"History knows transformations of all sorts." (Lenin)
The question of the class nature of Russia has been a central issue in the Marxist movement for decades. Now, with the collapse of the USSR and the movement in the direction of capitalism, this question assumes an even greater importance. How we approach this problem will be vital not only for training our cadres, but for our general work in the labour movement, and, at a later stage, for the building of a Marxist tendency in Russia.
It is not possible to grasp the processes that are taking place in Russia from the point of view of formal logic and abstract definitions. Only the dialectical method, which takes the process as a whole and con cretely analyses its contradictory tendencies as they un fold, stage by stage, can shed light on the situation. In elementary chemistry, a simple litmus test is sufficient to reveal whether a substance is acid or alkaline. But complex historical processes do not admit such a simple approach.
The demand for an immediate answer to the question "workers' state or capitalism" seems to have the virtue of clear definition and even political firmness. Alas! in nature, as in society, the attempt to impose a "final solution" when dealing with unfinished processes is the source, not of clarity, but of endless confusion and mistakes. When it is a question of transitional formations, demands for a black and white, "eitherÉor" solution re veal, not intellectual rigour, but only a formalistic frame of mind which, in its haste to "solve" a problem by applying an external definition in a thoughtless fashion, does not deal with the real processes at all.
Nor are formal analogies much use here. What is taking place in Russia has no real precedent in his tory since the fall of the Roman empire. If the movement towards capitalism is finally accomplished, it would signify the destruction of all the gains of the October Revolution. This did not occur, for example, with the French Revolution, where the gains of the Jacobean-plebeian movement were liquidated by the Thermidorian reaction in 1794. Thereafter, the movement in the direction of reaction went very far&emdash;from Thermidor to the Directorate, Bonapartism, the restoration of the Empire and a new aristocracy, and even the restoration of the Bourbon monarchy on English and Prussian bayonets after 1815. Yet through all these changes, the basic socio-economic gains of the Revolution of 1789-93 remained intact. The fundamental question was the new property relations raised on the foundation of the breaking up of the big feudal estates and the establishment of a mass of small peasant proprietors.
Likewise, the political counterrevolution carried out by the Stalinist bureaucracy in Russia completely liquidated the regime of workers' soviet democracy, but did not destroy the new property relations established by the October Revolution. The ruling bureaucracy based itself on the nationalised, planned economy and played a relatively progressive role in develop ing the productive forces, although at three times the cost of capitalism, with tremendous waste, corruption and mismanagement, as Trotsky pointed out even before the War when the economy was advancing at 20% a year.
The problem which we now face was also faced by Trotsky in the 1920s and 30s, when he had the task of analysing the phenomenon of Stalinism. For certain ultra lefts, the problem was a simple one. The Soviet Union, in their opinion, was already a new class society as early as 1920. All further analysis was therefore superfluous! There was a fundamental difference between this formalism and the careful dialectical method of Trotsky. He painstakingly traced the process of the Stalinist counterrevolution through all its stages, laying bare all its contradictions, analysing the conflicting tendencies both within Soviet society and within the bureaucracy itself, and showing the dialectical interrelation between developments in the USSR and on a world scale.
Here is how Trotsky describes his own method of analysis:
"To define the Soviet regime as a transitional, or intermediate, means to abandon such finished social categories as capitalism (and therewith 'state capitalism') and also socialism. But besides being completely inadequate in itself, such a definition is capable of producing the mistaken idea that from the present Soviet regime only a transition to socialism is possible. In reality a backslide to capitalism is wholly possible. A more complete definition will of necessity be complicated and ponderous.
"The Soviet Union is a contradictory society halfway between capitalism and socialism, in which: (a) the pro ductive forces are still far from adequate to give the state property a socialist character; (b) the tendency toward primitive accumulation created by want breaks out through innumerable pores of the planned economy; (c) norms of distribution preserving a bourgeois character lie at the basis of a new differentiation of society; (d) the economic growth, while slowly bettering the situation of the toilers, promotes a swift formation of privileged strata; (e) exploiting the social antagonisms, a bureaucracy has converted itself into an uncontrolled caste alien to socialism; (f) the social revolution, betrayed by the ruling party, still exists in property relations and in the consciousness of the toiling masses; (g) a further development of the accumulating contradictions can as well lead to socialism as back to capitalism; (h) on the road to capitalism the counterrevolution would have to break the resistance of the workers; on the road to socialism the workers would have to overthrow the bureaucracy. In the last analysis, the question will be decided by a struggle of living social forces, both on the national and the world arena.
"Doctrinaires will doubtless not be satisfied with this hypothetical definition. They would like categorical formulae: yes&emdash;yes, and no&emdash;no. Sociological problems would be certainly simpler, if social phenomena had always a finished character. There is nothing more dangerous, however, than to throw out of reality, for the sake of logical completeness, elements which today violate your scheme and tomorrow may wholly overturn it. In our analysis, we above all avoided doing violence to dynamical social formations which have no precedent and have no analogies. The scientific task, as well as the political, is not to give a finished definition to an unfinished process, but to follow all its stages, separate its progressive from its reactionary tendencies, expose their mutual relations, foresee possible variants of development, and find in this foresight a basis for action." (Leon Trotsky, The Revolution Betrayed, pp. 254-56.)
The problem of the class nature of the Soviet Union oc cupied Trotsky's attention right up to his death. In In Defence of Marxism, he outlines the way in which a Marxist would pose the question of the class nature of the Russian state:
"(1) What is the historical origin of the USSR? (2) What changes has this state suffered during its existence? (3) Did these changes pass from the quantitative stage to the qualitative? That is, did they create a historically necessary domination by a new exploiting class?" (p.68)
Right to the end, he was always extremely conditional on the question of the future evolution of the USSR, while maintaining a principled position on the defence of the Soviet Union in the War. He did not expect the Stalinist regime to last as long as it did. True, in his last work Stalin, he did suggest that the regime might last for decades in its present form, but the book was unfinished at the time of his assassination, and he was unable to develop this idea further.
It was left to the Marxists to develop and extend Trotsky's analysis of proletarian Bonapartism after the War, particularly in Ted Grant's The Marxist Theory of the State, the Reply to David James, and later on, the documents on the Colonial Revolution. What defines the class nature of the state from a Marxist point of view is undoubtedly property relations. However, here too, the relation is not automatic, but dialectical. The state is not the direct expression of the ruling class&emdash;whether it is the bourgeoisie or the working class. Under certain conditions, the ruling clique can manoeuvre between the classes and eliminate the existing property relations. This was the case with the army caste in Syria, Burma, Ethiopia, Afghanistan, as only our tendency was able to explain. Now in Russia and Eastern Europe we have a peculiar variant of the same process, but in reverse.
This unusual variant of Bonapartism can only be explained by the fact that the state has raised itself above society. Trotsky predicted that the bureaucracy, particularly its upper layers, would inevitably seek to guarantee its power and privileges by transforming itself into a ruling class. Within a particular historical concatenation of circumstances, the pro-bourgeois wing of the bureaucracy has, for the time being, gained the upper hand. Leaning on world imperialism and the nascent bourgeoisie&emdash;the millions of crooks, spivs, and black marketeers, who already existed in the pores of Soviet society&emdash;they have already gone a long way in this direction, without provoking a civil war. This is a peculiar mechanism for the carrying out of the counterrevolution. But it is no more peculiar than the "workers state" from which it arose, or the peculiar way in which the regimes of proletarian Bonapartism established themselves in Eastern Europe, Syria or Ethiopia.
Up to the present time, the bourgeois wing of the bureaucracy has partially succeeded in carrying out the counterrevolution in a "cold" way. Partially, but not entirely. The process is not complete. On the basis of the frightful economic and social collapse, not only the working class, but a section of the bureaucracy is beginning to swing the other way. It is possible that this process could lead eventually to civil war. This perspec tive partly depends on which way the officer caste will jump. It is quite likely that the decisive section of the officers will move in the direction of proletarian Bonapartism which, after all, guaranteed their privileges much better that the present regime.
In Eastern Europe, the old regime collapsed without a whimper. In the same way, under certain con ditions, it is possible that the bourgeois regime could collapse when confronted with a massive movement of the work ing class which draws behind it a big section of the petit-bourgeoisie. History indeed knows all kinds of transformations! Of course, we have the classical models of revolution and counterrevolution which are famil iar to every schoolboy who has read a bit of Lenin. But there are many other variants known to history. In the 19th century, the transition from feudalism to capital ism in Japan was accomplished through the mechanism of the bureaucracy, which, under a peculiar set of cir cum stances, shifted from one class basis to another without a revolution or civil war. Of course, the transition to capitalism was not a "pure" one&emdash;there were many ele ments of feudalism in it, which were only eliminated (in another peculiar variant) by the US occupying forces after 1945, under the pressure of the Chinese revolution. All these events further illustrate the enormous complexity of the question of the state.
When considering the development of society, economics must be considered the dominant factor. The superstructure which develops on this economic base separates itself from the base and becomes antagonistic to it. The essence of the Marxist theory of revolution is that with the gradual changes in production under the embryo of the old form, i.e. superstructure and re-organising society on the base of the new mode of production which has developed within the old. Economy is ultimately decisive. Because of this, as all the Marxist teachers were at pains to explain, in the long run the superstructure must come into correspondence with it. Once we abandon the criterion of the basic economic structure of society, all sorts of superficial and arbitrary constructions are possible. However, the bare affirmation that, in the last analysis, the class nature of the state is decided by property relations is insufficient.
The state can be defined in various ways. One of the most common ways for Marxists to do so is by referring to the state as "armed bodies of men in defence of private property." In the last analysis, all forms of state are reduced to this. But in practice, the state is much more than the army and the police. The modern state, even under capitalism, is a bureaucratic monster, an army of functionaries absorbing a huge amount of the surplus value produced by the working class. From that point of view, there is a germ of truth in the arguments of the monetarists, whose demand for cutting down the state is a modern echo of the demand of the 19th century Liberals for "cheap government." Of course, as Marx explains in The Civil War in France, the only way to get "cheap government" is by the revolutionary abolition of the bourgeois state, and the setting up of a workers' state, or semi-state, like the Paris Commune.
The Marxist theory of the State
Marx, Engels and Lenin all explained that the state is a special power, standing above society and in creasingly alienating itself from it. As a general proposition, we can accept that every state reflects the interest of a particular ruling class. But this observation does not at all exhaust the question of the specific role of the state in society. In reality, the state bureaucracy has its own interests, which do not necessarily and at all times correspond to those of the ruling class, and may even come into open collision with the latter.
According to Marxists, the state arises as the necessary instrument for the oppression of one class by another class. The state in the last analysis, as explained by Marx and Lenin, consists of armed bodies of men and their appendages. That is the essence of the Marxist definition. However, one must be careful in using their broad Marxist generalisations, which are undoubtedly correct, in an absolute sense. Truth is always concrete but if one does not analyse the particular ramifications and concrete circumstances, one must inevitably fall into abstractions and errors. Look at the cautious way in which Engels deals with the question, even when generalising. In The Origins of the Family, Private Property and the State, Engels writes:
"But in order that these antagonisms, classes with con flicting economic interests, shall not consume them selves and society in fruitless struggle, a power, apparently standing above society, has become necessary to moderate the conflict and keep it within the bounds of 'order,' and this power, arisen out of society, but placing itself above it and increasingly alienating it self from it, is the State." (The Origins of the Family, p. 194.)
On the next page he adds:
"Éit is enough to look at Europe today, where class struggle and rivalry in conquest have brought the public power to a pitch where it threatens to devour the whole of society and even the state itself."
Engels goes on to show that once having arisen, the state within certain limits, develops an independent movement of its own and must necessarily do so under given conditions: "In possession of the public power and the right of taxation, the officials now present themselves as organs of society standing above society." (Emphasis in original.)
"As the state arose from the need to keep class antagonisms in check, but also arose in the thick of the fight between the classes, it is normally the state of the most powerful, economically ruling class, which by its means becomes also the political ruling class, and so acquires new means of holding down and exploiting the oppressed classÉ Exceptional periods, however, occur when the warring classes are so nearly equal in forces that the state power, as apparent mediator, acquires for the moment a certain independence in relation to bothÉ" (p.196, our emphasis.)
Again, on page 201, Engels says that:
"The central link in civilised society is the state, which in all typical periods (our emphasis) is without exception the state of the ruling class, and in all cases con tinues to be essentially a machine for holding down the oppressed, exploited classÉ"
Note the extremely careful, scientific way in which Engels expresses himself. "In all typical periods," "it is normally the state of the most powerful, economically ruling class," etc. Engels clearly understood that there were untypical and abnormal situations in which this general principle of Marxist theory could not be applied. This dialectical approach to the question of the state was developed by Marx in The 18th Brumaire of Louis Bonaparte, where he explains the phenomenon of Bonapartism, in which the relationship between the state and the ruling class does not correspond to the norm. Marx pointed out how the drunken soldiery of Louis Napoleon, in the name of "the law, order and the family," shot down the bourgeoisie whom they presumably represented. Were the bourgeoisie under Louis Napoleon the ruling class? It does not require a profound knowledge of Marxism to answer this question.
The bare generalisation "armed bodies of men" does not take into account either bourgeois or proletarian Bonapartism. If we take the history of modern society, we get many examples where the bourgeoisie is expropriated politically and yet remains the ruling class. Trotsky describes the regime of Bonapartism, or as Marx calls it, "naked rule by the sword over society."
In China after Chiang Kai Shek had crushed the Shanghai working class with the aid of the dregs of the Shanghai gangs, the bankers wished to give him banquets and applauded him as the benefactor and saviour of civilisation. But Chiang wanted something more material than the praise of his masters. Unceremoniously, he clapped all the rich industrialists and bankers of Shanghai in jail and extracted a ransom of millions before he would release them. He had done the job for them and now demanded the price. He had not crushed the Shanghai workers for the benefit of the capitalists, but for what it meant in power and income for him and his gang of thugs. Yet who will presume to say that the bankers who were in jail were not still the ruling class though they did not hold political power? The Chinese bourgeoisie must have reflected sadly on the complexity of a society where a good portion of the loot in the surplus value extracted from the workers had to go to their own watchdogs, and where many of their class were languishing in jail.
The bourgeoisie is politically expropriated under such conditions; naked force dominates society. An enormous part of the surplus value is consumed by the top militarists and officials. But it is in the interests of these bureaucrats that the capitalist exploitation of the workers should continue, and therefore while they squeeze as much as they can out of the bourgeoisie, nevertheless, they defend private property. That is why the bourgeoisie continues to be the ruling class.
In In Defence of Marxism, Trotsky outlines the difference between Bonapartism and fascism:
"The element which fascism has in common with the old Bonapartism is that it used the antagonisms of classes in order to give to the state power the greatest independence. But we have always underlined that the old Bonapartism was in a time of an ascending bour geois society, while fascism is a state power of the de clining bourgeois society." (p.227)
A fascist regime, unlike Bonapartism, comes to power on the backs of a mass movement composed of the en raged petit bourgeoisie and lumpenproletariat. Once in power, however, it rapidly loses its mass base and be comes a Bonapartist regime, leaning on the army and the police. Trotsky likens the nazi bureaucracy in Germany to the "Old Man of the Sea" who sits on the shoulders of the bourgeoisie, and, in return for guiding it on the road to safety, at the same time abuses it, spitting on its bald patch and digging his spurs in its sides. Of course, there is no doubt that the class nature of the nazi state was bourgeois. But, on the other hand, the German bourgeoisie lost control of the state, which fell into the hands of Hitler's irresponsible and criminal ad venturers, who used it for their own advantage. The nazis, who defended capitalist property relations, not only robbed the bourgeois and confiscated their property, but also occasionally executed them.
Here the relation between the state and the ruling class is dialectical and contradictory. In fact, by 1943, the in terests of the ruling class in Germany were in open conflict with the state. By that time, Germany had already lost the War. It was in the interests of the ruling class to arrive at a peace with Britain and America, in order to wage war against the Soviet Union. But surrender would have been the death sentence for the nazi clique that controlled the state. The German bourgeoisie tried, and failed, to remove Hitler by a military coup (the "generals' plot"). Hitler fought the war to the bitter end, and Germany paid the price with the loss of its eastern half to Stalinist Russia.
The transitional state after October
The proletariat, according to the classical con cept, smashes the old state machine and proceeds to create a semi-state. Nevertheless, it is forced to utilise the old technicians. But the state, even under the best conditions, say in an advanced country with an educated pro letariat, remains a bourgeois instrument, and because of this the possibility of degeneration is implicit in it. For that reason Marxists insist on the control of the masses, to ensure that the state should not be allowed to develop into an independent force. As speedily as possible, it should be dissolved into society.
It is for the very reasons given above that, under certain conditions, the state gains a certain independence from the base which it originally represented. Engels ex plained that though the superstructure is dependent on the economic base, it nevertheless has an in dependent movement of its own. For quite a lengthy period, there can be a conflict between the state and the class which that state represents. That is why Engels speaks of the state "normally" or in "typical periods" directly representing the ruling class.
It is impossible to pass directly from capitalism to socialism. Even in an advanced society, a transitional period would be necessary in which the state would continue to exist for a time, along with money and the law of value. But, as Marx explains, the working class would not require the kind of monstrous state that exists under capitalism, but a very simple state, a workers' state, which would begin to disappear from the first day. Two months before the seizure of power, Lenin wrote in The State and Revolution:
"The proletariat needs a state&emdash;this all the opportunists can tell you, but they, the opportunists, for get to add that the proletariat needs only a dying state&emdash;that is, a state constructed in such a way that it immediately be gins to die away and cannot help dying away."
The state cannot be abolished, as the anarchists imagine, but will wither away as the need for coercion disappears with the general increase of living standards and culture. That, however, depends on society's ability to satisfy human wants. This, in turn, depends on the level of economic development, and, above all, the productivity of labour ("economy of labour time").
A transitional state inevitably has a contradictory character. The Soviet regime was based on the new property relations that issued from the October Revolution, but still had many elements taken over from the old bourgeois society. The nationalisation of the means of production is the prior condition for moving in the direction of socialism, but the possibility of really carrying society onto a higher stage of human development depends on the level of the productive forces. Socialism presupposes a higher level of technique, labour produc tivity and culture than even the most de veloped capital ist society. It is impossible to build socialism on the basis of backwardness. As Marx expressed it: "where misery is general, all the old 'crap' revives." By the old 'crap' he meant bourgeois norms of distribution, in equality, money, the bourgeois family and that relic of barbarism, the state.
In The Revolution Betrayed, Trotsky explains the dual character of the transitional state:
"The bourgeois norms of distribution, by hastening the growth of material power, ought to serve socialist aims&emdash;but only in the last analysis. The state as sumes directly and from the very beginning a dual character: socialistic, insofar as it defends social property in the means of production; bourgeois, insofar as the distribution of life's goods is carried out with a capitalistic measure of value and all the consequences ensuing there from. Such a contradictory characterisation may horrify the dogmatists and scholastics; we can only offer them our condolences." (p.54)
Only the victory of the revolution in Western Europe, particularly Germany, could have changed this state of affairs. The union of German industry and technique with the huge natural and human resources of Russia in a Socialist Federation would have created the material conditions for the reduction of the working day, the prior condition for the participation of the working class in the running of industry and the state. But the betrayal of the Social democracy shipwrecked the German revolution and doomed the Russian revolution to isolation in a backward country. The victory of the bureaucracy flowed directly from this. As early as 1922, Lenin pointed out that, beneath the thin veneer of soviet democracy, "if you scratch a little, you will find the same old tsarist state which we have taken over and anointed with soviet oil." From 1920 onwards, the bureaucracy legally or illegally absorbed part of the surplus value produced by the working class.
This would be the case to some extent even in a healthy workers' state. The officials and managers would receive part of the surplus value, but they would only be entitled to what Marx called "the wages of superintendence." We would have, to use Lenin's expression, a bourgeois state without the bourgeoisie," or, in Trotsky's expression, a state without Mandarins, a general staff without Samurai. In such a state, the officials would have no special privileges. But given the extremely low level of the productive forces and culture in Russia, the working class was unable to run the state without the aid of the old tsarist officials and army officers who from the beginning demanded, and got, salaries far in excess of the average. Given the isolation of the Revolution in a backward country, this was inevitable. This was the fundamental reason why the proletariat was unable to maintain its hold on power. After the end of the Civil War, the workers were gradually pushed aside by the up start officials who felt themselves to be indispensable to the running of society.
Lenin and Trotsky did not envisage a situation where the Revolution could survive for long in the absence of the victory of the workers of the advanced capitalist countries. They assumed that, under such conditions, the capitalist elements would liquidate the gains of October. This did not take place, although it was possible in the 1920s, particularly in the period of the New Economic Policy (NEP), when the Bolsheviks were compelled to make big concessions to the rich peasants ("kulaks") and the nascent bourgeoisie ("nepmen"). Even before Lenin's death in 1924, a section of the Party leadership, unconsciously reflecting the pressures of alien classes carried the concessions to the kulaks to the point where a bourgeois restoration was a serious danger. A section of the counterrevolutionary émigrés, Ustralyov's Smena Vekh ("Change of Signpost") group, even returned to Russia, in the belief that the Bolsheviks (or a section of them) were becoming trans formed into bourgeois.
Lenin took this danger very seriously, and several times commented that Ustralyov might be right. It was at that time that he pointed out that "history knows transformations of all sorts." He pointed to the existence of contradictory class tendencies within the Soviet state, and affirmed that the decisive question was "Who shall prevail." Shortly before his last illness, he concluded a block with Trotsky to fight against the Bureaucracy, which he feared was creating the conditions for the victory of open bourgeois counterrevolution.
On January 1921, Lenin wrote:
"I stated, 'our state is in reality not a workers' state but a workers' and peasants' state.' É On reading the report of the discussion, I now see that I was wrong É I should have said: 'The workers' state is an abstraction. In reality we have a workers' state with the following peculiar features, (1) it is the peasants and not the workers who predominate in the population and (2) it is a workers' state with bureaucratic deformations.'"
In his last public appearance at a political gathering, the Eleventh Congress of the RCP(B), Lenin had warned that the state machine was escaping from the control of the Communists: "The machine refused to obey the hand that guided it. It was like a car that was going not in the direction the driver desired, but in the direction someone else desired; as if it were being driven by some mysterious lawless hand, God knows whose, perhaps of a profiteer, or of a private capitalist, or of both. Be that as it may, the car is not going quite in the direction the man at the wheel imagines, and often it goes in an alto gether different directionÉ
"If we take Moscow with its 4,700 Communists in responsible positions, and if we take that huge bureaucratic machine, that gigantic heap, we must ask: who is directing whom? I doubt very much whether it can truthfully be said that the Communists are directing that heap. To tell the truth, they are not directing, they are being directed." (Lenin, Collected Works, Vol. 33, pp. 279 and 288.)
As we have seen, Marx explains how, under certain conditions, the state can acquire a considerable degree of independence, as under a Bonapartist regime. It would be foolish to imagine that such a phenomenon could not, under certain conditions, occur even in a workers' state. The working class is not a "Sacred Cow" which possesses miraculous powers to make it immune against degeneration.
Endless mistakes occur when we attempt to base ourselves on chemically pure abstractions instead of real historical processes. Thus, we know what a trade union and a workers' party is supposed to look like. But history knows of all kinds of weird and wonderful variants, of the most monstrously bureaucratised trade unions and corrupt reformist parties. A workers' state is roughly like a trade union in power. Under conditions of extreme backwardness, such a state can experience a process of bureaucratic degeneration. Stalinism, as Trotsky explains, is a peculiar variant of Bonapartism&emdash;a regime of proletarian Bonapartism.
It is not uncommon to hear even experienced Marxists refer to the Soviet Union, China and Eastern Europe as "workers' states." This is an unforgivable misuse of Marxist terminology. As early as 1920, as we have seen, Lenin gave Bukharin a rap over the knuckles for referring to Russia as a "workers' state." He insisted that it was necessary to add "with bureaucratic deformations." Of course at that time these were comparatively mild deformations. Russia was a relatively healthy workers' state then. There is no compari son with the ghastly bureaucratic-totalitarian monster that emerged under Stalin. Suffice it to recall Trotsky's remark that, if you leave aside the nationalised planned economy, then the state in Stalin's Russia could only be compared to a fascist state. To describe that monster as a "workers' state" is simply an abomination.
The bureaucracy is not a "Thing-in-itself." It exists in a given society, and can reflect different class interests. In the 1920s, there was a section of the bureaucracy that stood close to the kulaks and nepmen and was in favour of capitalist restoration. The spokesman of this trend was one of the Old Bolshevik leaders, Bukharin. Of course, he did not consciously aspire to restore the old regime. But unconsciously, he was reflecting the pressures of the bourgeois elements. On the other hand, Trotsky and the Left Opposition stood con sciously for the defence of the interests of the proletariat. Stalin, who had no real idea where he was going, balanced between the different wings, but represented the millions of officials in the state, industry and Party, who were seeking to enlarge their own power and privileges.
In his important last work, Stalin, Trotsky provides a profoundly scientific analysis of the struggle between the bureaucracy and the nascent bourgeoisie in the pe riod 1924-9. These lines, unfortunately not sufficiently known to Marxists, shed a lot of light on the struggle that is now unfolding before our eyes in Russia:
"The kulak, jointly with the petty industrialist, worked for the complete restoration of capitalism. Thus opened the irreconcilable struggle over the surplus product of national labour. Who will dispose of it in the nearest future&emdash;the new bourgeoisie or the Soviet bureaucracy?&emdash;that became the next issue. He who dis poses of the surplus product has the power of the state at his dis posal. It was this that opened the struggle between the petty-bourgeoisie, which had helped the bu reaucracy to crush the resistance of the labouring masses and of their spokesman the Left Opposition, and the Thermidorian bureaucracy itself, which had helped the petty-bour geoisie to lord it over the agrarian masses. It was a direct struggle for power and for income.
"Obviously the bureaucracy did not rout the proletarian vanguard, pull free from the complications of the international revolution, and legitimise the philosophy of inequality in order to capitulate before the bourgeoisie, become the latter's servant, and be eventually itself pulled away from the state feed-bag." (Stalin, p.397.)
Here we have, in a few words, a marvellously precise account of the class basis of the struggle between different layers of the bureaucracy. The conflict consists of the struggle for the expropriation of the surplus value, which, in turn, gives to whoever possesses it control of the state. The difference between the bureaucracy and the nascent bourgeoisie can thus be reduced to two different ways of appropriating the surplus value. But this is not a secondary question. The bourgeoisie directly appropriates surplus value on the basis of private ownership of the means of production. The bureaucracy derives its power, income and privileges from state ownership. Indeed, the only progressive function it played was in defending state ownership, although, as Trotsky pointed out, it defended the USSR far less than it defended its own privileges. Nevertheless the interests of the bureaucracy which depends on the nationalised economy for its position were in conflict with the aspirations and interests of the nascent bourgeoisie.
Despite this, Trotsky was careful to place a question mark over the future of the Soviet state. He did not exclude the possibility at a certain stage that the process of bureaucratic counterrevolution would lead to the over throw of the property relations established by the October Revolution:
"The counter-revolution sets in when the spool of progressive social conquests begins to unwind. There seems no end to this unwinding. Yet some portion of the conquests of the revolution is always preserved. Thus, in spite of monstrous bureaucratic distortions, the class basis of the USSR remains proletarian. But let us bear in mind that the unwinding process has not yet been completed, and the future of Europe and the world during the next few decades has not yet been decided. The Russian Thermidor would have undoubtedly opened a new era of bourgeois rule, if that rule had not proved obsolete throughout the world. At any rate, the struggle against equality and the establishment of very deep social differentiations has so far been unable to eliminate the socialist consciousness of the masses or the nationalisation of the means of production and the land which were the basic socialist conquests of the revolution. Although it derogates these achievements, the bureau cracy has not yet ventured to resort to the restoration of the private ownership of the means of production." (Stalin, pp.405-6, our emphasis.)
Trotsky did not provide a finished, once-and-for-all anal ysis of the class nature of the Soviet state, but left the question open as to which direction it would finally take. This would be determined by the struggle of living forces, which was in turn inseparably connected with developments on a world scale:
"It is impossible at present to answer finally and irrevocably the question in what direction the economic contradictions and social antagonisms of Soviet society will develop in the course of the next three, five or ten years. The outcome depends upon a struggle of living social forces&emdash;not on a national scale, either, but on an international scale. At every new stage, therefore, a concrete analysis is necessary of actual relations and tendencies in their connection and continual interaction." (The Revolution Betrayed, p. 49.)
Eastern Europe after the War
As Trotsky had tentatively suggested in his last work, the proletarian Bonapartist regime in Russia lasted for decades. This was a result, firstly, of the victory of the USSR in the Second World War, an event which radically changed the correlation of forces on a world scale; secondly, the extension of the revolution to Eastern Europe by Bonapartist means meant the establishment, not of healthy worker' states like that of October 1917, but of monstrously deformed workers' states in the image of Stalin's Moscow.
Trotsky explained that the main danger to the nationalised planned economy was not so much a military defeat as the cheap consumer goods that would arrive in the baggage train of an imperialist army. As it happened, Hitler's armies brought, not cheap commodities, but gas chambers. As a result, not just the working class, but the peasants fought like tigers to defend the Soviet Union. The victory of the USSR in the War was one of the main factors that allowed the Stalinist regime to survive for decades after 1945. To the workers of Russia and the world, it appeared that the bureaucracy was playing a progressive role, not just in defending the planned economy against Hitler, but in extending the nationalised property forms to Eastern Europe, and, later China. In reality, these revolutions began where the Russian Revolution finished&emdash;as monstrously deformed regimes of proletarian Bonapartism. The installation of such regimes, far from weakening the Moscow bureaucracy, enormously strengthened it for a whole historical period.
The peculiar way in which the revolution took place in Eastern Europe was outlined by Ted Grant in a document published at that time:
"In Europe, the victory of Russia in the war and the up surge of the masses following the defeat of German-Italian fascism also developed a tremendous revolution ary wave which threatened to sweep capital ism away over the entire continent. However, the victory of Russia in the war had complex and contradictory conse quences. Temporarily, but nevertheless for an en tire his torical period, Stalinism has been enormously strength ened. Despite the destruction and blood letting to which Russia had been subjected, which left her in an ex hausted and weak state (while Anglo-American impe rial ism had hardly been touched during the war and suf fered negligible losses in resources and manpower, America had reached the apex of her power militarily and eco nomically), because of the mood of the peoples and the relationship of class forces on a world scale, the imperialists were impotent to intervene against Russia.
"Intervention even on a scale following that of World War I was impossible. On the contrary, the allies were forced to swallow the Russian hegemony of Eastern Europe and parts of Asia which they would never have agreed to concede even to reactionary Czarism. The Russian bureaucracy had achieved the domination of the region beyond the wildest dreams of Russia under the Czars.
"The process whereby capitalism was over thrown in Eastern Europe and Stalinism extended, took place in a peculiar way. The vacuum in the state power in Eastern Europe, following the defeat of the Nazis and their Quislings, was filled by the forces of the conquering Red Army. The weak bourgeoisie of these areas had been largely exterminated, absorbed as Quislings to German imperialism or reduced to minor partners of the Nazis during the years of the war. They had been relatively weak in Eastern Europe even before the war, as the states of this region were largely semi-colonies of the great powers on the lines of the South American states. The pre-war regimes suffered from a chronic crisis due to the Balkanisation of the area and the incapacity of the ruling class to solve the problems of even the bourgeois democratic revolution. They were nearly all military police dictatorships of a weak character without any real roots among the masses.
"The victory of Russia during the war un doubtedly provoked an upsurge among the masses either rapidly or in some countries, delayed for a time. The so cialist revolution was on the order of the day. This was dangerous not only for the bourgeoisie but also the Stalinist bu reaucracy. The bureaucracy achieved their aims by skil fully veering between and manipulating the classes in typically Bonapartist fashion. The trick was to form a 'popular front' between the classes and to organise a government of 'national concentration.' However this 'popular front' had a different basis, and different aims in view than the 'popular fronts' of the past.
"In Spain the aim of the 'popular front' was to destroy the powers of the workers and the embryonic workers' state, by destroying the workers' revolution. This was achieved by making an alliance with the bourgeoisie, or rather the shadow of the bourgeoisie, strangling the control which the workers had established in the, factories and the armed workers' militia and re-establishing the capitalist state under the control of the bourgeoisie. As a consequence of this policy towards the end of the war there was a military police dictatorship on both sides of the lines.
"The aim of the coalition with the broken bourgeoisie or its shadow in Eastern Europe had different objectives than that of handing control back to the capitalist class. In previous 'popular fronts' the real power of a state&emdash;armed bodies of men, police and the state apparatus&emdash;was firmly in the hands of the bourgeoisie with the workers' parties as appendages. In Eastern Europe, with one important variation or an other, the real power i.e. control of the armed bodies of men and the state apparatus, was in the hands of the Stalinists. The bourgeoisie occupied the position of appendage without the real power. Why then the coalition? It served as a cover under which a firm state machine on the model of that of Moscow, could be constructed and consolidated.
"The bourgeoisie was utilised by the bureaucracy in order to prevent the workers, awakened by the victory of the Red Army and the events of the war, from achieving the socialist revolution on the lines of October. The bureaucracy played off the bourgeoisie in the name of unity against the working class. They manipulated with Bonapartist manoeuvres the groping as pirations of the workers to establish control of the factories.
"By introducing land reform and expropriating the land lord class, they secured for the time being the support or acquiescence of the peasants. Having consolidated and built up a strong state under their control they then proceeded to the next stage. Mobilising the workers, they turned on the bourgeoisie, whom they no longer required, to balance against the workers and peasants, and step by step they proceeded to their expropriation. The bourgeoisie without the support of outside imperialism was incapable of decisive resistance. A totalitarian regime approximating more and more to the Moscow model has been gradually introduced. After the elimina tion of the bourgeoisie, and the beginning of a large scale industrialisation the bureaucracy has turned against the peasants and started on the road of the collectivisation of agriculture." (Stalinism in the Postwar Period, June 1951.)
The Chinese Revolution
An analogous event occurred when Mao took power in China at the head of a peasant army in 1949. Up to the Russian revolution even Lenin denied the possibility of the victory of the proletarian revolution in a backward country. The revolution of 1944-49 did not proceed on the model of 1917 or of the Chinese revolution of 1925-27. It was a peasant war, which took place be cause of the complete incapacity of the bourgeoisie to carry out the tasks of the bourgeois-demo cratic revolution&emdash;the ending of landlordism, national unification and the expulsion of imperialism&emdash;it ended with victory to the Chinese Stalinists.
Mao, in typical Bonapartist fashion on the ba sis of the peasant army, always an instrument of (bourgeois) Bonapartism in the past, balanced between the classes. Having perfected a state in the image of Moscow, leaning on the workers and peasants, he could snuff out the bourgeoisie painlessly. As Trotsky put it, for a lion you need a gun, for a flea, a fingernail will do! Therefore, having balanced between the bourgeoisie and the workers and peasants in order to prevent the workers from taking power, Mao and his gang&emdash;after perfecting the state&emdash;could then crush the bourgeoisie before turning on the workers and peasants to crush whatever elements of workers' democracy had developed.
The bureaucracy then developed a totalitarian one-party dictatorship, centred round the Bonapartist dictatorship of one single individual&emdash;Mao. But, not for nothing has Marxist theory given the task of achieving the socialist revolution and the transition to socialism to the working class. This is not an arbitrary affirmation. It is a product of the specific role in production of the proletariat which gives it a specific consciousness possessed by no other class. Least of all can the petit-bourgeois peasant develop this consciousness. A revolution based on that class by its very nature would be doomed to degeneration and Bonapartism. It is precisely because a proletarian Bonapartist dictatorship protects the privileges of the elite of state, party, the army, industry and the intellectuals of art and science that it has succeeded in so many backward countries.
The programme of the Chinese Stalinists was not fundamentally different to that of Castro later in Cuba: 50 or 100 years of "national capitalism" and an alliance with the "national bourgeoisie." Hence the be lief of many American bourgeois that they were "agrarian re formers." Only the Marxist tendency in Britain argued against the Stalinists and the alleged "Trotskyist" sects and explained the inevitability of Mao's victory and the establishment of a deformed workers' state. At a time when Mao and the Chinese CP had the programme of capitalism and "national democracy" we could predict the inevitability of proletarian Bonapartism as the next stage in China. This had nothing in common with the methods of the proletarian revolution in Russia in 1917.
Power was gained through the peasant war by giving land to the soldiers in Chiang Kai Shek's army. Then, by balancing between the classes and playing them off against each other in Bonapartist fashion, once military victory was achieved, landlordism and capitalism were expropriated. Nearly all the so-called "Trotskyist" sects latter accepted the accomplished fact. But never before in history had it even been theoretically posed that a peasant war on classical lines could lead to a workers' state, however deformed. The workers in China were passive throughout the civil war for rea sons we will not enter here. But here was a perfect ex ample of one class&emdash;the peasants in the form of the Red Army&emdash;carrying out the tasks of another.
From a Marxist standpoint, it is an aberration to think that such a process is "normal." It can only be explained by the impasse of capitalism in China, the paralysis of imperialism, the existence of a strong de formed Bonapartist state in Stalinist Russia, and most important of all, the delay in the victory in the industrially advance countries of the world. The colonial countries could not wait. The problems were too crushing. There was no way forward on the basis of capitalism. Hence the peculiar aberrations in colonial countries. But the price for this, as in the Soviet Union, would be a sec ond political revolution to put the control of society, industry and the state in the hands of the proletariat. Only thus could the first genuine beginnings of the transition of socialism, or rather steps in that direction, commence.
A similar process occurred later in Cuba, where Castro came to power on the basis of a guerrilla war. The wide support for "socialism" not only among the working class, but among the peasants and wide layers of the petit-bourgeoisie in the cities in colonial countries, was the expression of the complete blind alley of landlordism and capitalism in the colonial world in the modern epoch. It was also a result of the Russian and Chinese revolutions and their achievements in developing industry and the economy. It was this that laid the groundwork for the development of proletarian Bonapartism. In the last analysis, the state can be reduced to armed bodies of men. With the defeat and de struction of the police and army of Chiang Kai Shek, with the destruction of the army of Batista in Cuba, power was in the hands respectively of Mao and Castro. The fact that nominally Mao was a "Communist" and Castro a bourgeois democrat altered nothing.
The rule of the Russian bureaucracy would have been swiftly undermined by the coming to power of the workers along classical lines in these countries. But in Eastern Europe and China, the old bourgeois state was destroyed, and replaced by a regime of proletarian Bonapartism. They began where the Russian Revolution had ended. The establishment of such regimes presented no threat to Moscow. On the con trary, it strengthened the stranglehold of the bureaucracy for a whole period.
Proletarian Bonapartism
The main reason for the survival of the Stalinist regimes for such a long time was the world-wide tendency towards statisation, reflected in the advanced capitalist countries by the continual encroachment of the state even in the period of the post-war up swing. This fact was a striking indication of the limits of private ownership. In all capitalist countries we saw a tendency towards Keynesianism, measures of nationalisation and "state capitalism." Incidentally, together with the huge expansion of world trade, this was one of the factors which enabled them, partially and for a temporary period, to overcome the limitations of the system, achieving results that have no precedent in the history of capitalism.
The tendency towards statisation of the productive forces, which have grown beyond the limits of private ownership, was manifest in the most highly devel oped economies and even in the most reactionary colonial countries. There is no possibility of a consistent, uninterrupted and continuous increase in the productive forces in the countries of the so-called third world on a capitalist basis. Production stagnates or falls. In the colonial world, the national bourgeoisie, having come to power on the backs of the masses, was compelled to carry out measures of nationalisation. Every one of the bourgeois demagogues&emdash;Nasser, Nkrumah, Kenyatta, Nehru, Sukarno, Nyrere&emdash;described themselves as "socialists." This fact is a reflection of the impasse of capitalism in the modern epoch, its inability to solve the problems of society, particularly in the backward economies of Asia, Africa and Latin America.
Marxism finds in the development of the productive forces the key to the development of society. On a capitalist basis there is no longer a way forward, particularly for backward countries. That is why army officers, intellectuals and others, affected by the decay of their societies can under certain conditions switch their allegiance. Allegiance to proletarian Bonapartism actually enlarges their power, prestige, privileges and income. They become the sole commanding and directing stratum of the society, raising themselves even higher over the masses than in the past. Instead of being subservient to the weak, craven and ineffectual bourgeoisie they be come the masters of society.
In capitalist countries in the past, the bourgeoisie had a role to play and looked forward confidently to the fu ture&emdash;i.e. it is genuinely progressive in developing the productive forces. It had decades and generations to perfect the state as an instrument of its own class rule. The army, police, civil service, middle layers and especially all key positions at the top; heads of civil service, heads of departments, police chiefs, the colonels and generals are carefully selected to serve the needs and interests of the ruling class. With a developed economy and a mis sion and a role to play they eagerly serve the "national interest" i.e. the interest of the possessing class&emdash;the ruling class. However, the situation is completely dif ferent in the backward capitalist regimes which emerged from the colonial revolution.
Bonapartist regimes do not rest on air but balance between the classes. In the final analysis they represent whichever is the dominant class in society. The relation of the state to the productive forces in the last analysis determines its class character. Some of these countries, as in Latin America, a semi-colonial conti nent which was under the domination of British then especially American imperialism for the last century, nevertheless, have been nominally independent for more than a century. In consequence, despite a period of turbulence the ruling class of landowners and capitalists has had suffi cient time to perfect their state. Sometimes the armed forces of different fractions or factions of armed forces, can reflect different fractions of the ruling class and even the pressures of imperialism, primarily American imperialism. But, up to now, they have al ways reflected the interest of the ruling class in the defence of private ownership.
The officer caste must reflect the interest of some class or grouping in society. They do not represent themselves though of course they can plunder society and elevate themselves into a ruling caste. As in all the ex-colonial countries, the imperialists (in this case the French) were compelled to relinquish military domination of Syria, partly under the pressure of their rivals, especially American imperialism. The state which emerged was not fixed and static. The weakness and in capacity of the bourgeoisie gave a certain independence to the military caste. Hence the endless military coups and counter-coups. But in the last analysis they reflected the class interests of the ruling class. They could not play an independent role. The struggle between the cliques in the army reflected the instability and contra dictions in the given society. The personal aims of the generals reflected the differing interests of social classes or fractions of classes in society, the petit-bourgeois in its various strata, the bourgeoisie, or even under certain conditions the proletariat.
Burma and Ethiopia
In Burma, the regime had newly emerged from British domination and the ruling class was incapable of suc cessfully holding the country together. Facing a series of rebellions and wars, the army was formed from the Anti-Fascist Peoples Freedom League, which de scribed itself as "socialist." Tired of the incapacity of the landowners and capitalists to solve the problems of Burma, and with China as a model next door, the army leaders, based themselves on the support of the workers and peasants to organise a coup. They expropriated the landowners and capitalists and established Burma as a "Burmese Buddhist Socialist State."
As Marx long ago explained, there is no such thing as a supra-historical blue-print. It is necessary to take the material objective reality as it is and then explain it. That is the method of Marxist philosophy. It is not only necessary to see objective reality as it is, but to explain the process that brought it into being, the contradictions encompassing it, the law of social move ment which it represents and the future processes of contradictions and change which will envelop it. Its process of birth, development, decay and the changes which will destroy it.
The decay of capitalism-landlordism in the colonial countries aggravates all the social contradictions to an extreme. Social tensions reach an unbearable level. Hence in one country after another in Asia, Africa and Latin America, bourgeois democracy is replaced by bourgeois Bonapartist dictatorships or proletarian Bonapartist dictatorships. In the above-named ex-colonial countries not one proceeded on the model of the norm of the socialist revolution. Neither did the countries of Eastern Europe before them in the aftermath of the Second World War.
Under conditions of social crisis people change. This applies to classes and even individuals. Thus Marx explained that with the decay of feudalism a section of the feudal lords, bigger or smaller as the case may be, goes over to the side of the bourgeoisie in the bourgeois revolution. A section of the bourgeoisie, particularly the intellectual bourgeoisie, can also put themselves on the standpoint of the proletariat. No more barren, formalistic, anti-dialectical, philosophically idealist, anti-"Marxist philosophy" idea in the history of the movement has been put forward than by those who ar gue that because Castro began his revolutionary struggle as a bourgeois democrat with bourgeois democratic ideas and goals that therefore he must remain a bourgeois democrat for all eternity. They forget that Marx and Engels themselves began as bourgeois democrats who broke decisively with the bourgeoisie and became leaders of the proletariat.
The crisis of capitalism in Portugal, a semi-colonial country, affected the officer caste. The majority of the officers, sickened by the decades of dictatorship and the seemingly unending wars in Africa which they realised they could not win, moved in the direction of revolution and "socialism." Only our tendency explained this process. This gave an impetus to the movement of the working class, which then reacted in its turn on the army. This affected not only the rank and file, and the lower ranks of the officers, but even some admirals and generals who were sincerely desirous of solving the problems of Portuguese society and the Portuguese people.
This was something that would have been impossible in previous revolutions. The overwhelming majority of the officer caste supported Franco in the Spanish civil war. True enough, because of the reformist and Stalinist betrayal of the Portuguese revolution which prevented it from being carried through to completion, there has been a reaction. The army has been purged and purged again to become a more reliable instrument of the bourgeoisie. This demonstrated the need for a genuine dialec tical understanding and interpretation of the events of the present epoch. If such a trans formation was possible, in a semicolonial but imperialist capitalist Portugal, how much more could similar processes take place in the newly independent countries of Africa and of Asia?
Events in Ethiopia strikingly confirmed the theses we had worked out. There the famine brought about by Haile Selassie and the landlord nobility was the last catastrophe even the officer caste was prepared to toler ate. The callous indifference of the Emperor and the landlord class to the famine and the death from star va tion of hundreds of thousands and possibly even mil lions, plus the accumulated social contradictions in a backward country under the pressure of imperialism, pushed the middle layers of the officer caste to organise a coup.
This in its turn awakened the movement of the small working class in Addis Abbaba and the students and petit-bourgeois layers in the capital and in the towns. It also awakened the peasantry into a cataclysmic move ment to gain control of land. Thus the 1000 year old "empire" and its class structure crumbled to dust. The crisis in the army and the attempts at counter-revolution, the further impetus this gave to the guerrilla war in Eritrea, the guerrilla war in the Ogaden, aided by the direct intervention of Somalia, the uprisings of the Galla and other tribes, all acted as a spur to the revolution.
The movement of the classes in turn had its effect on the new ruling junta in the army. It produced splits and individual and group conspiracies of officers. These reflected the classes in battle in Ethiopia and the developing civil war in the whole country. Whatever the individual whims of the officers, they reflected (as in Syria)&emdash;and had to reflect&emdash;the class struggle taking place. Hardly any wished for a return to the old regime. The model of the Emperor's landlord semi-feudal regime was rejected by the bulk of the officer caste. But there were differences as to how far to go, which ended in armed conflicts and executions. In a distorted way, this reflected the struggle of the classes in Ethiopia. This process ended in the victory of Lieutenant Colonel Mengistu. Already the land had been divided among the peasants and industry nationalised without compensation to the imperialists and the native capitalists (though of course compensation is not necessarily the decisive factor).
In the struggles Lieutenant Colonel Mengistu emerged victorious as a Bonapartist dictator under the influence of the wars and civil wars. In order to obtain mass support Mengistu, formerly a high-up officer of the Emperor, had been forced to go all the way. He had declared himself a "Marxist-Leninist" (probably without reading a single word of Marx or Lenin) and set about creating a one party "Marxist-Leninist" totalitarian dictatorship. This is in the image of Moscow or Peking. The landlords and capitalist were expropriated and the imperialist countries are without real influence on the processes taking place in Ethiopia. In this case the process is clear. It is even clearer than in Mozambique, Angola or the former Aden, and this without a direct struggle against imperialist occupation. The imperialists were too weak and debilitated to intervene directly by military means and could only grind their teeth in impotence.
The coup in Afghanistan in 1979 proceeded along the same lines. Such developments cannot be understood unless the state is approached from a dialectical point of view. The main thing to see is how under certain condi tions the ruling stratum, when faced with a complete social and economic impasse, can shift from one system of class domination to another. Of course, this means only the substitution of one oppressive ruling elite by another. Under no circumstances can such a transition lead to socialism or a healthy workers' state. That would presuppose the active and conscious participation of the masses under the leadership of the working class organised in soviets. Nevertheless, it is not a matter of indifference whether such a movement takes a capitalist or anti-capitalist character. In the absence of a socialist revolution in the West or a classical workers' revolution as in 1917, the regimes of proletarian Bonapartism undoubtedly represented a blow against imperialism, landlordism and capitalism, and as such were welcomed by the Marxists, which nevertheless explained that the working class in these countries would later have to pay the price with a new revolution.
Crisis of proletarian Bonapartism
At a time when the productive forces were experiencing rapid growth in the USSR and China, and capitalism proved incapable of developing the economy in most of the underdeveloped world, especially in the most back ward areas, the attractive power of Russia and China created the conditions for the establishment of regimes of proletarian Bonapartism in Ethiopia, Somalia and Afghanistan, following the earlier examples of Syria and Burma, through the action of the military caste itself.
In Angola and Mozambique, two extremely backward African countries which for decades had waged a guerrilla war against Portuguese imperialism, the coming to power of peasant armies of national liberation under these conditions led to the establishment of proletarian Bonapartist regimes on the model of China and Cuba. This could have meant the collapse of capitalism in the whole African continent, something which could not be accepted by the imperialists. Utilising the services of the apartheid regime of South Africa, the imperialists armed, organised and trained gangs of thieves, scum, and lumpenproletarians in order to wreck and plunder these new deformed workers' states. With the collapse of the Soviet Union, the ruling caste, which had been unable to develop the productive forces as a result of the sabo tage of imperialism, was com pelled to turn again in the direction of capitalism. In Ethiopia, the Mengistu regime suffered a similar fate as a result of its failure to solve the national problem.
Cuba, like Vietnam and North Korea, has so far man aged to survive as a deformed workers state, al though it has been compelled to introduce something like an "NEP" economy which has elements of capital ism, but where the decisive sectors of the economy re main in the hands of the state. Until the fall of the Soviet Union, Cuba was financed and subsided by Moscow. Despite the ferocious blockade imposed by the USA, the regime has been able to maintain itself, partly because of the role of Castro, and also because the masses recognise the enormous gains of the Revolution, which, in part, still remain. Real GDP growth in Cuba resumed in 1994 and rose 2.5% in 1995. The government expects 5% growth in 1996. de spite the US embargo, which has been in force since 1961, trade has improved. Exports began to rise in 1994, growing by 20% in 1995, and are forecast to rise by a further 20% this year. The trade deficit is shrinking.
Very little has been privatised. There are some joint-venture firms, set up with foreign participation, and the government plans to allow 100% foreign-owned companies in special free-trade zones, on the Chinese model. Five years ago, there were almost no capitalist companies investing in Cuba. Now the stock of foreign in vestment has reached $2.1 billion and companies from 50 countries operate there. About 200000 Cubans are self-employed. But, says one report of the strategists of capital: "There are no official plans to set up a stock ex change, so traditional privatisation is still a long way off." (Our emphasis.)
The capitalist counterrevolution succeeded in overthrowing the proletarian bonapartist regimes in Mozambique, Angola, Ethiopia and Afghanistan. Syria and Burma have not yet gone down that road. Nor have the other Asian Stalinist regimes in Vietnam, North Korea, Laos and Cambodia. In Asia, events took a different turn, be cause of the powerful domination of China. Here, the bureaucracy also partially introduced elements of capitalism, but maintaining a firm grip on the state. The Vietnamese bureaucracy has made peace with China, and is attempting to pursue the Chinese model, as is Cuba. However, the fate of all these regimes, including Cuba, will be decided by developments on a world scale, and particularly the destiny of Russia and China.
In order to explain the present evolution of the bureaucracy in Russia, Eastern Europe, China and the other regimes of proletarian Bonapartism, it is first necessary to understand how the latter arose historically. Our tendency explained how proletarian Bonapartism arose out of the impasse of the productive forces on a world scale under capitalism, and the delay of the proletarian revolution in the West. Under these conditions, the crisis of capitalism found its expression in a general tendency towards statisation of the productive forces. Now it seems that the process has been thrown into reverse.
The main reason why the Stalinist regime in Russia lasted so long was, on the one hand, the delay in the proletarian revolution in the West, and, on the other hand, the world-wide tendency towards statisation. Even in the period of the post-war economic upswing in capi talism, this tendency asserted itself in the encroachment of the state in the advanced capitalist countries (Keynesianism, "state capitalism"). During the 1950s and early 1960s, the nationalised planned economy maintained high rates of growth. The bureaucracy felt itself to be a progressive force. Its self-confidence was reflected in Khrushchov's speech at the 22nd Party Congress in 1961, when he boasted that the Soviet Union would overtake the USA in all fields within 20 years. The working class, despite all the crimes of the bureaucracy, was prepared to tolerate it temporarily be cause it was still playing a relatively progressive role in developing the productive forces.
The following factors have had a decisive in fluence on events in Russia and Eastern Europe:
1) The bureaucracy found itself in an impasse and unable to develop the means of production on the old basis.
2) A long period of isolation resulted in the complete decay of the bureaucracy.
3) After decades of Stalinist totalitarianism, the proletariat was disoriented.
4) The temporary passivity of the working class as a result of 3).
5) The delay of the socialist revolution in the West.
6) The historical "accident" of the boom of 1982-90, which created the illusion that capitalism could offer a way out.
7) This gave a temporary access of confidence to the imperialists, who exerted pressure on Gorbachov to move in a capitalist direction.
8) The exhaustion of the model of "state capitalism" in the advanced capitalist countries resulted in a temporary reversal of the tendency towards statisation on a world scale.
9) The absence of an independent movement of the Russian workers, combined with the intense pressure of world imperialism, strengthened the pro-capitalist wing of the bureaucracy, and prevented the emergence of a proletarian wing as anticipated by Trotsky before the war.
10) The relative independence of the proletarian bonapartist state enabled the leading clique around Yeltsin to manoeuvre between the classes and sections of the bureaucracy, initially leaning on world imperial ism, in an attempt to move towards capitalism.
11) In this way, we have a contradictory hybrid situation, in which the bourgeois government of Yeltsin, under the pressure of imperialism, is striving to complete the transition to capitalism.
12) This peculiar process is not yet completed. The result will be decided by the struggle of contradictory forces in Russian society and the state.
13) The result of this will be determined by the class balance of forces in Russia and events on a world scale.
In the period from 1948 to 1975, world capitalism temporarily succeeded in overcoming its central contradictions through the development of world trade, and, to some extent, through measures of "state capitalism." However, as predicted by the Marxists, keynesian policies inevitably led to an explosion of inflation. Partial statisation did not solve the problems and merely created new contradictions. The realisation of this fact has produced a swing in the opposite direction in the past period. This, in turn, is the expression of the fact that the entire post-war model of world capitalism, which for a period gave spectacular results, has ex hausted itself. The attempt to go back to more "normal" methods will produce further convulsions on a world scale. We should remember the effects of the "classical" policies of balanced budgets and "sound finance" in the period between the wars.
In its desperate search for a field of investment, the bourgeoisie resorts to what is, in effect, the looting of the state through the privatisation of the nationalised industries and public utilities. Far from representing a progressive development, this is an expression of the dead end of capitalism. Of course, in the short term, spectacular profits are made by the big monopolies, but only at the cost of further closures, sackings, cuts in living standards and state expenditure, which must mean a further reduction of the market and aggravation of the crisis. The enthusiasm of the bourgeoisie for these policies is proof of the old saying, "whom the gods wish to destroy, they first make mad."
Not content with the results of this policy at home, they seek to inflict it on the whole world. The same search for a field of investment leads them to compel the ex-colonial countries to go down the same road of denationalisation. In the past, the colonial bourgeoisie was able to balance between imperialism and the deformed workers states in Russia and China. Now this is impossible. They are forced to open their markets to predatory imperialism. Their national industries are sold off for a song, not to local capitalists, but to the big multinationals. This will prepare a mighty explosion against capitalism and imperialism in the coming period.
"Every action has an equal and opposite reaction." This law applies not only to physics but to society. The drive towards privatisation will reach its limits. This is already beginning to happen in Britain. At a certain stage, the tendency towards statisation will reassert it self. Nevertheless, for the last ten years or so, the reaction against statisation appeared to give results, coinciding with the boom of 1982 to 90. This had a profound effect on the evolution of Russia and Eastern Europe.
Trotsky always showed the dialectical relationship be tween the rise of Stalinism in Russia and the development of world capitalism. He explained that the Thermidorian reaction in Russia would have led to the restoration of capitalism, if capitalism had not shown itself to be exhausted on a world scale. In the 1930s, the striking successes of the first five-year plans coincided with the greatest slump in the history of capitalism. Although capitalism recovered in the period following the Second World War, achieving annual growth rates of 5 to 6% in the USA and Western Europe, and even more in Japan, the Soviet economy achieved even higher averages&emdash;10 or 11%, without recessions, unemployment or inflation.
Under these circumstances, the regime of proletarian Bonapartism in Russia was able, not only to sur vive, but to consolidate itself. It acted as an important point of reference, together with China, to the masses of the ex-colonial world.
However, for the reasons already outlined, the system of bureaucratically controlled planned economy reached its limits by the mid 1960s. The rate of growth in the USSR declined continually throughout the 1970s. This was also the case with the other more industrialised de formed workers' states of Eastern Europe. Despite its earlier successes, proletarian Bonapartism did not solve the problems of society. In reality, it represented a monstrous historical anomaly, the result of a peculiar historical concatenation of circumstances. The ruthless pressure of imperialism, which did not shirk from using the services of the most barbarous forces in society, brought about the collapse of the proletarian bonapartist regimes in Mozambique, Angola and Afghanistan. The Mengistu regime in Ethiopia foundered on the rock of the national question, the Achilles' heel of all Stalinist regimes throughout his tory.
The situation in China was different. Starting from a more backward basis, the Chinese bureaucracy faced a position far more similar to that of the Stalinist regime in Russia in the 1930s. The difference is shown by the fact that Beijing is developing the productive forces at a far faster rate than any other country in the world. This means that it is still able to play a relatively progres sive role. Although there are important el ements of capitalism, the bureaucracy maintains an iron grip on the state. Paradoxically, this is what makes China such an attractive proposition to foreign in vestors, although that can easily change into its opposite in the coming period.
For the time being, the rapid growth of production is the explanation of the relative stability of the Chinese bureaucracy in contrast to the situation in Russia and Eastern Europe. The ruling elite feels confident in its historic mission. It is motivated, in part of course by the desire to preserve and augment its power, income and privileges, but also by the aim of creating a modern and powerful China (under its control, naturally). The successes of the Beijing regime gives some hope to the rulers of North Korea, Cuba and even per haps Vietnam, where there has been little or no move ment towards capitalism. China remains a point of reference for these regimes. If it were to go towards capitalism, these would also collapse. However, this seems unlikely as long as the "old men" remain in control. In common with all the ex-Stalinists, they are guided by purely empirical considerations. They have taken note of the disaster in Russia, and have no intention of going down that road. As with Russia, the future development of China will be determined by a struggle between the conflicting tendencies.
Crisis of Stalinism
Twenty five years ago Marxists had correctly analysed the reasons for the crisis of Stalinism, and predicted its collapse. Let us also recall the fact that we were the only ones to do so. Every other tendency, from the bourgeois to the Stalinists themselves, took for granted that the apparently monolithic regimes in Russia, China and Eastern Europe would last almost in definitely. As late as 1988, Tony Benn was writing articles praising "socialism" in Hungary. And Benn was not less perspicacious than other reformist or bourgeois commentators.
To this day, the real causes of the crisis of Stalinism are a book closed with seven seals to the bourgeois, reformists and ex-Stalinists, not to speak of the myriad sects on the fringes of the labour movement. Yet they are fully explained in the documents of the Marxists. The apologists of capital, including the reformist labour leaders have seized on the collapse of Stalinism to at tempt to discredit the very idea of a socialist planned economy. One of our prime responsibilities at this historic juncture is to answer these lies and distortions.
In their eagerness to blacken the idea of socialism, the apologists of the "free market" conveniently forget a few details. In 1917, there were only 10 million work ers in the whole tsarist empire, out of a total population of about 150 millions. The majority could neither read nor write. Tsarist Russia was, in fact, far more back ward than India at the present time. Yet, within a few decades, on the basis of a nationalised planned economy, the Soviet Union was transformed from a backward agricultural economy into the second most powerful nation on earth, with a mighty industrial base, with a high cultural level and more scientists than the USA and Japan combined. Even the CIA was compelled to admit that the Soviet space programme in the 1980s was at least ten years in advance of that of the USA.
The material conditions for socialism did not exist in Russia in 1917, though they did exist on a world scale. Lenin and Trotsky never envisaged the Russian Revolution as a self-sufficient act, but as the beginning of the world socialist revolution. But the cowardice of the Social Democratic leaders in Western Europe led to the defeat of the revolution in Germany, Italy and other countries, and the isolation of the Russian Revolution in conditions of appalling back wardness. Under these conditions, the Stalinist political counterrevolution was inevitable. The bureaucratic degeneration of the Russian Revolution did not emerge from some theoretical flaw in Bolshevism, but from crushing backwardness.
Despite the crimes of the bureaucracy, the planned economy produced outstanding results, which transformed the USSR into an advanced industrial nation. The material conditions were created which would now make possible at least the beginnings of a move ment in the direction of socialism, although this process would ultimately have to be finished on a world scale. However, the existence of a monstrous ruling caste, the bureaucracy, not only prevented this, but effectively undermined the planned economy itself.
Only thanks to the regime of nationalised planned economy was the USSR able to defeat Hitler's Germany, with all the combined resources of Europe behind it. This result was not anticipated by Churchill and Roosevelt, who expected Russia to be defeated in a matter of weeks. Despite the crimes of Stalin, who be headed the Red Army in the Purges, the workers of the Soviet Union rallied to defend it. The Second World War in Europe was really a titanic battle between the USSR and Nazi Germany, with Britain and the USA mere spectators. The brilliant victory of Russia in the War was, in itself, the most outstanding confirmation of the superiority of a nationalised planned economy over capitalist anarchy.
This is not the place to repeat in detail the reasons for the collapse of Stalinism, which we have explained in previous documents. The fundamental reasons were already outlined by Trotsky. As early as 1936, he explained that a nationalised planned economy needs democracy as the human body requires oxygen. In a relatively primitive economy, such as that of the Soviet Union in the 1930s, confronted with the relatively simple task of building up heavy industry, the Stalinist bu reaucracy could get results on the basis of what is now referred to as a "command economy." The Soviet economy achieved unprecedented rates of growth, although at a terrible cost.
Even at this stage, the rule of a privileged bureaucratic caste represented colossal waste, mismanagement, bungling, corruption and inefficiency. Marx and Engels explained that a socio-economic system plays an historically progressive role to the degree that it continues to develop the productive forces. Ted Grant pointed out a generation ago that the Stalinist bureaucracy had be come transformed from a relative to an absolute fetter on the growth of the productive forces. As early as the mid 1960s, we published material which showed, on the basis of official Soviet statistics, that anything between 30% and 50% of the production of the USSR was being lost through corruption and mismanagement every year.
The crisis of the bureaucratic-totalitarian system was graphically expressed in the declining rate of growth. In the period of the first five-year plans in the 1930s, there was an astonishing 20% annual rate of growth, which has never been equalled by any capitalist economy, not even Japan which occasionally reached 13% or more in the period of the post-war upswing, but not as a sustained rate of growth. In the same period, the USSR had an annual growth rate of 10% every year, until the mid 1960s, when it began to slow down.
Under Brezhnev, the rate of growth fell steadily, from 10% to 6%, 5%, 1%,É0%. In the last decades, the rul ing clique tried all manner of combina tions involving decentralisation, recentralisation, re-decentralisation. To no avail. "Theoreticians" like Isaac Deutscher imagined that the bureaucracy was going to reform itself out of existence. Vain hope! The privileged ruling caste was prepared to do anything for the working class&emdash;except get off its back! A modern economy producing one million different commodities each year could not be organ ised properly without the conscious control and participation of the majority of society. But the introduction of a regime of workers' democracy would have immediately spelt the end of the power and privileges of the bureaucracy, which they could not accept.
A modern, sophisticated economy, such as Russia had become by this time, is a delicate mechanism. The precise relations between heavy industry, light industry, agriculture, science and technique, cannot be established by arbitrary administrative fiat. In the absence of competition, the only way to avoid colossal bungling and corruption is through the conscious con trol of society, by means of the democratic administration of the work ing class. Thus, for socialism, democracy is not an optional "extra" but a fundamental precondition.
The meaning of Perestroika
By the late 1970s, things had gone so far that there was a black market, not only in blue jeans and ball-point pens, but in steel, coal and oil. This was known in the West as "the parallel market." And woe betide the manager who tried to ignore it! There was a case reported in the Soviet press of the manager of a de partment store, a model member of the Komsomol, who announced to his assembled staff on the first day that he would not tolerate any stealing, corruption or "blatt," and that only the official state prices must be paid for deliveries. Within a week, the store faced bankruptcy. No goods were delivered, and the shelves were empty. The man ager drew the necessary conclusion and fell into line with the accepted practices. There were millions of such examples. Having failed to control the problem by re pression, Gorbachov made a feeble at tempt to lean on the working class to strike blows against corruption by introducing a measure of "democracy." This was the in real meaning of "Perestroika" and "Glasnost." Gorbachov tried to loosen the system up and make it more flexible, but without abolishing the power and privileges of the ruling caste.
When every other tendency was praising Gorbachov as the great Saviour, we alone pointed out that his reform was bound to fail, and characterised him as an accidental petit-bourgeois figure, doomed to be swept away, al though we thought that this would come as a result of political revolution, and not a movement in the direc tion of capitalism which, at that stage, we erroneously considered to be ruled out. The only way to solve the problem was to reintroduce a Leninist regime of work ers' control and management, which would eas ily have been possible on the basis of a developed econ omy that now existed in Russia. But that was the last thing Gorbachov had in mind! Instead of improving things, Gorbachov's reforms introduced a further element of destabilisation, hastening the dissolution of the system. Only two alternatives were possible. In the ab sence of a movement of the working class in the direction of a political revolution, the balance tilted sharply in the direction of a move towards capitalism.
In his famous satire Animal Farm, George Orwell de picts the pigs and farmers in a meeting where it is im possible to distinguish one group from the other. Two generations of bureaucratic rule produced a layer of privileged functionaries utterly divorced from the working class and the ideas of the October Revolution. The old Stalinist officials were corrupt gangsters, but at least had some link with the old tradi tions. Here we had a new generation of aristocrats "born in the purple," used to Pierre Cardin suits and Cadillacs. Raissa Gorbachov was a classical specimen of these creatures. In particular the elite of the diplomatic corps got used to hobnobbing with the bourgeois, and clearly enjoyed the experience. Shevarnadze was typical of this layer. Unlike the old crude and ignorant bureaucrats who could not even speak a foreign language, the new layer were educated, sleek, cosmopolitan&emdash;and with the men tality of petit-bourgeois upstarts which is the hallmark of reformist leaders in their dealings with the big bourgeois, where fear and envy struggle with a secret and slavish admiration.
Nowhere was the rottenness of the bureaucracy more evident than in the period of so-called Perestroika (or Katastroika, as the Soviet workers soon dubbed it). Gorbachov was smart enough to realise that, unless drastic measures were taken by the leadership, the whole thing would seize up. At this point, there is no reason to suppose that he intended to return to capitalism. The pro-capitalist elements in the bureaucracy were almost certainly in a minority at this time. Gorbachov's mea sures were a typical attempt to carry out a bureaucratic reform from the top to prevent revolution from below. Such reforms are not new in the history of Russia, as shown by the Emancipation of the Serfs in 1861. But in every case, the ruling elite tries to preserve its power and privileges, while loosening the bonds of oppression to some degree. Invariably, these attempts only serve to stoke the flames they were intended to extinguish.
It was incredible how anyone with the most el ementary knowledge of Russian history, let alone Marxism, could have entertained the slightest illusion in Gorbachov and his policies. Yet we had so-called Marxists praising Gorbachov, and even travelling to Moscow to witness the strange spectacle of the bureau cracy "abolishing it self"! Of course, other wiseacres, like the SWP in Britain were unimpressed, since, as far as they were concerned, capitalism already existed in Russia, what was all the fuss about? We alone pointed out that Gorbachov could not reform the Soviet Union, because he was acting in the interests of the bureaucracy.
As we predicted in advance, Perestroika ended up in an impasse. Had a genuinely Leninist alternative existed, the road would have been open for a political revolution in the Soviet Union to restore the regime of workers' democracy that existed in 1917. But generations of a monstrous bureaucratic totalitarian caricature of socialism had exercised a baneful influence on the consciousness of all classes in Soviet society. The absence of the subjective factor was decisive. The mass extermination of the 1930s had wiped out not only the Old Bolsheviks, but practically any element which had had some contact with the genuine ideas of October. In the later Purges, even large numbers of Stalinists were killed. In this way, Stalin succeeded far more thor oughly than what could have been anticipated in eradi cating the memory of genuine Bolshevism from the collective consciousness. In so doing, however, as Trotsky had warned, he also undermined the basis of the conquests of the Revolution.
It is an undeniable fact that the consciousness of the Russian masses was thrown back a long way. What has conditioned the whole situation is the fact that, so far, the proletariat has not intervened decisively as an independent force. Of course, this will inevitably change, perhaps sooner than many believe. But to date this has been the determining element in the whole equation. In the absence of a mass independent move ment of the workers, the whole struggle has been fought out between rival wings of the bureaucracy. The blind ally of Perestroika led directly to the attempted coup of 1991. The Stalinist plotters clashed head-on with the resis tance of the nascent Russian bourgeoisie led by Yeltsin, an unscrupulous adventurer, the former protégé of Gorbachov who took advantage of the coup to promote himself as the alleged defender of "democracy."
None of the warring factions appealed to the working class, which in the main remained in the role of specta tors. This was the situation at every major turning-point in the situation for the past four years. The outcome of the 1991 coup was the first such turning-point. Yeltsin succeeded temporarily in stabilising the situation and took decisively to the road of capitalism.
How much privatisation?
The different possibilities for capitalist restora tion in Russia were set forth by Trotsky in The Revolution Betrayed:
"A collapse of the Soviet regime would lead inevitably to the collapse of the planned economy, and thus the abolition of state property. The bond of com pulsion be tween the trusts and the factories within them would fall away. The more successful enterprises would succeed in coming out on the road of independence. They might convert themselves into stock companies, or they might find some other transitional form of property&emdash;one, for example, in which the workers should participate in the profits. The collective farms would disintegrate at the same time and far more easily. The fall of the present bureaucratic dictatorship, if it were not replaced by a new socialist power, would thus mean a return to capi talist relations with a catastrophic decline of industry and culture." (Leon Trotsky, The Revolution Betrayed, pp. 250-51.)
What strikes one is the brilliant way in which Trotsky anticipated the main lines of what is taking place in Russia at the present time. Yet there are also important differences. The class balance of forces in Russia is entirely different now. For example, Trotsky was convinced that the peasantry would be the main social support for capitalist restoration, whereas the opposite is the case. Here again, the reason is that the Stalinist regime survived far longer than Trotsky thought possi ble. The advances made possible by the nationalised planned economy led to the disappearance of the peasantry altogether. The rural population of Russia now consists almost entirely of agricultural proletarians who have no interest in going back to small private plots of land.
It is true that, ultimately, the question of property relations must be decisive in determining the class nature of a state. However, as we have seen, the correlation is not always an automatic one. At decisive turning-points, the way in which a given socio-economic formation will go is decided by a struggle between conflicting class forces. In the process, all kinds of peculiar transitional variants are possible which do not admit an easy appraisal precisely because of their transitional, that is, unfinished, uncompleted character. That the process of capitalist restoration in Russia has begun is self-evident. Indeed, it has gone quite far. But that does not exhaust the matter. At every stage, it is necessary to take stock of the situation. To what extent has the at tempt to move in the direction of capitalism succeeded? Under the pressure of imperialism, the Russian government has privatised a large number of enterprises. Nevertheless, the West remains sceptical. This scepticism is graphically expressed in the absence of serious levels of investment from the West.
This is a hybrid formation, with elements of a bourgeois state grafted onto the old bureaucratic apparatus. But the old Stalinist state remains largely intact. The same old functionaries, with the same interests, outlook and prejudices, sit in the same offices, watching developments, some with expectations, others with growing alarm. It is necessary to underline that this was not a worker' state, but a hideously deformed workers' state&emdash;a regime of proletarian Bonapartism. After generations of totalitarian rule, the privileged elite was completely corrupted. A Bonapartist regime, by its very essence, rises above society and acquires a great deal of independence.
In its upper layers, the bureaucracy reflects the pressures of the nascent bourgeoisie and, above all, world imperialism, the lower layers that of the working class. This contradiction is reflected in the struggle be tween the different factions of the bureaucracy, which sometimes flares up in violent confrontations such as the assault on the White House, and at other times remains more or less submerged, but is visible in the rise and fall of different individuals and groups. That is why the strategists of capital follow with such careful attention all the twists and turns of the obscure power struggle in the Kremlin. It is the outcome of the struggle which will determine the nature of the state. But this cannot easily be predicted in advance. It is determined by a multiplicity of factors, both internal and external. The way in which the Russian state will evolve is not yet decided by history. The bourgeois wing which has gained con trol of the government is striving towards restoration, but they have not yet succeeded in carrying it out. The situation is not fixed, but tremendously volatile. It can move in any direction.
All kinds of claims are being made concerning the de gree to which privatisation has been carried out. It is not always easy to establish the true situation. For example, it is usual to quote the percentage of GDP represented by the "private sector," but, on the one hand, the definition of a "private" company is frequently unclear, including all kinds of co-operatives and other firms that are partly or mainly state owned, and, on the other hand, these percentages are artificially high because of the slump of state owned industries.
The most complete set of figures on privatisation are those published by the annual Transition Report of the European Bank for Reconstruction and Development (EBRD), which is specifically devoted to "measuring and defining" the transition to a "market economy" in Eastern Europe and the countries of the former Soviet Union (FSU). The latest report, published in 1995, includes detailed statistics on all the ma jor indices of the economies of the ex-Stalinist states up to the end of 1994. It makes highly instructive reading.
The share of the private sector of the GDP, as estimated by the EBRD in mid-1995 varies considerably, from 70% in the Czech Republic and 65% in Estonia to 35% in the Ukraine, 30% in Uzbekistan and Moldova, 25% in Azerbaijan and Kazakhstan, and a mere 15% in Belarus, Tajikistan and Turkmenistan. The figure given for the Russian Republic is 55%, but closer scrutiny show that this figure is misleading. In all these states decisive sections of the economy remain in the hands of the state. On the other hand, what passes for "privatisation" is a very peculiar animal in many cases. In order to prevent bankruptcy and closure, the bureaucrats of large enterprises have combined with the workers to "buy" the firm, and the very next day demand subsidies from the state to keep it open. It is not quite clear in practice what the difference is between the situation of such firms before and after privatisation!
The EBRD report distinguishes very carefully between real private ownership ("pure" private sector) and other forms of "privatisation" such as worker-manager buy-outs, which they do not regard as genuinely capitalist concerns. Frequently, these companies, though formally part of the private sector, are still heav ily enmeshed in the state, involving little or no private capital. The fact that this is not just a detail is shown by the fact that the EBRD keeps special tables to show the difference be tween the private sector and the "non-state sector."
Thus, in Russia, the "non-state" sector in 1994 was estimated to account for 62% of GDP, but the real private sector was only 25%. The figures for the Ukraine were even more striking&emdash;the "non-state" sector was put at 41% in 1993, but the real private sector amounted to a mere 7.5% (the 1995 figures were not available, but there is no reason to suppose that the proportion would be much different). In Belarus, where privatisation has hardly advanced at all, the percentage of the workforce employed in the "non-state sector in 1994 was put at 40.2%, but the figure for the real private sector was only 6.2%. The situation in Latvia was very different. Here the non-state sector is mainly com posed of private concerns: the figures of those employed in the non-state sector (58%) differed only slightly from those in the private sector (53%).
The figures for the composition of ownership in Russia published by Earle, Estrin and Leshchenko in 1995 show that, out of 439 industrial firms chosen at random, 110 were owned by the state, 140 were workers' co-operatives, 40 had been taken over by the man agers, and only 35 were owned by private capitalists, either Russian or foreign ("outsiders"), and a further 45 were new enterprises ("de novo"). The state maintained a majority share in 30% of the firms, despite privatisation. Workers and managers hold 51% of the shares in nearly 70% of all privatised companies. The 1995 EBRD report of privatisation in Russia, Hungary, Poland and the Czech Republic concludes that:
"The four countries examined have adopted very different approaches to privatisation, and this has yielded different government structures within the priva tised enterprise sector. Several tentative conclusions, largely confirmed by the evidence presented above, can be drawn about these structures. First, state ownership, with large insider ownership, has remained important in most countries. Second, insider ownership, with dominant employee stakes and reportedly managerial control is extensive in Russia, and to a lesser extent in Poland. Third, outside ownership has emerged on a large scale in the Czech Republic, and to a smaller scale in Hungary, but dominant foreign ownership is more common in Hungary and this is more likely to be concentrated ownership with stronger control rights." (EBRD Report,1995, p.132.)
The thing to see here is the extreme caution with which the strategists of capital approach the situation, which they clearly characterise as a process of transition which has not yet been completed. The picture that emerges is of a hybrid economy in which the capitalist elements are struggling to assert themselves over the state sector, which retains a powerful presence. The process has proceeded in an uneven fashion, being further advanced in the Czech Republic, Hungary and, to some extent Poland, but the situation in Russia, which is the deci sive question, is still far from being resolved in a satisfactory way from the standpoint of international capital.
Successive approximations
There were many turning-points on the road of the bureaucratic counterrevolution in the period 1923-36. This was by no means a preordained event. The final victory of Stalin was not determined in advance. As a matter of fact, up till 1934, Trotsky held the position that it was possible to reform both the Soviet state and the Communist Parties, a position that led to frequent conflicts with the ultra lefts. Trotsky's dialectical method was one of successive approximations, which followed the process through all its stages, showing concretely the relation between the class balance of forces in Russia, the different tendencies in the Communist Party and their relationship to the classes, the evolution of the world situation, the economy, and the subjective factor. It is true that he varied his analy sis at different times. For example, he initially characterised Stalinism as "bureaucratic centrism," a formula which he later rejected in favour of the more precise "proletarian Bonapartism." These changes do not reflect any vacillations on Trotsky's part, but only the way in which his analysis accurately followed the process of bureaucratic degeneration as it unfolded.
The method of our analysis of the present events in Russia is in no way different from that of Trotsky. There is not the slightest doubt that the movement to wards capitalism in Russia not only ex ists, but has gone quite far. However, from the stand point of Marxist analysis, this does not exhaust the problem. The question is: has the process of capitalist restoration reached the decisive point where quantity be comes transformed into quality? Put another way: do we consider that the new property relations have established themselves unequivocally, in such a way that the process is irreversible? Or, on the contrary, is it possible that the movement towards capitalism can be reversed? Upon the answer to this question many things hinge. It is there fore necessary to approach the question very carefully indeed. To determine the class nature of the Russian state it is not sufficient to refer to the percent age of the economy in private hands. It is necessary to analyse the process as a whole, to lay bare the relation between the different class forces involved, and show how the central contradiction is likely to be resolved.
It is possible to have a workers' state with 100% pri vate ownership of the means of production, and also to have a bourgeois state with 100% state ownership. The former was the case with the Paris Commune. The first workers' state in history did not even nationalise the Bank of France, an omission which, as Marx explained, was one of its most serious errors. Even in the first phase of the Russian Revolution, the Bolsheviks did not proceed immediately to nationalise industry. There was workers' control through the Soviets, but for about 18 months most of industry remained formally in private hands.
The same contradiction would have existed if the capitalist counterrevolution had overthrown the Soviet power. Incidentally, this was a real possibility for a decade after October. Only the correct policies of Lenin and Trotsky prevented it. If Bukharin's position had tri umphed, there could have been a capitalist restora tion even in the 1920s. This fact is sufficient, on the one hand, to show how the historical process is not at all automatic or predestined, as economic determinists imagine, and on the other hand reveals the decisive role of the subjective factor.
To put the question more clearly still, if Hitler had succeeded in defeating the Soviet Union, what would have happened? The victors would have imposed a fascist regime in the USSR, with a programme of the most savage capitalist counterrevolution. But they could not succeed in carrying this out all at once. They would have to proceed gradually, Trotsky predicted, beginning with agriculture, then light industry, and finally denationalising the decisive sector of heavy industry. Even then, it was likely that a big proportion of heavy industry would remain in the hands of the state, which, despite this, would be a bourgeois state from start to finish.
These examples are sufficient to demonstrate the correctness of the general proposition that, in order to determine the class nature of a state, it is not enough merely to publish the statistics of ownership. It is also necessary to determine the direction in which society is moving, and, in Lenin's phrase, to say "who shall prevail?" In our view, it is not yet possible to give a definitive answer to these questions.
Dealing with the mechanics of a bourgeois counterrevolution in Russia, Trotsky explains:
"Bourgeois society has in the course of its his tory displaced many political regimes and bureaucratic castes, without changing its social foundations. It has preserved itself against the restoration of feudal and guild relations by the superiority of its productive methods. The state power has been able either to co-operate with capitalist development, or to put brakes on it. But in general the productive forces, upon a basis of private property and competition, have been working out their own destiny. In contrast to this, the property relations which issued from the socialist revolution are indivisibly bound up with the new state as their repository. The predominance of socialist over petty bourgeois tendencies is guaranteed, not by the automatism of the economy&emdash;we are still far from that&emdash;but by political measures taken by the dictatorship. The character of the economy as a whole thus depends upon the character of the state power." (The Revolution Betrayed, p. 250, our empha sis.)
We have a duty to say what the class nature of the Russian state is. But this must be approached from a dialectical, not a formal point of view. Here too we are dealing with a process that is not yet finished, and there fore it is impermissible to demand a finished, once and for all definition. It is necessary to see the process as a whole, and to determine at what point the decisive break occurs.
In the historical examples already mentioned, the answer is quite clear. When the workers of Paris smashed the old state apparatus, they took political power into their hands and began the task of transforming society. Had the Commune not been overthrown by the Versaillese reaction, it would have inevitably moved to expropriate the capitalists. The contradiction between a workers' state and an economy in the hands of the exploiters had to be resolved one way or another. In France it was resolved when the bourgeois joined hand with monarchist reaction to crush the Commune. In Russia, the Bolsheviks used state power to carry out the expropriation of the landlords and capitalists.
The same decisive break could be seen in the opposite process. The victory of Hitler over the Soviet Union would have been the result of a terrible military defeat. The victorious fascists would have destroyed the old state apparatus and replaced it with a new one which would answer to their needs. It is true that a part of the old Stalinist bureaucracy would have collaborated, and been incorporated into the nazi state, but this does not alter the fact that the change would have been accomplished by the most violent struggle imaginable. Is it possible to maintain that a similarly decisive change has taken place now?
Has a decisive change occurred?
Up to the present, we have characterised the situation in Russia as a transitional state, with a bourgeois government attempting to move towards capitalism. This formulation, which is, admittedly, rather clumsy, in our view, adequately expresses the unfinished, contradictory, transitional nature of the stage we find ourselves in. The essential question which has to be addressed is this: Do we consider that the movement towards capitalism, the existence of which is not in ques tion, has passed the point of no return? Has quantity be come transformed into quality? Or, on the contrary, is it still unfinished, in which case it is possible that the whole process can still be thrown into reverse? If we are of the opinion that the bourgeois counterrevolution has definitely triumphed, then we must be in a position to say how and when the qualitative change occurred.
Just as in the 1920 and 30s, it is possible to point to a number of turning-points in the situation that has pertained in the last period. We have, firstly, the reforms of Gorbachov, leading to the fall of the Berlin Wall. Then the defeat of the coup in 1991 and the rise of Yeltsin. After that, the crushing of the White House in the Autumn of 1993 and the institution of Yeltsin's Bonapartist constitution. Subsequently, we have the more or less rapid privatisation of a large part of the economy. Thus, for the past six years or more, the pendulum can be represented as moving continuously in one direction&emdash;towards capitalism.
However, such a presentation would be entirely one-sided and mechanical. Despite the temporary inertia of the working class, it would be foolish not to see the existence of enormous tensions at all levels of Russian society. This was sharply revealed in the bloody storm ing of the White House. The complete bankruptcy of the former Stalinists of the "hard-line" faction of Khasbulatov and Rutskoi was shown by their inability to appeal to the working class. However, the victory of Yeltsin (which came as a surprise to himself) did not lead to stabilisation on a capitalist basis. On the contrary. In the following months, the faction of bourgeois reformers have suffered one setback after another.
When we say that there is a movement in the direction of capitalism, that directly establishes the transitional nature of the phenomenon. And it is not at all sure how this particular transition will end. At this moment of writing, we see no reason to modify our earlier posi tion. On the contrary. Recent events have only served to underline the difficulties in the path of capitalist restora tion in Russia, and the powerful countervailing tendencies that exist.
Here we can learn a lesson from the class enemy. If the process of capitalist restoration in Russia has already been successfully concluded, it is hard to explain the extraordinarily cautious attitude of Western investors in relation to the Russian market. This was aptly summed up in a recent analysis for investors which bore the significant title: Russia&emdash;a Sinking Ship, dated 30th of January 1995. This memorandum to the multinationals draws the following conclusions: "We expect Russia to maintain the pretence of reform, and the West to pretend to support them." And it goes on: "The Russian reform ship is sinking, and along with it any short-term confidence in its financial assets."
The same document explains that, despite extensive privatisation plans "there's not much left that's really attractive to own." Answering Yeltsin's assertion that, after the Chechen war, there would be "business as usual," it states flatly: "Nothing could be further from the truth." The invasion of Chechnya, it says, represented "a triumph for the more hard-line elements in the Kremlin." It points out that a number of people actually opposed to privatisation have been given jobs in the Ministry of Privatisation. One Minister, Polevanov, had to be removed following a speech suggesting the renationalisation of strategic industries in Russia. It concludes:
"The real lesson of Chechnya is that, despite the adoption of a new constitution and the incorporation of many 'technocrats' in Russia's government, the old bureaucracy of the former Soviet Union continue to rule the state in the same secretive way as before, and with the same instincts. Whenever confronted by a seemingly intractable problem, Yeltsin opts for force, rather than compromise. That leads to wild swings between reform and repression, without any of the predictability so necessary for any long-term, durable change."
Despite all the public show of support for Yeltsin, the Western leaders are well aware of the real situation. The fact that they are obliged to cling to this ailing and drunken buffoon is itself an eloquent comment on the extremely tenuous nature of the reform in Russia. From the standpoint of imperialism, any of the other options would be still worse. Five years of "market reform" have alienated the reformers from the mass of the population. Gaidar and Fyodorov find themselves in opposition. In order to stay in power, Yeltsin has been forced to rely on the support of the so-called "hard-liners."
The international strategists of capital are anxiously fol lowing every twist and turn in the policy of Yeltsin and the other factions of the bureaucracy. For what reason? They understand that in the rise and fall of different parties, individuals and groups is reflected shifts in the mood of different classes in society which find a distorted expression in the conflicts within the bureaucracy. In the absence of an open struggle for power between the proletariat and the nascent bourgeoisie, the process takes place in a confused and caricatured form. Nevertheless the conflicts exist and are care fully monitored by the imperialists, who are extremely interested in the outcome.
The December election was only the most graphic manifestation of a general shift in Russian society against privatisation. This is not an abstract question, but a very concrete one. Not only the working class is drawing a balance sheet of privatisation, but the bureaucracy also. One section has succeeded in enriching itself, but by no means all of them share the enthusiasm of Chernomyrdin and Chubais. Without doubt, the lower strata of the bureaucracy closely reflect the mood of the workers. But even in the upper layers, doubts about the benefits of the "market" are gathering force. This is clearest in the case of the officer caste, but also of an important layer of the managerial wing of the bureaucracy, whose factories are faced with bankruptcy.
On the 5th of February, the Financial Times carried an article with the title "Red barons try to roll back privatisation," which deals with this phenomenon. It points out that privatisation has harmed the position of this layer of the bureaucracy, which finds its interests threatened by the upstart nascent capitalists:
"Russia's bold mass privatisation programme," it says, "weakened many of Russia's stolid Soviet-era factory directors and transferred control of their enterprises to a flashy new breed of Moscow financiers. But, following the communist triumph in December's parliamentary elections and the sacking of prominent reformers from the government, the rump of old-style red directors have mounted a spirited campaign to roll back the tide.
"This national trend has been highlighted by the recent efforts of the old managers of two of Russia's flagship companies to wrest control from the private en trepreneurs who acquired big stakes in them through the country's privatisation programme."
The article goes on to detail the attempt of the manager of Norilsk Nikel, the world's biggest nickel producer, and one of Russia's most valuable companies, to regain control, and also the "coup" in which the old managers of the Zil car plant ousted the directors put in place by Microdean, a newly-established capitalist holding com pany. The Financial Times comments:
"These battles are being watched closely by Russia's political and business leaders, because they are part of a broader effort to reverse at least partially the bold privatisation programme which has transferred 80% of the Russian economy into private hands." The figure of 80% is an exaggeration, as we shall shortly show. But the main point is the way in which the serious representatives of capital analyse the processes, bringing out very clearly the contradictory tendencies:
"The growing momentum behind efforts to roll back privatisation suggests that western fears that Mr. Gennady Zyuganov's Communist party may be some what misplaced: the challenge to Russian market reforms comes not only from the communists but also from the hard-line faction which is increasingly power ful within Mr. Boris Yeltsin's Kremlin.
"The campaign for what Russian coyly describe as 'de-privatisation' has already enlisted a number of high-level supporters," the article adds, naming Yuri Luzhkov, the influential mayor of Moscow whose relations with Yeltsin appear to have improved to the degree that the President has grasped the need to distance himself from the "reformers" in order to save his skin. With Yeltsin's not so tacit backing, Luzhkov has even gone so far as to call for Anatoly Chubais, the recently sacked former Minister of Privatisation to be put on trial, thus confirming the well-known adage that there is no gratitude in politics!
"Chubais may have not had any malicious in tent," acknowledges Luzhkov gracefully, before sticking the knife in, "but, nonetheless, the prosecutor's office should consider his performance."
More serious still, a special committee has been formed by the Russian parliament to review the legality of privatisation. "The first casualty of the committee is likely to be last autumn's hasty and con troversial shares-for-loan privatisation programme, already ruled invalid by the Minister of Justice," says the Financial Times, and concludes:
"For western investors and Russia's bourgeoisie, these challenges to privatisation are one of the biggest threats since the collapse of communism. The conflict cannot be reduced to a simple free market forces and neo-communists.
"Even leading Russian reformers admit that, in many instances, the red directors have a moral and legal point because of the corrupt and uncompetitive way much of Russia's state property was transferred to private hands. But the messy character of Russia's privatisation process means once de-privatisation begins it will be very difficult for courts and investors to deter mine where it ends." (Our emphasis.)
Is the Russian bourgeoisie progressive?
Socialism means that the development of industry, technique, science and culture stand on a higher level than the most developed capitalist society. In that case, there is no question of society reverting to a more backward system such as commodity production. Such elements of small commodity production that remained would gradually disappear and be replaced by superior socialist forms. Compulsion would not be necessary, to the degree that the small farmers and businessmen see for themselves the immense advantages of the new eco nomic formations.
This picture of a workers' state is correct, but it is only an abstraction. The workers' state that was es tablished in Russia in 1917 was not on a higher economic level than Britain and the USA, but on a very primitive basis. Under the circumstances, the specific weight of the bourgeois and petit-bourgeois elements was enormous. As long as the working class, repre sented by the Bolsheviks, maintained control of the state, the pressure of the bourgeois nepmen and their al lies, the wealthy peasants ("kulaks") could be kept at bay. Nevertheless, the danger of capitalist restoration was very real, as Lenin and Trotsky repeatedly warned. By the end of the Civil War, the process of social polarisation began to create an alarming situation:
"The peasantry," wrote Trotsky, "was becoming polarised between the small capitalist on the one hand and the hired hand on the other. At the same hand, lacking industrial commodities, the state was crowded out of the rural market. Between the kulak and the petty home craftsman there appeared, as though from under the earth, the middleman. The state enterprises themselves, in search of raw material, were more and more com pelled to deal with the private trader. The rising tide of capitalism was visible everywhere. Thinking people saw plainly that a revolution in the forms of property does not solve the problem of socialism, but only raises it." (The Revolution Betrayed, p.26.)
Lenin had warned many times of the danger that the petit-bourgeois masses in Russia could link up with foreign capital, creating a formidable restorationist block. That is why he and Trotsky fought implacably in defence of the state monopoly of foreign trade which Stalin and Bukharin originally wanted to abolish. The victory of the Stalin faction over Bukharin's Right Opposition signified the defeat of the bourgeois restorationist trend, but did not remove the danger.
The conflict between the nationalised property forms established by October and the nascent bourgeoisie at that time was solved in favour of the former. The decisive section of the Stalinist bureaucracy, in or der to defend its power and privileges, leaned on the support of the working class to crush the kulaks and nepmen. But, un der the given conditions, this did not mean the restoration of a regime of workers' democracy, but, on the contrary, the consolidation of a bureaucratic totalitarian state.
The defeat of the nascent bourgeois elements was achieved by the most monstrous Bonapartist means, such as the madness of forced collectivisation which alienated the peasants and disorganised Soviet agriculture for generations. Stalin imagined that it was possi ble to eliminate the danger of capitalist restoration by administrative means and naked force. This was an illusion. The real danger to the nationalised planned econ omy came from the extremely low level of the pro duc tive forces, low labour productivity and general poverty and, above all, from imperialist encirclement, where the main enemies of the Soviet Union enjoyed a higher level of economic development, despite the crisis of world capitalism.
Within the edifice of bureaucratic planning, the "nepman" elements had not disappeared, but worked in a disguised way. In the absence of workers' control and administration of industry, society and the state, to repeat Marx's phrase, "all the old crap" revived. The dual nature of the transitional state, in which elements of socialist planned economy coexisted with bourgeois norms of distribution, inequality and corruption, acted as a fertile breeding ground for all kinds of swindling and theft which, even at the time of the First Five Year Plan, swallowed up a large and growing part of the surplus produced by the working class.
"Capital comes initially from circulation," writes Marx, "and, moreover, its point of departure is money." (Marx, Grundrisse, p. 253.) Marx explains that capitalism, in its most primitive and underdeveloped forms, usurers' and merchant capital, makes an appear ance long before the objective conditions for the estab lishment of the capitalist mode of production have arisen. In pre-capitalist societies, however, the phenomena related to merchant capital do not play a productive role.
When society had not yet reached the level when commodity production was possible as the norm, trading peoples like the Phoenicians, Carthaginians and Jews appeared at the margins of the economy, appropriating the surplus produced by other, less developed peoples through exchange. In the ancient world, these activities were closely identified with cheating, robbery, kidnapping and piracy. They arose in the "interstices" of society, where they acted as a disintegrating influence on the existing socio-economic order. In the ancient world, whenever it got a hold, merchant capital hastened the dissolution of the old gens society and inevitably led to slavery. Later on, in the Middle Ages, usury and merchant capital played a similar role in undermining feudalism:
"With semi-barbarian or completely barbarian peoples, there is at first interposition by trading peoples, or else tribes whose production is different by nature