The USSR and non-linear capitalism

Sean Matgamna's long article in WL56 adds a lot to our understanding of Tony Cliff's doctrine of state capitalism in the USSR. Far from being the original, or definitive, theory of Stalinist state capitalism, as SWP publicity would have us believe, Cliff's doctrine is a freakish variant having "little in common with other state capitalist theories". It is an incoherent mix of neo-Trotskyist "degenerated workers' state" and "bureaucratic collectivist" ideas.

In asides from his argument, however, Sean also claims that no state-capitalist interpretation of Stalinism is possible. Calling the Stalinist USSR state-capitalist, he declares, is as absurd as calling a marsupial a mammal.

In scientific classification marsupials are mammals! And so are some more apparently unlikely creatures, such as whales. The biological analogy proves nothing, but it does at least suggest that shortcutting the debate by an appeal to supposed sturdy common sense - "just look at this! It can't be capitalist/a mammal!" - is scientifically unsound.

Sean concedes in a footnote that "Trotsky's arguments against 'state capitalism' were never of the formal 'not-enough-market-regulation' type, but always of a concrete and historical type, aiming to show that the Stalinist system is located in history somewhere radically different from capitalism". But then, in the very passage to which that footnote is attached, Sean deploys exactly those same 'not-enough-market-regulation' arguments. "The USSR could not be analysed as a giant 'firm' in the international capitalist market... not a self-regulating, but a 'planned' economy... the idea that [Maoist China] was an economically regulated system, and not one of overwhelming totalitarian state power crazily out of control, cannot be sustained...".

Trotsky considered the Soviet Union certainly a market economy - not a free market economy, of course, but a market economy - only messed up by the Stalinists' delusions about the ability of administrative decrees to replace market mechanisms. He rejected the equation of Stalinism with state-capitalism, not because Stalinism had "not enough market", but (as he wrote in The Revolution Betrayed) because he believed that the USSR's economy was progressive and capitalist statism reactionary.

If we reject the idea that Stalin's more-total statism represented economic progress (as Trotsky himself came close to doing in the course of the 1930s) and if we also reject a picture of capitalism as being at an absolute dead-end economically (as we must), then all Trotsky's arguments against describing the Stalinist USSR as state-capitalist fall to the ground.

Max Shachtman, the finest of the writers working in Trotsky's tradition after Leon Davidovich's death, took a different view. What Trotsky took to be the Stalinists' delusions, Shachtman took to be reality. What Trotsky took to be the hard underlying reality, Shachtman considered a pretence or facade. There was no market in the Soviet Union. Shachtman never argued this issue out, as far as I'm aware, or even mentioned the difference between his view and Trotsky's. But I guess Shachtman's thinking here is connected with the fact that as late as 1961 he was repeating Trotsky's assessment of capitalism as being in hopeless decline. To call the USSR "state-capitalist" would imply the conclusion (impossible in Shachtman's eyes) that capitalism might have a whole new phase of economic advance beyond it. If he called it "bureaucratic collectivist", with the proviso that this was a unique hybrid system, that avoided such implications.

Despite all the later anathemas against Shachtman by the orthodox "neo-Trotskyists", his arguments against state capitalism were reprised almost exactly by the most influential of those orthodox, Ernest Mandel. Via Shachtman, Mandel, and all their colleagues and followers, the idea that capitalism = market, Stalinism = non-market, became fixed in all neo-Trotskyist discourse. But I believe it is false.

There are radical differences between "ordinary" capitalism and Stalinism, but they do not consist in "ordinary" capitalism being market-regulated and Stalinism lacking all regulation beyond political whim. Capitalism is never self-regulating. Sometimes it operates under "overwhelming totalitarian state power crazily out of control" (not just Stalinism, but also the Nazis and many Third World despots) - more often under more moderate state regulation. Alongside that regulation, markets are economic regulators, within limits. Conversely, the Stalinist economies were often extremely resistant to political will. They could not function without markets - extensive "black" and "grey" markets, but also extensive official markets, and extensive use of world markets by the bureaucrats to guide their administrative price-setting.

In the early '30s Stalin's regime seriously talked about replacing wages by state rations. But it never did; and it never snuffed out market forces.

Workers in the USSR and in most other Eastern Bloc countries moved from job to job, seeking the best bargain. Employers bid for the best workers with bonuses and perks, and tried to squeeze productivity out of their workers with piece-rates. When the workers mobilised, wage rises were among their first demands. Often the mobilisation was sparked by price rises, sometimes by uncontrolled inflation. The class struggle between workers and bosses, on both sides, demonstrated that the wage bargain was a real economic factor, not just a formal facade for political allocation of work and of food, clothing and shelter. The Stalinist economies were state-capitalist because they were based on wage-labour. It was wage-labour coupled with extreme political coercion. As Bukharin pointed out in analysing it as a theoretical possibility, "State-capitalist structure of society makes the workers formally bonded to the imperialist state". But as the system developed and matured, the political coercion did not gradually become the dominant form of surplus extraction, with wage-labour more and more vestigial. The opposite happened. The system drifted more and more towards "ordinary" wage-labour. It did that because the wage-labour, and the states that exploited it, were embedded in, and competed within, the capitalist era of world economy.

As the terrible political torsion on the economies of the USSR and Eastern Europe (and to some degree China) has unwound, the economic substructure revealed has been not "collectivist" but capitalist. When the "bureaucratic" twist to supposed "bureaucratic collectivism" unwinds, the spontaneous outcome is not collectivism but capitalism.

Sean might reply that I am ignoring a "transformation of quantity into quality". Even if there is a continuous spectrum from USA-capitalism to USSR-economy, that does not prove that the USSR was capitalism any more than the existence of a continuous spectrum from red to violet proves that violet is red.

But the bedrock difference between "bureaucratic collectivism" and "state capitalism", in the whole long historical debate, remains this: "state capitalist" means capitalist, "bureaucratic collectivist" means something beyond capitalism. By now the evidence is clear. The Eastern Bloc systems were not post-capitalist. It is not true that they were generated because economic development needed state planning, and they satisfied that need albeit in a bureaucratic and bungled way. Heavy state intervention has proved necessary for economic development in less-industrial countries; the totalitarian planning which distinguishes the Stalinist states certainly has not. It has no clear economic advantage over the milder forms of state capitalism which have dominated everywhere else in the less-industrial world. The Stalinist systems also did not represent a highest or ultimate stage of capitalism. They were limited episodes within the epoch of capitalism, and characteristically in underdeveloped countries.

To my mind, a "bureaucratic collectivism" which is deemed not post-capitalist is no "bureaucratic collectivism" at all. "New superior relations of production never replace older ones before the material conditions for their existence have matured in within the framework of the old society... " So wrote Marx in the Preface to the Critique of Political Economy. Certainly we need to avoid summary and mechanical interpretations of this terse phrase. Avoiding mechanical interpretations is one thing.

Quite another is the idea that a "bureaucratic collectivism" can emerge as a whole new mode of production (rather than as a distinctive politico-economic regime of capitalism) from within capitalism, without being post-capitalist - without representing a qualitative step forward from capitalism for at least the decisive social classes involved. A whole new mode of production does not spring up - least of all out of capitalism, the most dynamic, flexible, adaptable and mutable mode of production yet in history, in the period of its greatest flowering - just because this or that political group desires it.

To put a label ("bureaucratic collectivist") on the Stalinist bureaucracies' clashes with private capitalism does not clarify the contrast, but only restates it. (Why do they clash with private capitalism? Because they are bureaucratic-collectivist. Why are they bureaucratic-collectivist? Because they clash with private capitalism. The argument is circular.) Moreover the "bureaucratic collectivist" designation can seem to clarify the contrast between Stalinist economies and "ordinary" capitalism only for those who confine their analysis to the two polar cases typified by the USA and the USSR, and leave most modern economies in a comfortable blur.

If the state economies of the Eastern Bloc were anti-capitalist, then inescapably the state sectors of Mexico, Algeria, Iraq, and many other countries were too; and their state bureaucracies were anti-capitalist ("bureaucratic collectivist") classes. Even in Mexico, the "bureaucratic collectivist" class (if that is what it is) was visibly more powerful than the private capitalist class. Analyses, incontrovertible in their own terms, have been written to show that pre-1982 Mexico, or Israel in the era of solid Labour/Histadrut domination, were "bureaucratic collectivist". The foremost writer of the "bureaucratic collectivist" current, Hal Draper, arrived, as is well known, at the idea that not only Stalinism but also social democracy and all other forms of non-Marxian socialism were incipiently bureaucratic-collectivist ("socialism from above"). The world shows not "bureaucratic collectivism" on one side, and "capitalism" on the other, but a spectrum of different mixes between "bureaucratic collectivism" and capitalism.

The USSR was not very much like the USA. But if we define capitalism as "like the [modern] USA", then even disregarding Stalinism we will have to recognise that the 500 years of the capitalist era have included many forms of quasi-capitalism that certainly fall within that era but have not been much "like the USA" (capitalism in colonial and ex-colonial countries, for example). We will need a new word X for "capitalism or quasi-capitalism" or "a variable mix of bureaucratic collectivism and capitalism". The problem of analysing the specificity of the Stalinist states (precisely what sort of X were they? What is its historical relation to other forms of X?) is not clarified, but obscured, by adopting the label "bureaucratic collectivism".

Set aside the labels and look at the historic facts. The conflicts of the Stalinist or "statist" political autocracies with private capitalists in the less-industrialised countries have been not anti-capitalist but nationalist. The state bureaucracies in less-industrialised economies have originated from the petty bourgeoisie, and generally from more or less closely-knit military formations drawn from the petty bourgeoisie. Those petty bourgeois rebelled against the parasitism, corruption and dependence of the old oligarchies or colonial administrations in their countries. They wanted national development. They made bourgeois revolutions or semi-revolutions against the bourgeois oligarchies and their allies, feudalistic landowners and colonial rulers. Depending how tightly-knit and ideologically coherent their organisation was, they pushed the old oligarchies aside, reduced them to second rank, or crushed them.

The petty bourgeois revolutionaries or reformers mobilised on the basis of bourgeois measures like land reform and national independence. But they did not want bourgeois democracy and free enterprise, which will allow the old oligarchs and imperialists still to hold considerable sway. In all cases they created powerful interventionist states; where they were vigorous, fervent, mass-mobilising revolutionaries (revolutionary Stalinists) they created totalitarian regimes, austerely dedicated to national industrial development, protected by military discipline against disruption by individual profiteers or by the working class. In such cases the liberated peasants were re-enslaved, this time to the profit of the State rather than private landowners. Not merely the larger part, but the whole of surplus value was ruthlessly concentrated in the hands of the State and channelled into crash industrialisation. The state sectors developed large-scale national capitalism, not anti-capitalism.

Sometimes the state has consciously worked to foster an indigenous private-capitalist class. Sometimes it has been tightly committed to allowing no competitors, thus cementing many specificities (the elimination of most of the bourgeois civilisation that would normally accompany capitalist development; unmanageable economic biases towards chronic shortages, cycles of over-investment, stifled inflation, inadequate scrapping, and top-heavy industry; and so on). It has never broken out of the historic ambit of capitalism.

Much cited in the debate about the nature of the USSR is the true idea that the development of class societies is more complex than a straight linear sequence - slavery, feudalism, capitalism, socialism. Necessary also, I think, is the equally true idea that the development of capitalism is not just a straight linear sequence. Capitalism can run on different tracks, in parallel, in different sectors of the world; it can back-track; it can develop in "inorganic" forms. In the era of "classical Marxism", before Stalinism, Marxists were not afraid to discuss different forms of capitalism (monopoly capitalism, finance capitalism, imperialism, state capitalism...) With Stalinism, all that discussion came to a dead halt. The standard Marxist scheme remains "competitive capitalism - monopoly capitalism - socialism". Even the early theorists of state-capitalism in the USSR remained trapped by that scheme, feeling that they had to "locate" the USSR at the most-monopolised (most-advanced) end of the "monopoly-capitalist" section of the sequence.

Even if you set all the Stalinist states aside, not all capitalist societies can be located along that linear sequence. We need a more complex, multi-track picture of the development of capitalism - and that, I think, can provide the understanding of the specificity of Stalinism ("capitalism without bourgeois civilisation", you might call it) which "bureaucratic collectivism", for all its verbal extremism, cannot give. There are serious, probably irreparable, difficulties with the one sustained attempt made so far by Marxist writers to develop a "multi-track" understanding of capitalism, the Regulation School of Michel Aglietta, Alain Lipietz, Robert Boyer, Bernard Chavance and others. It is highly significant, however, I think, that the attempt alone has led all these writers to categorise the Stalinist states either as capitalist or as some sort of quasi-capitalism, and has produced such rich and detailed analyses of the specific economic patterns of Stalinist economy (very different from those of Western capitalism) as Jacques Sapir's Economic Fluctuations in the USSR.