In this episode of the Friday Focus podcast, Rudyard Griffiths and Janice Stein discuss the week’s dramatic developments in U.S. politics, focusing on President Trump’s controversial appointments. They reflect on the lack of competence and merit in key nominations, which have drawn widespread shock and criticism from observers, including those sympathetic to Trump’s agenda. Specific appointments, such as Pete Hegseth to the Department of Defense and Tulsi Gabbard to Director of National Intelligence, are critiqued for prioritizing loyalty and media presence over experience. They also highlight troubling trends, including the absence of standard background checks and ethical concerns.
The discussion then shifts to Elon Musk’s unprecedented involvement in U.S. government affairs, including conversations with Ukrainian and Iranian leaders. Musk’s dual role as a major contractor and de facto advisor raises concerns about conflicts of interest and oligarchic tendencies within the administration.
Finally, Rudyard and Janice debate the broader implications of these developments, likening Trump’s administration to historical authoritarian regimes while emphasizing its radical and revolutionary agenda. They consider whether American institutions outside of Washington can withstand the administration’s erosion of norms and governance. The episode concludes with a call for listener feedback and reflections on these pressing issues.
Why do some Canadians support Donald Trump when the potential imposition of 10% to 20% across-the-board tariffs by the United States under his leadership could have devastating repercussions for the Canadian economy? Approximately two-thirds of Canada's exports are destined for the U.S., making our economy deeply intertwined with theirs.
These tariffs would likely drive up the cost of Canadian goods in the U.S. market, reducing demand and delivering a severe blow to Canadian industries reliant on exports. Analysts have already raised alarms that such a move could trigger a recession in Canada, disrupting trade flows and destabilizing our economic foundation.
The impact wouldn’t stop there—it would hit the Canadian oil industry particularly hard. Provinces like Alberta, Saskatchewan, Newfoundland, and Labrador, which depend heavily on petroleum exports, could experience crippling economic downturns. Canadian oil would become less competitive in the United States, our largest buyer, which currently accounts for nearly all of our crude oil exports. With tariffs in place, American buyers could easily pivot to domestic or other international suppliers, leaving Canada to bear the brunt of the loss.
I fail to understand the logic behind admiring a would-be president who shows such blatant disregard for Canada. Trump does not give a rat’s ass about our economy or the devastating domino effect these policies could have on our entire country.
Conclusion
The potential for tariffs under a Trump-led U.S. administration highlights the vulnerability of Canada's trade-dependent economy. Such policies could wreak havoc on industries like petroleum, driving regional and national economic instability. While free trade agreements such as the USMCA offer a framework for collaboration, the review scheduled for 2026 adds uncertainty to an already precarious relationship.
It is imperative for Canadians to critically assess the economic and political implications of U.S. leadership choices. Supporting a leader who threatens the core pillars of Canada’s economy seems counter-intuitive, particularly when the consequences could reverberate across the nation. The need for robust, strategic responses to safeguard Canadian interests has never been clearer.
It is puzzling why Trump seems to garner so much support from some Canadians. This sentiment echoes from the streets, coffee shops, and across social media. At first glance, it seems illogical: first, as Canadians, we don’t have a vote in the United States; and second, his protectionist policies could ripple unfavourably throughout the Canadian economy from coast to coast.
To understand Trump’s protectionist stance, let’s briefly examine the impacts of the United States–Mexico–Canada Agreement (USMCA) and some key trade restrictions his administration placed on Canada:
Steel and Aluminum Tariffs
In March 2018, the Trump administration imposed tariffs of 25% on Canadian steel and 10% on Canadian aluminum, citing national security under Section 232 of the Trade Expansion Act. In response, Canada implemented retaliatory tariffs on U.S. goods, including steel, aluminum, and various consumer items. Although these tariffs were eventually lifted in May 2019 after negotiations, they marked a shift in U.S.-Canada trade relations.
Softwood Lumber Tariffs
Trump's administration claimed Canadian provinces were unfairly subsidizing the lumber industry, resulting in duties ranging from 10% to 24% on Canadian softwood lumber imports. This impacted construction costs and strained trade relations.
Dairy Trade Restrictions
During the USMCA renegotiation, Trump criticized Canada’s dairy supply management system, which limited U.S. imports to protect Canadian farmers. The USMCA required Canada to ease restrictions on U.S. dairy, poultry, and egg products.
Threatened Tariffs on Auto Imports
Trump repeatedly threatened tariffs on Canadian auto imports as part of a broader negotiation strategy, though these were never enacted. This tactic pushed Canada to make concessions during USMCA talks.
These measures, most of which were lifted or adjusted by the end of Trump’s presidency as USMCA took effect in July 2020, underscored his "America First" approach. This stance brought a new tension to U.S.-Canada trade relations, favouring U.S. interests at Canada’s expense.
When it comes to trade, Canada’s bargaining power with the U.S. is limited. As such, USMCA primarily benefits the United States. Realistically, given the power disparity, it hardly matters if Trudeau or Poilievre is in office—the dynamic remains a zero-sum game where the United States typically benefits to Canada’s disadvantage.
So, why do some Canadians appear to support a foreign leader whose policies could jeopardize Canada’s economic relationship with the United States? Given that Canada’s economy is highly integrated with the U.S.—particularly through trade that supports agriculture and energy exports—this seems counterintuitive. Nonetheless, ideological and cultural alignments sometimes supersede economic pragmatism.
Here are a few factors that might explain why Trump’s protectionism hasn’t dissuaded some Canadians from supporting him:
Ideology Over Economics
For some supporters, ideology outweighs economic concerns. Canadians who align with Trump’s values—such as strong borders, nationalism, or conservative social policies—may view his economic policies as secondary. They might even believe Canada could adapt or benefit from a renegotiated relationship, hoping it fosters self-sufficiency.
Misperceptions of Economic Impact
Not all Canadians fully understand the risks protectionism poses to our economy. Tariffs and trade barriers may seem abstract, especially if they don’t immediately affect daily life. Media portrayals often simplify or sensationalize economic issues, making the true consequences of protectionist policies harder to grasp.
Discontent with Canadian Policy and Institutions
Some Canadians dissatisfied with the current state of Canadian politics or institutions may see Trump as a desirable alternative, even if his policies could harm Canada’s economy. This perspective often reflects a desire for radical change, regardless of the economic logic for Canada.
Belief in U.S.-Canada Resilience
Some Canadians assume that the close Canada-U.S. relationship would shield us from the full effects of American protectionism. They might believe that U.S. businesses, particularly those reliant on Canadian resources, would press against harsh tariffs, thereby maintaining some stability despite Trump’s policies.
Populism and National Pride
Canadian populist sentiments sometimes mirror those in the U.S., advocating for national pride and reduced global dependence. Trump’s rhetoric may inspire Canadians who believe in reducing reliance on U.S. or international trade, especially those favouring local industry, even at a cost.
Canada’s negotiating power with the U.S. is indeed limited, and a protectionist American leader could seriously impact critical Canadian sectors like manufacturing, agriculture, and energy. However, when ideology and populism come into play, economic concerns may take a back seat. Some Canadians may assume that, despite protectionist measures, Canada’s adaptability and resource-based economy could provide stability through turbulent times.
Summary
Donald Trump's administration implemented protectionist policies that negatively impacted Canada’s economy, such as tariffs on steel and aluminum, which were later lifted in 2019, and restrictions on dairy trade, as well as threats of auto tariffs. Despite these policies, which disrupted sectors of the Canadian economy, some Canadians continue to support Trump. For these individuals, ideological alignment with Trump on issues like nationalism and conservative social values often outweighs concerns about economic impacts. Additionally, some Canadians hold misconceptions about the effect of protectionist policies, believe in the resilience of the U.S.-Canada relationship to withstand economic tension, or seek alternatives to Canadian policy and institutions. Populist views favouring economic independence and national pride further contribute to Trump’s appeal, despite risks to Canada’s economic stability. These findings underscore the way cultural values often eclipse economic pragmatism in shaping political preferences.
Conclusion
In examining the support some Canadians have for Donald Trump despite his protectionist policies, it becomes clear that ideology can overshadow practical economic concerns. Although Trump’s policies—such as tariffs, restrictions, and trade renegotiations—have adversely affected Canada, including initial tariffs on steel and aluminum later lifted in 2019, his supporters persist due to deeper ideological and cultural affinities. This alignment demonstrates a broader trend: cultural identity and ideology frequently override economic interests, shaping public opinion in unexpected ways. While Canada’s reliance on the United States creates a vulnerable trade position, many supporters seem to believe Canada’s adaptability and close economic ties with the U.S. will sustain stability despite protectionist policies.
As it stands, the first-past-the-post voting system, at least for now, allows for only two dominant parties; that is not to say this couldn’t change. However, it is highly unlikely that such a change would occur.
Understanding the game of politics can be a daunting task, as the game is complex within Canada and becomes even more complicated when international issues are introduced, such as trade agreements, treaties, maintaining alliances, and so forth. One explanation behind the complexity is that each player’s strategy is to maximize their payoffs. To gain insight into how the game is played from a Canadian perspective, it helps to have a basic understanding of the dominant parties' political philosophies and ideologies. All ideologies, after all, have their roots in philosophy.
Currently, at the federal level, the Canadian political landscape has two dominant political ideologies: conservatism, which aligns with the Conservative Party, and liberalism, which aligns with the Liberal Party.
The current Conservative Party of Canada (CPC) philosophy and ideology reflect a blend of traditional conservative principles, populist influences, and an emphasis on individual freedoms. The party is shaped by its historical roots in both the Progressive Conservative (PC) and Reform/Canadian Alliance legacies, which has led to a unique combination of right-leaning values focused on economic, social, and political issues. Here’s an overview of the CPC’s current philosophy and ideologies:
1. Fiscal Conservatism and Economic Policies
Pro-Business, Low-Tax Approach: The CPC promotes a business-friendly environment through policies aimed at reducing taxes, deregulating industries, and encouraging investment. It advocates for corporate tax cuts, reduced income taxes, and tax credits to stimulate economic growth and maintain a competitive economy.
Balanced Budgets and Limited Government Spending: The party emphasizes fiscal responsibility, advocating for balanced budgets and a reduction in national debt. It generally opposes extensive government spending and prefers a more restrained role for the federal government in economic matters.
Free-Market Policies: The CPC supports free-market capitalism, favouring private enterprise over government intervention, especially in sectors like healthcare and energy.
2. Individual Freedoms and Personal Responsibility
Limited Government Intervention: The CPC emphasizes personal freedom and responsibility, favouring minimal government involvement in individuals' lives. It encourages individual choice in areas such as healthcare, education, and personal finance.
Support for Charter Rights: While the party advocates for limited government, it generally supports rights enshrined in the Canadian Charter of Rights and Freedoms, including freedoms of speech and religion. However, this is sometimes balanced with conservative social policies, particularly where social conservatism plays a role.
3. Social Policies and Cultural Conservatism
Social Conservatism: While ideologically varied, social conservatives within the CPC influence its stance on issues like abortion, family values, and same-sex marriage. The party as a whole, however, tends to avoid making these issues central to its platform, balancing between traditional conservative values and mainstream voters.
Traditional Family Values and Social Institutions: The CPC traditionally supports policies that reinforce family structures and social institutions. It favours policies that support families, such as tax breaks for families and parental leave options.
4. Populism and Regional Representation
Populist and Grassroots Appeal: The CPC often adopts populist rhetoric to address the concerns of ordinary Canadians, particularly on issues like affordability, inflation, and perceived government overreach. It presents itself as a voice for average Canadians against political elites and bureaucracy.
Western and Rural Advocacy: The CPC has strong roots in western Canada and often addresses the specific concerns of western provinces, such as energy policy and provincial rights. The party advocates for fair treatment of all provinces and is cautious about policies that could disproportionately benefit specific regions, like Quebec.
5. Energy and Environmental Policy
Support for the Energy Sector: The CPC is a strong advocate for the energy industry, particularly oil and gas. It supports pipeline development and resource extraction as part of a balanced approach to energy policy, arguing that Canada can lead in responsible resource development.
Balanced Approach to Climate Change: While the CPC acknowledges climate change, its policies emphasize a balanced approach that supports economic growth and the energy sector. It generally favors market-based solutions over government-imposed restrictions, focusing on innovation and carbon capture technology rather than stringent regulations.
6. National Security and Foreign Policy
Strong Defense and Border Security: The CPC advocates for increased defense spending, border security, and support for law enforcement. It supports a robust military and aims to strengthen Canada’s national security.
Skeptical of Foreign Interventions: In foreign policy, the CPC tends to emphasize Canadian sovereignty and is often skeptical of international agreements or treaties that could undermine national interests. However, it supports strong alliances with traditional allies, particularly the United States.
7. Provincial Rights and Decentralization
Advocacy for Provincial Autonomy: The CPC often emphasizes decentralization, supporting greater autonomy for provincial governments. It opposes federal policies perceived as infringing on provincial jurisdiction, such as certain healthcare mandates or environmental regulations.
Opposition to Centralization: Reflecting its western Canadian roots, the CPC typically argues against centralization of power in Ottawa, advocating for policies that respect provincial rights and reduce federal influence in areas traditionally managed by provinces.
To give context to the CPC: In 2003, the Progressive Conservative Party and the Canadian Alliance (the successor to the Reform Party) merged to form the Conservative Party of Canada. This merger aimed to unite the right-wing vote and challenge the Liberal Party's dominance. The modern Conservative Party reflects both the fiscally conservative and populist influence of the Reform/Canadian Alliance while maintaining some centrist, traditional conservative elements of the Progressive Conservatives.
While there are some overlaps in political philosophy, there is a significant difference between the two dominant parties.
As mentioned earlier, the Liberal Party follows liberalism but integrates a range of ideologies emphasizing social equality, economic growth, and individual freedoms. Here’s an outline of the key ideological components that shape the Liberal Party’s approach:
Liberalism
Individual Rights and Social Equality: The Liberal Party advocates for policies promoting inclusivity, social justice, and civil liberties, supporting programs like universal healthcare, education, and environmental regulation.
Progressivism
Progressive Values: The party often aligns with progressive values, particularly on social issues such as LGBTQ+ rights, reproductive rights, and multiculturalism.
Social Inequities: It seeks to address social inequities and improve representation and opportunities for marginalized groups.
Social Democracy
Mixed Economy: The Liberal Party leans toward social democratic principles by supporting a mixed economy where the government plays a strong role in regulating business and redistributing wealth.
Welfare Programs: Policies include welfare programs, social safety nets, and progressive taxation to reduce income inequality and support low- and middle-income Canadians.
Environmentalism
Environmental Protection: The Liberal Party promotes policies aimed at reducing carbon emissions, investing in renewable energy, and addressing climate change.
Economic Liberalism
Trade Liberalization: While socially progressive, the party supports economic liberalism, advocating for trade liberalization, foreign investment, and private enterprise.
Multiculturalism
Diversity: The Liberal Party has historically championed Canadian multiculturalism, supporting diversity and immigration as core values.
Globalism
International Alliances: The Liberal Party often adopts a globalist approach, supporting international alliances, trade agreements, and a strong role in international organizations like the United Nations.
The Liberal Party's blend of liberalism, social democracy, and progressivism reflects a commitment to balancing economic growth with social equity, environmental protection, and a global perspective on key issues. This broad ideological spectrum aims to appeal to a wide range of Canadians, particularly those who value both individual freedom and social welfare.
It can’t be stressed enough how important it is to understand the principles, ideologies, and philosophies of the respective parties. Joe Clark's departure from the Conservative Party of Canada was based on ideological differences between the Progressive Conservative Party and the Conservative Party of Canada. The following is an example of how understanding political ideologies can affect decision-making.
Joe Clark, former leader of the Progressive Conservative Party, opposed the merger of the Progressive Conservatives and the Reform Party due to concerns about the party’s future direction. The Conservative Party’s political ideology now combines more right-leaning elements from the Reform/Canadian Alliance with a strong focus on the interests of Western Canadians. Rather than compromise his political beliefs and values, Joe Clark left the party in 1998, unwilling to see the party he had led transform into a more right-wing, populist movement that, in his view, would betray the legacy of the Progressive Conservatives.
Summary
In Canada’s current federal political environment, the Conservative and Liberal parties dominate, each reflecting a distinct political ideology rooted in conservatism and liberalism, respectively. This piece outlines the Conservative Party of Canada’s core principles, which integrate traditional conservative values with populist elements. These principles include a pro-business, low-tax approach, support for individual freedoms, and advocacy for provincial autonomy, especially in Western Canada. The Conservative Party, as it stands, is shaped by the merger of the Progressive Conservative and Reform/Canadian Alliance legacies, resulting in a unique combination of fiscally conservative and populist perspectives.
In contrast, the Liberal Party emphasizes social equity, inclusivity, and environmental stewardship, integrating liberalism with elements of social democracy and progressivism. Its policies focus on universal healthcare, multiculturalism, and global cooperation, seeking a balance between economic growth and social welfare. Together, these two parties present differing visions for Canada, each with its own ideological framework.
The piece also touches on the historical opposition by Joe Clark, former Progressive Conservative leader, to the merger with the Reform Party. Clark’s departure reflected a broader ideological rift, highlighting concerns that the merger would dilute traditional conservative values and shift the party toward a more populist stance. This background provides context for the evolution of Canada’s conservative landscape and its implications for today’s political dynamics.
Conclusion
In understanding Canada’s political landscape, it is essential to recognize the distinct ideological bases of its two dominant parties. The Conservative Party’s philosophy reflects a blend of conservatism and populism, shaped by a commitment to economic freedom, personal responsibility, and a decentralized federal structure. The Liberal Party, on the other hand, aligns with liberalism’s core tenets, promoting social justice, inclusivity, and environmental protection within a mixed economy.
Both parties have roots in broader philosophical traditions, and understanding their principles offers insights into Canada’s political challenges and policy debates. While Canada’s first-past-the-post system may limit the diversity of voices in mainstream politics, examining these dominant ideologies provides a clearer perspective on the political choices Canadians face. As politics continues to evolve, these ideological foundations will play a crucial role in shaping the country’s future, with each party’s approach representing a distinct path forward for Canada.
If an election were called today, it seems nearly inevitable that the Liberal Party would face a resounding defeat. Current polls and the public discourse on social media echo a discontent that cannot be ignored. The Bloc Québécois has now issued an ultimatum to the Trudeau government: either support an increase in old-age pensions, or we’ll join forces with other parties to push for a vote of non-confidence.
Poised at the ready, Pierre Poilievre and the Conservatives recognize the opportunity before them. Knowing this could be their best shot at taking power, they would undoubtedly throw their support behind the Bloc to bring down the Liberal government. The question mark, however, lies with the NDP. While a premature election may not be in their favor—they need time to solidify their campaign strategy—they could still act as a spoiler, effectively paving the way for a Conservative victory. Regardless, the Trudeau government has seen its popularity dwindle over the past year. For the Liberals to reclaim their footing, it may be time for Trudeau to step aside for the party’s greater good.
Meanwhile, NDP leader Jagmeet Singh has declared his party’s opposition to the Bloc’s motion, refusing to play into Poilievre’s hands. Singh lists the challenges Canadians face—rising housing costs, soaring grocery bills, an overwhelmed healthcare system. Yet, therein lies a glaring gap: Singh, like his political counterparts, stops short of presenting concrete solutions.
So, whether an election comes early or waits until October 2025, Canadians deserve answers. Voters must demand clarity from all candidates: what are your party’s tangible solutions to the mounting problems this nation faces? In the end, the promise of change means little without a clear path forward.
political and social ideologies are filled with complexities, and the "game" is influenced by so many factors that predicting outcomes is extremely difficult. Every ideology, including socialism, capitalism, or democracy, operates within unique cultural, historical, and economic contexts. Even the most carefully designed systems can have unpredictable results due to human behaviour, random events, and unforeseen circumstances.
When I look at the most common posts regarding political ideologies, I realize that many who post have little to no understanding of political ideologies, provincial and international relations (geopolitics), and how they are interconnected. (Fortunately, there are others who have a deep understanding of these relationships and comprehend how the game is played.)
I look at our southern neighbour, the United States, and the way they handle their politics reminds me of classic TV shows like "The Gong Show" or "The Mickey Mouse Club." The band Green Day captured this sentiment well with their song "American Idiot." Why do Canadians want to become Americanized? Character assassinations does not deal with issues that we face as a country.
Both Trump and Harris have used false information and half-truths. The only difference between the two is that Harris is more refined when it comes to debates.
What amazes me is that some very intelligent people still can't grasp these concepts. Despite life experience or formal post-secondary education, they seem to have no clue how the game is played. In general, it seems like they can't see past their own backyard.
What gave me the idea was a Facebook post in response to my critique of the capitalist system. The person replied, "Is socialism better?" Before answering, I wanted to understand his level of knowledge, so I asked, "How do you define socialism?" There was no response.
As a result, I formulated a definition of socialism in terms that a fifth grader would understand.
Socialism: Socialism is like when a group of friends decides to share everything so that no one is left out. Imagine you and your friends all have toys, but some have a lot, and some have very few. In socialism, everyone agrees to share the toys so that everyone has enough to play with. It's a system where people work together and make sure everyone gets what they need, like food, housing, and education, so no one goes without. The idea is to help everyone have a good life, not just a few people. - that is as simple as it gets.
The common one dimensional rebuttals are:
1. Less Motivation to Work Hard: Imagine if everyone in your class got the same grade, no matter how hard they studied. Some might think, "Why should I study if I’m going to get the same grade anyway?" Socialism can sometimes make people feel less motivated to work hard because everyone gets the same rewards, even if they don’t do the same amount of work.
2. Not Enough Freedom to Choose: In socialism, the government often makes decisions about what jobs people can have or what things they can buy. Some people don’t like this because they feel they should be free to make their own choices, like choosing their favourite games or hobbies, instead of someone deciding for them.
3. Sharing Might Not Always Be Fair: While sharing is a good thing, some people think socialism isn’t always fair because if someone works very hard and someone else doesn’t work much at all, they both still get the same amount of things. Some people believe that those who work harder should get more rewards.
At this tells me is that they don't understand socialism, they only have a general idea, but there are many other forms of socialism.
To provide some examples:
Many forms of socialism emphasize meeting people's basic needs while still encouraging creativity and hard work. Some people are motivated by more than just money, like contributing to their community or gaining recognition for their skills.
Still in other versions of socialism, people still have many choices, but the government or community helps provide basic services, like healthcare and education, so everyone can live well.
Lastly, those who have a worldview of socialism, beyond what the propaganda machine tries to sell, will argue that fairness also means ensuring no one struggles to survive just because they had fewer opportunities or faced challenges beyond their control, like illness or bad luck.
Marx explained that every social system is subject to its own laws: objective dynamics, forces, and
pressures that govern its motion and development. In this article, Adam Booth examines the early decades
of the Soviet Union, in order to provide a concrete understanding of the economic laws which imposed
themselves on the young workers’ state, and to arm a new generation with the lessons required to carry
out the successful struggle for communism.
"Gigantic achievements in industry, enormously promising beginnings in agriculture, a rapid
increase of the numbers of workers, a rise in cultural level – such are the indubitable results
of the October revolution, in which the prophets of the old world tried to see the grave of
human civilisation. With the bourgeois economists we have no longer anything to quarrel over.
Socialism has demonstrated its right to victory, not on the pages of Das Kapital, but in an
industrial arena comprising a sixth part of the Earth’s surface – not in the language of
dialectics, but in the language of steel, cement, and electricity."[1]
– Leon Trotsky, Revolution Betrayed
The Russian Revolution was the greatest event in human history. Led by the Bolsheviks, the working class
seized power, raised the banner of international socialist revolution, and offered a beacon of hope for
the exploited and oppressed masses across the world.
But they did so under the most extreme and unfavourable conditions: in an economically backward country,
devastated by years of war and upheaval, and besieged by imperialism. Moreover, they did so without any
roadmap, save for the brief experience of the Paris Commune, which was drowned in blood after just a few
months.
Despite making enormous progress in the field of economic development, the USSR never succeeded in
building a communist society. Nevertheless, the early decades of the Soviet Union – from 1917 to 1937 –
provide a number of important lessons for communists, which it is our duty to study and fully absorb.
By examining the Soviet economy in this period, warts and all, and by tracing the theoretical debates
that emerged amongst the Bolsheviks on economic questions, we can gain a concrete understanding of the
economic laws that would operate in the transition from capitalism to communism, and shed light on how a
communist society could be built.
Transitional regime
On 7 November 1917 (25 October in the old Russian calendar), Lenin famously ascended the rostrum at the
Second All-Russian Congress of Soviets and announced: “We shall now proceed to construct the socialist
order!”[2]
Neither Lenin, nor any of the Bolsheviks, however, believed it would be possible to construct this order
overnight. That same year, in his masterpiece The State and Revolution, Lenin quoted Marx:
“Between capitalist and communist society lies the period of the revolutionary transformation of
the one into the other. Corresponding to this is also a political transition period in which the
state can be nothing but the revolutionary dictatorship of the proletariat.”[3]
As Marx and Engels explained in The Communist Manifesto: “The first step in the revolution by the
working class is to raise the proletariat to the position of ruling class.”
Neither Lenin, nor any of the Bolsheviks, however, believed it would be possible to construct
this order overnight.
Having conquered power, the working class would then spread its revolutionary class rule across
the world, and “use its political supremacy to wrest, by degree, all capital from the bourgeoisie, to centralize all instruments of production in the hands of the state… and to increase the total productive
forces as rapidly as possible”.[4]
Neither
Lenin, nor any of the Bolsheviks, however, believed it would be
possible to construct this order overnight / Image: public domain
On this basis, society would reach what Marx called the “first phase of communist society”[5], commonly referred to as ‘socialism’. Only then would the last vestiges of class society – such as the
state, money, and inequality – finally begin to wither and die.
The transitional nature of the Bolshevik regime was recognized explicitly by Lenin in 1918:
“The term Soviet Socialist Republic implies the determination of the Soviet power to achieve the
transition to socialism, and not that the existing economic system is recognized as a socialist
order.”[6]
But Lenin and the Bolsheviks also understood that the conditions in Russia were a far cry from those
required to build socialism or communism.
Combined and uneven development
By 1917, on a global scale, the conditions for socialism certainly existed. In the decades leading up to
the First World War, capitalist production had become increasingly socialised and planned. But the
wealth produced continued to be privately appropriated by the bosses and bankers.
As Lenin explained in Imperialism: The Highest Stage of Capitalism, the economy had become
dominated by monopolies, which had fused with finance capital and the state, to form what he called
“state monopoly capitalism”.[7]
The German imperialist war machine exemplified this. The country’s industrial trusts and transport
networks were taken into state hands. In place of the ‘free’ market, production was planned – albeit in
the interests of the capitalists.
The working class, however, had first taken power not in an advanced capitalist country, like Germany or
Britain, but in semi-feudal Russia, where even the tasks of the bourgeois revolution, such as land
reform, had not been fulfilled.
“History,” Lenin noted, “has given birth in 1918 to two unconnected halves of socialism existing side by
side.” “Germany and Russia,” he continued, “have become the most striking embodiment of the material
realisation of the economic, the productive, and the socio-economic conditions for socialism, on the one
hand, and the political conditions, on the other.”[8]
This was a powerful expression of what Trotsky termed the ‘law of combined and uneven development’.
Due to its backwardness, Tsarist Russia was forced to import capital, machinery, and technique from
abroad. As a result, by 1914, the country was characterised by islands of modern industry, with a
developed working class, surrounded by a sea of economic, cultural, and agricultural backwardness.
This contradiction would prove to be both the mother of the Russian Revolution and, ultimately, its
gravedigger.
The chain of world capitalism broke at its weakest link. Russia was propelled onto the road of socialist
revolution “not because her economy was the first to become ripe for a socialist change,” as Trotsky
explained, “but because she could not develop further on a capitalist basis”.[9]
Russia was the weakest of the major powers involved in the First World War, without the modern armed
forces and industry at the disposal of its rivals. The country’s limited industrial capacity had to be
diverted towards producing arms, exacerbating the scarcity of basic necessities and the disintegration
of infrastructure.
Furthermore, the regime was particularly reliant on printing money and debt to fund its military
expenditures. Consequently, prices soared by three-fold over these years.[10]
Tsarist ministers tried to alleviate hunger amongst workers and soldiers by imposing a grain levy on
peasants. But this provoked fury in the countryside.
Economic breakdown; rampant inflation; shortages of goods; forceful procurement of food from the
peasantry: all of these horrors that bourgeois historians accuse the Bolsheviks of bringing about were
in place long before the introduction of ‘War Communism’.
It was these dire conditions that provoked the mass protests in St Petersburg that led to the downfall
of the Tsar in February 1917, and later of the Provisional Government, ushering in the October
Revolution.
But the same conditions that prepared the way for the socialist revolution rendered the construction of
socialism an unrealisable dream within the borders of the former Russian Empire.
From the very beginning, Lenin and the Bolsheviks embarked upon this formidable aim, armed with the
perspective that the success of the revolution would ultimately be determined by its spread
internationally. Without this, the nascent Soviet Republic could not survive, let alone build socialism.
This fact was explicitly recognised by Lenin in 1918, when he stated: “At all events, under all
conceivable circumstances, if the German revolution does not come, we are doomed.”[11]
Marxism vs. autonomism
The immediate task for the Bolsheviks was not – and could not be – the implementation of a fully-formed
socialist plan, but merely the prevention of complete collapse, alongside the spreading of the world
revolution.
The Bolsheviks had led the workers and peasants of Russia to power. But in the months following October
1917, they were also swept along by the movement, forced to react to events, rather than guide them.
The immediate task for the Bolsheviks was not – and could not be – the implementation of a
fully-formed socialist plan / Image: public domain
The
immediate task for the Bolsheviks was not – and could not be – the
implementation of a fully-formed socialist plan / Image: public domain
The seizure of power had taken place in the context of an immense revolutionary ferment in both the
cities and the countryside. Workers formed strike committees in the factories, while poor peasants drove
the landlords off their estates, and began redistributing the land amongst themselves.
Lenin and the Bolsheviks attempted to channel this wave towards socialist ends. But political
considerations consistently trumped economic ideals. And the apparatus of the new workers’ state was not
strong enough to translate policy into action.
Take the question of the land. A day after the October insurrection, the Second All-Russian Congress of
Soviets passed a decree that formally abolished all private land ownership. Instead of using
expropriated land to establish large-scale collective farms and organise agriculture along socialist
lines, however, the Bolsheviks were forced to adopt the programme of the so-called ‘Socialist
Revolutionary Party’, which gave land to the peasants on an individual basis.
In this way, the Bolsheviks were able to win over the peasant masses. But once in government, frictions
soon emerged with this newly-endowed mass of petty proprietors.
Similarly with workers and the factory committees, the Bolsheviks saw these as an embryonic form of
workers’ control and management, a component part of socialist planning in industry. And given the
backwardness of the country, Lenin envisaged a protracted period of workers’ control, during which the
working class would learn how to run industry by studying the methods of the old owners and their
experts.
The first steps in the direction of workers’ control, however, were anarchic, applied to localised
factories without any plan. Many workers perceived workers’ control in a more syndicalist sense: not in
terms of workers’ power over production as a whole, but in terms of workers’ cooperatives running their
own workplaces, independently of anyone or anything else.
As workers occupied the factories, and the capitalists fled the scene, many businesses were brought
under state ownership. But workers in these enterprises often assumed that they themselves were now the
owners.
In his History of Soviet Russia, E. H. Carr reports that there were even cases in which “the
workers, having taken over a factory, simply appropriated its funds or sold its stocks and plant for
their own advantage”.[12]
This was the difference between Marxism and ‘autonomism’; between workers acting as a class against the
capitalists, and groups of workers struggling against individual bosses; between coordinated,
centralised planning by a workers’ state, and independent control by scattered, isolated workers’
councils and cooperatives.
“The notion that the problems of production and of the relations of classes in society could be solved
by the direct and spontaneous action of the workers of individual factories was not socialism, but
syndicalism,” Carr concludes, adding:
“Socialism did not seek to subordinate the irresponsible capitalist entrepreneur to an equally
irresponsible factory committee claiming the same right of independence of the actual political
authority; that could only perpetuate the ‘anarchy of production’ which Marx regarded as the damning
stigma of capitalism.”[13]
Nationalisation of industry
The Bolsheviks consciously attempted to get a grip on the situation. In December 1917, the Soviet
government established the Supreme Council of National Economy – abbreviated to VSNKh, a.k.a. Vesenkha.
Vesenkha was responsible for “organising the economic activity of the nation and the financial resources
of the government”.[14] Its first task was to
bring under its control the glavki: trusts of big enterprises in each industry, such as metals
and textiles, which had emerged in Tsarist times to plan wartime production.
The first industry to be nationalised was that of finance. Analysing the Paris Commune, Marx emphasised
that the Communards’ failure to seize the Bank of France had been a fatal error. Lenin and the
Bolsheviks took on board these wise words.
In December 1917, in response to sabotage by the bankers, the Soviet government deployed troops and
decreed the merger of the banks into a single National Bank, with a monopoly over currency and credit.
The government also annulled all public debts accumulated by its predecessors – particularly those owed
to foreign financiers. This was met with howls of protest from the imperialists, who swiftly cut off
remaining lines of credit, heightening the importance of state control over the financial system.
Elsewhere, nationalisations were mostly spontaneous at first: a defensive response to sabotage by the
bosses, or a retroactive endorsement of direct action by workers. In the first nine months, over
two-thirds of nationalisations were carried out as initiatives by local Soviets and workers’ councils,
not by orders from the top.[15]
From around May-June of 1918, however, as the capitalists’ vandalism intensified, and the imperialists
stepped up their intervention, the Bolsheviks were forced to change direction and nationalise whole
swathes of industry. But even then, these expropriations were mainly conducted in an
ad hoc manner, not as part of a general plan.
The working class was clearly the motor force of the revolution. But this energy needed to be channelled
and directed, in a consciously organised, planned way.
Lenin explained, however, that the young Soviet state did not have the capacity to properly plan
production. In many cases, with the state starved of resources, nationalised enterprises were quickly
leased back to their former owners, with the same directors remaining in place.
A genuine system of workers’ control and management, meanwhile, would involve factory committees, trade
unions, and local soviets working in tandem. And to be successful, Lenin outlined, certain material
conditions would be required – conditions that the Soviet Republic did not yet possess.
What was required was a working class with sufficient time and culture: a level of productivity such
that workers had enough free time to participate in the running of production, along with the education
and skills to perform the administrative tasks involved.
In short, even socialist planning could not be properly accomplished without a rapid development of the
productive forces.
Instead, Lenin called for nationalisation only of the key levers of the economy, with the old managers
left in place, but under workers’ oversight. This was to be accompanied by the maximum centralisation
and organisation of industry, under Vesenkha’s purview.
A ‘Left Communist’ opposition emerged in the Bolshevik Party around this time, raising disagreements
with this position. These ultra-lefts leant on the more autonomous conception of workers’ control,
whilst also calling for a “determined policy of socialisation”.
Lenin gave them – and their denunciations that the government was pursuing a “Bolshevik deviation to the
right”[16] – short shrift.
“Only a blind man could fail to see that we have nationalised, confiscated, beaten down, and put down
more [capitalists] than we have had time to count,” Lenin asserted. But, he stressed, “confiscation can
be carried out by ‘determination’ alone, without the ability to calculate and distribute properly,
whereas socialisation cannot be brought about without this ability.”[17]
Nationalisation of the ‘commanding heights’ of the economy was accompanied by the establishment of a
state monopoly over foreign trade, which was officially implemented in April 1918.
This was vital for protecting the newly-born Soviet economy from the pressures of the capitalist world
market, and for preventing opportunistic merchants from syphoning wealth out of the country, or
profiting from imports.
Looking ahead, alongside the nationalisation of large industry, control over finance and foreign trade
would also be pivotal for socialist planning. In the short term, these moves were essential for the
defence of the revolution.
This was where things stood in the Soviet Republic as the civil war began to unfold, propelling the
Bolsheviks to put out even greater fires.
War Communism
The dislocation of the world war and civil war, in quick succession, was profound.
Between 1918 and 1920, millions of internal refugees were forced to flee their homes, as imperialist
troops and White armies ransacked towns and villages. Millions more died of hunger and epidemics of
disease.
This came on top of heavy territorial losses as a result of the Brest-Litovsk treaty and German
imperialist plunder.
Harvests were heavily disrupted, transport links were broken, and urban populations nosedived, as
starving workers returned to their villages in search of food.
The government attempted to resolve the food crisis by waging war on the speculators, private
traders, and kulaks / Image: public domain
The
government attempted to resolve the food crisis by waging war on the
speculators, private traders, and kulaks / Image: public domain
With factories deprived of workers, raw materials, and fuel, industrial output plummeted. By 1920,
large-scale industry was running at just 13 percent of its prewar level.[18]
The only aim of the Bolshevik government at this time was survival. Thus began the period and programme
known as ‘War Communism’: an attempt to channel every available resource towards the Red Army.
In doing so, little was left for workers and peasants. The former faced spiralling prices and acute
shortages in the towns, alongside gruelling hours and conditions in the factories. The latter were
subject to state requisitioning of their grain and livestock.
The government attempted to resolve the food crisis by waging war on the speculators, private traders,
and kulaks (wealthy capitalist peasants), who were profiteering and hoarding grain. But raids on
villages and stores could only obtain so much.
The central government also sought help from the cooperative movement, hoping they could obtain and
distribute food via their networks. Ironically, they proved to be remarkably uncooperative.
By 1919, therefore, the Bolsheviks introduced prodrazvyorstka: compulsory delivery quotas of
grain, at prices fixed by the state. In some cases, this meant confiscation of grain surpluses. In
others, it amounted to the same thing, since the money paid in return was meagre and increasingly
worthless, thanks to inflation.
Thousands of volunteers signed up to help the requisitioning campaign. Unions, factory committees, and
soviets formed armed ‘food brigades’, whose primary target was the kulaks.
As well as uncovering secret stockpiles and obtaining grain, their mission was to politically agitate
amongst poorer peasants, so that they could join both the search for food and the struggle against the
richer layers of the countryside.
The Bolshevik’s aim was to drive a wedge between the kulaks and the rest of the peasantry. The surplus
that could be obtained from the former was not enough, however, leading to a broadening of
prodrazvyorstka’s remit. The latter, meanwhile, tended to identify more with their fellow
rural-dwellers than with workers in the towns.
With neither sufficient money nor manufactured goods to offer the peasants in return for their grain,
requisitioning was met with resistance and sabotage, including reductions in sowing levels.
Workers in the food brigades faced the danger of being massacred by the kulaks’ henchmen. In more than
one instance, the bodies of requisitioners turned up in barns, their bellies slit and stuffed with
grain.[19]
The government was caught in a doom-loop. Without adequate industry, they could not provide peasants
with the goods they demanded in exchange for their foodstuffs. This meant worsening food shortages for
workers, leading to further falls in industrial output. And all the while, the army had to be fed.
Extreme measures
The civil war accelerated the nationalisation of industry. The military effort demanded strict
centralisation to combat the chaos proliferating across the economy. Production had to be concentrated
in the most efficient factories. And scarce materials had to be allocated to where they would be most
effective.
By November 1920, Vesenkha was responsible for overseeing around 3,800-4,500 state enterprises[20]
– mostly in large-scale industry, but also in smaller industries that weren’t exactly the ‘commanding
heights’ of the economy.
The number of Vesenkha officials and glavki staff exploded from around 300 in March 1918 to 6,000
in total six months later.[21] Many of these
had served in the Tsarist state apparatus, fuelling anger amongst workers.
Even under these siege conditions, the Bolsheviks maintained debate over key questions: the relationship
between central planners and local soviets, and between centralisation and federalism; the use of
bourgeois specialists and administrators who were offered higher wages and bonuses; and the role of the
trade unions as instruments for mobilising labour.
Criticism was raised against the leadership on all these issues, most notably from the so-called
‘Workers’ Opposition’. Lenin and Trotsky were the first to admit that the extreme measures demanded by
the civil war were far from ideal. But they were necessary.
The war could not be won without the utmost centralisation. State industry could not be run by an
inexperienced and exhausted working class, without the assistance of experts. Survival, not socialism,
was the most pressing task of the moment.
As shortages worsened, the government ramped up its control over distribution. Cooperatives and retail
outlets were effectively nationalised. Prices were fixed for a range of products. Rationing was revived,
having first been introduced before the revolution, with industrial workers prioritised and former
bourgeois at the back of the queue.
The war could not be won without the utmost centralisation / Image: public domain
But these rations were not enough. In 1919-20, only around 20-25 percent of food consumption in the
towns came from rationed supplies.[22] Factory
employees even grew their own vegetables in workplace gardens. Such was the hunger that cats, dogs, and
horses could no longer be found in Petrograd.[23]
Markets had officially been abolished. But government restrictions were powerless. The law of supply and
demand continued to make itself felt. Black markets mushroomed, with ‘bagmen’ (speculators) offering
scarce goods at highly inflated prices.
To fund state spending, the government increasingly resorted to money printing. The ruble became
ever-more devalued. The rate of inflation went from 600 percent in 1918 to 1,400 percent a year
later.[24]
As the currency became worthless, the economy began to scrape by without it. Money was replaced by
payment in kind. Nationalised enterprises swapped materials on the basis of Vesenkha bookkeeping. The
state provided rations and services – such as public canteens and transport – for free. And in lieu of
wages, factory workers received a share of their own industrial products, to be exchanged via barter on
the black market.
Law of value
War Communism, through emergency and expediency, had resulted in an almost entirely nationalised,
moneyless economy. But this had little in common with the Marxist conception of socialism or communism.
This contradictory outcome was the product of devastation and desperation, not doctrine or design.
More ultra-left Bolsheviks attempted to make a virtue out of necessity. What had come about unexpectedly
and anarchically, as a result of chaos and collapse, was painted as a deliberate step towards socialism.
In fact, the laws of capitalism continued to operate – not only externally, through the pressure of the
world market, but within the bounds of the workers’ state itself.
For every economic system, Marx showed, there are certain objective dynamics, existing independently of
any intentions or will, which regulate society’s wealth, labour, and means of production.
Under capitalism, he explained, the wealth of society takes the form of commodities: goods produced for
exchange, and distributed via the market.
Commodities, on average, are exchanged according to their value, determined by the socially necessary
labour time embedded within them. Marx called this the law of value.
The law of value regulates the capitalist economy. It establishes the proportions in which commodities
are exchanged. It determines the value of money, that ‘commodity of commodities’. And it guides the flow
of capital from one sector to another, shaping the global division of labour.
Within capitalism, every part of the economy is interconnected via the ‘invisible hand’ of the market.
But this system operates blindly, behind the backs of capitalists and workers alike.
The law of value therefore expresses itself under capitalism through the anarchy of market forces and
the fluctuations of price signals, striving for ‘equilibrium’ through chaos and crisis.
Under War Communism, by contrast, the entire capitalist class had been expropriated. Market relations
had been formally overridden, with basic goods and services now officially distributed not as
commodities, but via the state.
Surely, then, the law of value had been overthrown, and money could smoothly exit from the stage of
history?
Marx further explained, however, that money is ultimately a measure of value; a representation of
socially necessary labour time; an entitlement to a portion of the total wealth in society.
Money is a social tool, acting as a means of exchange, a unit of account, and a store of value. And like
any implement, it cannot be discarded until it has become obsolete and unnecessary.
Like the state, money must wither away in the transition from first phase of communism
(socialism) to the higher phase of communism, as the productive forces are developed; as scarcity turns
into superabundance; and as commodity production and market exchange are replaced by conscious planning
and allocation.
Only on this basis can the law of value be overcome as the primary regulator of the economy, along with
its monetary and material symptoms: volatile prices and shortages.
“In a communist society, the state and money will disappear,” Trotsky explains. “Their gradual dying
away ought consequently to begin under socialism.” But, he emphasises, “money cannot be arbitrarily
‘abolished’”:
“The deathblow to money fetishism will be struck only upon that stage when the steady growth of
social wealth has made us bipeds forget our miserly attitude toward every excess minute of labour,
and our humiliating fear about the size of our ration.”[25]
The existence of black markets and widespread shortages were a clear indication that the material
conditions for the disappearance of commodities, money and the law of value – the conditions for genuine
communism – did not exist under War Communism.
The productivity of labour was meagre. Every “excess minute of labour” was precious. The “size of one’s
ration” was indeed humiliating.
Under these conditions, the law of value did not weaken, but asserted itself even more sharply –
demonstrated by the fact that workers had to resort to barter, the most basic form of exchange.
War Communism therefore represented more of a step backwards than a move towards the construction of a
communist society.
The ultra-lefts had made a serious theoretical mistake: assuming that the revolution had overturned
capitalism’s laws in one fell swoop; that state ownership was enough to transcend the law of value. This
grave error would later be repeated by the Stalinists.
New Economic Policy
By the end of 1920, the tide had turned in favour of the Red Army. This provided some breathing space:
an opportunity for the Bolsheviks to review the policies of War Communism and to plan the next steps.
The entire country lay in ruin. Every aspect of the economy – industry, agriculture, transport – was
shattered. Starvation and sickness stalked the land. Inflation was out of control.
This was the grim context to debates within the party that began in early 1921, culminating in what came
to be known as the New Economic Policy (NEP).
‘
The most pressing issue was the shortage of food. More grain needed to be obtained from the peasantry.
But prodrazvyorstka (requisitioning) had run its course.
As the threat of White reaction receded – and with it the danger of a return of the landlords – peasants
became even less tolerant of the state’s seizures. This led to outbreaks of rebellion in the
countryside, which came to a head with the Kronstadt revolt in March 1921.
‘NEP-men’:
merchants and hawkers who would facilitate this network of private
trade, pocketing a tidy sum for themselves along the way / Image: public
domain
These uprisings were symptomatic, demonstrating that the current setup was unsustainable; that class
antagonisms were far from being resolved; that War Communism did not represent the foundations for a
leap towards socialism, as the utopian ultra-lefts imagined.
The government therefore switched tracks. Grain requisitioning was replaced with a progressive
tax-in-kind. Peasants would have to hand over a portion of their crop, but would be entitled to sell any
surplus above this through private channels. Compulsion was replaced with incentivisation.
But this seemingly small step took on a logic of its own, snowballing in a way that nobody had fully
anticipated.
Firstly, for the peasantry to sell their grain, there needed to be other goods – clothes, manufactured
products, and other food items – that they could spend their newly-acquired cash on.
This meant ramping up the production of consumer goods. But state-owned industries were crippled. And
the resources required to repair them could not be magicked into existence.
A successful revolution in the advanced capitalist countries would have solved the problem. But
capitalism had survived the first postwar revolutionary wave, which had peaked in 1919.
The Bolshevik government was therefore forced to lean on private petty producers: artisans,
cooperatives, and cottage industries, who did not require large upfront investments. Similarly,
nationalised enterprises in lighter industries were leased to private entrepreneurs, and allowed to
produce for profit.
All of this led to another requirement: the removal of price controls and the legalisation of markets.
This was necessary to provide peasants with a means of selling their surplus; to distribute foodstuffs
from the countryside to the cities; and to bring manufactured goods to the villages.
This gave rise to the notorious ‘NEP-men’: merchants and hawkers – already at large under War Communism
running black markets – who would facilitate this network of private trade, pocketing a tidy sum for
themselves along the way.
The next logical consequence was the need to stabilise the currency. How could there be private trade
without a reliable means of exchange and steady prices?
This raised further questions, which were broached during discussions on the NEP at the 10th party
congress in March 1921. As E. H. Carr reports:
“[The stabilisation of the currency] could plainly not be done so long as the printing press
continued to turn out an unlimited supply of rubles; the printing press could not be checked until
the government could find some other way of making both ends meet; and to bring government
expenditure within the limits of any revenue it could conceivably raise was unthinkable until the
state relieved itself of the immense costs of maintaining state industry and the workers engaged in
it.”[26]
In summary, the current inflationary economic regime needed to be replaced with one of monetarism and
austerity.
By July 1922, in a bid to subdue rampant hyperinflation (now running at over 7,000 percent[27]), the old, devalued ruble had been officially replaced by a new, gold-backed currency: the
chervonets.
A process of ‘rationalisation’ began in state industry, known as khozraschet. State enterprises
could no longer rely on the National Bank. Instead, they had to act as self-sufficient businesses,
operating on commercial principles: managing their own accounts; cutting costs; improving efficiency;
dealing directly with producers and distributors on the market; and seeking to generate a surplus (but
not running for the profit of individual bosses).
‘Unprofitable’ (mainly smaller) state enterprises were leased under private management, paying
rent-in-kind, or were consolidated inside the trusts. But, along with banking, all the most important
industries – the true commanding heights – remained under state control, employing the vast bulk of
industrial workers.
To balance the books, state enterprises had to reduce their costs. This led to a fire-sale of assets.
The result was a glut of industrial goods arriving on the market, at a time of depressed demand. Prices
fell compared to agricultural goods, benefitting the peasantry at the expense of urban producers and
consumers.
These enterprises were also forced to carry out mass sackings. Capitalism’s ‘reserve army of labour’
returned. Furthermore, khozraschet demanded that workers be paid again in monetary wages, with
bonuses to incentivise harder work.
This was a sharp shock for the working class; a stark change from the mobilisation of labour seen under
War Communism, when employment and basic subsistence were guaranteed. “This crude form of labour
discipline,” Carr remarks, “was quickly replaced by the old ‘economic whip’ of capitalism.”
“Work as a legal obligation,” he notes, “was succeeded by work as an economic necessity; fear of legal
penalties replaced as a sanction by fear of hunger.”
“In less than a year,” Carr concludes, “NEP had reproduced the characteristic essentials of a capitalist
economy.”[28]
Primitive socialist accumulation
From the initial act of allowing peasants to sell surplus grain, a transformation had taken place across
the economy. Tugging at this one thread, War Communism unravelled.
The full effects of reintroducing market relations in agriculture may have been unforeseen, but they
were not accidental. The unwinding of War Communism expressed a certain necessity.
The different parts of the NEP constituted an interconnected whole. Making the first move in the
direction of the market led the government far further down this path than anyone had initially
intended. Objective pressures asserted themselves, brushing aside subjective wishes.
The Soviet Union had not, and could not have, escaped the laws of capitalism. At the same time, however,
the workers’ state was not completely helpless in the face of market forces.
“The workers’ state, while shifting its economy to the foundations of the market,” Trotsky explained in
1922, “does not, however, renounce the beginnings of planned economy, not even for the period
immediately ahead.”
“Centralised state control over [key industrial] enterprises,” he continued, “will be combined [under
the NEP] with the automatic control of the market.”
The task for the Soviet state, according to Trotsky, was to “aid in eliminating the market as quickly as
possible”.
Importantly, he emphasised, the workers’ state must use its control over credit, foreign trade, and
taxation to channel resources towards state industry.
The state monopoly over foreign trade was an essential part of this. And both Lenin and Trotsky fought
back against any suggestion that it should be abolished or relaxed. This, they stressed, would
strengthen
The workers’ state was not completely helpless in the face of market forces / Image: public domain
the kulaks and the NEP-men, at the expense of the workers’ state and the planned economy.
These fiscal and financial levers in the hands of the state, Trotsky outlined, “provide the opportunity
for syphoning off increasingly greater portions of private capital incomes for the purposes of state
economy, not only in the sphere of agriculture (taxes in kind) but also in the sphere of commerce and
industry.”[29]
In this way, the private sector would be “compelled to pay tribute” to what Trotsky called “primitive
socialist accumulation”, in a nod to Marx’s concept of the primitive accumulation of capital.
The struggle between these two social forces – reflecting the pressures of commodity production and the
market on one side, and state planning on the other – thus represented a fundamental feature of the
‘transitional’ Soviet economy.
The economic laws and categories of capitalism (money, value, surplus value, etc.) would therefore
remain under the workers’ state, but now in a modified form, subject to a greater and greater degree of
conscious control.
Recovery and reconstruction
In its early years, the NEP offered some relief. After the catastrophic drought and famine in the Volga
region in 1921-22, harvests improved. And starting from a low base, industry began to recover – mainly
by restoring factories, rather than constructing new ones.
Although the market had been brought back in agriculture and trade, key industries remained in state
hands. And the government took steps to bring greater organisation and planning to these.
Already in 1920, the ‘Council of Defence’ had been reestablished as the ‘Council of Labour and Defence’,
with responsibility for drawing up an economic plan for the entire country.
This was followed in the next two years by the creation of Gosplan and Gosbank. The former was in charge
of general, long-term planning. This included preparing forecasts, targets, balances, and budgets for
production and consumption; overseeing the construction of major industrial and infrastructure projects;
and ensuring coordination between economic departments. The latter was the Soviet central bank.
Both supplemented Vesenkha, which continued to plan and manage state industry through its
glavki (trusts).
Economic recovery continued over the next few years – albeit with some serious setbacks along the way.
Most notable was the ‘scissors crisis’ of 1923, named because of the widening divergence between
agricultural and industrial prices.
The initial phase of the NEP had seen peasants benefiting from higher grain prices and lower prices for
consumer goods. Now, as agricultural production grew more rapidly than industrial output, these prices
switched places in relative terms. All prices, meanwhile, were rising in comparison to incomes, in spite
of government attempts to tame inflation.
Price controls on state-produced industrial goods were introduced. But this just led to greater
shortages. The result was growing tensions between the countryside and the towns, and the antagonism of
the peasantry, which increasingly felt that it was losing out.
This episode revealed the inherent instability in the Soviet economy; the difficulty of achieving
harmonious growth on the basis of a low level of development of the productive forces; and the social
explosions that could erupt at any moment. It was less a case of ‘scissors’, and more a case of
balancing on a knife edge.
By 1925-26, existing industrial capacity was mostly back up and running, and agricultural and industrial
production were at prewar levels of output.
No longer occupied by the immediate struggle for survival, the party’s attention began to shift away
from restoration and towards ‘reconstruction’ – preparing the ground for the next stage in the economy’s
development. What form this would take was a matter of great debate.
By this point, however, the argument was not merely over the rights and wrongs of economic policy. It
was a political struggle about the fate of the revolution.
Rise of the bureaucracy
Lenin had described the introduction of the NEP as a compromise with the petty bourgeoisie; a defeat and
retreat, but ultimately a necessary one; an attempt to buy time until a lifeline could be provided
through successful revolutions elsewhere.
With its reliance on market methods, however, the NEP had important political consequences. It
economically nurtured the kulaks, private traders, and other capitalistic elements, boosting their
social weight compared to the working class. Paradoxically, these parasitic layers were benefiting more
from the workers’ state than workers themselves.
Lenin had described the introduction of the NEP as a compromise with the petty bourgeoisie / Image: public domain
This, in turn, aided the rise of the Stalinist bureaucracy.
The working class was alienated from its own state and from production, due to exhaustion. The
Bolsheviks had to rely on a caste of old officials, administrators, and specialists to run society. And
there was an objective need for, in Trotsky’s words, “a policeman to keep order” in conditions of
generalised want.[30]
The strengthening of the NEP-men and kulaks accelerated this process, putting pressure on the
bureaucracy to adapt themselves to the new marketised framework, and to lean on capitalist tendencies in
Soviet society.
Accompanying the NEP, therefore, Lenin called for a campaign against bureaucracy and careerism in the
state and the party, and for steps to bolster workers’ democracy. If economic concessions were going to
be made to capitalist and petty-bourgeois layers, then these needed to be counterbalanced with political
measures to fortify the workers’ state.
In October 1923, with Lenin incapacitated by ill health, Trotsky and his supporters founded the Left
Opposition, in order to fight against the bureaucratic degeneration of the party, and to defend the
workers’ state as a workers’ state. Their programme included sharp criticisms of the NEP for its
role in nourishing the kulaks, merchants, and middlemen.
On the other side was the Right Opposition, led by Bukharin. In the days of War Communism, Bukharin had
been closer to the ultra-lefts. But he later swung sharply in the other direction, becoming a zealous
advocate of stimulating growth through market means – summarised in his appeal to the peasantry: “Enrich
yourselves!”
In the middle was the Troika: the triumvirate of Stalin, Zinoviev, and Kamenev, representing the
interests of the ballooning bureaucracy. Trotsky described this faction as ‘centrist’, meaning situated
between Marxism and reformism.
Lenin’s death in 1924 was certainly a blow. But his passing wasn’t the decisive factor in the
degeneration of the Bolshevik Party and the Soviet state. As his partner Krupskaya later remarked, if
Lenin had lived on, he too would have ended up in one of Stalin’s prison camps.
Battlelines drawn
The question of how the USSR was to develop industrially became an important flashpoint in this period
in the struggle between the proletarian and petty-bourgeois wings of the Communist Party.
Both sides were in favour of industrialisation. The question was how this was to be achieved, and at
what pace.
Trotsky and his supporters called for a transformative industrialisation plan to be drawn up and
implemented. Priority, they said, should be given to investment in large-scale industry – into factories
that could produce not just means of production (including materials such as steel and chemicals), but
also the ‘means of producing the means of production’: industrial equipment, machine tools, etc.
To improve productivity on the land, agriculture needed to be mechanised and modernised. This required
the creation of large-scale collective farms, since the present primitive, scattered state of peasant
production – spread across 20-25 million households – could not accommodate tractors and advanced
agricultural techniques.
Importantly, Trotsky and the Left Opposition emphasised that the poor and middle peasants must be
incentivised – not forced – to join collective farms, by demonstrating that these could provide better
living standards than traditional back-breaking petty agriculture.
To achieve both of these aims, Trotsky called for important engineering works to be undertaken. This
included construction of a hydroelectric dam on the Dnieper river, to provide power to a new wave of
modern factories and farms.
On the basis of such systematic, sweeping economic measures, Trotsky and his supporters asserted,
tremendous growth could be achieved in the space of two five-year plans, far above the extremely modest
targets set by Gosplan bureaucrats.
The Stalinists ridiculed these suggestions. Lenin had famously summarised communism as being “Soviet
power plus electrification”. Yet Stalin responded to Trotsky’s Dnieper proposal with the pithy retort
that it would be the equivalent of offering a peasant “a gramophone instead of a cow”.
Calls for an ambitious five-year plan were denounced as being unrealistic. Trotsky was accused of being
a ‘super-industrialiser’. Bukharin, in particular, warned that such policies would lead to a rift with
the peasantry.
At root, these criticisms reflected the inherent conservatism of the bureaucracy and the interests of
the petty bourgeoisie, upon whom Stalin and Bukharin leant – just as the perspective of ‘socialism in
one country’ did.
The Stalinists, fearing a peasant backlash to any measures that would put economic pressure on the
countryside, called for industrialisation to be funded primarily from within state industry itself, by
reducing costs and improving productivity in nationalised enterprises.
But such policies could only free up a small amount of resources for reinvestment into new means of
production – hence the conservative growth targets of the Stalinists at this time.
Instead, Bukharin suggested that the peasantry should be incentivised to produce as great a surplus of
raw materials as possible, which could then be exchanged for machinery and industrial equipment on the
world market.
“Bukharin himself spoke of riding into socialism on a peasant nag,” remarks economic historian Alec
Nove. “But could the peasant nag be persuaded to go in the right direction? Would the party be able to
control it?”[31]
These were the rough battlelines around which the reconstruction debate of 1925-27 took place: the
prelude to the expulsion of Trotsky and the Left Opposition, the zigzags of the Stalinists, and the
bureaucratic implementation of the first five-year plan.
Theoretical struggle
The struggle between the Stalinist majority and the Left Opposition was not only waged on the political
plane, but also theoretically.
One notable work was Yevgeni Preobrazhensky’s The New Economics. Written in 1926 as an answer to
the policies of Stalin and Bukharin, this was an attempt to develop a theory of the Soviet economy as a
guide to action.
Preobrazhensky aimed to show that the Left Opposition’s programme was correct and necessary: correct in
highlighting the potential for rapid industrialisation; and necessary for mastering the science of
planning and developing the productive forces along socialist lines.
By comparison, he argued that Bukharin and Stalin – at this point in alliance – had abandoned scientific
socialism when it came to economic policy.
The Stalinists acted empirically, driven by ‘pragmatism’ and narrow bureaucratic interests, not
theoretical considerations. Like the bourgeois economists today, they had no real understanding of their
own system.
The bureaucracy and its representatives were pushed along by events. Without recognising it, they were
applying policies that were in complete accordance with the law of value – the logical conclusion of
which was the full reintegration of the USSR into the capitalist world market.
Left unimpeded in a market system, Marx explained, capital flows into sectors that provide the highest
rate of profit. Applied to Russia in NEP years, this meant directing investment towards agriculture,
given what bourgeois economists would call the country’s ‘comparative advantage’: its abundance of rural
labour, compared to its dearth of machinery. And this, in essence, is what Bukharin and Stalin were
calling for.
The Left Opposition explained that the Stalinists’ suggestions would not lead to socialism, but to the
return of capitalism. Rather than building up state industry, this strategy would only make the Soviet
economy more dependent on the export of raw materials, much like a colonial country.
The
struggle between the Stalinist majority and the Left Opposition was not
only waged on the political plane, but also theoretically / Image:
public domain
Furthermore, by insisting that industrial development must be self-financed from within the state
sector, the Stalinists were ensuring a slow rate of economic growth, and thereby a widening gap between
the Soviet Union and the advanced capitalist countries.
On this basis, Russia would not be industrialised, but would be kept in a state of permanent
backwardness, under the domination of imperialism and the world market.
At the same time, by focussing on agricultural production, the position of the wealthier peasants would
be strengthened. Eventually, this would produce a conflict between the countryside and the workers’
state, with rich peasants demanding direct, free access to the world market on their own terms.
Unless active steps were taken to subvert this process and deprive the private sector of its wealth,
Trotsky and Preobrazhensky emphasised, then further accumulation would be in favour of the capitalist
elements of society.
Taken together, these pressures would ultimately pose the question – and danger – of capitalist
restoration.
Instead, therefore, Trotsky and the Left Opposition emphasised the necessity of what they called the
‘law of primitive socialist accumulation’.
As explained previously, this term drew an analogy with the earliest phase of capitalism, when the
fledgling bourgeois system was still gathering the wealth and resources needed to develop industry on
the basis of profit.
This preliminary capitalist development, Marx explained in Capital, was based not on equal
exchange, i.e. adherence to the law of value, but on pillage and plunder – through colonialism, slavery,
and the force of the state.
Similarly, the Left Opposition argued that, due to its backwardness and isolation, the Soviet Union
would have to accumulate the resources for industrialisation through unequal exchange with non-state
sectors of the economy. This, they argued, was an unavoidable necessity that must be comprehended and
translated into party policy accordingly.
In practice, this meant fixing prices, imposing taxes, and utilising the state’s monopoly over finance
and foreign trade, such that resources would flow away from peasants and private traders, and towards
the workers’ state.
On this basis, accumulation could be accelerated in the state sector, primarily at the expense of the
kulaks and NEP-men, and the country could become a modern industrial powerhouse. Without this, the
Soviet economy would remain backward, reliant on a mass of low-productivity labour.
Primitive socialist accumulation would be necessary until the productive forces were sufficiently
developed and socialist planning was victorious – until the first phase of communism was reached, and
the state, money, and class antagonisms could begin to wither away.
In this respect, the requirements of primitive socialist accumulation were as much an objective law for
the transitional Soviet regime as the law of value, which also made itself felt.
Both Trotsky and Preobrazhensky stressed, however, that the law of value had not disappeared. The
prevalence of market relations, both internally and externally, maintained this pressure, as did the
immaturity of the productive forces and continued conditions of scarcity.
These objective factors restricted Soviet planners. The economy could not grow at an arbitrary,
breakneck pace. This would provoke shortages, inflation, and social outbursts – all symptoms of the law
of value.
But the law’s potency had been tempered by the growing strength of the state sector and planning. The
allocation of labour and means of production was no longer regulated simply by blind market forces, but
by accounting and organisation also.
As Preobrazhensky put it, there was now “a new way of achieving equilibrium in the economic system,
secured by the very great role of conscious foresight and practical calculation of economic
necessity.”[32]
“There operate at one and the same time two laws with diametrically opposite tendencies,” Preobrazhensky
stated. In the law of value, “our past weighs upon us, stubbornly striving to remain in existence and to
turn back the wheel of history.”[33]
Conversely:
“The more organised the state economy is, the more closely its separate links are united by an
operative economic plan… the stronger is its resistance to the law of value, the greater is its
active influence on the laws of commodity production, the more is it itself… transformed into the
most important factor of regularity in the entire economy.”[34]
Similarly, Marxist theoretician Ted Grant explained that in a transitional society attempting to move
towards socialism, “some of the laws peculiar to socialism apply and some peculiar to capitalism”.[35]
This, in essence, was a battle between the old mode of production and the new society struggling to be
born.
Trotsky shared Preobrazhensky’s appraisal of the need for ‘primitive socialist accumulation’. But he
argued forcefully against any crude and mechanical application of the concept.
Harmonious development was vital – above all from a political standpoint – in order to maintain the link
between the urban working class and the poor peasant masses. There could be no suggestion of
‘plundering’ the peasantry, as European capitalism had ravaged its colonies.
Credit, taxation, and price setting should be slanted towards an ‘unequal exchange’, Trotsky outlined,
favouring the towns and industry over the countryside. But matters should not be pushed to the point of
crisis, provoking an open clash between the peasantry and the workers’ state.
Furthermore, Trotsky emphasised that living standards must not be blithely sacrificed in order to ensure
the fastest possible rate of industrialisation. The workers and peasants must be able to
feel that progress was being made.
Above all, Trotsky underlined, the demand for ‘primitive socialist accumulation’ must not be associated
with that of ‘socialism in one country’, as advocated by the Stalinists.
Even if the Left Opposition’s economic programme had been adopted wholesale, this alone would not have
led to the establishment of socialism, as long as the Soviet Union remained isolated and surrounded by
the capitalist market. There was no solution without world revolution.
Forced collectivisation
The danger of the Stalinists’ empirical approach was soon evident.
Having defeated Trotsky and the United Opposition at the 15th party congress in December 1927, Stalin
began to don their clothes and tack to the left. He suddenly became an advocate for rapid
industrialisation, and began to admonish Bukharin and the Right Opposition for adapting themselves to
bourgeois tendencies.
There were economic factors steering this U-turn. As the Left Opposition had cautioned, the kulaks and
rich peasants had been emboldened by the NEP. And they resisted any attempts to restrain them. In
particular, they were hostile to the socialisation of agriculture, which threatened their interests.
Without
collectivisation, and in turn mechanisation and electrification, however, it was impossible to improve productivity / Image: public
domain
Without collectivisation, and in turn mechanisation and electrification, however, it was impossible to
improve productivity on the land. And without higher crop yields, there was no way of feeding the
growing urban population, which was a necessary component of industrialisation.
“The peasantry,” Carr comments, “would be required to supply increasing quantities of agricultural
products to the growing towns and industries”. If this “imposed too great a strain on the peasant,”
however, “he would reduce his deliveries of agricultural products, hoard his surpluses, reduce his
sowings for the market, and retreat into self-sufficiency.”
“On this delicate issue relations between the regime and the peasantry were to turn,” Carr
concludes.[36]
Preoccupied with purging the Left, the Stalinists ignored this simmering conflict for a while. But a
deterioration in grain supplies towards the end of 1927 brought matters to a head.
As the warnings of the Left Opposition played out, the bureaucracy was forced to carry out a policy of
‘primitive socialist accumulation’, but in the most ham-fisted and reactionary manner.
Having leant on the petty bourgeoisie to strike blows against the Left, Stalin was now leaning on the
working class to strike blows against the Right – in both cases to bolster his own position and power.
This abrupt turn disorientated many who had aligned themselves with Trotsky. This included
Preobrazhensky, who concluded that, since the bureaucracy was now carrying out its own version of his
recommendations, the time had come “to make peace with the party majority on the basis of the new
course.”[37]
Trotsky, for his part, predicted that the Stalinists’ turn would not lead to socialism, but to disaster
– and to the further strengthening of the reactionary bureaucracy.
His predictions were rapidly confirmed by events. Without manufactured goods to offer in exchange for
grain, the government resorted to repressive measures to resolve the agricultural crisis.
From early 1928, the Stalinist bureaucracy waged an increasingly coercive campaign against the kulaks
and their hoarding and speculating. But state officials often made little distinction between richer
layers and middle-and-poor peasants, forcing the latter into the arms of the former. Memories of War
Communism were still fresh.
Soon enough, Stalin was calling for forced collectivisation and the ‘liquidation of the kulaks as a
class’. But this only exacerbated the food crisis.
With the state grabbing all the grain that it could, little was left in the countryside to feed peasants
and their livestock. This also meant less horsepower and manure for the fields, further impacting
yields.
By 1932, agricultural production had fallen to 73 percent of its 1928 level.[38]
Bread queues sprung up in the cities. Rationing returned. The ‘bagmen’ reemerged. And millions died of
malnutrition and disease.
Targets and crises
In the background, Gosplan and Vesenkha officials were busy formulating the first five-year plan. Having
previously come under pressure to moderate their suggestions, hyper-ambitious targets were now the name
of the game.
Debates took place amongst Soviet economists as to whether planning should be ‘genetic’ or
‘teleological’. Supporters of the former believed that planning should simply involve forecasting
organic, anarchic economic changes. Advocates of the latter emphasised the need to set targets and then
shape society accordingly through conscious efforts.
Broadly speaking, the ‘geneticists’ were associated with the Right, and with greater reliance on market
methods to bring about economic equilibrium. The ‘teleologists’ reflected the subjectivist outlook of
the Stalinist bureaucracy – the belief that planning production simply required willpower and a firm
hand.
It was the views of the teleologists and Stalinists that moulded the first five-year plan. This was
officially launched in October 1928. But its aims were only formally approved the following spring,
after the Right Opposition had been routed. The NEP was over.
Despite its bureaucratic limitations and social costs, Soviet planning generated enormous progress. Even
bourgeois estimates suggest that the economy grew by around 62-72 percent under the first and second
five-year plans, between 1928-37. Output per capita jumped by 60 percent.[39]
Industry was rapidly developed and reequipped. The country was transformed by impressive projects like
the Dnieper hydroelectric dam, the construction of which began in 1927, only months after it had been
dismissed by Stalin. Education and healthcare saw dramatic improvements. The Soviet Union was yanked out
of its backwardness, and thrust into the modern age.
In this same period, meanwhile, western economies were being wracked by the deepest crisis in the
history of capitalism: the Great Depression.
From the outset, however, the potential of planning was hindered by the unscientific, commandist
approach of the Soviet bureaucracy. Stalin and his apparatchiks may have changed their tune since the
days of the NEP, but all their bureaucratic flaws remained.
Bukharin had called for industry to adapt itself to agriculture, to be a slave to the peasantry. But now
bureaucratic planners were setting objectives without any concern for genuine physical, productive, or
political limits.
The advice of engineers and specialists was ignored, as were scientific data and models, in favour of
targets based on prestige, not facts. The stated goal was to catch up with the imperialist powers as
quickly as possible and at any cost.
The conservatism of the Stalinists in the NEP years was now replaced by adventurism. But the philosophy
behind both approaches was the same: empiricism and subjectivism – the idea that the Soviet economy
was not governed by objective laws and limits that needed to be understood in order to guide
decisions.
As Stanislav Strumilin, one of the architects of the first five-year plan, stated candidly:
“Our task is not to study economics but to change it. We are bound by no laws. There are no
fortresses which the Bolsheviks cannot storm. The question of the tempo [of industrialisation] is
subject to decision by human beings.”[40]
But in spite of the vainglorious declarations of the bureaucracy, the development of the Soviet economy
under the first five-year plan was far from an uninterrupted upward march. There were times when growth
stuttered. 1931-32 saw a sharp slowdown.
The Soviet Union was coming up against something even the Bolsheviks could not ‘storm’: the limitations
imposed by its own internal dynamics, and by the external pressure of world capitalism.
Superficial sectarians saw in this evidence that the Soviet Union was a form of ‘state capitalism’. But
the USSR’s economic crises were of a fundamentally different nature to those seen under capitalism.
Economic crises under capitalism are, at root, the result of overproduction: a generalised excess
accumulation of capital across the economy; a fundamental contradiction, arising from the law of value
and the origins of profit (surplus value) – the unpaid labour of the working class.
The crises in the Soviet Union, by contrast, were crises of underproduction, arising from
bureaucratic planning; from Stalinist leaders setting unrealistic targets, and then straining the whole
economy to meet these – creating tears and ruptures, disproportions and bottlenecks, shortages and
inflation.
Crisis under capitalism is an indication that the productive forces have outgrown the limits of the
market, that capitalist accumulation has gone too far, expressed in a glut of unsold goods.
Crisis in the bureaucratically planned Soviet economy was a sign that targets had exceeded the limits of
the productive forces, that socialist accumulation had not gone far enough, expressed in rows of empty
shelves. As Ted Grant comments:
“The state can now regulate, but not arbitrarily, only within the confines of the law of value. Any attempt to violate and pass beyond the strict limits set by the development of the productive
forces themselves, immediately results in the re-assertion of the domination of production over
producer… The law of value is not abolished, but is modified.”[41]
Having pushed back against the laws of the capitalist market, the bureaucracy found itself butting up
against other laws that it did not understand. This would have major implications for the fate of the
USSR.
Science of planning
As the first five-year plan drew to a close, it was clear that problems were piling up in the Soviet
economy. And yet the bureaucracy turned a blind eye to these, and ploughed on with the second five-year
plan – setting even more ridiculous targets, and silencing anyone who protested.
Tension between the cities and countryside heightened. Imbalances between different sectors of the
economy grew. Both the quantity and quality of goods deteriorated. Workers were put under inordinate
physical strain, forced to work insane hours and live in cramped, dilapidated conditions. And Stalin’s
purges amplified the contradictions.
Trotsky observed these disasters from exile, having been expelled from the USSR in 1929.
“The whole trouble is that the wild leaps in industrialisation have brought the various elements of the
plan into dire contradiction with each other,” he wrote in 1932. “The trouble is that the social and
political instruments for the determination of the effectiveness of the plan have been broken or
mangled. The trouble is that the accrued disproportions threaten more and greater surprises.”
“The gist of the matter is that we have not entered into socialism,” he continued. “We have far from
attained mastery of the methods of planned regulation. We are fulfilling only the first rough
hypothesis, fulfilling it poorly, and with our headlights not yet on. Crises are not only possible, they
are inevitable.”[42]
The problem was the bureaucratic approach to Soviet planning, arising from disenfranchisement of the
working class from the running of society; from the deformed nature of the workers’ state.
Planning is a science that needs to be tested, Trotsky explained. “It is impossible to create
a priori a complete system of economic harmony,” he warned. “Only continuous regulation of the
plan in the process of its fulfilment, its reconstruction in part and as a whole can guarantee economic
effectiveness."
Planning is a science that needs to be tested / Image: public domain
There is no “universal mind”, he emphasised, that could “draw up a faultless and exhaustive economic
plan, beginning with the number of acres of wheat down to the last button for a vest”.
And yet this is exactly what the bureaucracy was attempting, calculating physical balances – inputs and
outputs for all major materials and state industries – from the top down, from the comfort of their
Moscow offices, with little connection to reality on the ground. Instead, Trotsky continued:
“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.”
In the transitional period, Trotsky stressed: “The plan is checked and, to a considerable degree,
realised through the market… The blueprints produced by the departments must demonstrate their economic
efficacy through commercial calculation.”[43]
In other words, the workers’ state would need to use price signals to test, corroborate, and update any
economic plan; to identify pinch-points and shortages; and with this, to consciously allocate resources
and investment in order to bring about harmonious development and balanced growth.
A healthy proletarian regime would not be a helpless, ignorant victim of the law of value, but would
wield this law as one tool amongst many to plan production and distribution. “Money as the means of
economic accounting evolved by capitalism is not thrown aside,” Trotsky noted, “but socialised”.[44]
This, in turn, he emphasised, would require a stable currency. But the bureaucracy was undermining the
chervonets’ capacity to act as a reliable monetary yardstick by resorting to the printing press to fill
holes in the budget.
Just as the ultra-left Bolsheviks had been complacent towards the menace of inflation in the early
1920s, so too were the Stalinists now woefully mistaken in imagining that they were free from the
clutches of the law of value and money circulation.
“To erect a plan of economy on a slipping valuta is the same as to make a blueprint of a machine with a
loose compass and a bent ruler,” Trotsky stated. “This is exactly what is taking place. The inflation of
the chervonets is one of the most pernicious consequences – and also instrument – of the bureaucratic
disorganisation of the Soviet economy.”[45]
Planning is not only a science, Trotsky remarked, but an art – one that must be learnt through
experience.
“The art of socialist planning does not drop from heaven, nor is it presented full-blown into one’s
hands with the conquest of power,” he outlined. “This art may be mastered only by struggle, step by step
– not by a few, but by millions, as a component part of the new economy and culture.”[46]
This raised a life-or-death question for the socialist republic, and for the building of communism
anywhere: scientific instruments of planning – such as forecasts and statistics, material balances, and
price signals – need to be supplemented by a healthy setup of workers’ democracy.
This meant gathering information on production and consumption from workplace committees, trade unions,
and elected representatives; continuously checking plans against the facts, and making the necessary
modifications; and involving the organised working class in the running of society.
“Only through the inter-reaction of these three elements – state planning, the market, and soviet
democracy – can the correct direction of the economy of the transitional epoch be attained,” Trotsky
concludes, adding:
“Only thus can be assured, not the complete surmounting of contradictions and disproportions within
a few years (this is utopian!), but their mitigation, and through that the strengthening of the
material bases of the dictatorship of the proletariat until the moment when a new and victorious
revolution will widen the arena of socialist planning and will reconstruct the system.”[47]
Fight for communism
While the monstrous Stalinist state was executing communists, stripping away democratic rights, and
strangling the Spanish Revolution, it was proudly announcing that: “We have not yet, of course, complete
communism… but we have already achieved socialism – that is, the lowest stage of communism.”
Trotsky gave the following withering assessment of this claim:
“If Marx called that society which was to be formed upon the basis of a socialisation of the
productive forces of the most advanced capitalism of its epoch, the lowest stage of communism, then
this designation obviously does not apply to the Soviet Union, which is still today considerably
poorer in technique and culture than the capitalist countries.”
“It would be truer,” he continued, “to name the present Soviet regime in all its contradictoriness, not
a socialist regime, but a preparatory regime transitional from capitalism to
socialism.”[48]
In 1959, Soviet leader Nikita Kruschev repeated the Stalinists’ assertions once again. Having completed
the period of socialist construction, he stated, the USSR was ready to take its “first step into
communism”.[49]
But despite such proclamations, the goal of communism was never achieved in the Soviet Union in any
form.
The USSR remained at all times a transitional regime between capitalism and socialism. And contained in
the nature of any such regime is the potential not only for progress, towards socialism, but also
regression, towards the full return of capitalism.
Over the decades, on the basis of planning, there were incredible advances in terms of industry and
education. At the same time, however, the bureaucracy grew to become a debilitating tumour, slowly
draining all life out of the economy and society.
Ultimately, this led not to communism, but to capitalist restoration. Then as now, the only way forward
was through international socialist revolution.
Today, on the basis of the development of the productive forces internationally, the conditions for
socialism have never been more favourable.
The process of planning production would be incalculably easier thanks to the technology and techniques
that have been developed under monopoly capitalism.
Furthermore, the size, strength, and cultural level of the working class – in all countries – is far
higher than that which existed a century ago in Russia. Workers are equipped with more than enough
skills and knowledge required to run the economy.
Following revolution in the advanced capitalist countries, with the latest science, innovations, and
industry, the leap to the first phase of communism could occur in the space of a generation.
Even at this point, however, economic laws will not disappear completely. The law of value will have
first been subdued, and then dissolved entirely. But we remain material beings. There will still be
objective lawfulness governing society.
Genuine freedom under communism will not come from imagining ourselves to be free of such forces, but
from understanding necessity – and harnessing this knowledge to our advantage, to transform the world
around us.
“Control and planning will, in the first stages, take place within given limits,” explains Ted Grant.
“These limits will be determined by the level of technique when the new social order takes over. Society
cannot step from the realm of necessity into the realm of freedom overnight.”[50]
“The realm of freedom really begins only where labour determined by necessity and external expediency
ends,” Marx highlights.
“Just as the savage must wrestle with nature to satisfy his needs, to maintain and reproduce his
life, so must civilised man, and he must do so in all forms of society and under all possible modes
of production.”[51]
Marx concludes:
“In a higher phase of communist society… after labour has become not only a means of life but life’s
prime want; after the productive forces have also increased with the all-around development of the
individual, and all the springs of co-operative wealth flow more abundantly – only then can the
narrow horizon of bourgeois right be crossed in its entirety and society inscribe on its banners:
From each according to his ability, to each according to his needs!”[52]
This is the communist future that we must organise and fight for.
References
[1] L Trotsky, The Revolution Betrayed, Wellred
Books, 2015, pg 3
[2] L Trotsky, History of the Russian Revolution,
Vol. 3, Wellred Books, 2022, pg 1168
[3] V I Lenin, State and Revolution, Wellred Books,
2019, pg 85-86
[4] K Marx, F Engels, “The Communist Manifesto”,
Classics of Marxism, Vol. 1, Wellred Books, 2013, pg 21-22
[5] K Marx, Critique of the Gotha Programme, Foreign
Languages Press, 2021, pg 15
[6] V I Lenin,
‘Left-Wing’ childishness and petty-bourgeois mentality, Progress Publishers, 1968, pg 18
[7] V I Lenin, State and Revolution, Wellred Books,
2019, pg 67
[8] V I Lenin,
‘Left-Wing’ childishness and petty-bourgeois mentality, Progress Publishers, 1968, pg 19
[9] L Trotsky, The Revolution Betrayed, Wellred
Books, 2015, pg 1
[10] S M Efremov,
The role of inflation in Soviet history: Prices, living standards, and political change, East
Tennessee State University, 2012, pg 17
[11] V I Lenin, “Extraordinary Seventh Congress of the
R.C.P.(B.)”, Lenin Collected Works, Vol. 27, Progress Publishers, 1965, pg 98
[12] E H Carr,
The Bolshevik Revolution, 1917-1923, Vol. 2, Penguin Books, 1952, pg 76
[23] V Serge, Year One of the Russian Revolution,
Haymarket Books, 2015, pg 213
[24] S M Efremov,
The role of inflation in Soviet history: Prices, living standards, and political change, East
Tennessee State University, 2012, pg 17
[25] L Trotsky, The Revolution Betrayed, Wellred
Books, 2015, pg 46
[26] E H Carr,
The Bolshevik Revolution, 1917-1923, Vol. 2, Penguin Books, 1952, pg 344
[27] S M Efremov,
The role of inflation in Soviet history: Prices, living standards, and political change, East
Tennessee State University, 2012, pg 17
[28] E H Carr,
The Bolshevik Revolution, 1917-1923, Vol. 2, Penguin Books, 1952, pg 321-22
[29] L Trotsky,
The First Five Years of the Communist International, Wellred Books, 2020, pg 650
[30] L Trotsky, The Revolution Betrayed, Wellred
Books, 2015, pg 79
[31] A Nove,
An economic history of the USSR, 1917-1991, Penguin Books, 1992, pg 121
[32] E Preobrazhensky, The New Economics, Oxford
University Press, 1965, pg 172
[44] L Trotsky, “The Degeneration of Theory and the Theory
of Degeneration: Problems of the Soviet Regime”, Writings of Leon Trotsky (1932-33), Pathfinder
Press, 1972, pg 223
