Paul
Goble
Staunton, December 16 – In the
coming decade, Moscow economist Dmitry Prokofyev says, “Russia risks repeating
collectivization,” that is, “instead of oil, profit will be extracted from
people,” exactly what Stalin did in the late 1920s and 1930s however improbable
this may seem to many.
The economist says that “comparing Stalin’s
‘command’ economy and the ‘market’ economy of Russia may seem strange – but
only at first glance and only for those who imagine the Soviet Union of the
first five-year plans from pictures in children’s books and contemporary Russia
from official television” (novayagazeta.ru/articles/2019/12/16/83185-vozvraschenie-stalinskoy-ekonomiki).
If you ask 100 Russians “how Stalin
ran the economy of the USSR, 99 will answer that the leader ‘build socialism in
a single country.’ But as is well-known, neither Marx nor Lenin, whose follower
Stalin declared himself to be never said that it would be necessary to ‘build’
socialism,’” just as is the case that “no one ‘builds’ capitalism.”
Instead, people would choose
socialism because it would give them a better life. That is what those who
followed the Bolsheviks in 1917 thought. But “approximately in the middle of
the 1920s, after land was divided and factories seized, it turned out that life
became happier but not easier.” Instead, the situation returned more or less to
what it had been in 1913.
As Prokofyev puts it, “Stalin and
his entourage knew very well what could happen if there were too few goods in
the countryside and too little bread in the cities;” and they remembered the
slogan “Soviets without Communists” that some of their opponents had used
during the Civil War.
But to solve the problems they
faced, Stalin and his system needed “one critically important thing – money.
And there wasn’t any.” They couldn’t obtain it by exporting grain as the tsars
had because world prices for that had collapsed. And they could hardly attract foreign capital
having seized factories foreigner had owned.
Stalin personally might have been
willing to take that latter step – “he was a pragmatist and cynic,” the
economist says – “but how would he convince his comrades in the Politburo?” At
the same time, he and they knew that there wasn’t enough money in the hands of
the NEPmen to solve the problem.
Consequently, “it was necessary to
look for money within, in the pockets of workers and peasants. There were more
peasants” and so they became “’the resource’ for industrialization,’” “’the
second oil’” to put it in present-day parlance. At first, the Bolsheviks hoped
to use the scissors crisis to extract money but that didn’t provide enough
either.
Hence, the decision was made to
carry out enforced collectivization, something that sparked resistance that was
put down forcefully and led those who could to flee to the cities, providing
cheap labor for Moscow’s industrialization projects. “From the point of view of
economics,” Prokofyev says, “’collectivization’ was nothing than a super tax on
the peasantry.”
That policy led to a radical
reduction of incomes and consumption for most of the population, “but the
concentration of resources in the hands of the government allowed it to ensure an
increase in consumption by privileged groups, in the first instance the bosses,
the propagandists and the siloviki.” There was no equality under Stalin, “even
officially.”
Only in the 1960s did that begin to
change because the regime was able to use oil to buy grain and because of the
rise of the relatively numerous generations who began to ask where the payoff
was for all the sacrifices they had been forced to make. But oil could do only
so much, and it could not solve the longterm investment needs of the country.
As a result, the economist says, “the
heirs of Stalin decided to use means from the arsenal of the leader of the peoples
-- to take resources from consumption and direct them to investment” via higher
taxes. The Kremlin attempted to cover up what it was doing by saying that oil
exports were paying the bills but that was never the case.
Today, “looking at the practice of the
construction of Russian state capitalism,” Prokofyev says, “Comrade Stalin
would praise the builders for following his directions,” including using the scissors
crisis of buying cheaply from the people and selling the products for more,
thus impoverishing the population while allowing the state to continue to
flourish.
The question now arises, he says, “if
our bosses really are following Stalin’s recipe of running the economy,” why aren’t
they getting the growth rates he did? The answer of course is that Stalin shifted
the population from low productivity agriculture to higher productivity
industry. But a country can do that only once.
Moreover, now as compared with the 1930s, the
regime’s “’Stalinist’ policy of cheap labor … in combination with the same
policy of expensive capital … is leading to a situation where industry is using
labor rather than capital intensive technologies” just as in the 1930s and
1940s.
“Formally,” the economist suggests, “unemployment
is not high and there are many jobs. But these are ‘bad’ workplace which do not
allow the worker either to produce capital for investment or rise beyond the minimum
necessary for his own survival.” But the reduction of real wages means that
what capital the leaders get has to be sent abroad as there simply isn’t enough
domestic demand to do otherwise.
And as a result, “the growth of
profits of major enterprises and the growth of incomes of their owners do not
translate into the growth of the Russian economy as expressed in the growth of the
well-being of the citizens.”
There is something the regime could
do about this: provide real protection for property and thus of investors,
Prokofyev says. Bud doing so would undermine “the main paradigm Russian bosses
use – power is the source of property and not the reverse.” That means that again as in the 1920s, the
Kremlin leaders face problems without good or acceptable solutions.
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