Socialist Economies Stagnating

[Matty_UK]

So, why exactly did the USSR's economy begin to stagnate after initial high growth rates?
I haven't heard any reasons for this other than "its coz it was collectivist!!!111," which I find hard to square with the fact it had high growth at the early stages.

[Acorn]

In the beginning, the USSR was an unindustrialized nation of Serfs. When the Stalin took power, his Collectivization programs, as well as his Industrially-based 5-Year plans provided tremendous growth in production. WWII helped tremendously, because Unemployment was eradicated & production skyrocketed. The Production sector was controlled by the state, & all consumption was made by the state as well (because they focused mainly on Militariliy-laced heavy industry) so the State could self-perpetuate the economy for a while. However, the economy began to decline by the 50's & 60's because it was state capitalist, & therefore Based soley on growth. Growth of the economy could only be attained with high production & high Consumption levels of goods, but the Soviet had 2 problems.
1. They had invested far too much money into Heavy industry & not enough into Light industry, therefore consumerism was almost nonexistant.
2. The Soviet Union, as a result of purges & overall spiritual desolation, had a Negative Population growth rate. When this happens, Consumption is forced to lower, But production is not forced to lower. It takes a while for the market, & even the state, to react to the lowering consumption levels, & therefore more than is needed is produced & thus the fruits of Production a lwered in value, & because the produce is the fruit of the state, the monetary value of the state is lowered as well. Tus, stagnation begins in a booming War-time economy.

I think. I don't really know.

[trivas7]

http://www.revleft.com/vb/ussr-mode-production-t83532/index.html?p=1189195#post1189195

[Schrödinger's Cat]

The problem with the Soviet model is based around the closure of democracy in the workplace. Yugoslavia ran on an economy of cooperatives quite successfully until both powers campaigned for its execution and destruction. Up until the late 1970s it had a living standard on par with West Europe. The Soviets centralized information and production, making for some terrible decision-making, such as shipping patterns that were bi-monthly. The growth patterns of the Soviet model from the 1930s to the early 1960s were astronomical because not much input was needed: the economy was "simple." By the 1970s the Soviet Union had reached its peak, with an economy about 60% as large as the US's. Scientists were advocating the use of computers in the workplace, but Brezhnev changed around production and got rid of decentralization programs - and he ignored computer planning. Obviously that was a a mistake. The biggest corporations adopted computer programming in the late 80s, which makes them the successes they are today when it comes to stocking up.

Further socialist experiments must:

- Be decentralized. Consumers are workers, and visa versa. They know what they want. If there is a state, planning must be kept to a minimum. In my mind (and this is purely speculative on my part - it's probably not necessary), planning boards should run as primitive democracy, or demarchy. People who can meet qualifications for the board (by testing into it) should be chosen at random.

- Look favorably on technology like computers, GMOs, etc.

- Should not be concerned about home entrepreneurs and small businesses

- Democratize all social services. Don't keep the top-down planning models

- Allocate as much self responcibility as possible when it comes to lifestyle choices. The Soviet Union was "conservative" on issues of pornography, abortion, drugs, and homosexuality.

[BobKKKindle$]

In the beginning, the USSR was an unindustrialized nation of Serfs.

The emancipation of the serfs took place in 1861 - thereafter peasants were not tied to an individual landowner and were free to move between rural villages and even migrate to the towns to search for employment in the industrial sector, if they were able to gain the permission of the local village council. In addition, Russia was not an "unindustrialized nation" as although the industrial base was small and weak in comparison to other countries which had endured an extended period of capitalist development, foreign firms and banks recognized that Russia was a valuable destination for the export of capital, as the state offered a guaranteed rate of return on all investment, and authoritarian political control ensured that workers were unable to create unions to demand improvements in working conditions or wage increases, such that during the late nineteenth century Russia experienced the rapid growth of industrial centers, which exhibited modern technology and large units of production. During the period 1890-1899 he average annual rate of growth in industrial output was 8.03% (compared to 5.44% in Germany) a clear indication of the economic changes which were taking place in Russia prior to WW1 (Source: A. Gerschenkron 'The Rate of Growth in Russia') This industrial base existed alongside semi-feudal relations and intense poverty in rural areas, and so Trotsky described this socio-economic contrast as "combined and uneven development".

[Dimentio]

The emancipation of the serfs took place in 1861 - thereafter peasants were not tied to an individual landowner and were free to move between rural villages and even migrate to the towns to search for employment in the industrial sector, if they were able to gain the permission of the local village council. In addition, Russia was not an "unindustrialized nation" as although the industrial base was small and weak in comparison to other countries which had endured an extended period of capitalist development, foreign firms and banks recognized that Russia was a valuable destination for the export of capital, as the state offered a guaranteed rate of return on all investment, and authoritarian political control ensured that workers were unable to create unions to demand improvements in working conditions or wage increases, such that during the late nineteenth century Russia experienced the rapid growth of industrial centers, which exhibited modern technology and large units of production. During the period 1890-1899 he average annual rate of growth in industrial output was 8.03% (compared to 5.44% in Germany) a clear indication of the economic changes which were taking place in Russia prior to WW1 (Source: A. Gerschenkron 'The Rate of Growth in Russia') This industrial base existed alongside semi-feudal relations and intense poverty in rural areas, and so Trotsky described this socio-economic contrast as "combined and uneven development".

Much like China and India today.

As for Genecosta's proposals, they remind a bit of the NET model.

[Demogorgon]

The economic growth was channeled into producing goods that weren't useful for consumers. You can keep an economy going artificially by producing large amounts of military equipment, but it can't last forever. That is what happened to the Soviet Union, it spent far to much on its military.

There was also the fact that its economy was becoming too developed and too complex to plan centrally. It should have been devolved but wasn't. That was a mistake.

[ComradeOm]

2. The Soviet Union, as a result of purges & overall spiritual desolation, had a Negative Population growth rate. When this happens, Consumption is forced to lower, But production is not forced to lower. It takes a while for the market, & even the state, to react to the lowering consumption levels, & therefore more than is needed is produced & thus the fruits of Production a lwered in value, & because the produce is the fruit of the state, the monetary value of the state is lowered as well. Tus, stagnation begins in a booming War-time economyHuh? Leaving aside the contradictions in your logic, the USSR did not have 'negative population growth'. Fertility levels were healthy, if only special for the gender and age imbalances introduced by WWII, but it was not until the collapse of the Cold War that fertility rates plummeted and not until 1992 that the number of deaths surpassed births in Russia

[Nothing Human Is Alien]

The economic downturn in the USSR's late history was largely a product of the U.S.-imposed arms race and an increasingly parasitic bureaucracy.

[JimFar]

The economic downturn in the USSR's late history was largely a product of the U.S.-imposed arms race and an increasingly parasitic bureaucracy.

We also shouldn't neglect the drop in world oil prices during the 1980s. By then the Soviet Union was a major oil producer whose economy was increasingly dependent on oil sales. As long as world oil prices stayed up, the Soviets were able to muddle on. When world oil prices fell, the bottom dropped out of their economy. Likewise, much of the present resurgence of Russia is due to the fact that world oil prices are at an all time high.

[Paul Cockshott]

How do you determine that it spent too much on the millitary?
How much did it need to spend to protect it from Nazi Germany and then the USA?
One could argue that it could have spent less and survived, but you need a reasoned military argument to this effect.

[ckaihatsu]

GeneCosta,

Please excuse my following critique of the points you posited. I'd like to use them as departure points, in the most constructive spirit -- I hope I don't seem too harsh, but I am just being direct. No offense is meant.



Further socialist experiments must:

- Be decentralized. Consumers are workers, and visa versa. They know what they want.


A truly post-capitalist, socialist economy might wind up being kind of tricky -- assuming that a global class, worker-militia conflict would be a prerequisite (like the U.S. Civil War), the absence of a foe might create a (dialectical) aftermath of worker / producer disorientation.

Once full emancipation of humanity from poverty and wage-slavery is achieved, what then?

Maybe the future worker / consumers *would not* know what they want. What then? Decentralization in such a situation would be a curse, not a boon. Too many diffuse, uncoordinated projects could turn the human population into a mass of semi-psychotic wanderers.



If there is a state, planning must be kept to a minimum.


Again, playing devil's advocate here, the flipside of decentralization and minimal state planning is that resources could be haphazardly requested and then frittered away to no good lasting results. As an offhand example, what if everyone wanted to design their own living environments, in very individual and artistic ways? The materials (and logistics) required from the state might be possible, but wasteful, and over the long term, not even viable.



In my mind (and this is purely speculative on my part - it's probably not necessary), planning boards should run as primitive democracy, or demarchy. People who can meet qualifications for the board (by testing into it) should be chosen at random.


This sounds more reasonable. I think we would have to have an institutionalized system of oversight, regulation, and academia, much as we have now, but free of the burdens of profit, careerism, institutional politics, and cronyism.



- Look favorably on technology like computers, GMOs, etc.

- Should not be concerned about home entrepreneurs and small businesses

- Democratize all social services. Don't keep the top-down planning models

- Allocate as much self responcibility as possible when it comes to lifestyle choices. The Soviet Union was "conservative" on issues of pornography, abortion, drugs, and homosexuality.




I don't think there'd be any controversy on these last four points -- computers, GMOs, and other technologies would simply be the latest tools at our disposal -- politically the questions would be about how best to implement them.

The last three points are almost entirely non-political and therefore outside the scope of central planning. Anyone who can provide personal service to anyone else -- while themselves being supported by the general state welfare -- is simply doing things at the ground level, whether you would want to call that "business", "social service", or "lifestyle".

It's the mass allocation of mass assets and resources -- including mass labor projects -- that's the more intricate part of a post-capitalist society. I've raised this point previously, on other threads -- what's to preclude a post-capitalist society from democratically deciding to build a newer version of the Giza pyramids, or some similar large-scale artistic project? How would large-scale scientific investigations be furthered, freed from the yoke of capitalist profit extraction?

I submit the following as a framework, or possible overarching method:


http://en.wikipedia.org/wiki/Connectionism

Connectionism

From Wikipedia, the free encyclopedia

Connectionism is an approach in the fields of artificial intelligence, cognitive psychology/cognitive science, neuroscience and philosophy of mind, that models mental or behavioral phenomena as the emergent processes of interconnected networks of simple units. There are many forms of connectionism, but the most common forms use neural network models.

[...]

Spreading activation

In most connectionist models, networks change over time. A closely related and very common aspect of connectionist models is activation. At any time, a unit in the network has an activation, which is a numerical value intended to represent some aspect of the unit. For example, if the units in the model are neurons, the activation could represent the probability that the neuron would generate an action potential spike. If the model is a spreading activation model, then over time a unit's activation spreads to all the other units connected to it. Spreading activation is always a feature of neural network models, and it is very common in connectionist models used by cognitive psychologists.


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Chris




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[Lenin's Law]

- Allocate as much self responcibility as possible when it comes to lifestyle choices. The Soviet Union was "conservative" on issues of pornography, abortion, drugs, and homosexuality.


Just as a point of clarification: those issues you list (with the exception of drugs and maybe pornography) occurred during the Stalinist period. The Bolsheviks were one of the first governments in the world to abolish the anti-gay laws created by the czar and recognize abortion, this was reversed in the 1930s.