By Tim Knight-Hughes
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Why read State Capitalism in Russia?

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Issue 383

Many people still associate socialism and especially Marx’s version of socialism with the brutal Stalinist regime in the Soviet Union.

Tony Cliff’s book State Capitalism in Russia has enabled us to explain why the horrific crimes committed by the Stalinist regime had nothing to do with socialism. Instead Cliff argued that Russia under Stalin’s rule became a particular form of capitalist society, state capitalism, locked into competition with its rivals in the West.

In the 1930s the Russian revolutionary Leon Trotsky made a pioneering Marxist attempt to understand what the Soviet Union had become under Stalin. He called it a “degenerated workers state”. The 1917 revolution had overthrown capitalism and established a workers’ state, but the isolation of the revolution in a backward, impoverished, society had led to the growth of a parasitical bureaucracy, headed by Stalin, but which had not succeeded in turning itself into a class with a social base of its own. The result, argued Trotsky, was a highly unstable form of society that could not last long.

But in the years that followed Trotsky’s assassination in 1940, Stalinism, far from collapsing, was able to expand into Eastern Europe in the years following the Second World War.
It was in the immediate wake of this situation, in 1948, that Cliff wrote State Capitalism in Russia. Building on Trotsky’s argument, Cliff nonetheless rejected his conclusions. For Cliff, the litmus test was whether workers were in control of the state and the means of production. He showed that they were just as alienated in the Soviet Union as they were in the West.

Even in the 1920s, despite the huge privations of the civil war and the isolation of the revolution, workers still retained significant influence over production. Every workplace was run by a combination of workers, Bolshevik Party committees and an internal manager. But this was abruptly scrapped in February 1928 in favour of total control by the manager, appointed from above. Elections to the soviets, when they did take place, were now rigged to ensure there was only one person on the ballot paper and “the poll has nearly always been 99.9 percent, and one candidate actually polled more than 100 percent!”

Many socialists argued that because property was nationalised and held collectively by the state, the Soviet Union could not be capitalist. But as Cliff pointed out, Marx had criticised the French socialist Pierre Proudhon for defining capitalism simply in terms of private property. He argued that the essence of capitalism is not private property but the accumulation of capital.

Cliff showed that the move to state capitalism took place in 1928 when the rising bureaucracy responded to the threat of invasion from Britain and France by a shift towards rapid industrialisation. This was to ensure the Soviet Union could establish itself as a military power capable of warding off such threats from more advanced capitalist states.

This meant repeating in Russia what the West had done three centuries earlier in a process Marx called “primitive accumulation”. The West enslaved millions of Africans, slaughtered millions of native peoples and drove the peasantry off the land to create a class that could only survive by working for someone else in the new factories.

The Stalinist regime did the same but much faster. The immediate post-revolution economy was geared towards the consumption of the masses. This now had to be cut in order to accumulate and compete with the West. Consumption fell from 67.2 percent of the overall economy in 1927 to just 37.8 percent by 1940. The peasantry was expropriated, resulting in the great famines of the 1930s in the Ukraine and Russia. And just as the West used slavery to primitively accumulate, Stalin’s regime used forced labour camps on a huge scale.

One criticism of the theory of state capitalism is the argument that, since there was no competition between workplaces in Russia, it could not be capitalist. But there is no competition between the different branches within capitalist firms. Cliff showed that the Soviet Union was like a giant factory forced through military competition with the West to act like a capitalist. The bureaucracy was compelled to accumulate and attempt to match its productivity levels to those of its rivals, just like any “private” capitalist firm is.

When Cliff first wrote his article Stalinism seemed to be an all-conquering economic system that could compete and overtake the West. The first Five Year Plan produced high growth rates and a rapid expansion of industry. But Cliff showed that this couldn’t continue and crisis would eventually assert itself.

After the initial boom the Soviet Union growth began to slow and, by the 1980s, the economy was clearly in crisis, paving the way for splits at the top and strikes from below that would eventually seal the fate of the Soviet Union.

Cliff’s analysis in State Capitalism in Russia allows us to rescue the real Marxist tradition. Socialism cannot come through the state claiming to act on behalf of the masses, but only through the self-activity of the workers.

Tony Cliff’s State Capitalism in Russia is available online at the Marxist Internet Archive.

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