival in the Second World War.

1. Tractors were substituted for horses and men. This not only increased productivity it meant that mobilisation had less impact on production.
2. Scientific techniques could be more easily disseminated and implemented. (your point)
3. The whole rural economy was more closely integrated with towns thus guaranteeing food security.

This last point was vital, not just during the war but for the whole process of industrialisation.

No collectivisation, no five-year plans.
No five-year plans, no industrialisation.
No industrialisation, no victory over Nazi Germany.



In the circumstances of the time, I would say the advocates of the NEP, including in this case Trotsky, had their noses closer to reality given, as you yourself say, that developing planning kind techniques "was probably impossible for a complex economy prior to the development of computers." Lumping the 1920s NEPers in with the Gorbachev and Deng tendencies which arose in the computer era is too ahistorical to be informative.
I agree that Gorbachov had options that were not available in the 30s, but,
I would argue the were probably not needed in the 30s. At that stage an
essentially millitary system of plan organisation was probably still enough
for what had to be done. As the economy became larger and more complicated
the task of planning in kind became harder, but in the 30s, the Soviet Economy
was not actually 'in danger', on the contrary it was doing better than
any other economy in the world. It was not for another two generations
that the problem of attempting to plan in kind without adequate
computer networks became a pressing issue.

[Die Neue Zeit]

No I would not advocate them now in Britain, largely because the bourgeois social revolution acomplished the task of modernising and mechanising agriculture long ago, so the problem simply does not arise.

Has British food production really been that modernized? I've yet to see the proliferation of vertical farming in even its most basic form (shelves in warehouses). Here, there's an opportunity to go straight into public-owned agriculture, aquaculture, etc. without the mess of the kolkhozy, kibbutzim, etc.

[Kotze]

If you really believe subsidies for innovation aren't better than price-raising allowances you might as well advocate patents :P

[Paul Cockshott]

It depends on how the subsidy mechanism worked, I think that he probably has lighted onto an important factor, but it is unclear that you might not have had similar gaming in the long run by enterprises looking for subsidies for innovations that in the end turned out to be pretty marginal.