lnp3 at SPAMpanix.com
Sun Aug 29 09:46:56 MDT 1999
(This was first posted a couple of years ago in the course of a debate with
As part of his ongoing crusade against socialism, Chris Sciabarra blames
the economic woes of the former Soviet Union on "planning." Stalin and his
clique of rulers did not "plan" the Soviet economy. They had no use for
engineers, statisticians or economists. When Peter Palchinsky, the subject
of Loren Graham's essential "Ghost of the Executed Engineer", objected to
Stalin's capriciousness, the tyrant had him executed. Stalin's
industrialization policies were identical to his approach to Soviet
military defense: irrational, stupid and self- destructive.
Let us put Stalin's policies into context. In the mid 1920's Bukharin and
Stalin were allied against the Left Opposition, which included Trotsky,
Kamenev and Zinoviev. Bukharin and Stalin were for tolerating the growth of
capitalist agriculture. The Left Opposition favored rapid
industrialization, a planned economy and steep taxation on Kulaks, the
wealthy peasants, in order to finance the state sector. Stalin and Bukharin
triumphed and plowed ahead with their rightist policies. However, in the
late 1920's, the rich peasants began to resist the Soviet government by
withholding grain. Stalin grew alarmed, and lurched wildly to the left. He
declared war on the Kulaks and appropriated many of the superficial
features of the program of the Left Opposition.
In a few short years, everybody figured out that Stalin was making a
mockery of the platform of the Left Opposition on all fronts. The area, of
course, that concerns us in this article is the planned economy. Did Stalin
favor a planned economy? History tells us otherwise.
The Soviet government announced the first five year plan in 1928. Stalin
loyalists, like Krzhizanovksy and Strumlin, who headed Gosplan, the
minister of planning, worried about the excess rigidity of this plan. They
noted that the success of the plan was based on 4 factors: 1) five good
consecutive crops, 2) more external trade and help than in 1928, 3) a
"sharp improvement" in overall economic indicators, and 4) a smaller ration
than before of military expenditures in the state's total expenditures.
How could anybody predict five consecutive good crops in the USSR? The plan
assumed the most optimistic conditions and nobody had a contingency plan to
allow for failure of any of the necessary conditions.
Bazarov, another Stalin loyalist in Gosplan, pointed to another area of
risk: the lack of political cadres. He warned the Gosplan presidium in
1929, "If you plan simultaneously a series of undertakings on such a
gigantic scale without knowing in advance the organizational forms, without
having cadres and without knowing what they should be taught, then you get
a chaos guaranteed in advance; difficulties will arise which will not only
slow down the execution of the five-year plan, which will take seven if not
ten years to achieve, but results even worse may occur; here such a
blatantly squandering of means could happen which would discredit the whole
idea of industrialization."
Strumlin admitted that the planners preferred to "stand for higher tempos
rather than sit in prison for lower ones." Strumlin and Krzhizanovksy had
been expressing doubts about the plan for some time and Stalin removed
these acolytes from Gosplan in 1930.
In order for the planners, who were operating under terrible political
pressure, to make sense of the plan, they had to play all kinds of games.
They had to falsify productivity and yield goals in order to allow the
input and output portions of the plan to balance. V.V. Kuibyshev, another
high-level planner and one of Stalin's proteges, confessed in a letter to
his wife how he had finessed the industrial plan he had developing. "Here
is what worried me yesterday and today; I am unable to tie up the balance,
and as I cannot go for contracting the capital outlays--contracting the
tempo--there will be no other way but to take upon myself an almost
unmanageable task in the realm of lowering costs."
Eventually Kuibyshev swallowed any doubts he may have had and began cooking
the books in such a way as to make the five-year plan, risky as it was,
Real life proved how senseless the plan was. Kuibyshev had recklessly
predicted that costs would go down, meanwhile they went up: although the
plan allocated 22 billion rubles for industry, transportation and building,
the Soviets spent 41.6 billion. The money in circulation, which planners
limited to a growth of only 1.25 billion rubles, consequently grew to 5.7
billion in 1933.
Now we get to the real problem for those who speak about "planning" during
this period. As madcap and as utopian as the original plan was, Stalin
tossed it into the garbage can immediately after the planners submitted it
to him. He commanded new goals in 1929-30 that disregarded any economic
criteria. For example, instead of a goal of producing 10 million tons of
pig iron in 1933, the Soviets now targeted 17 million. All this scientific
"planning" was taking place when a bloody war against the Kulaks was
turning the Russian countryside into chaos. Molotov declared that to talk
about a 5-year plan during this period was "nonsense."
Stalin told Gosplan to forget about coming up with a new plan that made
sense. The main driving force now was speed. The slogan "tempos decide
everything" became policy. The overwhelming majority of Gosplan,
hand-picked by Stalin, viewed the new policy with shock. Molotov said this
was too bad, and cleaned house in the old Gosplan with "all of its
old-fashioned planners" as he delicately put it.
When Stalin turned the whole nation into a work camp in order to meet these
unrealistic goals, he expanded the police force in order that they may
function as work gang bosses. Scientific planning declined and command
mechanisms took their place. As the command mechanisms grew, so grew the
administrative apparatus to implement them. The more bottlenecks that
showed up, the greater the need for bureaucrats to step in and pull levers.
This is the explanation of the monstrous bureaucratic apparatus in the
former Soviet Union, not scientific planning.
When I functioned as east coast coordinator of Tecnica, I helped to recruit
many of the volunteers who went to Nicaragua and provided technical
assistance to the Sandinista revolution. These volunteers worked at a time
when mercenary armies were attacking Nicaragua from both north and south,
funded and organized by the United States.
The United States in a single year spends more money on blue jeans than
there is in the entire gross national product of Nicaragua. Despite
Nicaragua's poverty, this revolutionary society was able to make great
gains in literacy, health, nutrition and agricultural growth.
Tecnica volunteers helped Nicaragua with some key projects:
1) A volunteer helped replace the old-fashioned type-setting equipment at
Barricada International with desktop publishing. This allowed the newspaper
to put out copy every single day without fail.
2) Volunteers worked closely with the late Ben Linder on his rural
electrification in northern Nicaragua. One of them, Jamie Lewontin, son of
Harvard scientist Richard Lewontin, was key to completing the project after
Ben's untimely death.
3) A volunteer converted currency-conversion procedures in the Central Bank
from tedious, time-consuming manual methods to one based on Lotus123
running on a single desktop computer. The dozen or so college-educated
Nicaraguans who worked in this section now could do more important work.
Tecnica as an organization reported to Carl Oquist, the chief economist
reporting to President Daniel Ortega. Oquist was an American economist who
had lived in Nicaragua since the early 70's and had sunk deep roots in
Nicaraguan society. Oquist was exactly the type of person Stalin would have
jailed or murdered.
For those who are considering the feasibility of socialism, it is about
time to start looking at newer experiments like Nicaragua or Cuba. To talk
about the USSR in the 1930's and planning in the same breath does violence
to history and cheapens language to an extreme and Orwellian degree.
When I was a teenager in the late 1950's, I used to go over to Dead Man's
Canyon with my friends to smoke Lucky Strikes and discuss politics,
religion and philosophy. We, the children of grocers, truck-drivers,
electricians and plumbers, always came to the same conclusion. Socialism
was not feasible because the United States was just too big and too
complicated for it to work. We could never manage it; the economy was
beyond our control.
Over in places like Greenwich, Connecticut, the children of ruling-class
families who were on their way to Harvard and Yale had an entirely
different concept and expectation. Not only did they see American society
and economics as manageable, they were the ones who were going to do it.
They were correct. They took their old-school ties with them into Chase
Manhattan, Exxon, General Motors, IBM, etc. and built links with their
chums in government from the same ivy-league colleges and country-clubs.
This class of people regards politics and economics as an insider's game.
They manipulate the system in order to enrich themselves and impoverish the
poor fools who smoked Lucky Strikes and convinced themselves that socialism
was just too complicated to accomplish.
Libertarianism targets not the ruling-class, but the working-class.
Libertarianism preaches that we need a society of rugged individuals.
Libertarians urge the working-class, which needs to unite itself to make
any significant gains, to fend for itself as atomized households and
individuals. Meanwhile, the ruling-class winks its eye at the libertarian
philosophers. They know full well that the only way to get ahead is to rig
the rules of the game in their own favor. Capitalism is basically a system
that requires exploitation of the many by the few and you need all sorts of
ideological con-games going on to take people's mind off their oppression.
Libertarianism is getting more and more popular in this respect.
I do not expect people like Chris Sciabarra to change his mind on questions
like this. I do hope that "market socialists" who are afraid of planning
and who lurk on this list might begin to rethink some of these questions.
Planning should not be a dirty word in our vocabulary. We should say that
we favor it and intend to put it into practice when we have finished
expropriating the capitalist class. Nothing else will do.
(Details on Stalin and planning come from chapter 5 entitled "The
Disappearance of Planning in the Plan" in Moshe Lewin's new book "Russia
USSR Russia" [The New Press, New York, 1995]. This book is as important in
understanding the former Soviet Union as anything written by Isaac
Deutscher or E.H. Carr)
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