Light on Soviet Russia. (1930)

Book Review from the December 1930 issue of the Socialist Standard

“Economic Trends in Soviet Russia.” By A. Yugoff. (George Allen & Unwin.)

The above volume is intended as a broad general outline of affairs in Russia. It affords considerable support to the position maintained by the Socialist Party since the Bolshevik upheaval.

“Soviet Russia,” says the author, in his introduction 

“is a land of economic contrasts and oppositions. In the towns there are huge factories and workshops; in the countryside, a natural economy is still almost exclusively dominant. Huge trusts and syndicates, embracing whole branches of industry and commerce, confront independent home workers and itinerant traders. Theoretically, and as a matter of principle, all the economic life of the country is under State control; whilst in practice currency crises, crises of production, gluts, crises of demand, press hard on one another’s heels, and are renewed ever and again by the spontaneous play of economic forces and by the lack of due proportion between the various branches of economic life.

Furthermore, in latter-day Russia we can see a peculiarly vivid picture of the results of artificially cultivated Socialist economic forms in a country where neither the economic nor the social conditions are ripe for anything of the kind; we can note what a caricature of true Socialism such an enforced ‘Socialism’ must be.

Two conflicting tendencies arc at work in Soviet Russia to-day. One of them has originated out of the new economic and social situation created by the revolution, the overthrow of Tsarism, and the freshly-created possibilities for a rapid unfolding of productive forces alike in industry and agriculture. The other, which Communist policy has artificially introduced into the realm of economic reality acts as a brake upon economic progress, rivets Utopian fetters upon these same productive forces, and gives rise to a pendulum swing from ‘right’ to ‘left,’ and then back to ‘right’ again.”

Yugoff holds that not only is Russia unripe for Socialism, but that the elaborate bureaucratic structure of nationalisation which the Communist rulers have built up, is a barrier to the capitalist development, which is an essential preliminary to the establishment of Socialism. Nationalisation, he points out, is not Socialism; it has been adopted by the most reactionary governments on occasions when it has suited their interests, and does not in itself necessarily constitute economic progress. In this, Yugoff merely repeats what Engels says in his little work, “Socialism ; Utopian and Scientific” (see footnote and text on pp. 83-4-5)); but he shows also the practical bearing of this fact on the Russian situation.

Nationalisation was adopted by the Bolsheviks as a result of the chaos ensuing from the economic collapse in 1916-17, their seizure of power and the civil war. It was an emergency measure and was carried a good deal further than Lenin had suggested as being desirable in his writings just prior to the events of October-November, 1917. (See “Preparing for Revolt.”) Having adopted it as an immediate policy, however, the Bolsheviks proceeded to make the most extravagant claims for it. The collapse of the currency was hailed as the prelude to the final disappearance of money ; the system of compulsory rationing became the first step towards a planned economy. Small wonder then that the partial reversion to normal capitalism, represented by the N.E,P., should have been regretted by a considerable section of the ruling party as a retreat. Yugoff, however, maintains that the logical implications of the N.E.P. have never been carried out, and the reason is not far to seek.

“During the process of nationalisation thousands upon thousands of private property owners were replaced by new hosts of ‘red’ bureaucrats, trust managers and commissaries, who gobbled up all the savings which might otherwise have been made by the expropriation of the expropriators” (p. 99).

The Bolsheviks nationalised thousands of small enterprises whose owners were also their managers; but the new rulers lacked the technical resources necessary to the reconstruction of these enterprises upon a larger and more economical scale. Hence the surplus value extracted from the workers’ labour did not even provide fresh capital for the expansion of industry. It was swallowed up in “administrative expenses.” The motive of private gain remained the only one capable of acting as a stimulus to the accumulation of capital.

The Bolsheviks, in introducing the New Economic Policy, of course, recognised this fact; but having entrenched themselves in the realm of State industry, their parasitic, bureaucratic supporters are loath to surrender to outsiders the privileges which they enjoy. So far from having been smashed, the State in Russia has expanded into an excrescence which stands in the way of further economic development.

Hence the struggle between those who claim to be intent upon “building up Socialism” and the new class of private capitalists who are arising partly in spite of the Bolsheviks’ efforts, but partly also as a result of them.

In order to provide the capital for the expansion of State industry, the old Tsarist expedient of taxing the peasantry is adopted; but carried beyond a certain point, this defeats its own object by checking agricultural accumulation and the growth of food supplies and raw materials. The experiment of State farms, as Yugoff shows, involves inroads upon peasant cultivation which reduce numbers of peasants to beggary and increase the drift to the towns. The increase in the unemployed is greater than the industries of the State can absorb, and the way is thus opened up for private exploiters to embark upon industrial enterprise. Thus, sooner or later, Yugoff argues, the heavy hand of the State upon trade and industry will be relaxed. In the interests of an expanding capitalism, the State monopoly of foreign commerce will be broken down ; but in so far as these measures involve the abolition of the economic basis of the dictatorship, a serious political change is the essential preliminary. Yugoff puts the question : What form is this likely to take?

He sees three possible alternatives. 

“A democratic State authority might be set up; or part of the Communist Party might be transformed into a party of the possessing classes (Thermidor); or, finally, there might be a Bonapartist, or reactionary coup-d’etat. No one can foresee which course development will take. This much, however, is certain, that the party which now rules in the U.S.S.R. is no longer a party of the working class; is not a party which can carry out a policy of socialisation; is not even a party competent to promote in any consistent or enduring fashion the interests of the working class” (pp. 335-6).

Not that Yugoff blames the Communists for their failure to work a miracle. Indeed, his work is, in its way, a masterpiece of scientific method. He sees in the “dictators” the creatures rather than the creators of the present transitional period in Russia from feudalism to capitalism. Even the very illusions, which he credits them with sharing with their followers in the early days of the Revolution, have in Yugoff’s eyes an historical function. Intoxicated with the idea of an impending world Socialist revolution, the workers of Russia accomplished a task which the Russian capitalists were incapable of doing for themselves. They swept the last vestiges of feudalism from Russian society. They assisted the peasants to lay hands upon the land and free themselves “from the burden of high rents, land taxes, and interest on mortgages,” which Yugoff describes as the main historical task of the revolution.

No sooner, however, had the peasants overthrown the old ruling class in the country than a new one began to appear in the towns. This new class grows at the expense both of the peasants and the urban working-class, converting by degrees the former into the latter. Thus, in spite of certain differences, economic history in Russia repeats that of Western Europe.

The temptation to quote Yugoff’s three final chapters at some length is great, but the following brief extract must suffice:

“Behind the Socialist facade the features of a society which, though new, though born out of the revolution, is fundamentally capitalist, are disclosing themselves more plainly day by day; we must do our utmost to dispel the illusion that this revolution is a Socialist one, so that the working class (hitherto deceived) may be enabled to hold at least the second line of its revolutionary position, and may escape being crushed politically and morally as soon as the nature of the masquerade becomes plain to all the world.” (pp. 320-1).

For Yugoff sees quite plainly that the adversaries of Socialism can make good use of the Communist Party’s failure.

“They declare that the failure of nationalisation in Russia is tantamount to the failure of Socialism. . . . They consider that the Russian experiment provides them with a powerful weapon of defence against the struggle of the working class for Socialism” (p. 95).

To thoroughly appreciate Yugoff’s book, however, it is necessary to compare it with others that profess to cover similar ground. Mr. Maurice Dobb’s volume, “Russian Economic Development,” for instance, while more fully detailed, is vitiated by economic inaccuracies, chief of which is the fallacy that Russian development is Socialist. Mr. Farbman’s writings, while illuminating in many particulars, make no attempt to offer an explanation for the effects which he describes. They cannot therefore be classed as scientific. Anatole Baikaloff’s little book, “In the Land of Communist Dictatorship,” remains equally superficial, in spite of the author’s industrious accumulation of data exploding the stories of the Workers’ Paradise.

Yugoff’s book will be far from welcome to so-called reformers, Communist and Labour Party alike, to whom nationalisation is the panacea for working class ills. Miss Ellen Wilkinson, for instance, in the July “Plebs,” finds it somewhat “disturbing.” More important, however, than this, it spikes the guns of reactionaries, Tory and Liberal, who, ever since the introduction of the New Economic Policy, have sedulously paraded the legend that Socialism has failed in Russia. By laying bare the economic forces actually at work the author has stripped the Russian Revolution of its romance and enabled us the better to understand its reality.

Both publishers and translators (Eden and Cedar Paul) are to be congratulated on the results of their efforts,

Eric Boden