Soviet Union prioritised increased production

Socialism will not require industrialisation

The transition to a new society is possible, argues Mike Macnair

This is the concluding part of what may seem to have been a rather disjointed series. In the first article (April 9) I argued briefly for the need for a strategic and general alternative to capitalism - a maximum programme. I criticised what seemed to be Chris Cutrone’s approach to the issue, outlined the CPGB’s version and asked whether this alternative is in fact posed to us.

In the second article I reviewed the arguments of Peter Hudis about what Karl Marx actually argued on this issue and those of Michal Polak responding to ‘analytical Marxist’ critiques of Marxism on it. In the third, I argued that the need for a strategic alternative to capitalism is, in fact, objectively posed for us today, because the present (meaning the recent past and the near future) is one in which capitalism as such - generalised commodity production or ‘market plus state society’ - is systematically worsening existing conditions for everyone outside the capitalist elite and their paid agents and subsidised allies. In this article I continue this argument, and go on to demonstrate that features of the present also show that beginning to construct such an alternative is possible for humanity today.

I stress that capitalism as such is worsening existing conditions, because, as Marx argued in Capital and other ‘economic writings’, the fundamental infernal dynamics of boom and bust and of polarisation between rich and poor grow inherently out of the fundamental dynamics of the practice of coordinating humans’ common productive activities through private property (especially, private property in information) and money exchange.

And, as I argued in part three (and have in previous articles), market society, generalised commodity production, both by tending to disequilibrium and by requiring credit money, actually also requires the strong state and the mercantilist state. And it therefore also requires the infernal dynamics of imperialism and the inequality of nations - and of the rise, decline and fall of world-dominant powers, which provide the global reserve currency. It is these ‘geopolitical economy’ dynamics, driving both the inability to act effectively to control human-induced climate change and the worsening tendency towards war, which overshadow the present.

Beyond money exchange

The ground of humanity’s immediate problems is, then, the foundational features of capitalist economy. Money exchange enables ‘calculation’ (in the terms of Ludwig von Mises’ argument in the inter-war ‘socialist calculation debate’), and ‘solves’ Friedrich von Hayek’s ‘knowledge problem’. But it is precisely the features of money which make these effects possible, which veil our individual choices from each other and which today produce repeated crashes, immiseration and wars. They threaten us in the future with the requirement of a third world war to overcome the effects of the relative decline of the US and the gross overgrowth of capital values, and with a world potentially rendered uninhabitable by human-induced climate change.

To overcome these problems, then, requires us humans to get sufficiently beyond money exchange arrangements to limit the negative dynamics in respect of boom-bust, polarisation and ‘geopolitical economy’. I say sufficiently and limit for two reasons. The first reason, which I gave in the third article, is that we should categorically reject the forced collectivisation of small private-property production in the light of the very negative Soviet experience. Given the continued existence of small property in important economic sectors (eg, in particular, agriculture!) the continued use of money exchange in relation to these sectors is unavoidable. It should be blindingly obvious that even a global ‘dictatorship of the proletariat’ will face this problem. Perhaps especially a global ‘dictatorship of the proletariat’ - since this will include large areas of the world in which peasant household-scale production in agriculture has never been superseded, and others in which (as in France) it has been artificially preserved.

The second reason is this. A return to 1950s-70s economic management is not feasible without the combination of the overthrow of the military and financial power of the US and the creation of an equivalent to the USSR (one might hope for a less bad one ...). But the 1950s-70s regime does make clear that the subordination of finance capital and of middle class ‘savers’ and ‘pensioners’ through ‘financial repression’ can allow substantial mitigation of the tendencies to cyclical crashes and polarisation without complete supersession of the money system.1

Further, the tendency to the cyclical return of crashes in particular appeared only after 1763: that is, well before the ‘industrial revolution’ of the rise to dominance of steam-driven industry; but also substantially after the creation of organised British financial markets (etc) in the 1690s. Rather, it developed at the point of the establishment of British world dominance (the third global defeat of absolutist France), at the point at which it became unambiguously clear that no restoration of feudalism was possible.2 It is the military (naval) world-dominance of the leading capitalist state, then, producing control of the international element of the division of labour through shipping and shipping finance, which enforces ‘rational choice’ behaviour on other economic actors on a scale sufficient to produce the business cycle - and also enforces capitalist state mercantilism beyond the initial capitalist states themselves.

Hence, a global ‘dictatorship of the proletariat’ could in principle manage a ‘mixed economy’ (so as to drive it towards the full supersession of the money exchange system) without using forced collectivisation, and while dealing with the immediate threats to the species posed by the infernal dynamics of the money exchange system.

An aside. I place ‘dictatorship of the proletariat’ in quote marks here so as to allow direct cross-reference to the issue posed by Peter Hudis, and by Chris Cutrone in his April 16 letter: that is, that in Marx’s and Engels’ writing this ‘dictatorship’ is a Roman-style dictatura: a short revolutionary period of a year or two. Even if this was correct it would still be possible,as the CPGB does, and as Second International lefts did, to call this temporary regime ‘socialism’ for the sake of shorthand. Having said this, in fact, I think that if we reject forced collectivisation, it follows that even a global ‘dictatorship of the proletariat’ must last for at least a generation - until the old generation of family farmers, etc die out and their kids choose to go for cooperative production.

Indeed, it is probable that a sufficiently substantial chunk of the world, including a part of the world in which the local internal dynamic is towards the supersession of capitalism (as well as the global dynamic being so), could do so: that is, a large chunk of the world which included western Europe or North America, as opposed to a chunk like the old ‘socialist camp’, which was characterised from the outset by a lower development of the forces and relations of production.

Transformed goals

To do so, however, entails transforming the goals, the incentive structures, the decision-making processes, and so on, of the part of our productive activities which capital has already socialised in its own way and which the ‘dictatorship of the proletariat’ now takes out of the capitalist/market incentive structures.

The goals are most fundamental. Plainly, they cannot be to maximise profit. Equally, they cannot be to maximise ‘gross domestic product’ - or to pursue ‘growth’ or maximise output more generally. The economists’ ‘efficiency’ cannot be the goal, since ‘Pareto efficiency’ and all its various derivates are merely code for random ‘growth’.

The fundamental reason for these points is the climate change problem, since, in the first place, this immediately requires‘ex ante’ planning(in advance) ‘in natura’: that is, of the particular physical goods to be produced, on a global scale - as, for example, by shifting at least urban transport and long-distance bulk goods from private cars and trucks to public transport. This is inconsistent with the random growth selected ex post facto by markets. And, secondly, the phenomenon of human-induced climate change implies absolute limits to random ‘growth’, given by the carrying capacity of the biosphere.

A side consequence of this circumstance is that in post-capitalist society the question of distributive principles is immediately posed and is not (as it is in class societies, and as Marx argued more generally that it is3) merely given by the order of production. When the organisation of production becomes consciously collective, the principles of distribution will no longer follow logically from it: there is collective consumption, but also individual consumption, and the nature of the distribution to individuals (beyond the bare minimum necessary to reproduce labour-power) does not follow directly from the logic of production.

Moreover, capitalism cycles between positive-sum games, which make inequalities tolerable and produce reformist versions of liberalism and technocratic progress ideologies, and negative-sum games, in which inequalities become increasingly intolerable; if there is not a development of socialist anti-capitalism, there will be a development of reactionary anti-capitalist utopias - whether petty-bourgeois individualist, religious or nationalist - and a tendency towards war. Natural limits to growth imply an economy planned to be permanently at or near a zero-sum game. The consequence is that questions of ‘equity’, ‘fairness’, or whatever you call it, in social goals, are necessarily posed more sharply than they are in boom periods of capitalism.

Equally, maximising productivity or its converse, minimising socially necessary labour time, cannot be the goal of the new economy. This is less obvious, since it would be possible to minimise socially necessary labour time while absolute output remained constant. There are two sides to the explanation. The first is that minimising socially necessary labour time in fact requires the money mechanism and all that goes with it. This is because, while a ‘threshold’ approach to social necessity is knowable ex ante by planning in natura, minimising socially necessary labour time requires calculability, which in turn requires money and markets, and is only knowable ex post (after the event) through this means, which takes us back to capitalism.

The second side is that it is already the case that “labour has become not only a means of life, but life’s prime want” (Critique of the Gotha programme (CGP), section 1) because of the existing growth of the productivity of labour under capitalism. The point here is simple. Part of the reason we need to supersede capitalism is the growth of standing mass unemployment and ‘underemployment’ (growth of part time, zero-hours, etc contracts). But what has not (in the near past) resulted is the ‘feast of Malthus’: ie, mass starvation of the unemployed. In fact, famines have become less frequent even in ‘underdeveloped’ countries. The reason is that the global productivity of labour is now high enough comfortably to feed, house and clothe the world’s population and to deal with local harvest failures: “labour has become not only a means of life”. But unemployment and ‘underemployment’ mean, under this global capitalist regime, not richness in free time, but pauperisation, dependence and social exclusion. Worthwhile work has, therefore, indeed already “become ... life’s prime want”.

The principle of the new society which can even begin toescape the infernal dynamics of current capitalism is therefore in the first place the principle of human need, as Marx argued is the long-term aspiration of communism, “as it has developed on its own foundations”.

In fact, it is utterly banal that the left today defends or fights for the provision of healthcare and education according to need, not rationed by money or by contribution even in unmodified labour time.4 It is equally banal that the left defends or fights for the provision of additional resources to people affected by disabilities of one sort or another over and above those available to people who do not have these specific needs (and the allocation of additional resources to making public buildings, transportation systems, etc accessible to such people).

Again, the US is becoming a “trailer park nation”,5 the UK “generation rent”;6 the Tories promise to increase ‘market’ rationing of housing by extending ‘right to buy’ in the remaining council housing and introducing it to expropriate charitable housing associations has been universally condemned, including by TheDaily Telegraph, as likely to worsen the housing crisis and increase the likelihood of a new financial crash.7 The question of planning to provide housing in response to need is presently posed - perhaps not everywhere, but certainly in the most ‘developed’ capitalist countries.

In short, 140 years after the Critique of the Gotha programme, the image of the first phase of communism in that text turns out to assume more persistence of capitalist incentive structures into socialism than today under capitalist rule.

Developmental ‘socialism’

From the CGP image of the “communist society, not as it has developed on its own foundations, but, on the contrary, just as it emerges from capitalist society; which is thus in every respect, economically, morally and intellectually, still stamped with the birthmarks of the old society from whose womb it emerges” came the idea of ‘socialism’ as a developmentalregime, which would contain structural incentives to increase output and productivity - and hence which looked to a future of an abundance sufficient to eliminate all human disputes, which would be the long-term point at which ‘full communism’ was posed.

It is worth making the side point that this issue illustrates the uselessness of the ‘Engels vulgarised Marx’ paradigm: since the idea of a first phase of communism, or a socialism, containing systemic ‘developmental regime’ incentives, is Marx’s error in CGP.

It is an entirely understandable error - if capitalism had, in Britain at least, reached its apogee and begun to enter into decline (like slave-owner urbanism around 0 BCE/CE or European feudalism around 1200 CE) But capitalism was nowhere near reaching its limits, which have begun toappear in the late 20th century.8 Hence the shape of what would replace capitalism - probably, in fact, a contradictory combination of persisting markets for small producers with large-scale production having aims of human development - was a great deal less visible than now.

Outside CGP, there is a good deal of evidence that Marx was aware of this problem. For instance, in the afterword to the 1873 second German edition of Capital, Marx observed that “the Paris Revue Positiviste reproaches me in that, on the one hand, I treat economics metaphysically and, on the other hand - imagine! - confine myself to the mere critical analysis of actual facts, instead of writing recipes (Comtist ones?) for the cook-shops of the future”.9

After Stalinism, of course, we cannot avoid saying more about “recipes for the cook-shops of the future” than Marx and his contemporaries had to; but also, both because of capitalist development and because of the (deformed) Soviet experience itself, we have more that we can say about such “recipes” on the basis of “critical analysis of actual facts”.

From the idea of a developmental socialism, in turn, came the idea (sketchily adumbrated by Lenin in casual comments in 1919-22) that socialist development, increasing output and productivity more than capitalism, could allow a backward country to ‘overtake’ more advanced ones.

In reality, no such overtaking took place. Though the large-scale wartime technology transfer from the western Allies in 1941-45 and from occupied Germany in 1945-48 gave the USSR a major boost, for the bulk of the period 1921-1991 the USSR was playing catch-up with the ‘west’ - and always running as far behind as the tsarist empire had been behind in 1914.10 Even among capitalist states, the UK overtook the Netherlands as the latter declined into dominance of financial capital in the 1700s, and the US similarly overtook the UK. But, as 1914-45 showed, France never succeeded in overtaking the UK (whether it has done so even now is debatable), and Germany and Japan did not succeed in overtaking the US - and have not done so even now in spite of US financialisation reaching levels analogous to the later 19th century UK.

The idea of socialism as a developmental regime, and the incentive structures which went along with the attempt to go for overtaking the west in the USSR and its satellites and imitators, supported the notion that the USSR et al could be considered ‘state-capitalist’ because the regime was still aiming to extract a surplus product for the purposes of reinvestment and growth.

But in reality, contrary to the ‘Brenner thesis’ and similar views, pre-capitalist societies as well as capitalist ones also contain incentives to reinvest part of the social surplus product, leading to increased productivity: as, for example, in medieval road and bridge building, wind and water mills.11 Thus the primary theoretical problem with the theory of state capitalism, as I already indicated in the second article in this series, is that it fails to distinguish between capitalism and pre-capitalist social orders. Its main predictive problem is related: that it also completely fails to account for the inability of the industrial labour force in the ‘socialist’ countries to create permanent organisations against the Stalinist bureaucracy (unlike workers under very repressive capitalist regimes), and the widespread illusions of the ‘southern’ and parts of the ‘western’ working class movement in the ‘socialist camp’ until the last stages of the latter’s collapse.

The aspect of the regimes which looked ‘socialist’ was, in fact, precisely the aspect which was non- ‘developmental’ in their dynamics: the existence of (limited) forms of welfarism, together with the tendency of managers to hoard labour, blunting capitalist incentives and leading - as Hillel Ticktin has argued - to failure to follow capitalist developmental dynamics.12 There is no reason to suppose that a genuine communism (first-phase or other) will have an inherent developmental dynamic or incentives: on the contrary, all ‘development’ will become purely a matter of conscious choices.

With this discussion of the appropriation of the ‘developmental’ aspect of the CGP image of the first phase of communism, I have partly moved from the question of the need for alternative social goals to those of capitalism, into the question - posed, in reality, by the Stalinist experience - of whether a move towards such alternative goals is possible. My initial point was that elements of the ‘maximum programme’ are posed in immediate conditions, and that ‘developmental socialism’ was a false conception. Unavoidably, this led into whether ‘state capitalism’ is a useful interpretation of Stalinism. But there are elements of the argument which are also about the nature of the communist goal.

Hierarchy and expertise

To repeat an argument I made in 2008 (albeit parts of what I say in this series are inconsistent with and intended to correct my arguments in that series). ‘Need’ is a slippery word, which can have an expansive or a restrictive sense.13 The expansive sense requires Marx’s interpretation of ‘production for need’: ie, a society with very high productivity, in which the division of labour is overcome. But suppose we adopt the restrictive sense, and say simply that people need food, clothes, housing, access to transport and communication, education, health services and public health measures, and so on. These basic needs are very extensively unsatisfied in the capitalist world. On the other hand, a great deal of what is currently offered for sale in the capitalist market cannot be said to be things we need in the most expansive sense of the word. They may, indeed, be things we need not to have: for example, cigarettes, urban 4x4s, and instruments and techniques of torture.

Within the restrictive sense of ‘need’, however, there remain unavoidable choices. To give a large-scale example: suppose that we overthrew capitalist rule worldwide. We would have to make choices about priorities. What is the relative priority between improving transport infrastructure, education or health services? What is the relative priority between improving healthcare for the old in Britain, and improving basic-level healthcare in Latin America? Either choice will be a decision to use production for need: profit would not enter into the question. But the choice will nonetheless have to be faced.

How will the choices be made? The CPGB’s approach is to say that we will have to make them democratically;that that is the only way in which the working class can effectively take decisions. Hence (among other reasons) our very strong emphasis on the struggle for extreme democracy as the centre of our political programme.

But the majority tradition of the 20th century left, including the Stalinists, was that the choices should be made by ‘experts’. It makes no difference whether these ‘experts’ are to be technical experts or ‘cadres’ (political ‘experts’): they have still been taken away from the people ultimately affected. A trivial example, dating back to the 1970s: a local council decided it would be beneficial to council tenants to live in an architect-designed block; the expert architect designed the block with amber windows; tenant complaints (they wanted clear windows) were unavailing. It is an accumulation of petty ‘expert’ stupidities of this sort, together with real cuts in public expenditure leading to reduced repairs, etc, which undermined mass support for council housing and opened the political way for the Tory ‘right to buy’ legislation. Bureaucratic ‘collective’ decision-making is so unattractive as to make pro-capitalist ideologues’ offer of increased individual decision-making - part of what Tony Clark called ‘consumerism’ - look attractive.

The Soviet and eastern European regimes were, and the Chinese, Vietnamese and North Korean regimes remain, much more extreme examples of this problem: the broad masses are denied the right to make decisions, and the result is bureaucratic stupidities which do not conform to people’s actual needs.

The result was not production for human need at all. In the Stalin-era USSR, all other needs were subordinated to the needs of the state for arms production: hence the priority accorded to heavy industry. It is grotesque to imagine that the Marx who in 1871 characterised the Paris Commune as “a revolution against the state itself, of this supernaturalist abortion of society, a resumption by the people for the people of its own social life”14 would have thought that the USSR was an example of ‘production for need’.

Resentment about subordination to decisions arbitrarily taken by ‘experts’ is partly because of the bad results of the decisions. But it is also, in fact, an aspect of human basic needs. Status inequality is, independent of absolute wealth or poverty, a cause of ill-health.15 Since the phenomenon is independent of absolute wealth or poverty, hierarchical relations of decision-making in which some people are permanently subordinated to others are implicated in this problem just as much as monetary income inequality. In addition, of course, permanent relations of domination and subordination will tend to produce income inequality, since the decision-makers will tend to favour themselves: as already appeared in the USSR in 1922 with the creation of special material privileges for ‘cadres’.16

Production genuinely aimed at the basic human need for health would therefore involve ‘republican equality’: ie, the end of permanent relations of domination and subordination between humans.17 This goal, in turn, involves - as Marx points out in CGP- the end of “the enslaving subordination of the individual to the division of labour, and therewith also the antithesis between mental and physical labour”.

Presently posed?

To argue what I have just argued is to propose that the supersession of decision-making by experts is presently posed within the ‘large-scale production sector’. To put the point another way, this is a transition beyond meritocracy or beyond equality of opportunity - not to a flat egalitarianism (equal doses of penicillin for all, to give an exceptionally stupid example), but rather a transition to rotational employment and in particular to term limits, which require the ‘experts’ after a term in post to do ‘grunt level’ jobs for a while - the architect to do some portering, as Engels put it in the Anti-Dühring passage quoted in the first article in this series.

Is a turn in this direction presently possible? In fact, it is reasonably clear that it is, for precisely the reasons, referred to above, for not treating maximising productivity as a goal of socialism. The point is that the present productivity of labour is so high that present society - while imposing long hours on those who are in full-time work - can afford to support many millions globally either in pauperised idleness, or in make-work jobs or positively undesirable activities (much of ‘financial services’ ...). Existing society also ‘overproduces’ literate and educated people, and has the potential resources to educate and train many more; for many more people to move from one job, to education or training, to another job, and so on.

Moreover, the transition from production and society being dependent on specialist information held in individuals’ heads alone to such information being available through one or another form of information technology is already in progress. This technical process is reflected in modern discontents about ‘intellectual property rights’; about privacy; and about state secrets and freedom of information. Through this transition, capital socialises information in its own way, expropriating the middle class petty proprietors of information - as it has in the past expropriated commons from peasants and local monopolies and jurisdictions from small artisans.18 In the process, it both makes possible the restoration of the old individualism grounded on small property and makes more possible steps beyond “the enslaving subordination of the individual to the division of labour”.

Again, these points reflect the development of capitalism way beyond the point it had reached even in the ‘advanced’ countries in 1875 or 1918 - let alone backward Russia, where the peasantry could be symbolised by the sickle, obsolete in western Europe since the late middle ages.

Is this perspective - beyond meritocracy, beyond privacy, beyond occupational specialisation - genuinely emancipatory? In spite of the intensity with which today’s society valorises occupational specialisation, and therefore the foreignness to modern eyes of the renaissance idea of the ‘universal man’ (l’uomo universale), which descended to Marx as ‘species-being’, it is.

It is not about the restoration of a pre-capitalist world or even - except in a limited sense - of hunter-gatherer ‘primitive communism’, which involved a gendered division of labour. It is not an anarchist perspective, in which human fulfilment comes from solitary choices, but one in which human fulfilment comes from creative individual contributions to a transparently collective social life. It is a truly radical alternative - in a way in which neither dreams of a return to the post-war boom, nor fantasies of the umma,the congregation or the nation, nor the ‘difference feminism’ which fetishises motherhood is radical.

And it is now truly posed for us by capitalism’s own development.



1. See, for example, DL Rigby and MJ Webber The golden age illusion: rethinking post-war capitalism New York 1996; CM Reinhart and M Belen Sbrancia, ‘The liquidation of government debt’ (2011): www.imf.org/external/np/seminars/eng/2011/res2/pdf/crbs.pdf.

2. J Hoppit, ‘Financial crises in 18th century England’ Economic History Review No39, pp39-58 (1986) draws the necessary distinction between financial panics driven by wars and similar events, and cyclical crises, and identifies the cycle becoming regular at this period.

3. K Marx Critique of the Gotha programme section 1: “Any distribution whatever of the means of consumption is only a consequence of the distribution of the conditions of production themselves ...” (and the following passage).

4. ‘Even’ unmodified labour time - because this is an a fortiori to us rejecting market rationing: ie, contribution in average socially necessary labour time (money).

5. See, for instance, www.ozy.com/true-story/trailer-park-nation-the-great-eviction/40029.

6. See www.generationrent.org/policies.

7. Eg, “Extending the right to buy is economically illiterate and morally wrong” The Daily Telegraph April 14 2015; ‘Right to buy extension “would hit borrowing and could push landlords to insolvency”’ Inside Housing April 15 2015.

8. The point is argued in forms which should be acceptable to the most Hegelian Marxist in I Mészáros Beyond capital New York 1994.

9. www.marxists.org/archive/marx/works/1867-c1/p3.htm. ‘Comtist’ from Auguste Comte, 1798-1857, social-evolutionist philosopher influenced by the ‘utopian socialist’, Saint-Simon, and founder of the ‘positivist’ doctrine which the Revue positiviste defended.

10. See B Kagarlitsky Empire of the periphery London 2007 and my review of this in Weekly Worker April 1 and 8 2009; see also my polemic with Tony Clark Weekly Worker September 4, 11 and 18 2008.

11. Eg, roads etc: A Cooper Bridges, law and power in medieval England Woodbridge 2006; P Spufford Power and profit: the merchant in medieval Europe London 2006; wind and water mills: SA Walton (ed) Wind and water in the Middle Ages Tempe 2006.

12. Origins of the crisis in the USSR London 1992.

13. Cf my review of I Fraser Hegel, Marx: the concept of need (Edinburgh 1998): ‘Hegelian pitfalls’ Weekly Worker July 31 2003; and also Norman Geras’s (in my opinion unsatisfactory) discussion of Marx’s formula, in ‘The controversy about Marx and justice’ (1989): www.marxists.org/reference/subject/philosophy/works/us/geras.htm.

14. www.marxists.org/archive/marx/works/1871/civil-war-france/drafts/ch01.htm.

15. R Wilkinson The impact of inequality: how to make sick societies healthier (2005 - outline summary at www.nationalestatechurches.org/Wilkinson%20Conf%2006.pdf).

16. Podsheldolkin, ‘The origins of the Stalinist bureaucracy - some new historical facts’; www.revolutionary-history.co.uk/supplem/podsheld.htm.

17. For the use of ‘republican equality’ here, compare P Pettit Republicanism (Oxford 1997), though Pettit’s policy prescriptions are in substance social democratic. Compare also Marx’s comment in ‘Instructions for delegates of the provisional general council’ (1866): “We acknowledge the cooperative movement as one of the transforming forces of the present society based upon class antagonism. Its great merit is to practically show that the present pauperising and despotic system of the subordination of labour to capital can be superseded by the republican and beneficent system of the association of free and equal producers”: www.marxists.org/archive/marx/works/1866/08/instructions.htm.

18. M Macnair, ‘A bridge too far’ Weekly Worker December 18 2003.