When in 1921 the Bolsheviks introduced their ”New Economic Policy,” they stated plainly what they were doing and why they had no alternative. Their early hopes of the immediate establishment of socialism in the advanced capitalist countries had been shown to be illusory, and it was necessary for Russia to develop on capitalist lines. The Bolsheviks consciously adopted the policy described by the late Leonid Krassin as “nationalisation,” or ”state capitalism.” (See report of lecture by Krassin reproduced in “Labour Monthly,” January 16th, 1922.)
They saw that Russian industry could be developed on no other basis than a capitalist basis, and in respect of a large area of industry and transport they preferred state capitalism to private capitalism.
The Socialist Party does not support nationalisation or state capitalism in this country, because that policy is contrary to working-class interests, and is not in this country a step towards Socialism. Russian conditions are different. Russia was, and is, very backward industrially, and the problems there are not those which face the workers in the more advanced countries. We have therefore no criticism to offer of the general policy of hastening capitalist development in Russia. No other policy is practicable. What criticisms we offer relate to methods of applying that policy and to the policy of suppression.
We do, however, strongly protest against the attempts to misrepresent Russia as being run on socialist lines. It is untrue, and such misrepresentation makes more difficult the work of preaching Socialism. Russia presents, and will continue to present, in spite of any good intentions of its rulers, the conflicts and evils normal to the capitalist system. Nothing but harm to the Socialist movement can come from propaganda which misrepresents the very real achievements of the Bolsheviks by calling them the building up of Socialism. Socialism—the common ownership of the means of production and distribution—is not to be found in Russia any more than in Great Britain or the U.S.A.
Sometimes this misleading propaganda is the work of persons who have never troubled to understand what capitalism is. Calling themselves Communists, they merely apply to Russia the confusing propaganda used by the Labour Party in this country. They support State capitalism and call it Socialism because they know no better and really believe that the change from private capitalism to State control of capitalist industry represents a fundamental change. Others who associate themselves with this confusion do know better and are guilty of deliberate falsehood.
We find Scott Nearing, a prominent American Communist, writing in the “New Masses” (October), about Russia, and saying : “Profiteering has been largely eliminated. Exploitation has been wiped out.”
It will be noticed that Scott Nearing uses the loose and undefined term “profiteering” instead of “profit making,” and implies that the “profiteering” which has not yet been eliminated is not “exploitation.” We say that such misleading statements from Scott Nearing can only result from a deliberate intention to deceive.
The “Trade Union Bulletin” (August-September, 1929) issued by the U.S.S.R. Central Council of Trade Unions, Labour Palace, Solianka 12, Moscow, describes the plans for large State farms under the title “Socialistic Reconstruction of Rural Economy.” In fact this is simply an application of State capitalism to Russian agriculture.
The “Sunday Worker” on September 15th made the deliberately false statement that “All the products of (Russian) industry go to the workers and peasants,” and asked, “What do they want parasites for?”
When it was pointed out to the editor that the State industries are largely financed by means of loans and that the receivers of interest are “parasites,” the editor replied with the evasive and untrue statements, which follow :—
“The loans which are being raised to finance the Five-Year Plan are largely subscribed by Russian workers and peasants. These, using their own money to build their own Socialist state, can hardly be parasites—unless they are to be regarded as parasites upon themselves. There are also non-working-class investors, who would be glad to live on the interest from these loans, and become parasites. But the laws of the Soviet Union prevent that. These people cannot acquire land or any of the means of production which would enable them to exploit workers. They are not allowed to be parasites.” (Sunday Worker, Sept. 22nd.)
Such arguments from a so-called Socialist paper are pitiful. To suggest that Russians calling themselves ”workers and peasants” cannot be “parasites on themselves,” is equivalent to saying that there cannot be parasites in England because persons calling themselves “English” cannot be parasites on themselves. The simple truth is that a minority of persons in England have large investments and draw incomes from them; the majority do not possess such investments. So also in Russia, a wealthy minority having relatively large incomes from various sources, from salaries, from legal and illegal trading, from farming, and from investments, are able to accumulate capital for further use in legitimate and illegitimate business, or for investment in State loans. They draw property incomes from these investments and are “parasites.”
To say that those who receive incomes from investment in Russia cannot “become parasites” (they are that already) because they are prevented from acquiring land or other means of production, is like saying that those English capitalists who invest in Government loans and live on the proceeds without buying land or other means of production are not “parasites,” but that their fellow investors who derive similar property incomes from investment in farming or other productive concerns, are “parasites.”
Inequality of incomes and of property in Russia is great and growing, although less than in this country. According to figures from official Russian sources given in his book, “Three Months in Russia,” by W. J. Brown, M.P., the pay in the Russian Civil Service rises, according to grade, from less than £5 a month up to £45 a month (see pages 113 & 114). Mr. Brown, it may be remarked, is more than sympathetic to the Bolsheviks, and is in fact highly gratified because the inequality of pay in Russia is less than elsewhere.
A correspondent of the “Manchester Guardian” (Oct. 21st) states that the pay of engineering experts is as high as £1,750, £2,500 and even £3,500 a year. The average wage of manual workers, on the other hand, is 73 roubles a month, or less than £90 a year. (See “Ministry of Labour Gazette,” October, for figures from Russian official sources.)
According to the Soviet Union Year Book, 1929, out of a population of 140 millions, the number of persons with deposits in the Savings Banks on October 1st, 1928, was only 3,825,900, the average deposit being 82 roubles (see page 449). (A rouble is worth about 2s.)
The loans being issued at high rates of interest in connection with the Five Year Economic Plan are comparable in amount and in kind with the annual investments of capital in the rest of the capitalist countries.
The Russian State Debt stands now at about 2,100 million roubles (about £210 million). Interest ranges up to as much as 12 per cent. on some of the issues. It is planned to increase the debt under the Five Year Economic Plan by borrowing another 6,000 million roubles (£600 million) in five years (see Bank for Russian Trade Review, June, 1929). Other fields of capital investment are the co-operatives and the concession companies. The profits on the concessions are extraordinarily high.
The existence of a class of large investors is clearly shown by the relative amounts of State lottery loans and non-lottery loans. On page 406 of the “Soviet Union Year Book,” it is stated that “Soviet State loans that are intended to be placed among small investors are lottery loans, since these are more attractive to the small subscribers.”
On pages 408 and 409 are details of the various loans. It will be seen that the total of non-lottery issues is more than four times as great as the lottery loans— i.e., the small investors’ loans.
From these particulars it will be seen that Russia is making encouraging progress along the road of capitalist industry. It is impossible for Russia yet to progress on any other basis than capitalism.
But Communists who pretend that it is socialism are deliberately or unknowingly propagating a falsehood and hindering the work for socialism.
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