by Rafael Martinez
Introduction
Marxism, as opposed to any other earlier ideology which one way or
the other was inspired by the hardships of the exploited masses, is a
science. From this point of view, Marxism is not a system of more or
less idealist thoughts of how things ought to be and how people should
behave, a doctrine of dogmas, but a system of thoughts, organised with
a very well-defined scientific method using the principles of
dialectical materialism. The Marxist system is a scientific system with
which to unveil the objective laws of historical development. Marxism
is a scientific tool in the hands of the exploited classes with which
the latter take historical development into their hands and transform
society on the basis of higher forms of social organisation towards the
construction of communism.
Marxism as a science is not a
system of frozen ideas, but a system of thoughts that evolves
historically. However, while evolving, Marxism remains a unique and
self-contained system, as a result of which it has a single correct
interpretation, in virtue of its scientific essence. The same way the
phenomena of nature and their laws of development are studied by such
branches of natural science as chemistry, biology, physics, etc.,
social phenomena are studied and interpreted by Marxist sciences. For
the same reason that there exists only one possible scientific
interpretation of the phenomena of nature, that there exists only one
science of chemistry, biology, physics and not two or more sciences of
chemistry, biology and physics, there exists only one single scientific
system that is able to study and interpret social phenomena.
The principles of Marxism-Leninism are not postulates about the laws
that govern society and history. They are the result of a titanic
effort to generalise the knowledge about social phenomena and they best
reflect their essence. Therefore these principles are not eternal
truths, the quintessence of human thought, conceived by minds of
geniuses. Quite to the contrary, the principles of Marxism-Leninism do
not pre-date history; they are a product of history itself and they are
derived from the latter, they are a reflection of the objective laws
that govern reality. The principles of Marxism-Leninism are not a
mystic knowledge of the elders but the minimal expression of a
full-fledged science, whose ultimate goal is to understand social
processes for the purpose of changing society.
The revision of the principles of Marxism, regardless of its
orientation and historical epoch, subverts the scientific basis of
Marxism and turns the latter into a dogmatic set of thoughts and
citations of holy texts; in other words, it turns the once scientific
system of thought into a form of religious doctrine, which overtakes
the superstructure of the revisionist system. From being the ideology
of the exploited masses, this hollow Marxism turns into a tool of
exploitation. Having reached this point, revisionist Marxism,
anti-Marxist in essence, can split into different heresies, into
different interpretations of what turned into some kind of Holy
Scriptures, as those interpretations cease to be scientific and are
moulded to fit the needs and idiosyncrasy of the new ruling classes or
those who serve the old ruling classes, according to the concrete
historical situation.
Revisionism retains the outward form of Marxism but rips off its
scientific basis. Revisionism fosters dogmas. For instance, many (if
not all) forms of revisionist doctrines uphold the commodity character
of all products under socialism. Different revisionist trends
(heresies) argue in favour of such a dogma in a different way, and
though they agree to disagree in the form, they agree on the need for
products under socialism to be commodities. While disagreeing on many
issues, Bukharinists and Trotskyites arrived at the same conclusions
with regard to the Soviet policies of collectivisation and the
progressive curtailing of the sphere of operation of commodity-money
relations. While disagreeing on many issues, Khrushchevites and
Titoites agreed to condemn the basic principles of Marxist-Leninism of
the transition to socialism and communism, which many revisionist and
openly bourgeois ideologists have labelled as Stalinist and, hence,
evil.
The political economy of socialism has been a highly debated topic for
as long as the theory of Marxism has existed. Discussions over this
fascinating topic have become a battle ground between Marxism-Leninism
and revisionism. It is no coincidence that the process of restoration
of capitalism in the Soviet Union and other former People’s Republics
in Eastern Europe has been preceded and followed by thorough economic
discussions, at the end of which the specifics of revisionism took
shape and become a more or less consistent system of thought, a new
doctrine, so to say. The system of economic thought developed in the
post-Stalin Soviet Union became a more or less consistent revisionist
system, which was propagated and became more or less accepted by the
revisionist leadership of the former People’s Republics of Eastern
Europe.
The revisionist essence of those trends that merged into what came to
be known as post-Stalin or modern revisionism, as well as those that
were derived from the latter, has been repeatedly exposed by
Marxist-Leninists. Not wishing to add anything of substance to this
critique, in the present article we would like to concentrate on a
fascinating topic in the discussions on the political economy of
socialism. In the present work we present a brief critique of what in
our opinion is the revisionist essence of the principles of the
political economy of socialism promulgated by the famous Shanghai
political economy text-book, published in 1975 in China. The Shanghai
text-book summarises and publicises the basics of what has been
portrayed for many years as a development of the principles of
Marxism-Leninism. In the present work we try to substantiate the view
that a number of allegedly innovative ideas put forward in the Shanghai
text-book are, far from a development of Marxist science, quite to the
contrary, a mixture of pre-Marxist thought and openly
Bukharinite-Khrushchevite thinking. While adopting a somewhat different
form of revision of the principles of Marxist-Leninist political
economy, the authors of the Shanghai text-book basically come to
similar conclusions as the Khrushchevite-Brezhnevite clique with regard
to the basic guidelines for the construction of socialism, the roles of
the plan, commodity-money relations, interrelations between industry
and agriculture, collectivization, etc. Moreover, the new principles of
political economy of socialism advocated by the authors of the Shanghai
text-book are postulates which are not the result of a thorough
analysis of the concrete economic conditions of revolutionary China.
These postulates are rather a reflection of the ‘change of mood’ among
economists after the death of Stalin, and do not add anything of
substance to revisionist postulates formulated by the revisionists in
the Soviet Union. It is important to note that a number of the
principles and formulations presented by the Shanghai text-book do
display certain formal differences from those adopted in other
countries. While pointing the reader to the major similarities we will
try to emphasise the specifics of the reasoning used by the authors of
the text-book.
It is most fortunate for the economic history of revolutionary China
and for our analysis that Chinese economists were indeed aware of and
very much familiar with the basic Marxist-Leninist principles for the
transition to socialism. After a brief period of brisk economic
recovery (1949-1952), the Chinese government launched a very successful
First Five-Year Plan (1953-57) whose excellent economic results were
praised even by bourgeois economists. This five-year plan followed
closely what bourgeois ideologists usually refer to as the Soviet or
Stalinist model for the transition to socialism, which had produced
very successful and at times even almost spectacular results in the
People’s Republics of Easter Europe during the post-war period.
Indeed, by virtue of the Treaty of Friendship, Alliance and Mutual
Assistance signed in January 1950 by Mao and Stalin and valid until
1980, the Soviet Union rendered significant financial and technical
assistance to modernise Chinese industry. The Soviet Union provided
thousands of engineers to boost China’s industry and therefore her
economy as a whole. Large numbers of Soviet engineers, technicians, and
scientists assisted in developing and installing new heavy industrial
facilities, including many entire plants and pieces of equipment
purchased from the Soviet Union. Soviet planners helped their Chinese
counterparts formulate the plan, as a result of which the period of
1949-1957 could be regarded as the most successful economic period that
China ever had, not only from the point of view of sustained, steady
and well-balanced economic growth as a whole, but also from the
perspective of the resolution of class contradictions, the liquidation
of the capitalist mode of production and feudal domination.
In the present work we concentrate on the most prominent tenets
advocated by the authors of the Shanghai text-book, which liquidate the
basic principles of Marxism-Leninism with regard to socialist
construction that were materialised in the main by the first Five-Year
plan: the postulate about agriculture as the foundation of the economy,
the violation of the Marxist principle of the leading role of the
development of heavy industry, the right-wing stand on the role of
commodity-money relations and collectivisation, and the idealist
character of the definition of the role of politics in the economy.
Pre-Marxist Character of the Postulate of Agriculture as the Foundation of the Economy
In this and the next sections we will cover two of the most relevant
aspects of the economic system advocated by the authors of the Shanghai
text-book. Before touching upon what in our opinion is a systematic
violation by the authors of the Marxist-Leninist principle of the
determining role of the development of heavy industry in both the
transitional and socialist economies, it is convenient to evaluate one
specific aspect of their economic thinking. In particular we elaborate
on the postulate of agriculture as the foundation of the Chinese
economy. This postulate as we know it today may be found in the Chinese
economic literature by the end of the first Five-Year Plan. Although we
do not observe this to be an evident element inherent in the economic
thinking of the Chinese communists in general, further investigation
may throw additional light on this question. We believe that this
postulate is deeply rooted in pre-Marxist economic thinking and, as a
result, it may have been inspired one way or another by pre-Marxist
Chinese thinkers.
In the next section we will be specific with
regard to economic figures characteristic of the first Five-Year Plan
and it will illustrate how the relative growth of heavy industry with
respect to the others branches suffers a qualitative decline,
especially after the economic reforms of the early 1960s. The
Marxist-Leninist principle of the prioritisation of heavy industry was
followed during the 1950s. Around 1957 the Chinese leadership started
to express serious concerns that the path to industrialisation of the
country should be carried out differently from the spirit of the first
Five-Year Plan. The need for industrialisation of the country was never
denied, neither before nor after the completion of the first Five-Year
Plan; however, a new thinking started to arise, that other sectors of
the economy had allegedly been neglected. It is at this time that the
Chinese leadership raises the issue of the need to establish new
relationships and balances among various sectors of the economy. By the
time of the writing of the Shanghai text-book the new economic thinking
had long been consolidated:
‘To realise socialist industrialisation, it is of course necessary to
give priority to developing heavy industry. But, giving priority to
developing heavy industry does not mean that agriculture and light
industry must be ignored’ (ed. George C. Wang, ‘Fundamentals of
Political Economy’, M.E. Sharpe, White Plains, New York 10603, 1977, p.
383. This is a translation of ‘Cheng-chih ching-chi hsueh chinch’u
chih-shih, 2 vols., compiled by the ‘Fundamentals of Political Economy’
Writing Group, Shanghai (Shanghai People’s Press, 1974) ).
The leading role of industry is not denied here; however the concept of
prioritisation suffers a substantial change, as we will see below. The
authors of the text-book never deny the progressive character of heavy
industry, or the crucial role of science, technology and its
application to more advanced and productive means of production. The
benefits of the application of technological advances and a robust
heavy industry are also acknowledged as a very important element for
the mechanisation of the countryside, which the authors are clearly
concerned about. With statements of this type the authors try to
formally accept, in the form of a statement, the need to develop heavy
industry, but at the same time to allow for a very different
interpretation of the relationship between various branches of the
economy. As will be elaborated in more detail in other sections, this
type of statement opens the way to the revision of principles and is
used by the authors on different occasions to tackle certain
fundamental issues.
For a Marxist who understands the relationship between heavy industry
and other sectors of the economy, it makes little sense to say that one
should give priority to industry without neglecting agriculture. The
Marxist-Leninist scheme for extended social reproduction is very well
established both in the theory and practice of socialist construction.
Bourgeois and right-wing revisionist economists usually come up with
statements of the following sort: The industrialisation in the Soviet
Union corresponds to an economic model in which heavy industry is
developed at the expense of other sectors of the economy, in
particular, in relatively backward countries (like pre-revolutionary
Russia and China), at the expense of the vast masses of the peasantry.
This stereotype has been repeated over and over again for as long as
the revolutionaries have tried to establish a roadmap for
industrialisation. A Marxist knows very well that the only possible way
for massive collectivisation is via the mechanisation of labour in the
countryside. The latter is impossible without the development of a
robust domestic heavy industry. Apparently, the authors of the
text-book disagree with this view, as a result of which they feel
impelled to establish the ‘theoretical’ framework that will enable them
to draw a number of earth-shaking conclusions.
In our opinion, the statement above has little to do with
Marxist-Leninist political economy and is simply a reflection of the
bourgeois and right-wing revisionist thinking that we mentioned above.
Let us examine the role of two points raised in the preceding quotation
in the political economy put forward by the Shanghai text-book: the
meaning of their concept of priority in developing heavy industry and
the assertion that agriculture must not be ignored. The authors openly
state that agriculture is the foundation of the national economy:
‘In organising the development of the national economy, the socialist country must consciously apply the objective law of agriculture as the foundation of the national economy’ (ibid., p. 368, our emphasis).
This statement goes far beyond the understanding that agriculture, in a
country with an overwhelming majority of peasants, has to play a very
important role for the very obvious reason that there is a clear
economic disproportion at the start of the economic development. We are
dealing here with a new understanding of the direction of development
in the transitional economy in a relatively backward country like
China. When the authors appeal to the principle of agriculture as the
foundation of the national economy, they imply that agriculture is to
be given priority in the national economy:
‘Since agriculture is the foundation of the national economy, it is
necessary to treat the development of agriculture as a priority of the
national economy. Only when agriculture is developed as the foundation
of the national economy can light industry, heavy industry, and other
economic, cultural and educational enterprises be developed’ (p. 370).
At this point, a seeming logical but profoundly anti-Marxist argument
is used. We will elaborate on this in more detail below. According to
the authors, if agriculture is not developed then industry cannot
develop either. It is assumed that the national economy can function
only if agriculture is developed as the basis for economic development
of the national economy as a whole. According to the authors, the
development of industry is determined by the development of agriculture
and not the other way around. At this point this scheme is presented as
an abstract relationship. It is not clear at first glance exactly what
proportions are implied by that relation of subordination. As will
become clearer in the quantitative analysis made in the next section,
this scheme implies that the level of capital investment in heavy
industry is determined by the level of investment in agriculture and
light industry and not the other way around.
This is further substantiated by the postulate that agriculture should
become heavy industry’s primary market and therefore the level of
investment in heavy industry is determined by the needs of agriculture.
A more or less advanced agriculture will reflect a more or less
advanced heavy industry, as agriculture is the beginning and end of the
production process.
‘At present, people have not yet clearly realised that the point that
heavy industry must take agriculture as its primary market. With the
steady advancement of agricultural technology and its ever-increasing
modernisation, fertilisers, water conservancy and power and
transportation facilities will be available for agriculture and more
fuels and construction materials will be available to private
consumption, then people will comprehend that agriculture is the
primary market for heavy industry’ (op. cit., p.. 369, a quote from ‘On
the Correct Handling of Contradictions Among the People’, Selected
Readings from the Works of Mao Tse-Tung, (Type A) Jen-min ch’u-pan-she,
1965, p. 362).
The true meaning of the statement that agriculture should not be
neglected is explicitly stated in the form of the postulate of the
proportions of labour exchanged between the three main sectors of the
economy. The authors draw clear guidelines with regard to the
priorities for development in the transitional economy: first
agriculture, then light industry, followed by heavy industry.
‘Under the guidance of the General Line for building socialism and the
general policy for developing the national economy, China’s national
economic plan is arranged in the order of agriculture, light industry,
and heavy industry with Chairman Mao suggested. That is to say, in
arranging the national economic plan, we must start from agriculture
and place agriculture in the primary position. Whether it is allocation
of capital funds or the supply of material goods, the needs of
agriculture cannot be neglected.’
The authors of the text-book turn upside down the order of priorities
established by the founders of Marxism-Leninism. They contradict the
very basics of Marxist economics. They ignore Marx and Engels’ theory
of reproduction and extended reproduction and their predictions for
socialism. They undermine Lenin’s teachings on political economy and
his struggle for the industrialisation of Soviet Russia. They put a
cross on the titanic effort and practical experience for the
industrialisation of a vast agricultural country, the building of the
main basis of socialism in the Soviet Union. They liquidate Marxist
political economy and replace it with a petty-bourgeois pseudo-science
wrapped up in the external appearance of Marxism deprived of its
scientific substrate. Using revolutionary phraseology the authors of
the Shanghai text-book put forward this and other anti-Marxist theses,
which they even dare to portray as a development of Marxist-Leninism!
Is this really a development of the Marxist-Leninist science or a
plagiarism of pre-Marxist economic thought under the
concrete-historical conditions when Marxist-Leninism was under attack
by all types of right-wing theories and practice following the XXth
CPSU Congress?
So far we have examined the formulation of the postulate regarding
agriculture as the foundation of the economy. Such a statement was
regarded by the Chinese economists as a novel statement in the science
of political economy. More careful analysis of this postulate indicates
that the essence of this statement, which is so pivotal to the economic
thought advocated by the authors of the Shanghai text-book, is
fundamentally pre-Marxist and its essence had been exposed long ago by
Lenin, especially in his early works on political economy.
Lenin, following Marx, exposed the mistakes of Sismondi and the
Narodniks and also showed the fundamentals of their mistakes with
regard to the value of social production within the context of the
analysis of the development of capitalism in Russia. Lenin showed that
Marx could create his theory of capitalist reproduction by overcoming
two main mistakes of classical bourgeois political economy. The first
one is related to excluding constant capital from the analysis of the
value of social production and thus reducing it to two parts (which
correspond to the worker and the capitalist). The second is related to
confusing individual consumption and consumption of production, which
leads to ignoring the latter in the analysis of reproduction and
extended reproduction in general.
Lenin conscientiously and systematically fought against the reactionary
economic theory of the Narodniks. In doing so he further developed a
crucial methodological statement in the Marxist theory of reproduction,
namely, the question of the relationship between individual and
productive consumption. The classics of bourgeois political economy,
Adam Smith and David Ricardo, in confusing individual and productive
consumption reduced all consumption to individual consumption, which
prevented them from understanding the process of realisation of the
social product. This also prevented them from understanding the process
of reproduction of capital. It is only possible to solve these
fundamental problems of political economy, regardless of the mode of
production, by making a clear distinction between the production of
means of production (Department I) and the production of the means of
consumption (Department II). These questions are dealt with great
detail in Marx’s Capital. Particularly valuable in this respect is the
fourth volume of the Capital.
To reduce the social product to two components is a mistake common to
pre-Marxist economic thought and has an objective substrate. This
‘omission’ is due to a superficial analysis of the capitalist product
at a time when capitalist production was at its early stage of its
development, namely the epoch of manufacture, before the advent of
large-scale machine industry. The root of this mistake is objective in
the sense that it is based on concrete historical-economic conditions,
which pre-determine the pre-Marxist economic thinking. Needless to say,
the objective conditions in China with regard to the development of
large-scale machine industry, which influenced the Chinese economists,
were not very different from those that influenced the ideas of the
Narodniks in Russia:
‘Old China was a semi-colonial and semi-feudal country. Under the
oppression of imperialism, feudalism and bureaucratic capitalism, the
level of production was extremely backward. The few modern industries
that existed consisted primarily of light industry and textile
industry. When the country was liberated in 1949, the annual output of
steel was only 158,000 tons. There was nothing to speak of in many
important industrial sectors’ (ibid., p. 383).
In this context is much easier to understand the rationale behind the
following statement regarding a more quantitative estimate of resource
allocation under socialism, which otherwise would sound rather
preposterous, to say the least:
‘At the same time, we must also take care that the development of heavy
industry and other sectors of the national economy cannot exceed the
amount of food grain, raw materials, capital funds, and labour force
that can be provided by agriculture’ (ibid, p. 388).
By committing the same methodological mistake as classic bourgeois
political economy and its followers in Russia, the authors of the
Shanghai text-book not only arrive at the well-known conclusion about
agriculture being the basis of the national economy, but they also
establish an upper limit on the proportion of the social product that
can be involved in heavy industry. Therefore, by construction, the
socialist plan establishes an upper limit on investment and resources
allocated to heavy industry determined by the development of
agriculture, a sector of the economy which displays a lower level of
labour productivity. Whether the total social product is large enough
in an economically backward country like China at that time, with
respect to the total amount of social product involved in heavy
industry, is of no substance. We are referring here to a general
statement for the construction of the socialist economic base.
The authors of the Shanghai text-book agree with the Narodniks that
without the development of agriculture the development of the national
economy is not possible, and therefore they conclude that the
development of the national economy is determined by the development of
agriculture. The growth of capitalism during its early stages of
development took place despite a shrinkage of the peasant market
because of the expansion of the market of the means of production.
Under socialism, the large masses of individual producers do not
disappear under the pressure of the development of capitalism in the
countryside, nor does the peasant’s market shrink in favour of the
development of industry, as happens under capitalism. Much to the
contrary, in the transitional economy the expansion of the forces of
production in agriculture is mainly driven by heavy industry. To
believe that the development of agriculture in a relatively backward
country like China can take place on the basis of simple cooperation
without the assistance of the state in the form of a solid heavy
industry is a hopeless illusion and a reflection of a profound lack of
understanding of the basics of Marxist political economy. The economic
history of the construction of socialism has shown that failure to
understand and implement this in economic practice ultimately leads to
the development of capitalism in the countryside. The authors of the
Shanghai text-book arrive at quite the opposite conclusions. They
arrive at the same conclusions as the Narodniks when they even
questioned the feasibility of the development of capitalism in Russia.
‘Indeed, let us imagine that in answer to the question: ‘Can capitalism
develop in Russia, when the masses of the people are poor and are
becoming still poorer?’ somebody would say the following: ‘Yes, it can,
because capitalism will develop not on account of articles of
consumption, but on account of means of production.’ Obviously, such an
answer is based on the absolutely correct idea that the total
productivity of a capitalist nation increases chiefly on account of
means of production (i.e., more on account of means of production than
of articles of consumption);' (V.I. Lenin, On the So-Called Market Question, Collected Works, 4th English Edition, Progress Publishers, Moscow, 1972, p 110)
Lenin’s classical Marxist analysis of the pre-Marxist character of
the Narodniks views of the development of capitalism in Russia is
perfectly valid in our analysis of the sources of the anti-Marxist
deviation advocated by the authors of the Shanghai text-book in the
form of the postulate of agriculture as the basis of the national
economy.
‘He regards as the greatest ‘obstacle’ to the development
of capitalism in Russia the ‘contraction’ of the home market and the
‘diminution’ of the purchasing power of the peasants.’
‘…Wherein lies the absurdity of this ‘ever new’ (for the Russian Narodniks) theory?
‘Is it that its author fails to understand the significance of the
‘production of means of production as means of production’? Of course
not. Mr. Nik. – on knows that law very well and even mentions that it
operates in our country, too (pp. 186, 203-204). True, in view of his
faculty for castigating himself with contradictions, he sometimes (cf.
p. 123) forgets about that law, but it is obvious that the correction
of such contradictions would not in the least correct the author’s main
(above-quoted) argument’ (V.I. Lenin, On the So-Called Market Question, Collected Works, 4th English Edition, Progress Publishers, Moscow, 1972, p 122-123)
This and other economic theses advocated by the authors of the Shanghai
text-book are inconsistent with the proletarian essence of politics
guided by Marxism-Leninism. As will be elaborated in other sections,
the authors resort to revolutionary (at times ultra-revolutionary)
phraseology to cover the pre-Marxist and right-wing revisionist essence
of a number of their pivotal theses. From the point of view of a
consistent Marxist it makes no sense to call on the masses to follow
proletarian policies while the essence of the economic reforms proposed
by the authors is fundamentally petty-bourgeois. Their class essence
together with the anti-Marxist character of the economic thought of the
Narodniks has been exposed long ago. We appeal to those who still
consider the economic thesis about agriculture being the foundation of
the economy as a proletarian policy to carefully address these issues
and pay more attention to the essence of economic phenomena:
‘…the Narodniks did not regard the working class as the foremost class
in the revolution. They dreamed of attaining Socialism without the
proletariat. They considered that the principal revolutionary force was
the peasantry – led by the intelligentsia – and the peasant commune,
which they regarded as the embryo and foundation of Socialism.’’
(History of the Communist Party of the Soviet Union (Bolsheviks), 1939,
International Publishers, p. 12.)
Violation of the Marxist Principle of the Leading Role of the Development of Heavy Industry
In the previous section we touched upon one of the most important
postulates on which the Shanghai political economy text-book relies. As
we have seen, the authors unambiguously admit to thinking that
agriculture is the basis of the economy and determines the development
of other sectors of the economy, in particular heavy industry. Even
though the authors of the text-book formally agree with the formulation
of the leading role of heavy industry, it is clear that they have a
very different conception of the labour exchange between the various
sectors of the economy than that advocated by the founders of
Marxism-Leninism. To be specific, the authors give priority to
agriculture, followed by light industry and then by heavy industry. In
this section we will be more quantitative and we will try to show that
this conception leads to the violation of the Marxist-Leninist
principle in the political economy of the transitional and socialist
societies of the determining role of heavy industry in economic
development. We emphasise the qualitative change taking place in the
development of heavy industry when comparing the main economic control
figures of the first Five-Year Plan and the economic reforms that took
shape in the early 1960s which, in our opinion, liquidated a number of
basic progressive features embodied by the first Five-Year Plan.
The Marxist-Leninist principle of the leading role of the development
of heavy industry had been applied in the Soviet Union and in the
People’s Democracies of Eastern Europe and it had become a widespread
notion when the Chinese Communists came to power. In this sense the
first Five-Year Plan had become a concretisation in the conditions of
China of what was considered a well-accepted and uncontroversial modus
operandi. It is not within the scope of the present work to elaborate
on the classical considerations leading the founders of
Marxism-Leninism to the conclusion of the need for the leading role of
heavy industry in the transitional economy. To conclude otherwise, as
the authors of the Shanghai text-book imply, is to deny the very basics
of Marxist political economy. Marx reiterated that the level of
development of the productive forces is strongly linked to the level of
achieved productivity, which depends on the degree of mechanisation of
labour. The increasing mechanisation of labour is necessarily driven by
a change in the composition in the social product in favour of industry
with respect to agriculture and in favour of heavy industry with
respect to light industry. This is a necessary result of the Marxist
analysis of the realisation of the social product, a necessary result
of the Marxist theory of reproduction and extended reproduction. This
is applicable to the Capitalist, Socialist and Communist modes of
production as well as to the transitional economy. To deny in deeds the
leading role of the development of heavy industry over other sectors of
the national economy is not only flagrantly anti-Marxist but it also
contradicts the purely phenomenological observation about the strong
correlation of the growth of industry and the overall growth of the
economy in modern modes of production.
At this point it is important to make two remarks. Firstly, we do not
touch upon the basic features of the Chinese economic development
during the years of the Great Leap Forward. These economic reforms were
relatively short-lived compared to other stages of the economic history
of China. Not wishing to discuss the essence of the economic phenomena
that were produced by the Great Leap Forward, we prefer to establish a
comparison between the spirit of the first Five-Year Plan and the
economic reforms of early 1960s. First, this is meant to simplify the
analysis and to establish a clear demarcation between two well-defined
periods of the economic history of China. Secondly, it is not
necessarily correct to view the first Five-Year Plan as a uniform
stage. As a matter of fact, a more detailed analysis of the control
figures of the first Five-Year Plan show changes towards 1956-1957 that
reflect certain changes in the economic discussions of that time. The
pillars of the new economic doctrine, as summarised in the Shanghai
text-book, were laid down during the period of 1956-1957 in the
aftermath of the CPSU XXth Congress, were consolidated in the years
after and were in our opinion consistently applied during the early
1960s. When we establish a comparison between the first Five-Year Plan
and the economic reforms of the 1960s we are using a convenient
simplification.
Regardless of the academic considerations concerning the determination
of various stages in the economic history of China, it is evident to us
that the spirit of the first Five-Year Plan and the economic reforms of
the early 1960s are fundamentally different. The scope of the first
Five-Year Plan was very well-defined and it included building the
material foundation for socialism via the industrialisation of the
country:
‘The magnificent First-Five Year Plan for the Development of the
National Economy was launched in 1953. One of its fundamental tasks was
to lay a preliminary foundation for the socialist industrialisation of
the country’ (‘Ten Great Years’, State Statistical Bureau, Foreign
Language Press, Peking 1960, p. 80).
In principle, right-wing revisionist political economy does not
preclude declarations in favour of industrialisation as a leading
criterion of success of the socialist transformation. The above
statement does not necessarily make the first Five-Year Plan any better
than the successive plans if it was not for the fact that the
guidelines of the former were specific and clear:
‘The central task in China’s transitional period is to carry out
socialist industrialisation and the basic policy for socialist
construction is to give priority to the development of heavy industry’ (ibid., p. 46, our emphasis).
The Marxist-Leninist principle of the determining role of the
development of heavy industry was hard-coded into the spirit of the
first Five-Year Plan. As quantitative analysis shows, Chinese
economists and planners did implement this basic principle in economic
practice. Moreover, the leading role of heavy industry was at the very
heart of the first Five-Year Plan. In retrospect, many imperialist and
petty-bourgeois critiques of the first Five-Year Plan associate it with
the policies of Stalinism that were allegedly imposed on China and
other progressive countries from the outside. The ideologists of
imperialism and their followers always confused the respect by the
progressive world that the Soviet Union and its leadership enjoyed with
political imposition, especially in the post-war period. We do not deny
the tremendous respect that the progressive world had for the economic
model that turned a backward and agricultural country into a mighty and
industrialised superpower, which was victorious in the toughest of all
wars. However, it is evident to us that the basic principles of such an
economic model were not considered at that time to be intrinsic to
Russian concrete historic-economic conditions, but rather were a
concretisation of the economic principles of Marxism-Leninism. It was
acknowledged throughout the progressive world that the Soviet Union’s
celebrated success was due to the correct concretisation of the
economic principles of Marxism-Leninism, the leading role of heavy
industry being particularly important. As matter of fact, the highest
rates of sustained economic growth were achieved when the principle of
the leading role of heavy industry was applied consistently. The
ideologists of right-wing revisionism, imperialism and petty-bourgeois
economists argue otherwise while denying flagrant historical facts:
‘One section of leaders of the Communist Party advocated a programme of
rapid industrialisation. Their approach was to concentrate resources on
big and modern factories and advanced technology. They wanted to build
up the urban areas. Development, in their eyes, would then trickle down
to the countryside. These leaders said that you needed a big
centralised planning apparatus in order to run the economy and that you
needed to train vast armies of experts and specialists to staff the new
economy and administrative organs. They argued that the way to motivate
people and the staff of enterprises was to rely on wide wage
differentials and financial incentives.
‘This programme reflected the influence of the Soviet Union, which was
very strong in China in the 1950s. But Mao saw problems with this model
– both as it was practiced in the Soviet Union and as it was being
applied in China in the 1950s. This path of development elevated
technique and expertise over the conscious initiative and activism of
the masses. He rejected the model of subordinating agriculture to serve
urban-based industrialisation. And if China was going to be able to
withstand imperialist attack and invasion, it had to decentralise
industry and not concentrate development in the vulnerable cities and
coastal areas’ (Raymond Lotta, ‘Mao's Advance – Breaking with the
Soviet Model’, Revolution #032, January 29, 2006,
http://rwor.org/a/032/socialism-communism-much-better-capitalism-pt8.htm).
We do not want to discuss here the political line of this or that
political leader who at a given time did or did not stand behind the
policies of rapid industrialisation. That is beside the point and is
basically irrelevant to the present discussion. It is evident to us
that the standard critique of what the petty-bourgeois ideologists
refer to as the Soviet model reflects, on the one hand, their lack of
understanding of the basic principles of Marxist-Leninist political
economy and their disregard for studying economic and historic facts on
the other. In addition, the apologists for the ideas summarised in the
Shanghai text-book basically plagiarise many of the arguments put
forward by imperialist ideologists, U.S. scholars being the most
prolific of them. Lotta, as a typical supporter of the ideas of the
Shanghai book, reproduces distinct features of the bourgeois critique
of the so-called Soviet model that allegedly the development of
industry occurs in detriment to the countryside. Lotta’s objection does
not add much to Bukharin-Trotsky’s ‘rebuttal’ of the party line for the
industrialisation and collectivisation of the countryside in Soviet
Russia. Nor does Lotta differ much from the typical bourgeois critic of
centralised planning as one of the basic pillars of the economic model
he seems to object to. It is a well-known fact that the economic
reforms that followed the completion of the first Five-Year Plan
involved massive decentralisation of economic management and
decision-making, with central planning reduced to a body coordinating a
large mass of independent producers, that exchanged labour according to
the principle of the exchange of equivalent values (law of value) and
the so-called principle of self-reliance. Despite what the supporters
of the ideas of the Shanghai text-book may believe, these principles
are also common to the Yugoslavian Titoite ‘contribution’ to modern
theories of ‘market socialism’. This is the economic model that Lotta
and the authors of the text-book define as Marxist-Leninist. The
so-called Soviet model did not rely on wide wage differentials and
material incentives as much as Lotta and many like him claim. Moral
incentives did play a crucial role in Soviet production. Nevertheless,
wage differentials and material incentives, even though they should not
become the main incentive for the masses to participate in production,
are consistent with the socialist principle of distribution and should
exist in socialism. It is utopian to argue otherwise. Not surprisingly,
Lotta appeals to the phenomenon of consciousness when characterising
the so-called Soviet model when he states that this ‘path of
development elevated technique and expertise over the conscious
initiative and activism of the masses. As will be discussed in the last
section, this is an expression of metaphysics and idealism in the
treatment of politics and the phenomena of consciousness in questions
of political economy. With this digression we want to illustrate the
idiosyncrasy of those who have argued and still argue against the
determining role of the development of heavy industry with respect to
other sectors of the economy.
In terms of economic development the first decade, 1949-1959, can be
broken up into three distinct stages: first, the period of recuperation
from 1949-1952, then the first Five-Year Plan from 1952-1957 and the
Great Leap Forward from 1957-1959. The period of 1950-52, after the
seizure of power by the revolutionary government, was marked by
considerable economic growth due to efforts to restore dormant sections
of the productive forces, especially in industry and other crucial
sectors of the national economy. According to various sources, the
economic GNP (Gross National Product) grew during that period by an
average of 25%. This was due to the mobilisation of political cadre and
working population at a time when whole industries had been
unproductive following a period of political instability, which came to
an abrupt end after 1949.
‘During the period 1949-1952 the gross output value of industry
increased by 145% and the gross output value of agriculture increased
by 48.5 per cent. By 1952 most of the major products of industry and
agriculture had either been restored to their previous levels or had
actually surpassed pre-liberation records’ (‘Ten Great Years’, State
Statistical Bureau, Foreign Language Press, Peking 1960, p. 3).
After a brief but rather spectacular process of recuperation the
Chinese planners, with the assistance of their Soviet counterparts,
formulated what has been commonly known as the first Five-Year Plan.
This period is without a shred of doubt the most successful economic
period of the economic history of revolutionary China. To argue
otherwise is to ignore and misinterpret overwhelming historical facts:
‘During the period of 1952-1957 the gross output value of industry
increased by 128 per cent, an average annual increase of 18 per cent,
and the gross output value of agriculture increased by 25 per cent, an
annual increase of 4.5 per cent’ (ibid., p. 3).
The sound success of the first Five-Year Plan resonated around the
world. It was praised in the Soviet press as well as in the press of
the People’s Democracies. Even bourgeois economists admitted to the
exhilarating success of the first Five-Year Plan which, as mentioned
above, had its primary focus on laying the foundations of the
industrialisation of backward China:
‘China’s First Five-Year Plan (1952-1957) was a relatively rationally
thought-out technical plan for economic development, and quite
impressive economic progress emerged during that period (B.M. Richman,
‘Industrial Society in Communist China’, Random House, New York, 1969.
p. 47).
The historical success of the policies of the first Five-Year Plan,
which confirm the correctness of Marxist economic science, touches upon
a more fundamental question, namely, the superiority of the socialist
mode of production with respect to capitalism. The superiority of the
socialist mode of production was demonstrated on the basis of
prioritising the development of heavy industry:
‘All this proves that the two different systems, socialism and
capitalism, create two entirely different rates of development of the
national economy and socialism is incomparably the better system’ (‘Ten
Great Years’, State Statistical Bureau, Foreign Language Press, Peking
1960, p. 6).
This prominent feature is usually ignored by the ideologists of
right-wing revisionism and of imperialism. The latter do so for obvious
reasons. The former were faced with the harsh reality that their
anti-Marxist theories with regard to the question of heavy industry and
other crucial points of the political economy of socialism in practice
liquidated the excellent economic growth shown by the Soviet Union and
the People’s Democracies during the 1930-50s, which overshadowed that
of the most developed capitalist countries. The superiority of the
socialist form of organisation of production was liquidated with the
liquidation of the Marxist-Leninist principle of the leading role of
the development of heavy industry in the transitional economy and
socialism. This is another historic-economic fact that the supporters
of the Shanghai text-book seem to ignore. Instead they choose to
concentrate on arguing about the role of consciousness in economics
while failing to grasp the objective laws of economic development, the
true task of political economy. While the right-wing revisionist
economic thought in China, summarised by the Shanghai text-book,
emphasised phenomena of consciousness by putting forward the concept of
‘revolution in command’, revisionist economists in the Soviet Union and
other countries concentrated on a more ‘conscientious’ critique of the
so-called Stalinist model of industrialisation, while avoiding obvious
idealist mistakes. Nevertheless, all of them, regardless of their line
of thought and argument, converged in demonising the ‘old model’ as
being excessively supportive of heavy industry and creating economic
imbalances.
The analysis of the control figures of the Five-Year Plan and the
actual economic performance is a fascinating topic that in our opinion
has been neglected by those who claim to uphold the revolutionary
traditions of the Chinese revolutionaries. The concrete figures of
economic growth in different sectors of the national economy were
indeed impressive. While overall the economic growth was outstanding,
the most impressive growth was in heavy industry:
‘Comparing production figures of 1958 and 1949, the following increases
were recorded: steel (not including steel produced by indigenous
methods) increased by 4960 per cent; pig iron (not including iron
produced by indigenous methods) increased by 3680 per cent; electric
power, 540 per cent; coal, 730 per cent; crude oil, 1770 per cent;
metal-cutting machine tools, 3060 per cent; cement, 1310 per cent;
cotton cloth, 200 per cent; paper, 610 per cent; edible vegetable oil,
180 per cent; sugar, 350 per cent; grain, 130 per cent; and cotton, 370
per cent.’ (‘Ten Great Years’, State Statistical Bureau, Foreign
Language Press, Peking 1960, p. 6.)
Table I displays the year-by-year change in the relative weight of
the gross output of industry and agriculture between 1949-1957, which
cover the period of recuperation and the first Five-Year Plan (‘Ten
Great Years’, State Statistical Bureau, Foreign Language Press, Peking
1960, p. 17). The relative weight of industry (both consumer goods and
means of production) was about 33% in 1950 and the relative weight of
agriculture was about 67%. By the end of the first Five-Year Plan the
preponderance of agriculture was reversed to the extent that the gross
output value of industry significantly surpassed that of agriculture.
It is important to note that a significant fraction of what was
classified as industrial production also included artisan production
and small-scale workshops. The relative weight of their contribution to
the gross output value in industry decreased significantly by the end
of the first Five- Plan Year. For reasons of brevity the year-by-year
absolute values of the gross output value of each of the two main
sectors of the national economy is not shown. The decline in the
relative contribution of agriculture does not by any means imply a
decrease in the actual agricultural output; it just means that the rate
of growth of industry was significantly larger than in agriculture. It
is important to note that the rate of growth of agriculture during that
period of time significantly surpassed those of pre-revolutionary China
and also surpassed the rate of population growth at the time.
Table I shows the qualitative and quantitative change in the
evolution of the two main components of the national economy, but it
does not shed light on the change in the internal composition of
industry. The relative weight of the production of means of production
in 1949 corresponded to 26.6 per cent, where the relative weight of the
output value of consumer goods reached 73.4 per cent. Before the
launching of the first Five-Year Plan, in 1952 the relative weight of
heavy industry had increased to 35.6 per cent. By the end of the first
Five-Year plan, in 1957, the relative weight of the output value of
means of production reached 57.3 per cent of industry. These figures
show the qualitative change in the composition of industry towards
heavy industry. This indicates an important change in the composition
of the Chinese economy, which is consistent with those attained by the
People’s Democracies in Eastern Europe during the post-war period.
Table II displays the yearly change in the rate of growth of the
gross output value of industry (‘en Great Years’ State Statistical
Bureau, Foreign Language Press, Peking 1960, p. 89). Table II also
shows the change in the gross output value of the production of means
of production and the production of consumer goods. The year-to-year
growth rate of industry overall was really impressive, as indicated in
the second column of Table II. This growth is made possible by a more
impressive growth of the gross output value of the means of production.
The third and fourth columns show that the rate of growth of the means
of production is always greater than the corresponding index for
consumer goods. This does not by any means imply that the material
needs of the population were neglected, as bourgeois propaganda claimed
for years and years. In fact, significant rates of growth of heavy
industry are accompanied by large rates of growth of light industry
with rates significantly greater than the rate of growth of the
population. The dynamics of the change in the composition of the
national income is strongly related to the growth of the economy in
general and the growth of productivity throughout all sectors of the
economy in particular. The average growth of the GNP over the period of
1957-1965 dropped by more than a factor of 2.5 compared to the
corresponding figures achieved in the period of 1953-1957, during which
the growth of the relative weight of industry had become prominent. The
necessity for the prioritisation of the development of the means of
production is very well shown by the Marxist analysis of extended
reproduction of social production. This is part of the ABC of Marxism.
Any socialist economy has to follow these guidelines in order to
overcome economic backwardness and achieve genuine independence.
The industrialisation of China was taken extremely seriously during
the first Five-Year Plan, which was the main reason for its sound
success. This involved expanding heavy industry, not only by means of
developing existing industrial branches but also by means of
diversifying industry, creating new industrial branches on the basis of
modern technology:
‘China, a backward agricultural country, had to
be gradually turned into a great socialist country with a highly
developed modern industry, modern agriculture and modern science and
culture. In the execution of this great task it was necessary, apart
from making full use of the existing productive equipment and
development of its potential, to carry out new large-scale capital
construction, set up new industrial branches, specially those of heavy
industry, provide the various departments of the national economy with
new equipment and technique and build strong socialist material and
technological foundations’ (‘Ten Great Years’, State Statistical
Bureau, Foreign Language Press, Peking 1960, p. 45).
The implementation of the Marxist-Leninist principle of prioritisation
of the development of heavy industry was reflected in the structure of
capital investment in the different branches of the national economy.
The distribution of capital investment in favour of heavy industry was
made possible due to the role of centralised socialist planning. This
is a direct expression of the prerogative of the socialist state to
organise forces of production according to the objective laws of
socialism and to satisfy the main law of socialist production. This is
quite opposite to the conception advocated by the authors of the
Shanghai text-book who, like their counterparts in the post-Stalin
Soviet Union, regarded the principle of equivalent exchange of value
(i.e. the law of value; see the section on the ‘Role of Commodity-Money
Relations) as the leading criterion which regulates the exchange of
labour in the national economy. Their ‘marketist’ conception in
conjunction with their pre-Marxist view that the resources intended for
heavy industry and other sectors ‘cannot exceed the amount of food
grain, raw materials, capital funds, and labour force that can be
provided by agriculture’ leaves no room for a healthy development of
industry. In contrast, the policies of prioritisation of heavy industry
in terms of capital investment were taken very seriously by centralised
planning during the first Five-Year Plan:
‘Of the more than 86,000 million yuan the state invested in capital
construction from 1952 to 1958, 51.1 per cent was for industrial
construction, of which 43.8 per cent was for heavy industry. The
balance was divided as follows: 8.6 per cent for agriculture, forestry
and water conservancy, 15.3 per cent for communications, transport,
port and tele-communications, 9 per cent for cultural, educational and
public health work and public utilities, and 16 per cent for other
construction’ (ibid., p. 46).
The qualitative trends mentioned above were acknowledged even by
bourgeois economists. According to bourgeois sources the relative
weight of industry (manufacturing, mining, transportation and
construction) accounted for about 27% of the net domestic product
(based on 1952 yuan prices) in 1957, up from 16.6% in 1952. During that
same period of time the relative weight of agriculture fell from 48% to
39%, while displaying sustained and stable growths of the GNP and
agricultural production (T.C Liu and K.C. Yeh, ‘The Economy of the
Chinese Mainland’, Princeton, Princeton University Press, 1965, p. 88).
This was corroborated by countless bourgeois sources. It is
well-accepted by bourgeois experts and scholars in general. Needless to
say, Marxists do not need corroboration from bourgeois and imperialist
ideologists in order to gain confidence in the correctness of the main
laws of Marxist-Leninist political economy in general and the leading
role of heavy industry in particular. As matter of fact bourgeois
economists reduce themselves to quantitative analysis accompanied by
random political statements as to what in their opinion could have
motivated this or that economic policy. Their approach is purely
phenomenological, as they do not understand the essence of Marxist
political economy. However, even such a superficial approach to the
analysis of economic phenomena cannot escape the most glaring economic
benefits that the Marxist-Leninist policies of industrialisation can
bring in such a brief period of time as a five-year plan.
The liquidation of the economic principles upon which the first
Five-Year Plan was conceived and executed is a complex matter and it
was not a straightforward process. It is not within the scope of the
present article to evaluate the different stages that the economic
reforms that followed the first Five-Year Plan should be divided into.
As mentioned above, the first Five-Year Plan was not homogeneously
executed and was ‘corrected’ towards the end in the light of the
economic discussions within the Chinese leadership. It is equally
complex to evaluate the rationale of the economic reforms of the Great
Leap Forward. Therefore, to simplify the analysis of the Shanghai
text-book we have concentrated on its central features and their
similarities with the right-wing revisionist economic discipline
created by their counterparts in the post-Stalin Soviet Union, rather
than focusing on the intricacies of the evolution of the thinking of
Chinese economists.
The economic policies of the Great Leap Forward were not necessarily
aimed at liquidating the leading role of heavy industry, or at least in
its most external expression. What is clear to us and hopefully is
uncontroversial at this point is that the policies of the Great Leap
Forward were accompanied by an adamant effort to decentralise the
management of the economy in favour of local and regional authorities
and in detriment to central planning, so crucial for a conscious and
sustained policy of support for heavy industry. The economic policies
of the Great Leap Forward were short-lived and were followed by a
number of countermeasures, which lead, among many other things, to the
liquidation of the determining role of heavy industry and the
consolidation and development of the principles of ‘marketism’.
The dynamics of the flow of labour among sectors of the national
economy suffered a qualitative change after 1960 in order to
accommodate the economic postulates which were summarised later in the
Shanghai text-book. Indeed, the rapid qualitative change in the
composition of the national economy was brought to a halt after
1959-1960. According to official Chinese statistics, the ratio of the
relative weight of industry to that of agriculture increased from a
factor of 0.89 in 1953 to 1.3 in 1957, displaying a qualitative change
in the structure of the economy (see Table I). The first Five-Year Plan
was followed by the policies of the Great Leap Forward, during which
large masses of peasants were mobilised to participate in industry.
Between 1957 and 1960 the ratio of the relative weight of industry to
that of agriculture increased to a factor of 3.6, as a result of an
abrupt increase of industrial output and a decrease of 20% of the
output value of agricultural production. The policies of the Great Leap
Forward came to an equally abrupt end in 1961. By 1962 the relative
weight of industry to that of agriculture had dropped to a factor of
1.6. As a result of the new policies, which finally liquidated the
application of the Marxist-Leninist principle of the preponderance of
the development of heavy industry over other sectors of the economy,
between 1962 and 1965 the ratio of the output value of industry to
agriculture increased very slowly, from 1.6 to 1.68 (from ‘Brief
History of the Socialist Economy of China’, Beijing 1984).
The essence of the economic reforms that followed the Great Leap
Forward is clear to us as far as the development of industry is
concerned. With the excuse of ‘re-adjusting’ the economic
disproportions created by the abrupt redirection of resources to
industry, the economic reforms of the early 1960s concentrated on
reversing these tendencies. The development of industry was slowed and
the ratio of the weight of heavy industry to that of light industry was
improved’ in order to reflect a more ‘harmonious’ system of
relationships between economic sectors:
‘…The proportional relation between industry and agriculture and
between light industry and heavy industry improved. In 1962 the gross
output value of agricultural production reached 43.000 million yuan, an
increase of 6.2% with respect to the previous year, and that of
industrial production 85.000 yuan, a decrease of 16.6% with respect to
the preceding year; the ratio of the value of industrial to
agricultural production was 4:1 in 1960 and 2.1 in 1962. In the
industrial production, the value of production of light industry was
39.500 million yuan, a decrease of 8.4% with respect to 1961, and that
of heavy industry 45.5000 million yuan, a drop of 22.6%; and its
relative weight went from 42.5:57.5 in 1961 to 47.2:52.8 in 1962’
(‘Brief History of the Socialist Economy of China’, Beijing 1984, p.
300).
Following the ‘re-adjustment’ of the policies of the Great Leap
Forward, the economic reforms of the early 1960s liquidated altogether
the socialist principle of preponderance of heavy industry. Instead, a
new system of proportions and absolute and relative growths emerged,
more characteristic of what one observes in the capitalist mode of
production. Table III shows the change of the ratio (or relative
weight) of the gross output value of light and heavy industries to the
total gross output value of industry for the period of 1949-1975
(‘Brief History of the Socialist Economy of China’, Beijing 1984, from
Table 1, p. 481). The fourth column shows the change of the ratio of
the relative weight of heavy to light industry (or the ratio of the
gross output value of heavy to light industry). This statistics are
indeed revealing: the growth of the ratio of the relative weights of
heavy industry to that of light industry between 1952 and 1957 (from
0.55 to 0.82, or an increase of a factor of 1.5) is similar to the
period between 1957 and 1975 (form 0.82 to 1.27 or an increase of a
factor of 1.55). In other words, in the 5 year period between 1952 and
1957, a similar relative growth of heavy industry was achieved as in
the following 18 years! It is interesting to observe that the ratio of
the relative weights of heavy industry t that of light industry
remained flat during the years following the Mao’s death. It is
relevant to note that this feature is specific to this period in
question. The liquidation of the socialist principle of preponderance
of heavy industry does not necessarily lead in the economic practice to
freezing or even decreasing of the ratio discussed above. As a matter
of fact, in developed capitalist countries this ratio increases as a
function of time, although at rates lower than those typical to
socialism (such as those observed in the Soviet Union, the People’s
Democracies and the Chinese First Five-Year Plan)
Role of Commodity-Money Relations
In the present section we evaluate the role of commodity-money
relations in the system advocated by the authors of the Shanghai
text-book. It is convenient to note that the postulates put forward by
the authors with regards to commodity-money relations differ little in
essence from those advocated by revisionist economists in the
post-Stalin period. We observe a number of formal differences with
respect to the party line defined by their counterparts in the Soviet
Union, but these, regardless of what many would claim, do not alter the
true ‘marketist’ essence of their postulates. This is the case for
other aspects of the political economy of the transitional society
presented in the text-book as well.
It is relevant to note that
the treatment of commodity-money relations by the authors is more a
by-product of other more fundamental postulates and it is clearly tied
to strong pre-Marxist elements so characteristic of the Shanghai
text-book. Their ‘marketism’ is a result of more basic considerations
and adds little to the history of the question if looked from the
historical perspective of the formation of Marxist thought and the
struggle against right-wing deviations. Let us start the discussion
with one of the most important conclusions drawn in the text-book.
‘The unfolding of socialist cooperation requires an extension of the
communist work style, a firm adherence to socialist principles, a
voluntary observance of fiscal policies, and the resolute
implementation of various proletarian economic policies. Therefore, in
the cooperative relations between the state enterprises and the
collective enterprises, among state enterprises, among collective
enterprises, among sectors and among regions, the principle of equivalent exchange must be observed, and fair pricing enforced’ (ibid, p. 297, our emphasis).
The sentence emphasised represents nothing more than the well-known law
of value, or law of equivalent exchanges. The statement is explicit:
the law of value regulates the exchange of labour among production
objects in the transitional society, whether among state-owned and
collective-owned enterprises, or among state-owned enterprises. This is
not an isolated expression in the text-book of the most pure and
elementary ‘marketism’ advocated by Dühring and all right-wing
revisionists deviations after him. This statement is fundamentally
pre-Marxist and constitutes one of the most important cornerstones of
the petty-bourgeois interpretation of the political economy of the
transitional society.
The citation which we bring to the readers’ attention is not an
isolated blunder but a well-defined characteristic of the Shanghai
text-book and it is consistent with the economic system advocated by
them. The authors equate the ‘cooperative style of communism’ to the
application of the principle of equivalent exchange. This applies to
all sectors of the economy.
‘The exchange of manpower, material resources, and funds among
enterprises must therefore be inspired by the cooperative style of
communism and follow the principle of equivalent exchange’ (ibid, p.
404).
The economic history of the construction of socialism and the
generalisation of vast economic data indicate that the law of
equivalent exchanges is not the leading criterion and regulator of the
portions of labour among production units. As a matter of fact, the law
of value may be systematically violated in entire sectors of the
economy if the tasks of the construction of the new economy demand it.
The law of equivalent exchanges may be observed depending on the
concrete-historical conditions, the policies of the proletarian state
at a given time, and the tasks of the socialist construction, but it
does not constitute a general law, a general principle of either the
transitional or socialist or communist economies. For instance, the
cooperation between the state and collective sector is bound to violate
the law of equivalent exchanges at some stage; otherwise the
mechanisation of the countryside would not be possible. While the state
retains the property of the main means of production (tractors for
instance), the collective farms enjoy their use. In exchange, a certain
fraction of agricultural production is allocated by the collective farm
to the state in a way that does not necessarily comply with the law of
equivalent exchanges and conforms to an exchange of a different type.
The same applies to the development of heavy industry or other sectors
of the economy, which may not necessarily be profitable or even
productive at all, and yet are indispensable to ensure extended
socialist reproduction. The fact that the law of value is not the
regulator of proportions of labour in the transitional and socialist
economies is a very well-established fact and it is not within the
scope of the present discussion to cover the different aspects of this
fascinating question, as it has been covered elsewhere in the
Marxist-Leninist literature. We have every reason to believe (although
we do not have direct evidence) that Chinese economists were acquainted
with the Soviet economic literature of the first half of the 1950s
since this type of statement openly contradicts the spirit of the first
five-year plan.
To proclaim that the principle of equivalent exchange is a general
principle for the transitional economy is an expression of pre-Marxist
thought so brilliantly exposed by Engels in Anti-Duhring:
‘The ‘exchange of labour for labour on the principle of equal
valuation’, in so far as it has any meaning, that is to say, the mutual
exchangeability of products of equal social labour, hence the law of
value, is the fundamental law precisely of commodity production, and
hence also of its highest form, capitalist production. It asserts
itself in present-day society in the only way in which economic laws
can assert themselves in a society of private producers, as a blindly
operating law of nature which is inherent in things and relations,
which is independent of the will or actions of the producers.’ (F.
Engels, Anti-Dühring, Foreign Language Press, Peking 1976, p. 406.)
The statement proposed by the authors is meant to be universal under
socialism and applies, in particular, to state enterprises. It
represents one of the most explicit statements throughout the political
economy text-book that their authors advocate nothing more and nothing
less than a programme for the construction of ‘market socialism’, in
probably one of its most naïve expressions. In this respect the authors
of the political economy text-book conceive economic relations under
socialism in a way similar to Dühring, and Engels’ critique applies
equally well to them as it did to Dühring. Needless to say, the
‘marketist’ stand of Bogdanov-Bukharin-Rykov and their heirs in the
post-war period, Voznesenski being the most prominent of them,
conceived the nature of the exchange of labour in the transitional
society and socialism in a very similar way. They differ little from
Dühring in this respect. Revisionist economists of the post-Stalin era
take up this tradition, although they make significant efforts to
‘substantiate’ it in more elaborate and academic terms.
It goes without saying and it is most unfortunate that such
anti-Marxist formulations are accompanied by seemingly revolutionary
statements, which are aimed at nothing other than confusing the reader.
To state that socialist cooperation requires an extension of the
communist work style while at the same time appealing to the law of
value is either an empty phrase or a glaring contradiction. It seems
contradictory to us that the principle of equivalent exchange,
understood as a general law in socialism, is consistent with socialist
cooperation, socialist principles and communist work-style. It makes
little or no sense to proclaim either strict or relaxed ‘adherence to
socialist principles’ or ‘resolute implementation of various
proletarian economic policies’ if the basics of the economic relations
are generally determined by the law of value. It represents the
well-known doctrine of ‘revolution in command’, which has nothing to do
with Marxist-Leninist political economy, and whose anti-Marxist
character will be elaborated in somewhat more detail in the last
section.
In the meantime let us elaborate a bit more on the line of thought
followed by the authors in order to arrive at this openly revisionist
conclusion. This is interesting for understanding the internal
structure of the revisionist deviation that is specific to what is
commonly known as Maoism. The Shanghai text-book initiates the
discussion by formally agreeing to the Marxist-Leninist formulation of
the source of commodity-money relations under socialism. The text-book
accepts the fact that commodity production under socialism is due to
the existence of two forms of property:
‘In the state economy, products are transferred from one state
enterprise to another state enterprise … The product is still owned by
the socialist state, and there has not been no transfer of ownership
rights. Furthermore, product transfers among enterprises are usually
allocated and delivered according to state plans rather than taking
place through the market. Therefore, this type of product transfer is
basically not commodity exchange. It already possesses many
characteristics of the communist distribution of products’. (ibid, p.
314.)
This is a very well-known statement formulated in Stalin’s Economic Problems,
which was a document that, unlike in the post-Stalin Soviet Union, was
allowed to circulate and was not censored. Moreover, Stalin’s works
were referred to in official documents and discussions for a number of
years, at least until the end of the Cultural Revolution. It is
important to remind the reader that this statement had become widely
accepted by economists in the 1950s throughout the whole socialist and
progressive-minded world, and in this sense it is not surprising to
appreciate ‘remnants’ of the ‘old thought’. This point will be
elaborated further below. Nevertheless, as we hope to clarify in this
section, this type of assertion holds a purely formal character and
uncovers a serious deviation from the spirit of Economic Problems.
Despite formally accepting this Marxist-Leninist statement, the
text-book authors run into a terrible contradiction. Such a seemingly
correct assertion is made under the assumption that the products in the
transitional economy, including that of the collective farms, embody
direct social production. While considering all production under
socialism as being directly social, the authors of the text-book
advocate the need to preserve commodity production because of the
existence of two forms of property:
‘Socialist direct social production is conducted on the basis of these
two forms of socialist ownership [state and collective – our note].
Products are owned respectively by the socialist state and various
enterprises under the collective ownership system. This determines that direct social production under socialism cannot eliminate commodity production and exchange’ (ibid, p. 313, our emphasis).
The anti-Marxist idea that the production of collective farms, i.e. of
vast non-socialised sectors of the economy, is a manifestation of
directly social production is further substantiated by the authors, who
argue that the restrictions under which the collective farms are placed
subvert the private nature of their production to the extent that their
labour becomes directly social.
‘Seen as a whole, the production of the state economy and the
collective economy based on socialist public ownership is organised
according to plans throughout the whole country. It is conducted to
directly meet the needs of society, namely, to directly meet the needs
of the proletariat and the whole labouring people. This kind of
production has lost the nature of private production. Looked at from
its basic aspect, it has become direct social production. Labour
products are also socially useful from the start, and therefore are no
longer private products but they are direct social products’ (ibid, p.
312).
To argue that a product is useful hence is directly social is a type of
argumentation that was followed by Bukharin and was bluntly exposed by
Lenin as anti-Marxist. As a matter of fact products in capitalist
economy also meet social needs, but that does not make them directly
social. To openly state that collective production is a form of
directly social labour is a peculiar contribution to the history of the
economic thought of modern revisionism. The Soviet economists of the
post-Stalin period were careful enough not to make such an openly
anti-Marxist statement. Indeed, the ideologists of modern revisionism,
in order to advocate the commodity character of products under
socialism, assumed one way or the other that labour under socialism had
not yet achieved the of directly social labour. Neither do
Marxist-Leninists treat the labour of the collective farms as a form of
directly social labour.
It is very important to note that the argumentation we use here is
valid as long as the main means of production belong to the collective
farms. This was the case of the Chinese people’s communes and the
Soviet Kolkhoz in the post-Stalin period. This point will be touched
upon in the Section on collectivisation. We would partially agree with
the authors of the Shanghai text-book in their assessment of the
character of the labour of the collective farms if the socialist State
had preserved the property of the machine tractor stations, as a result
of which a significant fraction of the labour exchanged between the
collective farms and the state began to have elements of directly
social labour. However, in this case the infamous law of equivalent
exchange would not be observed, as the authors of the Shanghai
text-book advocate. In addition, Chinese economic reality was such that
the main means of production belonged to the communes and these acted
as independent producers with respect to the State, despite what the
authors of the text-book want the reader to believe.
The fact that the authors of the Shanghai text-book advocate the
anti-Marxist and anti-scientific illusion that the labour of collective
farms is directly social is probably not the most serious problem in
their conception of commodity-money relations. What we find most absurd
is that the authors advocate the need for commodity-money relations
among two sectors of the economy which according to them display
socially direct labour. This is a preposterous absurdity:
‘Since direct social production and direct distribution preclude any
exchange of commodities, they also preclude the transformation of the
products into commodities (at any rate within the community) and
consequently into values as well’ (F. Engels, Anti-Dühring, Foreign Language Press, Peking 1976, p. 401).
It is impossible within Marxist economic thinking to conceive of
commodity-money relations as a form of economic bond among producers
who display directly social production. It is equally hard to imagine
the need for the existence of two forms of property in an economy that
has reached the level of the socialisation of labour that the authors
of the Shanghai text-book claim it has. However, in order to sound
revolutionary and to formally dissociate themselves from the mainstream
revisionism of that time, the authors of the Shanghai text-book argue
that existence of commodity-money relations is dictated by the
existence of two forms of property. One contradiction is followed by
another contradiction. The train of thought followed by the authors of
the Shanghai text-book lacks self-consistency.
The absurdity of the contradiction into which the authors fall is
reiterated in the text-book. The authors, despite starting with
seemingly Marxist-Leninist assertions with regard to the role of
commodity-money relations, basically come to the same conclusions as
their counterparts in the Soviet Union, that the law of value regulates
the flux of labour in the transitional and socialist economies.
Efforts are made by the authors of the Shanghai text-book to convince
the reader that the operation of the law of value is restricted in
China They treat the concept of allocation and the role of the law of
value in this type of transactions in a formally correct manner.
‘… the exchange of important means of production must be allocated by
the state strictly according to the plan rather than through market
transactions… Here, the law of value no longer has any regulatory
significance; it merely has a little influence. The law of value,
however, does have a regulatory function in socialist commodity
exchange’ (ibid, p. 417).
They formally agree with the concept of allocation of assets to state
enterprises. However, such declarations are deceiving and are meant to
confuse the reader. As a matter of fact, the authors contradict
themselves in this respect and admit that, in the economic practice of
China, state enterprises function as independent producers, which
exchange commodities according to a plan. The extent of such an
economic relation of allocation was restricted to a particular class of
transactions, namely the bond between the state and state enterprises
with regards to strategic means of production. The relative weight of
such transactions fell as a result of the economic reforms that
followed the Great Leap Forward, to the extent that they become more
like exceptions to the rule, rather than typical of the transitional
economy in China.
With regard to relations between state enterprises, the authors of the
text-book explicitly admit that the bond between state enterprises does
follow the law of equivalent exchange of values:
‘Meanwhile, with the present level of productivity, material conditions
demand that the state enterprises maintain their relative independence
of operation and management and that they trade with each other
according to the principle of exchanges of equivalent value. Therefore,
although the commodities exchanged among state enterprises are
basically no longer commodities, they still possess certain commodity
characteristics, and must be expressed in terms of price and purchased
with money’ (ibid, p. 314).
This paragraph is indeed very interesting, as it well reflects the
idiosyncrasy of what is commonly referred to as Maoism with regards to
economic questions. While formally advocating formulations that had
been adamantly rejected by the ideologists of Soviet modern
revisionism, when it comes to addressing the role of the law of value
in the transitional economy, the authors of the text-book reproduce
well-known revisionist arguments in favour of the commodity character
of the exchange between state enterprises. To argue that the
underdevelopment of the forces of production in the concrete historical
conditions of a backward agricultural country is an objective reason
for the existence of commodity-money relations in the state sector in
the transitional economy is a well-known right-wing revisionist
statement. Revisionist literature both in the post-Stalin Soviet Union
and elsewhere is plagued with such assertions, which in essence are
meant to suppress the Marxist-Leninist formulation regarding the real
cause for the existence of commodity-money relations in the
transitional society (the existence of two main forms of property),
which the authors of the text-book also explicitly advocate. It is
evident to us that the authors of the text-book were aware of the
‘potentially’ revisionist character of such assertions. While adhering
to them the authors are impelled to come up with some sort of statement
which, on the surface, looks Marxist-Leninist but is fundamentally
anti-Marxist.
In an attempt to resolve the contradictions discussed above the authors
of the text-book resort to a rather interesting line of thought. It is
evident to us that the authors have a particular view of the definition
of a commodity. This definition fits very conveniently into an economic
system which operates according to the principle of exchange of
equivalents and which needs to be portrayed in a very different
fashion. When covering the different types of labour exchange, the
authors make it clear that they reduce their understanding of the
concept of commodity to the exchange of ownership, which corresponds to
a superficial understanding of Stalin’s assertions in ‘Economic
Problems’:
‘Here, after an exchange, the ownership rights to the products have
been transferred. Therefore, they still possess the basic features of
general commodity exchange. This form of exchange should be called
commodity exchange’ (ibid, p. 416).
Therefore, whenever the exchange takes places among objects of the
socialised sector, then the authors mechanically declare that this type
of exchange
‘… should be called product exchange to distinguish it from commodity exchange between owners’ (ibid, p. 416).
The differences between a commodity and a product are far more subtle
that those indicated by the authors. However, it is convenient for the
authors to reduce those differences to the transfer of ownership. Such
a definition fits well into their scheme to keep a façade of
revolutionary thought, but unfortunately it is plagued with obvious
metaphysical elements that are used for the authors’ benefits. The
authors turn one aspect of the definition of a commodity into the
leading criterion to identify the concept of a commodity, while they de
facto ignore the economic relation embodied by it. The contradictions
discussed above are not resolved; they are simply hidden under the rug
and their resolution is simply assumed or postulated within the context
of a well-known ‘marketist’ scheme discussed above.
In the paragraphs cited above, the authors of the text-book on the one
hand acknowledge the market form of the economic bond among state
enterprises, but on the other hand, they want to convince the reader of
the contrary. Their treatment of form and content of the economic
relations is plagued with glaring contradictions, has nothing to do
with dialectical materialism and has purely declaratory character. The
dialectical understanding of the evolution of the content of
commodity-money relations under socialism is generally well established
in the Marxist-Leninist literature and contradicts what the authors of
the Shanghai text-book advocate as Marxist-Leninist. When Lenin talked
about commodities ceasing to be commodities a very different
relationship between form and content of this economic relation was
implied. Lenin’s famous statement was enriched by the generalisation of
the experience of socialist construction in the Soviet Union and the
People’s Democracies. The economic fact that commodities under
socialism cease to be commodities implies that the essence of such an
economic relation changes with respect to pre-socialist economic
systems, in which the essence of commodity exchange involves an
economic activity among independent producers by which value is
exchanged according to the principle of equivalent exchange. The fact
of the matter is that even though certain formal characteristics of the
commodity (such as pricing in value terms) are retained under
socialism, the economic relationship that these embody may
systematically violate the principle of equivalent exchange (i.e. of
the law of value). We do not mean to elaborate on this question here,
but it is important to note that one of the great advantages of
socialism with respect to the market economy is the fact that economic
proportions of a different type are established in such a manner that
the main law of socialist production is satisfied:
The
essential features and requirements of the basic law of socialism might
be formulated roughly in this way: the securing of the maximum
satisfaction of the constantly rising material and cultural
requirements of the whole of society through the continuous expansion
and perfection of socialist production on the basis of higher
techniques.’ (J.V. Stalin, Economic Problems of Socialism in the USSR, Peking, Foreign Language Press, 1972, pp. 40-41.)
This economic fact goes far beyond the power of the socialist state
to predict or consciously coordinate the economic activity of economic
units which exchange labour according the principle of equivalent
values. The fact that this relationship is more or less predicted in
the form of a plan by itself does not overcome the backwardness
intrinsic to the market relationship. It is a false and anti-scientific
illusion, common to all the right-wing revisionist deviations, to
reconcile the concept of a socialist plan and the market relationship
embedded in the principle of equivalent exchange of values. Using
pseudo-Marxist phraseology, the ideologists of revisionism want to
substantiate the idea of the subjugation of the market relationship to
the socialist plan as the modus operandi for the transition
to communism. As opposed to the Marxist-Leninist principle of the
progressive liquidation of the market relationship embodied in the
principle of equivalent exchange of values, modern revisionism as well
as the authors of the Shanghai text-book maintain that such a form
persists and even becomes further developed under socialism. History
has flagrantly proven that such a scheme ultimately leads to the
restoration of open forms of capitalist exploitation via more or less
lengthy processes in which capitalist exploitation is concealed under
certain forms inherited from a revolutionary past.
This illusory
attempt to reconcile market and plan is in essence a pre-Marxist
consideration that has been propagated by the ideologists of right-wing
revisionism over and over again in the 20th century. The authors
explicitly uphold this postulate and turn it into one of the most
important pillars of the Shanghai text-book, which is portrayed by many
as an innovation but which unfortunately has nothing original in it:
‘Ultimately, the subordination of the value-creation process to the
labour process is for the purpose of creating an ever-increasing
quantity of social wealth to satisfy the needs of the whole labouring
people’ (ibid, p. 323).
The attempt by the authors to show that the value-creation process can
be subordinated to the main law of socialist production in an economic
system that operates according to the principle of exchange of equal
values is performed within the context of the doctrine of ‘revolution
in command’. The idealist and metaphysical approach to the place of
politics in the economy plays a fundamental role for the authors to
give reassurance about this illusory subordination. This will be
elaborated further in the last section of the present article.
The authors of the Shanghai text-book are somewhat shy when it comes to
openly acknowledging the commodity character of all products in the
transitional economy, as their counterparts in the Soviet Union
concluded towards the end of the 1950s. The universality of the
commodity character of products in the Chinese economy is implied
throughout the text and it is made almost explicit in quotes such as
this:
‘The duality of socialist products is reflected in the duality of the
production process for socialist products. As production for direct
social products, it is a labour process which creates in a planned
manner various use values to satisfy the needs of the proletariat and
the whole labouring people. As commodity production, the labour of the
producer not only creates various concrete use values but also exchange
values. The socialist production process is a unity of this labour process and the value-creation process’ (ibid, p. 317, our emphasis).
From this follows nothing less and nothing more that the socialist
product is a commodity, and therefore the socialist product harbours a
dual character, following the duality of the nature of the commodity
unveiled by Marx. In essence, the duality of the product under
socialism is a result of the necessary duality of the commodity. The
authors, without stating it openly, for fear of not sounding
revolutionary, definitely come to the conclusion that the product under
socialism is a commodity. In doing so, they still strive to pretend
that their ‘marketism’ is not of the same kind as that shown by the
Soviet revisionists. They exonerate themselves in a way that is very
hard to reconcile with the very basics of Marxist political economy.
Capitalist production is also a unity of labour process and
value-creation process. According to the ideologists of right-wing
revisionism¸ the main difference between the capitalist and socialist
unity of use value and exchange value lies in the fact that in the
latter the market is subjugated to the plan. In this regard the authors
of the Shanghai text-book reinforce this revisionist thesis with the
doctrine of the ‘revolution in command’. This doctrine is a tool in the
hands of the authors to resolve the glaring contradiction involved in
the assertion that ‘the socialist production process is a unity of
labour process and the value-creation process’.
Revisionist political economy assumes that prices and value have to
coincide, otherwise the interrelations among the branches of the
economy and the equilibrium in the flux of labour is violated. The law
of equivalent exchange is materialised through the fact that value and
price should coincide. It is evident that the authors of the political
economy text-book do indeed advocate that view. As a matter of fact,
even when the authors admit to the possibility of a deviation of the
price from value, they do it in a way that is perfectly consistent with
the conception of ‘market socialism’:
‘Under the socialist system, because of different production conditions
and supply-demand, the state plan prices may not always be identical
with the value of products’ (ibid, p. 408).
The reasons why price and value do not necessarily coincide are
significantly broader and bear far-reaching implications, which can
only be understood within the context of the Marxist-Leninist
definition of the main law of socialist production. The reason why
price and value may not coincide under socialism is not determined by
supply and demand, or even by the different production conditions. Such
conclusions can only be drawn by those who think like capitalist and/or
petty bourgeois producers and has nothing to do with the
Marxist-Leninist political economy of socialism.
Gradualist Conception of Collectivisation
The topic of collectivisation in China is a rather intricate one. It
is not within the scope of this section to cover the evolution of the
views of the Chinese economists and the policies of collectivisation.
This should be the subject of a separate work. In this section we
concentrate on the gradualist conception of collectivisation, which in
our opinion played a central role in the role of the people’s communes
in the socialist transformation of the economy and differ fundamentally
from the Marxist-Leninist conception of collectivisation. We consider
these features within the framework of the overall view of the economic
transformation summarised by the authors of the Shanghai text-book. It
is our view that the basic features of the authors’ conception of
collectivisation are consistent with other crucial elements of their
economic views, which we regard as anti-Marxist. Overall, the path of
collectivisation summarised by the authors is in essence not socialist
and is based on a number of assumptions common to well-known right-wing
theories that we will to refer to in the present article under the
generic term of gradualism.
It is most relevant to bear in mind
that in this section we do not touch upon the actual process of
formation of the people’s communes and its internal class structure. In
order to avoid confusion, we ask the reader associate the term
collectivisation as referred to in this section to the process of
elevation of the people’s communes to the level of social property
unless it is explicitly specified that the two are different processes.
On the other hand, it is our view that the Chinese people’s communes
represent an incipient aggregation of peasant on the basis of simple
cooperation. From this point of view, the people’s communes, as they
emerged after the Great Leap Forward, represent a lower form of
collectivisation with respect to that achieved in the Soviet Union
during the 30’s (i.e. on the basis of mechanisation of labour while the
main means of production remain in the hands of the socialist state).
Therefore, when we refer to the process of elevation of the people’s
communes to the level socialised production we do not want to imply
that the tasks of collectivisation were completed by the Great Leap
Forward. In a sense, we are putting ourselves in the authors’ shoes,
who assume that the tasks of collectivisation were in fact completed
and think about the question of the elevation of the collective
property from that perspective.
Before jumping into the authors’ views on collectivisation it is most
relevant to clarify what we mean by the concept of gradualism from the
point of view of the Marxist-Leninist critique of right-wing political
economy. Gradualism represents one of the most prominent tenets of the
theory of right-wing revisionism with regard to the transformation of
the collective ownership into full-fledged socialist ownership.
Gradualism can be best defined as following: A belief that the process
of elevation of collective ownership to the level of social ownership
will occur by means of the development of the forces of production in
the countryside on the basis of commodity-exchange and collective
ownership of the main means of production. According to the conception
of gradualism, the collective farms exchange values with other
collective farms, the state and consumers according to the law of
value, as they own all the agricultural production. The conception of
gradualism rests upon the concept of economic independence (commonly
known in China as self-reliance) and the assumption that the basic
difference between state-owned and collective enterprises reduces
itself to the degree of concentration of forces of production. The
conception of economic independence of the productive unit was
implemented differently by the revisionists depending of the country
and the stage of development and it applied to both state and
collective enterprises. In general¸ the concept of economic
independence applied almost equally to state-owned and collective
enterprises, as a result of which they were considered on a similar
footing by the planning organs. Following this line of thought it is
natural to argue that the main means of production should belong to the
collective farms. Therefore, the dogma that the collective farms should
retain the ownership of the main means of production is intrinsic to
the right-wing theories of ‘market socialism’ and should be considered
within this context as a manifestation of self-consistency within that
system.
Gradual transformation of the countryside is not necessarily connected
to the speed of the transformation. As a matter of fact, the process of
creation of the communes during the years of the Great Leap Forward was
a rather swift process which, strictly speaking, is to be considered
within the gradualist conception of collectivisation. Many bourgeois
and petty-bourgeois authors who discuss the economic history of China
analyse the economic reforms of the Great Leap Forward in the
countryside by concentrating on the speed and the role of ideological
elements characteristic of that process. They hardly see any
differences between the conception of collectivisation before and after
the Great Leap Forward other than these two issues, whereas a Marxist
analysis uncovers major qualitative differences.
It is particularly instructive and useful to the discussion to remind
the reader of Bukharin’s views on collectivisation. Bukharin’s
objection to the party’s general line on collectivisation is probably
the most representative example of right-wing revisionist thinking on
these questions. Modern theories of right-wing revisionism ultimately
relate to Bukharin’s critique.
‘One point of view sees economic forms and market relations, but sees
no classes; another, sees classes, but does not see the market
relations, economic proportions. Both points of view are erroneous. The
correct statement, which corresponds to reality, can be formulated as
follows: through the struggle of economic forms, through the market,
through the commodities, through the regulation of these commodities,
through the property of these commodities, through the relations of
production and through the relations of the market classes struggle…
… If as a result of whatever mistakes, our planning organs violated the
necessary economic proportions, what does this means from the point of
view of the class struggle? This means that a situation is created that
can be easily used by our enemies, the kulaks, the private owners, the
bourgeoisie in general; our handicap becomes a plus, a benefit for our
class enemy.
If we manage to reinforce proper balance of the different elements of
the economy, if we do keep the latter in equilibrium, our class enemy
will be restricted to a greater extent.’ (N. Bukharin, published in Put
k Sotializmu, Nauka, Sibirskoe Otdelenie 1990, p. 263. Translated from
the Russian.)
It is relevant to note that at the time when Bukharin expressed these
views, not only was the question of the collectivisation of the middle
and lower strata of the peasantry at stake but also the issue of the
liquidation of the rich peasants (exploiters of other peasants) as a
class. Needless to say, Bukharin in practice was against the
suppression of the economic power of the kulaks. However, the essence
of the gradualist conception remains intact even under the conditions
of complete liquidation of capitalist elements in the countryside and
can be isolated from it. Bukharin’s theories constitute the core of
modern revisionism’s conception of the socialisation of the collective
farms in the historical conditions of absence of capitalist elements
and the completion of collectivisation of the peasant masses. Bukharin,
and together with him Trotsky, firmly believed that the path to
collectivisation and the elevation of peasant production to higher
forms of organisation goes via market relations and that the socialist
state should influence agriculture via commodity-exchange:
‘The innumerable living participants in the economy, state and private,
collective and individual, must serve notice of their needs and of
their relative strength not only through the statistical determinations
of the plan commissions but by the direct pressure of supply and
demand. The plan is checked and, to a considerable degree, realised through the market’
(L.D. Trotsky, ‘The Soviet Economy in Danger’, in ‘Writings of Leon
Trotsky 1932’, Pathfinder Press, New York, 1973, p. 275. Our emphasis.)
The views presented by the authors of the Shanghai text-book
represent a concretisation of the principles expressed above in the
conditions of China’s countryside following the policies of the Great
Leap Forward. The concrete historical conditions we refer to can be
succinctly summarised as follows: completion of collectivisation of the
Chinese peasantry on the basis of simple cooperation, or people’s
communes and liquidation of capitalist households. The terms under
which rich peasants entered the Chinese people’s communes are a very
important topic, which unfortunately cannot be covered in the present
article and should definitely be subject to major scrutiny.
The elevation of the collective property to the level of socialised
property is a much more complex process than the one depicted by the
ideologists of right-wing revisionism. The point of this
transformation, which is such a prominent question for the socialist
construction in a backward and agricultural country, is not reduced to
a question of organisation of forces of production and enhancement of
concentration of production, but rather, to ensure the elevation of the
collective property to the level of property of the whole people via a
progressive process of qualitative changes. It goes without saying that
the collective farms must not be abruptly transformed into the property
of the whole society, for such a disposition would have a merely formal
character and would not resolve the tasks imposed by a genuine
socialist transformation of agriculture. The quid pro quo of such a
transformation lies in the principle that the main means of production
are retained by the state. In the Soviet Union, this Marxist principle
was concretised in the form of the Machine Tractor Stations (MTS),
which were workshops with mechanised tools owned by the state:
‘The matter has nothing to do with either Sch[ulze]-Delitzsch or with
Lassalle. Both propagated small cooperatives, the one with, the other
without state help; however, in both cases the cooperatives were not
meant to come under the ownership of already existing means of
production, but create alongside the existing capitalist production a
new cooperative one. My suggestion requires the entry of the
cooperatives into the existing production. One should give them land
which otherwise would be exploited by capitalist means: as demanded by
the Paris Commune, the workers should operate the factories shut down
by the factory-owners on a cooperative basis. That is the great
difference. And
Marx and I never doubted that in the transition to the full communist
economy we will have to use the cooperative system as an intermediate
stage on a large scale. It must only be so organised that society,
initially the state, retains the ownership of the means of production
so that the private interests of the cooperative vis-Ã -vis society as a
whole cannot establish themselves.’ (Letter of F. Engels to August Bebel in Berlin, January 20th 1886. Published by V. Singh in Revolutionary Democracy, Vol. I, No. 2, September 1995. Our emphasis.)
The elevation of the collective property to socialised property is a
process which is evolutionary in form, but in essence involves a chain
of qualitative changes and differs fundamentally from the gradualist
formula proposed by the ideologists of right-wing revisionism. The
essence of the cooperation between the socialist state and the
collective farm changes radically as a result of the fact that the
socialist state retains ownership of the main means of production.
Labour exchange between the collective farms and the state changes
qualitatively from the period when the latter is forced to trade with
independent producers who own all the means of production and therefore
also own all the products of their production. In the latter case, the
law of value necessarily becomes the regulator of labour exchange
between the socialist state and the collective farms. The socialist
plan is an external force which interacts with the collective farm via
the market. The fact that the socialist state has the prerogative to
apply a given price policy does not change the essence of this economic
relation. Whether planners want it or not, in the long run the law of
value will become the leading criterion for pricing.
When the state owns the main means of production, the law of value step
by step ceases to be a regulator and the relationship between the
socialist state and the collective farm starts to look more like the
relationship between the socialist state and the state enterprises. As
we have seen in the section on the authors’ conception of
commodity-money relations, they consider the collective farms as
individual producers, who should exchange labour with other production
units according to the principle of equivalent exchange of values, or
the law of value. The fact that the means of production are owned by
the collective farms in China is no coincidence, as it is no invention
of the Chinese economists. Much to the contrary, the MTS were sold to
the collective farms by Khrushchev and this became a new ‘standard’ for
the policies of collectivisation in the revisionist countries. The
Great Leap Forward followed a similar policy and liquidated whatever
embryo of MTS that existed in China during the years of the first
Five-Year Plan. The question of efforts at developing something like
the MTS is another very important issue that cannot covered in the
present article, but which also requires special attention.
The so called ‘Stalinist’ model for collectivisation has been demonised
by the bourgeoisie and the right-wing revisionists. Unfortunately, many
Chinese economists, following the XXth Congress echo these views to a
considerable degree. These economists concentrate on insubstantial
issues and fail to grasp of the essence of the economic transformation.
The economic analysis reduces to ideological considerations or
discussions concerning the unfair treatment of kulaks as individuals,
considered in isolation from the concrete-historical conditions at the
time. None of those critiques address the relevant underlying issues
and, in rejecting the so called ‘Stalinist’ model, they consciously or
unconsciously reproduce Bukharin-Trotsky’s scheme for collectivisation.
In our view, the following paragraph embodies the Marxist-Leninist
understanding of the essence of socialist collectivisation. This
paragraph enriches the essence of Engels’ letter by generalising the
vast experience of collectivisation in the Soviet Union and the
People’s Democracies:
‘The highest stage of cooperation of the peasantry is the organisation
of collective economies – the kolkhoz, which entails the transition to
large socialised production. The kolkhoz is a large economic unit in
the countryside, a result of the voluntary collective enterprise of
peasants, which is based on the social character of the property of the means of production
and collective labour and excludes the exploitation of man by man.’
(‘Political Economy, a Text-book’, Gosudarstvennoe Izdatelstvo
Politicheskoi Literaturoi, 1953, p. 344, our emphasis. Translated from
the Russian. Our emphasis. This Draft is preserved in the former
Central Party Archives, Moscow).
The policies of collectivisation
during the Great Leap Forward were indeed successful from the point of
view achieving the organisation of a vast number of individual
producers into the people’s communes. However, a closer look at the
economic essence of the people’s communes sheds some light on the true
character of these reforms. First of all, the use of the very term
‘commune’ has more a declaratory meaning than anything else. The
economic essence of these communes is the aggregation of individual
peasants in terms of simple cooperation on the basis of manual labour
and commodity-money relations as a primary economic bond. The fact that
the process of formation of the people’s communes was characterised by
a high level of political consciousness does not change the essence of
this basic feature. It does not alter the fact that these economic
formations, strictly speaking, do not compare to either the economy of
primitive communism or the economy of communism. In fact gradualism was
hard-coded into the essence of the policies of the Great Leap Forward
and it is from this point of view that the economic essence of the
people’s communes needs to be evaluated:
‘After the establishment of people’s communes, there is no need
immediately to transform collective ownership into ownership by the
people as a whole. It is better at present to maintain collective
ownership to avoid unnecessary complications arising in the course of
transformation of ownership. In fact, collective ownership in people’s
communes already contains some elements of ownership by the people as a
whole. These elements will grow constantly in the course of the
continuous development of the people’s communes and will gradually
replace collective ownership’ (Resolution of the Central Committee of
the Chinese Communist Party on the Establishment of People’s Communes
in Rural Areas (August 29, 1958), in ‘People’s Communes in China’,
Foreign Language Press, Peking 1958, p. 7).
As discussed above, we agree with the view that the process of
elevation of collective ownership is a relative lengthy process.
However, we believe that the argument in favour of maintaining the
collective property is insubstantial and even ambiguous. It is clear
that the basic agricultural tools should remain collective property. It
is hard to believe that such economic measure that decrees the
expropriation of the basic agricultural tools will succeed or even be
necessary at all given the concrete-historical conditions of China at
the time. Such a statement is ambiguous since no distinction is made
between basic tools and the main complex tools, like tractors or other
highly mechanised and costly devices. Not to distinguish between the
two is a rather dangerous omission. On the other hand, it is clear that
the socialist character of the communes is taken too literally to the
extent that this concept is not necessarily filled with a clear
economic content, which puts under question the scientific character of
these considerations.
Taken in isolation, the statement that the people’s communes contain
‘some elements of ownership by the people as a whole, is not
necessarily wrong. However, this is true as long as this is conceived
as a potentiality and the qualitative differences between the two types
of properties are seriously understood. In our view this is clearly not
the case, as the issue of property of the main means of production is
taken too lightly. To ignore the essence of the economic relation
between the state and the collective farms implied by the fact that the
main means of production remain in the hands of the latter liquidates
that potentiality. There is little left of the progressive potentiality
assumed hitherto. The assertion that these elements ‘will grow
constantly in the course of the continuous development of the people’s
communes and will gradually replace collective ownership’ is void of
economic content and therefore it lacks scientific substantiation; it
only represents a desire to achieve socialisation without having the
means for it. This reasoning represents an abstract scheme that has
nothing to do with dialectics. Moreover it manifests the right-wing
revisionist illusion that development on the basis of economic
independence or self-reliance can lead to the completion of the tasks
of socialist construction.
The basic theoretical and practical questions of collectivisation had
been dealt with in the Soviet Union and the People’s Democracies of
Eastern Europe. The economic essence of such economic associations
based on simple cooperation of peasants was fairly well known and the
guidelines to overcome their backwardness were clear overall and were
implemented taking into account the specifics of each country. Before
the policies of the Great Leap Forward were implemented, the Chinese
economists were aware of the considerations in this regard that were so
brilliantly presented in the draft of the Soviet Political Economy
text-book of 1953:
‘A lower level of cooperation of peasant production is the cooperation
in the realisation of the agricultural production, means of production
and the means of consumption (industrial goods), and also cooperation
in credit. These forms of cooperation play a big role in the transition
from the individual peasant production to the large, social production.
They inculcate the habits of collective management of agriculture to
broad masses of peasants. At
this stage the bond between socialist industry and peasant production
is mainly commerce, which does not yet change of the private character
of the peasant production.’ (‘Political Economy, a Text-book’,
Gosudarstvennoe Izdatelstvo Politicheskoi Literaturoi, 1953, pp.
343-344, our emphasis. Translated from the Russian.)
We do not
question the presence of socialist elements in the people’s communes.
However, we fear that this assertion is basically driven by ideological
attributes rather than by a serious economic analysis. There is no
doubt that the agglutination of individual peasant households into
associations of peasants based of simple cooperation is a step forward
towards socialism, provided that those associations exclude
exploitation of man by man. But despite the progressiveness of such
associations, their private character is an objective economic fact
that simple cooperation by itself will not be able to overcome.
Thousands of revolutionary slogans and the best socialist education can
do little to overcome such a fundamental handicap, which establishes a
rift between state and collective ownership. To believe that such a
rift can be overcome by giving the main means of production to the
collective farms and by developing the forces of production on the
basis of commodity-money exchange is hopelessly anti-Marxist and
reminds us once again of Dühring’s conception of socialism. In order to
reconcile this glaring anti-Marxist contradiction the authors of the
Shanghai text-book do nothing else than to appeal to the elevation of
the consciousness of the peasants. If there is anything truly original
in this thinking it is the view that the level of ideological
development is the solution to all the hopeless contradictions of the
theory of ‘market socialism’ that the Shanghai text-book is a
particular expression of.
‘… China’s rural people’s commune will gradually pass from the present
ownership system based on the production team to a future ownership
system based on the brigade and the commune, and then from there
gradually to a socialist state ownership system. This will be a long
process of gradual development…
‘… The development of the collective ownership system from the small to
the big, from the low to the high, and from the collective ownership to
the state ownership is all based on a gradual improvement of the
productive forces and the socialist consciousness of the people’ (ibid,
p. 270).
At that time the Chinese leadership believed that the socialisation of
the people’s communes would take a number of years, although this would
be a relatively short period. The Chinese economists seem to have
changed that estimate, as is made manifest in the Shanghai text-book.
However, we do not observe any fundamental change in the conception of
collectivisation in the text-book with respect to those predominant in
China towards the end of the 1950s. A more detailed study of the
evolution of views among the Chinese economists is required to come to
solid conclusions. However, it seems fair to state that the authors of
the Shanghai text-book make their pro-market orientation more explicit.
The authors openly acknowledge that the Chinese people’s communes
operated as independent productive units, which is responsible for and
appropriates its profit while owns its means of production and,
therefore for capital investments. This is probably an expression of
the fact that their pro-market spirit was more advanced than that
displayed by the Chinese economists towards the end of the 1950s.
‘The means of production and labour power under the socialist
collective ownership belong to individual collective organisations of
the labouring people. Each collective economic organisation is an
accounting unit. It organises production, according to prices set by
the state. It operates independently and is responsible for its profits
and losses.… China’s rural people’s commune uses the three level
ownership system of the commune, the production brigade, and the
production team. The commune, the brigade and the production team are
all accounting units which operate independently and are responsible or
their profits and losses’ (ibid, p. 410).
As pointed out at the beginning of the present section, we are not
dealing with a number of crucial issues regarding collectivisation in
China. We have reduced ourselves to touch upon the authors’
understanding of the basic trends of the elevation of the people’s
communes to the level of socialised property. We view their conception
within the context of a broader question, namely the theories of
‘Market Socialism’. The gradualist character of the authors’
understanding of collectivisation is perfectly consistent with other
right-wing conceptions exposed in other sections. The present analysis
by far does not saturate the list of central topics in
collectivisation. For instance, in what form did the machine tractor
station exist in the Chinese country side and when were they
liquidated? Also, further investigation is required to establish the
class character of the Chinese people’s communes and what was the role
of the rich peasants in their formation. Under what conditions were the
rich peasants allowed to enter the people’s communes? We need to
investigate the similarities between the people’s communes and the
Titoite conception of collectivisation in this respect. We also need to
evaluate the differences and similarities between the people’s communes
and the policies of collectivisation in Eastern Europe after the XXth
CPSU congress. These and other questions need to be studied in order to
complete the global economic picture summarised by the Shanghai
text-book.
Idealism and Metaphysics in the Definition of the Role of Politics in the Economy
In this section we briefly address the issue of metaphysics and
idealism in the treatment of the relationship between politics and
economics assumed and consistently implemented by the authors of the
Shanghai text-book. This is indeed more a basic tenet of the theory
advocated by the authors of the Shanghai text-book than the other
topics covered above. However, for the sake of the presentation of our
critique it seems more convenient to cover this question last. This
order may help the reader to more clearly appreciate the central role
that these features play in the establishment of a new economic
doctrine after the completion of the first Five-Year Plan.
Indeed, the metaphysical treatment of politics and economy is not an
invention of the authors of the Shanghai text-book, since it is common
to quite a number of ideological trends and authors before Maoism. For
instance, metaphysics in the treatment of politics and economics is
common to ideologists of Trotskyism and a number of idealist tendencies
during the 1920s in the Soviet Union, which are not particularly
well-known because they have not been translated. The latter includes
Bogdanov, who greatly influenced Bukharin and Rykov, and other
right-wing deviationist tendencies that arose in the post-war period.
Metaphysics on the question of politics and economics was not even
invented by the above-mentioned deviations, as this feature is
basically pre-Marxist. In order to fully understand the rationale of
this problem one would have to start from the influence of bourgeois
philosophical and economic thinking that Marx and Engels systematically
exposed.
In the exposition of their ideas, the authors of the Shanghai text-book
try to stick to well-established formulations as much as possible. At
least formally speaking, they even agree with Stalin’s formulation of
the object of political economy. The following are, in their opinion,
the most relevant aspects of the production relations:
‘Production relations consist of three aspects: (1) the ownership
pattern of the means of production; (2) people’s roles in production
and their mutual relations; (3) the pattern of product distribution’
(ibid, p. 4).
This compares well with Stalin’s formulation in Economic Problems:
‘The province of political economy is the
production, the economic, relations of men. It includes: a) the forms
of ownership of the means of production; b) the status of the various
social groups in production and their interrelations that follow from
these forms, or what Marx calls: ‘they exchange their activities’…
c) the forms of distribution of products, which are entirely determined
by them. All these together constitute the province of political
economy.’ (J.V. Stalin, Economic Problems of Socialism in the USSR, Peking Foreign Language Press, 1972, p. 75.)
We address the similarities of the two definitions from the formal
point of view. Indeed, the authors of the Shanghai text-book de facto
imply something different when they refer to ‘people’s roles in
production and their mutual relations’. This becomes clear within the
context of the authors’ exacerbation of the role of politics in
economics, which will be discussed in more detail below. Before moving
on, it is relevant to note, that this is one more example of the
authors’ attachment to certain formulations in political economy that
were widely accepted up to the second half of the 1950s and that were
subsequently suppressed by revisionist economists. Unfortunately, this
is one more example of the particular way the authors of the Shanghai
text-book revise the principles of Marxist-Leninist political economy
rather than a way they uphold the latter against their systematic
revision by the Soviet economists of the post-Stalin period.
The role of the ‘people’s roles in production and their mutual
relations’ adopts a different character in the Shanghai text-book.
Indeed, despite formally accepting the correct definition of the object
of political economy, the authors of the Shanghai text-book are
impelled to arrive at the following conclusion which, to the best of
our knowledge, cannot be found in any of the texts written by the
classics of Marxism-Leninism:
‘Therefore, if one wants to understand how old production relations are
transformed and new production relations are established and perfected,
it is not enough to explain in terms of the contradictions between the
production relations and the productive forces. The relations between
the superstructure and the economic substructure must also be
investigated’ (ibid, p. 8).
At first glance, the last sentence would sound to a Marxist like a kind
of tautology, a very suspicious one indeed. Within the framework of
dialectical materialism it makes no sense not to consider the relations
between the superstructure and its economic basis. Marxists consider
society as a unity of the economic structure and the superstructure.
This is implied in the Marxist method itself. Whoever does not
implement such a relationship cannot be called a Marxist. Do the
authors of the Shanghai text-book want to emphasise dialectical
materialism in the study social phenomena? In our view, they pursue a
far more ambitious goal: they want to include the study of the
phenomena of superstructure in the object of political economy. This is
a basic postulate for the authors of the Shanghai text-book to preserve
a certain consistency in the system of ideas they advocate. One does
not have to emphasise the need to study the ‘relations between the
superstructure and the economic substructure’ if the basic laws of
historical materialism are properly laid down. It only makes sense to
emphasise this if the ultimate goal of the discussion is to exacerbate
the role of politics in the study of the production relations. It only
makes sense if one were to consider the ‘old’ political economy to be a
one-sided discipline, which prior to their ‘creative development’ had
underestimated the role of the influence of the superstructure on
economic phenomena.
Again, the authors of the Shanghai text-book formally accept a basic
formulation in political economy, according to which the economic base
determines the superstructure and not the other way around:
‘In the contradiction between the superstructure and the economic
substructure, the latter, in general, is the determining force’ (ibid,
p. 8).
The devil, however, can be found sometimes in the details. While
formally accepting a rather widespread Marxist notion, the authors of
the text-book express a concern that this formulation is valid ‘in
general’, i.e. it may not be valid in every instance. As will be seen
below, the authors of the Shanghai text-book believe that in the
transitional society the superstructure plays a dominant role and that
political economy deals to a great extent with how the superstructure
influences the economic base.
‘The superstructure is determined by the economic substructure. Once it
is established it has immense negative effect on the economic
substructure’ (ibid, p. 9).
This statement is followed by a quote from Stalin’s Marxism and Linguistics
in which the latter stresses that the superstructure serves the
economic base in order to consolidate it and in doing so destroys the
economic base and superstructure. Needless to say, Stalin does not
imply that the superstructure is either passive or that its influence
is immense, and he does not do this because, as a Marxist, Stalin
considers politics and economics in their dialectical unity. The true
goal of the authors of the Shanghai text-book here is to allow
themselves some flexibility in determining the relative weight of the
superstructure in social formation. It is clear that they reserve to
the superstructure a leading role in the transitional society. In order
to come to such conclusions in the practice of the study of economic
phenomena in revolutionary China, it is convenient to lay the necessary
groundwork:
‘The transition from one societal form to another in
human society is impelled by the basic social contradiction, namely,
the contradiction between the production relations and the productive
forces and between the superstructure and the economic substructure’
(ibid, p. 225).
The authors of the Shanghai text-book basically place the
contradictions between the production relations and the productive
forces on the same or even lower level than the contradictions between
the superstructure and the economic base. It is basically up to the
analysis of the contradictions in a particular society to determine the
relative weight of these two types of relationships. Needless to say,
such statements are an educational example of metaphysical thinking and
a rather crude expression of how alien dialectical materialism is to
the system of economic ideas advocated by the authors of the Shanghai
text-book.
The authors’ conception of the role of the superstructure in the
transition to socialism flagrantly violates the basics of political
economy and historical materialism. It should be unnecessary to remind
the reader that the founders of Marxist-Leninist political economy had
a different view of the role of the phenomena of consciousness and that
one can find innumerable accounts in which Marx and Engels made it
crystal clear what the foundations of historical materialism consist of
and why pre-Marxist historical science and political economy failed to
scientifically grasp the laws of historical evolution. Moreover, these
basic laws are applicable to all social formations, of which socialism
or the transition to it and communism is not an exception. It fits,
however, the flow of the discussion to remind the reader of these two
classic paragraphs:
‘The
general conclusion at which I arrived and which, once reached, became
the guiding principle of my studies can be summarised as follows. In
the social production of their existence, men enter into definite,
necessary relations, which are independent of their will, namely,
relations of production corresponding to a determinate stage of
development of their material forces of production. The totality of
these relations of production constitutes the economic structure of
society, the real foundation on which there arises a legal and
political superstructure and to which there correspond definite forms
of social consciousness. The mode of production of material life
conditions the social, political and intellectual life-process in
general. It is not the consciousness of men that determines their
being, but on the contrary it is their social being that determines
their consciousness.’ (K. Marx, ‘Introduction to a Contribution to
the Critique of Political Economy’, Foreign Languages Press, Peking
1976, p. 343.)
And this famous passage of Engels in Anti-Dühring:
‘The materialist conception of history starts from the principle
that production and, next to production, the exchange of things
produced, is the basis of every social order; that in every society
that has appeared in history, the distribution of wealth and with it
the division of society into classes or estates are dependent upon what
is produced, how it is produced, and how the products are exchanged.
Accordingly, the ultimate causes of all social changes and political
revolutions are to be sought, not in men's brains, not in their growing
insight into eternal truth and justice, but in changes in the modes of
production and exchange. They are to be sought, not in the philosophy, but in the economics of each particular epoch.’ (F. Engels, Foreign Languages Press, Peking 1976, p. 343.)
For some reason the authors imply that forms of the superstructure,
consciousness, ideology, play a leading role in the process of
socialist construction, which allegedly corresponds to a social
formation in which the basic principles of political economy and
historical materialism, as formulated by Marx and Engels, are either
transformed or operate in a different way. To the question as to why
the economic structure plays a dominant role with respect to the
superstructure in class societies such as capitalism, while this
relationship suffers a qualitative change in the transitional society,
the authors of the Shanghai text-book do not really give a scientific
answer. Apparently the practice of socialist construction in China has
led them to believe that the contradictions between the superstructure
and its economic structure come to the forefront as a fundamental
contradiction of the social formation, at the same level as the
contradiction between the forces of production and relations of
production. It seems to us, however, that the exacerbation of the
reverse influence of the superstructure plays the role of the Trojan
horse for right-wing revisionist conceptions in the political economy
of the transitional system, as will be discussed below.
The idealist character of the understanding of the role of the
superstructure advocated by the ideologists of the Shanghai text-book
has been brilliantly exposed by Sunil Sen (‘Raymond Lotta and the
Political Economy of Socialism’ published in Revolutionary Democracy
Vol. V, No. 1, April 1999). In his excellent article Sen delivers a
devastating critique of the appraisal by Lotta (who is a leader of the
Revolutionary Communist Party(USA) and the Revolutionary
Internationalist Movement) of the Shanghai text-book. The bourgeois
essence of Lotta’s allegedly Marxist appraisal is denounced by the
author, who exposes Lotta’s critique of the ‘productivist’ Stalin in
contrast to the ‘revolution-in- command’ political economy advocated by
the authors of the Shanghai text-book. It is most helpful to cite a
very important passage of Marx-Engels German Ideology
referred to by Sen, which clearly shows the anti-Marxist and idealist
character of the attacks on the so-called ‘productivism’ of the
‘Stalinist’ conception of the political economy of Socialism:
‘Communists do not oppose egoism to selflessness or selflessness to
egoism, nor do they express this contradiction theoretically either in
its sentimental or in its high-flown ideological form; they rather
demonstrate its material source, with which it disappears of itself.
The Communists do not preach morality at all.
They do not put to people the moral demand: love one another, do not be
egoists, etc.; on the contrary, they are very well aware that egoism,
just as much selflessness, is in definite circumstances a necessary
form of the self-assertion of individuals. Hence, the Communists by no
means want to do away with the ‘private individual’ for the sake of the
‘general’, selfless man. That is a statement of the imagination.
Communist theoreticians, the only Communists who have time to devote to
the study of history, are distinguished precisely by the fact that they
alone have discovered that throughout history the ‘general interest’ is
created by individuals who are defined as ‘private persons’. They know
that this contradiction is only a seeming one because one side of it,
what is called the ‘general interest’, is constantly being produced by
the other side, private interest, and in relation to the latter is by
no means an independent force with an independent history – so that
this contradiction is in practice constantly destroyed and reproduced. Hence
it is not a question of the Hegelian ‘negative unity’ of two sides of
the contradiction, but of the materially determined destruction of the
preceding materially determined mode of life of individuals, with the
disappearance of which this contradiction together with its unity also
disappear’ (our emphasis). (K. Marx and F. Engels, in German Ideology, Collected Works, Progress Publishers, Moscow 1975, Vol. 5, p. 247.)
As we have seen in the previous section, the authors’ attitude towards
commodity-money relations differs little from that of the revisionist
economists in the post-Stalin period. While appealing to the need to
‘control commodity-money relations in the transitional economy, to
subjugate them to the needs of the progressive transformation of
society, they nevertheless assume the commodity character of almost all
products in the transitional economy, both in form and content, and
they assume the law of value as the regulator of the portions of labour
exchanged among production objects. Among those who uphold the
allegedly revolutionary character of the Shanghai text-book, there are
those who still claim that its theses are in contradiction with the
essence of ‘market-socialism’, however they see the need to suppress
the role of commodity-money relations not from the point of view of the
economic laws of the transitional economy, but from the perspective of
consciousness:
‘I believe that commodity production and the market have to be
transcended – because they are obstacles to people consciously taking
hold of and transforming society.’ (R. Lotta in ‘Socialist Planning or
‘Market-Socialism’?’, Revolutionary Worker #1166, September 15, 2002.)
Lotta considers that the existence of commodity-money relations hinders
the development of the ability of people to transform society, because
it perpetuates bourgeois thinking, and thus he objects to those who
openly agitate in favour of ‘market-socialism’. But is the objection to
the theses of ‘market socialism’ in the realm of consciousness? Will
bourgeois and petty bourgeois thinking be liquidated with the
eradication of commodity-money relations? Is the understanding of the
laws that govern the transitional economy determined by phenomena of
consciousness? When a Marxist appeals to the need to restrict the
sphere of operation of commodity-money relations, issues related to the
character of labour exchange between various production units, the
relationship between production and consumption, extended reproduction,
the essence of plan are implied and interconnected, etc.
Many of those who have argued and still argue that the so-called
‘Soviet style’ (i.e. Stalinist) political economy ignored the role of
politics usually quote Lenin’s famous statement that ‘politics is a
concentrated expression of economics’, written in his polemics with
Trotsky and Bukharin with regard to the role of the trade unions under
the dictatorship of the proletariat. Those who support the view that
Stalin deviated from Lenin or that Lenin basically took an innovative
stand with regard to the interrelation between politics and economy,
which Stalin allegedly did not grasp, take the quote out of context. On
the contrary, those who advocate reducing the problems of political
economy to a question of the dominance of proletarian ideology
apparently have not paid close enough attention to the discussions and
causes that led Lenin to make his statement. Paradoxically, they commit
the same theoretical mistake as Trotsky and Bukharin, which Lenin was
fighting at the time when he made his famous statement, namely the
mechanical and metaphysical separation of politics and economics within
the contexts of a particular discussion. Let us review some of the
details of the circumstances surrounding Lenin’s famous statement:
‘It is strange that we should have to return to such elementary questions,
but we are unfortunately forced to do so by Trotsky and Bukharin. They
have both reproached me for ‘switching’ the issue, or for taking a
‘political’ approach, while theirs is an ‘economic’ one. Bukharin even
put that in his theses and tried to ‘rise above’ either side, as if to
say that he was combining the two.
This is a glaring
theoretical error. I said again in my speech that politics is a
concentrated expression of economics, because I had earlier heard my
‘political’ approach rebuked in a manner which is inconsistent and
inadmissible for a Marxist. Politics must take precedence over
economics. To argue otherwise is to forget the ABC of Marxism.’ (V.I.
Lenin, Collected Works, Progress Publishers, Moscow, 1965, Vol. 32, p. 83.)
The statement that politics is a concentrated expression of
economics came originally from the resolutions of the Ninth Congress of
the R.C.P. on the trade unions. The resolutions emphasised the
requirement that the trade unions, as the economic organisation of the
working class, should not enter into contradiction with the Soviet
power. The fact of the matter is that the existence of economic
organisations of the working class within the context of the state of
the dictatorship of the proletariat does not necessarily lead to the
confrontation between the economic interest of the proletariat and of
the state. Since politics is the concentrated expression of economics,
the defence of the economic interest of the proletariat cannot
contradict the politics of the Soviet State. In addition, let us not
forget that trade unions, unlike those under capitalism, perform other
tasks as well, although that is probably beside the point. When Lenin
emphasised that politics ‘must take precedence over economics’ he was
by no means subverting the Marxist relationship between politics and
economics, as the authors of the Shanghai text-book seem to claim.
Lenin’s statement should be understood within a different context: that
the local economic interest of the workers collective cannot enter into
contradiction with the politics of Soviet power and that politics and
economy in a workers state should display unity.
‘Politics is the
most concentrated expression of economics, its generalisation, and its
culmination. Therefore, any opposition between the trade unions, as the
economic organisation of the working class, and the soviets, as its
political organisation, is completely absurd and is a deviation from
Marxism in the direction of bourgeois – specifically, bourgeois
trade-unionist prejudices. Such an opposition is especially absurd and
harmful in the epoch of the proletarian dictatorship when its whole
struggle, its whole activity – both economic and political – must be
unified more than ever before, must be concentrated and directed by a
single will, bound together in an iron unity.’ (On the Question of the
Trade Unions and their Organisation, KPSS v rezoliutsiiakh 2, 150-179.)
From this it does not follow that Lenin ceased to be a Marxist by
admitting to the postulate formulated by the authors of the Shanghai
text-book, that along with the contradictions between the productive
forces and productive relations, the superstructure and the economic
substructure become a fundamental contradiction of the transitional
society. Much to the contrary, Lenin remains a Marxist throughout the
discussion on trade unions and does not deviate an inch from the basics
of Marxist political economy. Lenin makes that very clear, in case
those who do not understand dialectics claimed that the leader of the
Bolshevik revolution all of a sudden decided to take a turn in favour
of ‘politics over economics’:
‘…as political superstructure in general (which must exist until
classes have been abolished and a classless society established),
serves production and is ultimately determined by the relations of
production in a given society.’ (V.I. Lenin, Collected Works, Progress Publishers, Moscow, 1965, Vol. 32, p. 81.)
Lenin’s Marxist standpoint is made clear with a careful reading of
‘Once Again on the Trade Unions…’. Lenin’s statement about politics
being the most concentrated expression does not mean that a new
contradiction arises that becomes part of the object of study of
political economy. The following paragraph is very revealing and fits
very well the purpose of addressing allegations that Lenin meant
something different, other than overcoming the ideological confusion
that Trotsky and Bukharin dully fostered around the question of the
role of trade unions in the transitional society, and which the authors
of the Shanghai text-book seem to reproduce in different historical
conditions.
‘I could not help smiling, therefore, when I read Comrade Trotsky's
objection in his speech of December 30: ‘In his summing-up at the
Eighth Congress of Soviets of the debate on the situation, Comrade
Lenin said we ought to have less politics and more economics, but when
he got to the trade union question he laid emphasis on the political
aspect of the matter’ (p. 65). Comrade Trotsky thought these words were
‘very much to the point’. Actually, however, they reveal a terrible
confusion of ideas, a truly hopeless ‘ideological confusion’. Of
course, I have always said, and will continue to say, that we need more
economics and less politics, but if we are to have this we must clearly
be rid of political dangers and political mistakes.’ (Ibid, p. 85, our emphasis.)
It is absurd to argue that during the course of discussions about trade
unions and Soviet power Lenin could have taken a different attitude to
the role of politics and economics. Lenin as a Marxist considered
politics and economics, the superstructure and the economic structure,
in its dialectical unity. According to the specifics of such a
dialectical relationship, economics plays a determining role with
regards to politics. To argue that Lenin meant otherwise, that politics
should play a more prominent role, as opposed to what was advocated by
Marx and Engels, does not make much sense. This is equivalent to
claiming that Marx and Engels did not grasp such a basic relationship
and that all their works on historical materialism need to be reviewed.
Such an argument can be understood only if those who make such claims
are not aware of the dialectical relationship between politics and
economics. By claiming that politics should play a more prominent role,
one basically falls into the trap of metaphysical thinking, according
to which politics and economics are treated as two mechanically
connected sides of the unity. This type of metaphysical mistake was
exactly what Lenin was fighting and he was indeed very specific about
it.
‘The gist of his [Trotsky’s, our remark] theoretical mistake in this
case is substitution of eclecticism for the dialectical interplay of
politics and economics (which we find in Marxism). His theoretical
attitude is: ‘on the one hand, and on the other’, ‘the one and the
other’. That is eclecticism. Dialectics requires an all-round
consideration of relationships in their concrete development but not a
patchwork of bits and pieces. I have shown this to be so in the example
of politics and economics. (ibid, p. 91.)
Generally speaking, to claim a given side of the considered unity
should be more or less emphasised is a reflection of metaphysical
thinking, which in the particular context considered here leads to
idealism. To claim that politics was not sufficiently emphasised in the
so-called ‘Soviet-style’ (Stalinist) system is as absurd as arguing
that there exist good dialectical unities and bad dialectical unities.
To insinuate that this or that side of the unity was neglected is a
contradiction per se. The only possible objection that one can make is
whether economics and politics were ever considered as a dialectical
unity. It would be fair to evaluate whether in Stalin’s period the
economists considered politics and economics as two sides of a
dialectical unity and scrutinise the economic history from that point
of view. It would make sense to argue with those who would consider
(erroneously, though) that Soviet economists during Stalin’s period did
not consider politics and economics in their dialectical unity. In that
case we could develop a discussion on the basis of concrete historical
material and prove them wrong by means of a scientific analysis of the
politics and economics of that period. However, it is nonsense to argue
either that politics was neglected, or that the role of economics was
overestimated. It is absurd because by appealing to different degrees
of mechanical compensation of the poles of a contradiction one is
denying dialectics altogether and replacing it by mechanical
metaphysics.
The statement of the authors of the Shanghai text-book that the
contradiction between the superstructure and the economic substructure
is as basic a contradiction as the one between the production relations
and the productive forces is one of the most direct expression of their
metaphysical thinking and their lack of understanding with regard to
basic questions of dialectics. This statement is a reflection of the
mechanical separation between politics and economics that Lenin fought
so hard against and it subverts the very basics of historical
materialism.
Such mistakes are neither new in the history of revisionist thought
nor, fortunately, are they necessarily inherent in the revolutionary
traditions of the Chinese communists. One would therefore wonder why
Chinese economists after the XXth CPSU Congress, in which the Soviet
revisionists openly condemned Stalin, would resort to such type of
arguments. One would wonder if this was an isolated blunder with no
connection to a more general change of economic line or, on the
contrary, if such an argument was to play a more prominent role and
become the Trojan horse for right-wing revisionism in the practice of
economic construction in China.
We have seen above that, although it is concealed by militant
phraseology, one can unveil the basic tenets of right-wing revisionism
concerning the political economy of the transitional society in the
Shanghai text-book. We have also seen that the authors of the Shanghai
text-book display a particular idiosyncrasy, which enables them to
portray the new and revisionist economic line in a fashion differently
from that of their counterparts in the post-Stalin Soviet Union. In
addition, some of the ideas that were portrayed as innovative, or were
even elevated to the level of a development of Marxism-Leninism, are
fundamentally pre-Marxist. The authors of the Shanghai text-book at
times rebel against the Soviet revisionists by keeping some
formulations that had been banned in the Soviet Union towards the end
of the 1950s. As we have seen, such attempts to formally dissociate
themselves from the mainstream revisionist line that overwhelmed the
economic thinking in the post-Stalin period are aimed at nothing but
concealing the revisionist essence of the new economic doctrine that
took shape in China in the late 1950s (after the XXth CPSU Congress)
and early 1960s, which is well summarised in the Shanghai text-book. We
find these attempts to portray a well-known revisionist doctrine with
ultra-revolutionary phraseology to be severely deceiving. It is
especially deceiving because the authors of the Shanghai text-book
resort to the idealisation of the role of politics, a terrible misuse
of political declarations in order to conceal the fact that the roots
of the new economic system do not differ in any fundamental way from
those imposed by the revisionist cliques in the post-Stalin Soviet
Union and the former People’s Democracies in Eastern Europe.
The role of the metaphysical and idealist mistakes within the context
of the relationship between economics and politics has a well-defined
role for the authors of the Shanghai text-book: the key to the solution
of the economic problems of the transitional society, of the problems
of political economy are determined by the political leadership and the
level of political consciousness of the masses. Such fundamental
questions as the relationships between agriculture and industry,
between heavy and light industry, commodity-money relations, the role
of the plan, and the character of collectivisation are in essence
determined by the ideological stamina of society and not the other way
around. The metaphysical separation between economics and politics
allows the authors of the Shanghai text-book to reverse the classical
relationship between politics and economics. Following this line of
thought, it becomes more relevant to the process of socialist
construction to deal with ideological issues, educational issues,
issues of collective and socialist morale, etc., rather than to deal
with and solve concrete questions intrinsic to political economy.
Maybe within this context we can understand why the authors of the
Shanghai text-book include the study of interpersonal relations as part
of the object of political economy. It was never clear to us, what
exactly is the extent of interpersonal relations. Is this an expression
of the fact that people are forced to establish a pattern of
relationships as a result of their participation in production? But
this would be too much of an abstract and general consideration.
According to Marx, these so called personal relations would be
concretised by the relations of property, distribution and consumption.
Do the authors of the Shanghai text-book want to add a new aspect to
the definition of personal relations? Perhaps, the levels of
ideological development, collective and socialist morality also qualify
as a personal relation of production. This question remains unclear to
us.
Regardless of whatever formal definition of the object of political
economy the authors of the Shanghai text-book may want to put forward,
there is no doubt that the doctrine of ‘revolution in command’
summarised by them brings within itself the tenets of revisionism in
political economy, which were alien to the economic thinking that gave
birth to the First-Five year plan. In essence, one seems impelled to
conclude that as long as the proletarian ideology is in command and the
ideas of the revolution are deeply enough rooted in the minds of the
people, the fact that the development of heavy industry is driven by
agriculture, that light industry is given priority compared to heavy
industry, that enterprises de facto act as independent productive
units, that the plan, with the exemption of strategic units, acts more
like a principle of coordination among independent productive units,
that the law of value is the regulator of the proportions of labour
exchanged not only between the collective but also among state
enterprises, that collectivisation is developed on the basis of simple
cooperation and not on high-level cooperation between the state and the
collective farms on the basis of high-technological mechanisation led
by the state, that the collective farms own the main means of
production instead (if available), that old landowners are allowed to
enter the cooperatives, that the old national industrial bourgeoisie is
allowed to receive a fixed percentage of the profits, etc. All these
and more are allowed into the transitional economy. The authors of the
Shanghai text-book do not have a problem with propagating in practice
the basic features of the right-wing revisionist scheme that is
commonly referred to as ‘market socialism’ as long as revolutionary
politics and slogans are in command!
This idealist and metaphysical approach to the role of politics in the
economy reaches levels of absurdity unheard of in the history of
right-wing revisionism. These mistakes impel the authors of the
Shanghai text-book to arrive at and support glaring and unrealistic
voluntarism:
'Advances in science and technology and innovations in production
tools play a big role in developing production and raising labour
productivity. But ‘the determining factor is the people, not things’
[quote from Mao’s ‘On protracted war’, our remark] … The broad masses
of China put it well: ‘Fear
not the lack of machines; fear only the lack of ambition. With the red
heart in two hands, everything can be produced with self-reliance’ [our emphasis]…’ (ibid, p. 326-7).
Voluntarism in economy, which is a subjective idealist interpretation
of the economic laws in general, and under socialism in particular,
definitely leads to the denial of the objective character of economic
laws. In this case it reaches levels of monumental absurdity. The new
economic doctrine that arose in the late 1950s and early 1960s, which
dismantled the spirit of the first Five-Year Plan, comes to the
conclusion that the collectivisation of the vast masses of peasants and
the elevation of collective property to the level of property of the
whole people can occur without massive mechanisation of labour and on
the basis of simple cooperation of peasants. According to the authors
of the Shanghai text-book, the construction of socialism in the
countryside develops through self-reliance of individual collective
farms. As we saw in the sections about collectivisation and the role of
commodity-money relations, according to the authors the socialisation
of agriculture goes via the development of productive forces of a
system of isolated producers linked among themselves and with the state
through the principle of equivalent exchange of value (i.e. the law of
value). This is an absurdity in flagrant contradiction to what had been
advocated by the founders of Marxism-Leninism, which is portrayed by
the authors of the text-book as a perfectly plausible scheme for the
Chinese economy as long as revolutionary politics are in command. The
sad part is that the authors of the Shanghai text-book take this
petty-bourgeois thinking to the extreme and portray the result as a
development of Marxism-Leninism!
‘Therefore, in socialist society, the ultimate way to develop and
increase labour productivity is to insist on continuing revolution
under proletarian dictatorship. After the proletariat seizes political
power, only by exercising the influence of the socialist superstructure
to unfold penetratingly socialist revolution on the political,
economic, and ideological battle fronts under the guidance of the
Party’s correct line and with the aid of government power under
proletarian dictatorship can the sabotage and obstruction of the
bourgeoisie and capitalist influence be swept away and destroyed’
(ibid, p. 327).
The above paragraph summarises, in the opinion of the authors of the
text-book, what the political economy of the transitional society is
reduced to. Needless to say, Marxist-Leninist do not have a problem
with revolutionary politics and slogans, with political education of
the masses, with the idea of bringing politics to the workplace to
explain to the masses the new essence of labour in the transitional
society, with the propagation of the ideas of collectivism, socialist
morality in order to curb the ideology inherited from capitalism and
feudalism, to liquidate the remnants or even possible further
development of petty-bourgeois ideology and attitude towards labour.
All those things are necessary for the success of the construction of
the basis of socialism. But why propagate the tenets of right-wing,
anti-socialist revisionism in the practice of economic construction?
Why reproduce the basic features of the revisionist economic system
defined by post-Soviet revisionism? Why liquidate the economic
principles that made the first Five-Year Plan so successful? Can
politics bring about such a dramatic turn in the definition of the
basics of the political economy of the transitional period?
The tasks of the construction of the basis of socialism and the further
development of communist construction will not be achieved by politics
alone, not in a hundred years, especially if the revisionist political
economy is brought into the economic practice. Moreover, if we were to
be rigorous about the concrete-historical sources of the restoration of
classical forms of capitalism in modern China, one should not try to
find them in the level of success or failure of the politics of the
Cultural Revolution¸ or in the betrayal of concrete political leaders,
but in the well-established concrete-historical fact that the basic
principles of Marxist-Leninist political economy of the transitional
economy were liquidated after the first Five-Year Plan! Unfortunately,
the Cultural Revolution did not touch upon this crucial question. Much
to the contrary, it insisted on propagating further the ideas of
right-wing revisionism in political economy, as summarised by the
Shanghai text-book. The Cultural Revolution addressed questions of
ideology, fought bourgeois and petty bourgeois ideology, exposed the
enemies of the party and the people, but failed to address the
objective economic base of that very same bourgeois and petty-bourgeois
ideology.
To conclude, contrary to what many have come to advocate, the ideology
of Maoism as we know it today is not necessarily a frozen system of
ideas, since it evolved together with historical conditions. We have
shown this in the context of the discussions about the political
economy of socialism. It would be incorrect to put a cross on the
entire revolutionary process in China. Indeed, what it is commonly
known as Maoism, at least with regard to questions of political
economy, came to being after the XXth Congress of the CPSU and needs to
be understood from this perspective. Idealism in the treatment of the
relationship between politics and economics plays a central role in
this evolution and defines the idiosyncrasy of Maoism in political
economy. Whatever is formally different in the Shanghai text-book from
the dogmas developed by the post-Stalin Soviet revisionists is to a
large extent determined by metaphysics and idealist features discussed
in this section. Needless to say, these features are no more than a
reflection of pre-Marxist thinking.